Borders, Amazon named in antitrust suit

A class action suit filed in Northern California is charging Borders Group Inc. and Amazon.com Inc. with violating federal antitrust laws by selling books together online, according to a report filed with the U.S. Securities and Exchange Commission (SEC) this week.

The lawsuit was filed Oct. 29 on behalf of Gary Gerlinger and other consumers in the U.S. who have purchased books from either Amazon.com or Borders.com since Aug. 1, 2001, when the two companies launched a co-branded site run by an Amazon affiliate.

The suit charges the companies with violating federal antitrust laws, California statutory law and the common law of unjust enrichment.

Seattle-based Amazon began operating its book selling site in July of 1995 and has since expanded to sell electronics, toys and games, DVDs and other items. In April of 2001, Borders announced that it was relaunching its Border.com site in conjunction with Amazon in August of that year, to leverage the online giant's e-commerce experience.

However, the class-action suit charges that the companies' combined offline and online bookselling prowess give them too much power over the marketplace.

No one from Amazon was immediately available to comment on the suit Friday. However, Amazon has claimed in the past that its volume business has allowed it to consistently offer price cuts and free shipping offers.

Borders said in its filing with the SEC that it is preparing answers to the charges and plans to "vigorously defend the action."

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