Antitrust Law Daily Wrap Up, ANTITRUST NEWS: New Jersey AG accuses Amazon of monopsonizing delivery services, suppressing driver wages and unionization, (Aug 5, 2026)

By Martin A. Steinberg, J.D.

Amazon’s contractor model allegedly leaves delivery businesses captive, drivers underpaid, and organizing efforts vulnerable to retaliation.

New Jersey Attorney General Jennifer Davenport filed an antitrust action accusing Amazon of unlawfully exercising monopsony power over its Delivery Service Partners (DSP) and their drivers. The complaint alleges that Amazon created a captive delivery network in which nominally independent DSPs depend almost entirely on Amazon for routes, vehicles, technology, and revenue, allowing Amazon to dictate compensation and working conditions while shifting employment and liability risks to the contractors. The state further claims that Amazon suppressed competition by discouraging unionization, terminating or threatening DSPs whose drivers organized, blacklisting union supporters, and maintaining a practical no-poach policy that restricted drivers’ movement between DSPs. New Jersey asserts claims under Sections 1 and 2 of the Sherman Act and the New Jersey Antitrust Act and seeks preliminary and permanent injunctive relief, treble damages, civil penalties, restitution, structural remedies, and appointment of a corporate monitor (Attorney General Of The State Of New Jersey v. Amazon.com, Inc., No. 2:26-cv-09814 (D.N.J. Aug. 4, 2026)).

Nature of case. New Jersey alleges that Amazon created and controls its Delivery Service Partner program to exercise monopsony power over both DSPs and their delivery drivers. According to the complaint, DSPs are nominally independent businesses but depend on Amazon for routes, vehicles, software, hiring infrastructure, and revenue, making them captive service providers with little practical ability to serve other customers. Amazon allegedly keeps DSPs relatively small and financially dependent so they cannot bargain effectively over compensation or operating terms.

The complaint further alleges that Amazon uses the DSP structure to impose below-competitive wages and harsh working conditions on drivers while avoiding the costs and liabilities associated with direct employment. DSP drivers allegedly earn substantially less than drivers working for UPS, FedEx, and the U.S. Postal Service, face intensive surveillance and demanding delivery quotas, and have few realistic alternative employment opportunities offering comparable hours and stability.

Anticompetitive strategy. New Jersey identifies two principal components of Amazon’s alleged anticompetitive strategy. First, Amazon allegedly suppresses unionization by monitoring organizing activity, requiring DSPs to maintain policies that hinder collective action, threatening DSPs whose employees attempt to unionize, and terminating DSP relationships when organizing efforts persist. The complaint cites an alleged threat at an Edison, New Jersey, DSP and the termination of a Queens DSP after its drivers engaged in union activity, which reportedly resulted in more than 150 drivers reportedly being fired.

Second, Amazon allegedly restricts competition among DSPs for drivers through a formal and practical no-poach policy. The state claims that Amazon initially prohibited DSPs from recruiting drivers employed by other DSPs and continued to discourage such hiring even after modifying its written policy. According to the complaint, these restraints reduce driver mobility, suppress wages, and prevent individual DSPs from growing strong enough to negotiate more favorable terms with Amazon.

New Jersey intends to seek preliminary injunctive relief preventing Amazon from terminating or threatening additional DSPs in response to union activity in New Jersey and the New York–Newark–Jersey City metropolitan area. The state also seeks treble damages for compensation allegedly lost by DSPs and drivers, permanent injunctive relief, and other legal and equitable remedies.

Parties. The Attorney General of New Jersey brings the action on behalf of the state and its residents. She alleges that Amazon’s conduct has harmed competition, workers, consumers, and New Jersey’s economy. The action is brought under Sections 1 and 2 of the Sherman Act, the Clayton Act, the New Jersey Antitrust Act, and common law.

The defendants are Amazon.com, Inc.; Amazon.com Services LLC; and Amazon Logistics, Inc. Amazon.com, Inc. is a Delaware corporation headquartered in Washington and is alleged to own and operate Amazon.com Services LLC. Amazon.com Services manages key e-commerce, logistics, and fulfillment operations. Amazon Logistics operates the DSP program, enforces its contractual terms and policies, and manages Amazon’s last-mile delivery services. All three defendants allegedly conduct substantial business in New Jersey and throughout the United States.

Monopsony power. New Jersey alleges that Amazon created the Delivery Service Partners (DSP) program to build a captive last-mile delivery network while avoiding the costs and liabilities of direct employment. Although DSPs are nominally independent, Amazon allegedly controls their compensation, routes, vehicles, software, hiring, training, and performance standards. Because DSPs depend on Amazon’s infrastructure and package volume, they cannot realistically serve other customers and function more like middle managers than independent businesses.

Amazon’s control allegedly extends to drivers, who apply through Amazon systems, use Amazon software and branded vehicles, follow Amazon-designed routes, and receive Amazon-generated performance scores. Amazon can allegedly block hires, remove drivers from the platform, and monitor them through GPS, cameras, and other surveillance tools.

