California Attorney General Rob Bonta’s crusade against successful companies has hit a wall. Fresh off of his attempt to thwart the Paramount-Warner Bros. merger, Bonta has been laughed out of court for trying to short-circuit a pending trial on whether Amazon is guilty of price-fixing.
Bonta sought a preliminary injunction from the San Francisco Superior Court, claiming there was evidence anti-competitive practices. Said “evidence” turned out to be email exchanges between Amazon and a few of its vendors from 2019 to 2022, with no examples from the last four years. Essentially, Bonta tried to use a narrow selection of emails from five years ago to prove that Amazon is currently engaging in price-fixing.
Bonta’s request for a preliminary injunction to block Amazon’s alleged price-fixing scheme reflects an interest in circumventing the legal process. His office has been building the case since 2022, and it is already scheduled to go to trial in January to establish if what Amazon did was illegal. A preliminary injunction trying to stop behavior not yet deemed illegal misses the point of the case.
Had Judge Ethan Schulman granted Bonta’s request, he would have conceded the precedent that elected attorneys general, who are partisan politicians, can vex companies with injunctions on activities not yet found illegal without need of a trial. Injunctions are meant to stop activity that causes significant harm to a plaintiff until a trial has occurred. Injunctive relief abuse quickly becomes a way to punish firms without convincing a judge or jury that any law has been violated.
The judge also ruled against Bonta’s request to lower the burden of proof required to punish Amazon. The California AG’s office sought to have the courts apply the per se rule, which allows the judiciary to find Amazon liable without conducting an economic analysis. This requires that Amazon’s actions are completely illegal on their face. Since the state did not prove that price fixing had occurred or even address the court’s reasoning behind the decision not to have a preliminary injunction, it is unreasonable to reduce the standard at this time. This would not stop the AG’s office from making arguments in favor of a per se standard, it just means that the evidence currently presented does not justify a lower bar to clear.
While this may come as good news for Amazon, the case is not over yet. The judge has stated that there is evidence present that Amazon may have engaged in price-fixing, but the state has not proven that the company is currently doing this. Until this is proven at trial, Amazon should not be punished.
At a time when California is dealing with an above-average violent crime rate relative to the United States, Bonta’s crusade against Amazon reflects misplaced priorities and a desire to make California into a more hostile state to do business in. If this continues, Californians should not be surprised when more businesses flee.