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Maryland company sues Amazon for corporate bullying

A small Maryland firm has filed a lawsuit against Amazon.com. The online retail giant is accused of unfair competition, false advertising, patent infringement and commercial defamation. The Maryland company, which makes accessories for Amazon's Kindle e-reader, says that Amazon attempted to extort $6.5 million from the fledgling business by threatening to delist its products and make them more difficult to find.

The lawsuit also accuses Amazon of disparaging the company in front of other retail partners and infringing on its patent for a lighted Kindle cover. The company's complaint calls the case "a classic example of unlawful corporate bullying" and asks for injunctions against Amazon and an unspecified amount in damages.

The Maryland firm first started selling Kindle jackets on Amazon several years ago, providing Amazon with an 8 percent commission on each sale. In 2009, Amazon invited the company to become a "special partner," giving it special placement in the online Kindle store and giving it access to pre-launch information about the popular product.

The company signed a three-year contract to remain a special partner, agreeing to pay a 7 percent fee in addition to the commission. The Maryland company claims that Amazon then urged the company to pay a 25 percent commission and sell its products directly to Amazon, threatening to delist the company's Kindle covers if the company refused. The company also accuses Amazon of stealing the design for a lighted Kindle cover.

Amazon has not commented on the case. A spokesperson for the online store explained that the company holds a policy not to speak publicly about ongoing corporate litigation.

Source: The Seattle Times, "Suit accuses Amazon of 'corporate bullying'," Amy Martinez, Dec. 29, 2011

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