Lack of reasonable alternatives. The complaint alleges that losing an Amazon contract usually destroys a DSP because most lack other customers, vehicles, software, and independent delivery infrastructure. UPS and USPS do not use comparable contractor models, while becoming a FedEx contractor requires substantially greater investment.

Drivers likewise allegedly have few practical alternatives. Jobs with UPS, FedEx, and USPS are limited and harder to obtain, while gig work lacks predictable hours and generally requires use of a personal vehicle.

Substandard compensation and terms. New Jersey alleges that Amazon uses its buyer power to dictate DSP compensation, vary route volume, impose unexpected costs, and rely on opaque performance metrics. DSPs then pass those pressures on to drivers through lower wages, uncompensated meetings, invasive oversight, and demanding delivery quotas. Drivers allegedly face discipline for minor infractions and conditions so severe that some urinate in bottles to complete routes. The state contends that these conditions would be less likely in a competitive market.

Union suppression and restrictions on driver mobility. New Jersey alleges that unionization and driver mobility threaten Amazon’s control over DSPs. The complaint claims Amazon responded through anti-union messaging, surveillance, intimidation, route reductions, worker terminations, and termination of DSP contracts. It cites incidents in Edison and Queens, where Amazon allegedly retaliated against organizing efforts and blacklisted union supporters.

Amazon also allegedly maintained a written and practical no-poach policy that discourages DSPs from recruiting one another’s drivers. These restraints purportedly reduce worker mobility, suppressed wages, and prevented DSPs from gaining bargaining leverage.

Market. The complaint alleges that Amazon is effectively the only buyer of DSP services and holds nearly 100% of the market. DSPs allegedly cannot serve other customers without duplicating their vehicles, software, payroll, and operating infrastructure.

New Jersey identifies both the state and the New York–Newark–Jersey City metropolitan area as relevant geographic markets because last-mile delivery is local. It contends that Amazon’s near-total market share, unilateral control over DSP terms, and high barriers to entry establish monopsony power.

Last-mile delivery market. New Jersey alleges that Amazon would possess substantial buyer power even if the relevant market included all last-mile delivery services, such as UPS, FedEx, and USPS. Amazon reportedly accounts for about 30% of packages delivered nationwide, with an allegedly higher share in New Jersey. The complaint contends that DSPs still lack meaningful alternative customers and that high entry barriers prevent new buyers from constraining Amazon.

DSP-driver labor market. The complaint alleges that Amazon restrains the labor market for DSP drivers by limiting worker mobility and suppressing compensation. Through its control of DSPs, routes, performance requirements, and employment systems, Amazon allegedly keeps wages and working conditions below competitive levels.

New Jersey defines DSP drivers as a distinct labor market because traditional delivery jobs are limited and difficult to obtain. At the same time, gig work does not provide comparable stability or predictable hours. It identifies New Jersey and the New York–Newark–Jersey City metropolitan area as relevant geographic markets. It contends that Amazon’s dominant share and high entry barriers establish labor-market power.

Anticompetitive effects. New Jersey claims Amazon’s conduct has suppressed driver wages, reduced mobility, chilled union activity, and preserved invasive surveillance and harsh working conditions. The alleged no-poach practices discouraged DSPs from competing through better pay or benefits, while retaliation and blacklisting deterred organizing. The complaint also alleges harm to DSPs, who remain dependent on Amazon, receive inadequate compensation, and face unilateral route, scorecard, and termination decisions. The state contends that court intervention is necessary to restore competitive conditions.

Causes of action. New Jersey asserts five antitrust claims. It alleges that Amazon unlawfully monopsonized the DSP-services markets in New Jersey and the New York–Newark–Jersey City metropolitan area by suppressing unionization, restricting competition for drivers, and terminating DSPs or drivers who resisted its policies. Alternatively, the state claims Amazon attempted to monopsonize the broader last-mile delivery-services markets.

The complaint also alleges that Amazon’s agreements and coordinated practices with DSPs unreasonably restrained trade under Section 1 of the Sherman Act, including through terms that impeded unionization and preserved Amazon’s control over nominally independent contractors. A separate claim challenges Amazon’s alleged practical no-poach agreement as an unlawful restraint in the DSP-driver labor market. New Jersey further asserts parallel violations of the New Jersey Antitrust Act.

Requested relief. The state intends to seek preliminary injunctive relief and requests permanent injunctive relief, declarations that Amazon violated federal and state antitrust laws, and structural or conduct remedies designed to restore competition. It also seeks appointment of a corporate monitor, civil penalties, treble and punitive damages, restitution, disgorgement, refunds, pre- and post-judgment interest, attorneys’ fees, and other appropriate relief. The complaint demands a jury trial.

The Case is No. 2:26-cv-09814.

Judge: Padin, E.

Attorneys: David Reichenberg (Wilson Sonsini Goodrich & Rosati P.C.) for Jennifer Davenport.

Companies: Amazon.com, Inc.

News: Antitrust NewJerseyNews GCNNews