M-Edge suing Amazon

M-Edge has filed suit against Amazon for extorted higher-than-negotiated commissions. If the company did not comply that Amazon would D-List the company in searches.

M-Edge said in the lawsuit that in November 2009, it signed a three-year agreement to pay Amazon a roughly 15% commission for product sales. The company said that two months later, Amazon then demanded that it sign a new contract in which it would pay roughly 32% commission instead. The suit alleged that an Amazon executive threatened to “de-list” M-Edge from the Amazon website if it refused to do so.

According to the lawsuit, M-Edge said it refused, but Amazon kept pressing the company. In May 2010, M-Edge said another Amazon executive demanded that it sign the new contract again. The suit alleged that the executive said Amazon would “play” with M-Edge lists on Amazon’s website in a way that “no one will be able to find you.”

M-Edge said in the lawsuit that it couldn’t afford such consequences, since it got 90% of its revenue from Amazon, and signed a new contract in July 2010. M-Edge said the contract cost it $6.5 million in commissions and fees it wouldn’t have otherwise had to pay.

via GearDiary