The District of Columbia is suing Amazon, saying the company secretly stopped providing its fastest delivery service to residents who live in two predominantly Black Washington neighborhoods but is still charging residents millions of dollars for a service that provides speedy deliveries.
The complaint, filed Wednesday in District of Columbia Superior Court, revolves around Amazon’s Prime membership service, which charges consumers $139 per year or $14.99 per month for fast deliveries — including one-day, two-day and same-day shipments — as well as other benefits.
In mid-2022, the lawsuit says, the Seattle-based online retailer imposed what it called a delivery “exclusion” on two zip codes in the district — 20019 and 20020 — and began relying exclusively on third-party delivery services such as UPS and the U.S. Postal Service, rather than its own delivery systems.
Amazon claims to have made the change based on concerns about driver safety, the lawsuit notes.
However, the District of Columbia's attorney general’s office said the company never told Prime members in the two zip codes about the change even though they experienced slower deliveries as a result. Amazon also did not tell new customers about the exclusions when they signed up for Prime memberships, the lawsuit says.
“Amazon is charging tens of thousands of hard-working Ward 7 and 8 residents for an expedited delivery service it promises but does not provide,” District of Columbia Attorney General Brian Schwalb said in a statement, referencing the two areas in the city where Amazon is accused of excluding its speediest deliveries.
“While Amazon has every right to make operational changes, it cannot covertly decide that a dollar in one zip code is worth less than a dollar in another," Schwalb said.
The lawsuit says Amazon has nearly 50,000 Prime members who live in the two zip codes, a number that represents nearly half of the population. Prime members in those neighborhoods have ordered more than 4.5 million packages in the past four years, and are more likely to rely on Amazon since they have fewer services and retail stores nearby, the city said. The area is also a notorious food desert.
The district says that in 2021, before Amazon implemented its delivery “exclusion,” more than 72% of Prime packages in the impacted zip codes were delivered within two days. But last year, it was only 24%, according to the complaint.
Meanwhile, the district's lawsuit says Prime members who live in other parts of the city received two-day deliveries 75% of the time.
When some customers complained about the slower deliveries, Amazon concealed the true reason for the delays and “deceptively implied" that the delays "were simply due to natural fluctuations in shipping circumstances, rather than an affirmative decision by Amazon,” the lawsuit says.
District officials are asking the court to issue an order prohibiting Amazon from “engaging in unfair or deceptive practices.” They also want the company to pay restitution or damages to affected Prime members, as well as civil penalties.
The complaint filed Wednesday represents the second major legal battle between Amazon and the District, which has also filed an antitrust lawsuit against the company.
