The FTC and 22 state attorneys general are suing Amazon over its ad auctions. They say an undisclosed soft reserve pushed up what 1.2 million advertisers paid and cost them more than $20 billion since 2019. Amazon says CPCs stayed flat after inflation, conversion went up, and nobody was harmed.

Rick Watson and Jessica Lesesky go through the complaint, Amazon's same-day rebuttal and its Genesis-style blog post, why Chair Andrew Ferguson picked this fight in a midterm year, and what Amazon's struggle to grow CPCs means for the fees and ad formats sellers will see next, including sponsored prompts.

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