In 2000, Amazon.com signed a deal with Toys “R” Us to handle the online aspect of their business. Toys “R” Us handled the inventory and procurement. Amazon.com would make sure that Toys “R” Us’ website would run as seamlessly as Amazon.com. Every time a purchase would be handled on the website, it would connect to Toys “R” Us’ inventory system.
Toys “R” Us filed a lawsuit against Amazon.com in 2004 for breach of contract. This is because Amazon.com did not make Toys “R” Us the exclusive provider of toys on their website as agreed. In 2006, a judge ruled in favor of Toys “R” Us. Amazon.com finally settled with Toys “R” Us yesterday by paying them $51 million.
“On June 11, 2009, Amazon.com entered into a settlement agreement in its lawsuit with Toys ?R? Us, Inc., and its affiliates, with terms that include, among other things, (i) a one-time payment from Amazon.com of $51 million in the third quarter 2009, substantially all of which was unanticipated and will be charged to ‘Other operating expense’ in the second quarter, (ii) dismissal of all claims and counterclaims, and (iii) mutual releases,” stated an Amazon.com filing with the SEC.
Some of the other retailers that is powered by Amazon.com includes Target Corporation, Egghead.com, Pitara.com, etc.