Amazon Faces Proposed Class Action Alleging Audiobook Monopoly

Amazon.com Inc. is the target of a proposed class action brought by an author who claims the company has monopolized the audiobook retail market, enabling it to extract higher distribution fees and reduce the visibility and reach of titles not exclusive to the company.

Author CD Reiss alleges the e-commerce giant also penalizes authors who distribute their titles on other platforms, including by denying exclusive platform options on Amazon. Reiss says Amazon’s “coercive and anticompetitive conduct” violates the Sherman Act and the company should be declared a monopoly under the federal statute and have to pay damages.

Amazon is also facing additional antitrust lawsuits, including one from the US Federal Trade Commission, where the US said the company has monopolized online marketplace services by degrading quality for shoppers and overcharging sellers. Another suit alleges that Amazon monopolizes the market to raise e-book prices.

“Amazon’s tactics are unnecessary to achieve any legitimate or procompetitive goal that would justify its behavior and do not reflect any increased costs to Amazon for competitive distribution,” Reiss says in her complaint filed Thursday in the US District Court for the Western District of Washington. “Amazon’s conduct would be irrational but for its ability to foreclose competition.”

Amazon owns Audible, which is the largest audiobook retailer in the world and accounts for more than 60% of US audiobook purchases, Reiss says. Independent publishers are often left with no choice but to distribute with Audible because she says the defendant doesn’t allow distribution unless a title’s physical book or ebook is also sold on Amazon.

Reiss alleges that independent audiobook authors and rights holders who purchase Amazon distribution services are charged at least 60% of the audiobook’s sales price, which are set by the defendant. Authors who distribute their titles on other sites are subjected to even higher fees, exceeding 75% of the sales prices set by Amazon, the complaint says.

"[A] majority of class members are coerced into exclusive distribution through Amazon to avoid its Competition Penalty,” Reiss says.

For titles non-exclusive to Amazon, the defendant will impose various non-price penalties, which include precluding those titles from promotional opportunities, degrading their placement on its retail sites, dropping them in its search rankings, and imposing pricing schemes that dissuade purchase.

“Amazon’s higher fees for non-exclusive titles suggests that Amazon would be incentivized to sell more of those titles,” Reiss says. “But Amazon does just the opposite as a way to punish authors and stifle competition.”

The proposed class is comprised of anyone who contracted with Amazon for audiobook retail distribution in the US after June 13, 2020, and paid Amazon a 60% or greater fee, the complaint says. Reiss also seeks to represent a subclass of authors who contracted with the defendant in the same time frame who paid a 75% or greater fee.

The Audio Publishers Association’s annual sales survey estimated the total market for audiobook titles in 2022 to be $1.8 billion in annual sales, with $1 billion captured by Audible, the complaint says. “This figure represents approximately 6% of total U.S. trade sales of consumer books,” it says.

Reiss is seeking class certification, injunctive relief, treble damages, equitable relief, court costs, and attorneys’ fees.

Amazon didn’t immediately respond to a Friday request for comment.

Hagens Berman Sobol Shapiro LLP and Sperling & Slater LLC represent Reiss.

The case is Reiss v. Amazon.com Inc., W.D. Wash., 2:24-cv-00851, 6/13/24.