Amazon Punishes Seller for Five-Cent Price Cut, Echoing FTC Case

About once a week, Bernie Thompson gets a “take action” email from Amazon.com Inc. Online sellers like Thompson dread these messages because it means the e-commerce giant has discovered one of their products is selling for a lower price on a competing website. Unless he adjusts the price, Thompson says, Amazon could make his merchandise virtually invisible to shoppers.

Such emails are at the heart of the antitrust lawsuit the US Federal Trade Commission filed on Tuesday. The agency alleges that Amazon uses its online dominance to prevent would-be competitors from luring customers away with discounts — indirectly pushing up ...