Amazon v. National College Stores
Case No. C11–0754JLR. United States District Court,
W.D. Washington, at Seattle. Sept. 26, 2011.
Case Details:
On February 2, 2011, the National Association of College Stores’ general counsel sent a letter to Amazon expressing concern about “advertisements near college campuses for ‘up to 30% off new textbooks at Amazon.’
NACS stated that its investigation had left it concerned that Amazon was selling its textbooks at a loss in order to “siphon” customers away from NACS member stores. NACS also expressed its concern regarding the accuracy of Amazon’s claim, and stated that it “would like to understand” the study of competitive prices that it assumed Amazon had completed before beginning to use the comparative advertising claim.
NACS requested that Amazon “review its textbook pricing and advertising policies” and stated that it would be “pleased to publicize [the explanation for Amazon’s prices] to the NACS membership.” NACS warned that if there was no reasonable explanation for Amazon’s pricing claims, it would be forced to pursue its investigation more aggressively.
Amazon responded on February 18, 2011, stating that they match prices to their competition, which extends far beyond college bookstores. Amazon also stated that it would not share any pricing or competitive information with NACS.
Plaintiff’s Arguments:
On March 25, 2011, NACS initiated a challenge against Amazon’s advertising claims before the National Advertising Division of the Council of Better Business Bureaus, contending that three specific advertising claims by Amazon relating to its purchase and sale of college textbooks were misleading and deceptive:
- “SAVE UP TO 90% ON USED TEXTBOOKS”
- “SAVE UP TO 30% ON NEW TEXTBOOKS,” and
- “GET UP TO 60% BACK WHEN YOU SELL TEXTBOOKS BACK AT AMAZON.”
NACS stated in its NAD Complaint that it “believes it unlikely that Amazon is capable of providing substantiation for the claims made on its site.”
However, NACS did not initiate or threaten to file a lawsuit against Amazon under any cause of action, including Section 43(a) of the Lanham Act, which authorizes a civil suit against any person who makes a false or misleading representation in connection with goods or services.
Defendant’s Arguments:
Amazon declined to participate in the NAD dispute resolution process. Instead, on May 3, 2011, Amazon filed the present action seeking a declaration that its use of the three advertising claims does not violate Section 43(a) of the Lanham Act.
Because the advertising claims are now the subject of pending litigation, the NAD discontinued its investigation.
The day after Amazon filed its complaint in this action, NACS issued a press release publicizing its allegations that Amazon’s advertising claims are “misleading and deceptive because their sales platform makes it virtually impossible to substantiate the advertised discounts” and that Amazon’s “Get up to 60% back” claim is “deceptive because it is literally false.” NACS now moves to dismiss Amazon’s complaint for declaratory relief for lack of subject matter jurisdiction and personal jurisdiction.
Summary and Conclusion:
NACS has no offices or staff in Washington, is not licensed or registered to do business in Washington, and has no offices, property, bank accounts, telephone numbers, post office boxes, or employees in Washington.
The court concludes that these contacts “fall well short of the requisite showing for general jurisdiction.”