Amazon (AMZN.US) sued in Washington, D.C. over Prime delivery denied to low-income communities

Market IntelThursday, Dec 5, 2024 7:20 am ET

1min read

Amazon (AMZN.US) is being sued by the Washington, D.C. attorney general for allegedly secretly excluding about 48,000 customers in low-income communities from its Prime fast shipping service while continuing to charge them full subscription fees.

Washington, D.C. Attorney General Brian Schwalb claims Amazon has excluded the Prime membership from its fast shipping service for two zip codes in the eastern part of the Anacostia River area (20019, 20020) since 2022 — "historically underserved communities."

The lawsuit states the e-commerce giant has been using third-party shipping services, including United Parcel (UPS.US) and the U.S. Postal Service, for those zip codes, "but it knows those services are usually slower than Amazon."

The lawsuit also mentions Amazon claimed it made "secret changes" to delivery options "out of concern for driver safety." But the company allegedly failed to publicly disclose its decision.

Schwalb said: "While Amazon has the right to make operational changes, it cannot secretly decide that a dollar in one zip code is worth less than a dollar in another. We're suing to stop this deception and to ensure that D.C. residents get what they pay for."

Amazon spokesperson Kelly Nantel responded: "The attorney general's claim that our business practices are somehow discriminatory or deceptive is absolutely false. There are specific behaviors directed at Amazon drivers in the zip codes involved. We made the thoughtful decision to adjust our operations for one reason only: to protect driver safety."

"We've always been transparent with our customers, telling them exactly when their orders will arrive. We want to work with the attorney general to improve safety in those areas, and we are doing just that."

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