The Federal Trade Commission (FTC) has announced it is suing online retailer 1-800 Contacts, alleging the company unlawfully orchestrated and now maintains a web of anticompetitive agreements with rival online contact lens sellers that suppress competition in certain online search advertising auctions and that restrict truthful and non-misleading internet advertising to consumers, resulting in some consumers paying higher retail prices for contact lenses.
According to a statement released this afternoon by the FTC, 1-800 Contact entered into bidding agreements with at least 14 competing online contact lens retailers that eliminate competition in auctions to place advertisements on the search results page generated by online search engines. The FTC complaint alleges that these bidding agreements unreasonably restrain price competition in internet search auctions, and restrict truthful and non-misleading advertising to consumers, constituting an unfair method of competition in violation of federal law.
The FTC complaint alleges these reciprocal bidding agreements harm competition in the U.S. for the sale of search advertising by auction and for the retail sale of contact lenses, and also harm consumers by restraining competition and distorting prices.
The administrative trial is reportedly scheduled to begin on April 11, 2017.
Click here to read the full press release.
Source: Federal Trade Commission