Barnes & Noble Sues Amazon.com, Alleging False Advertising

NEW YORK (Dow Jones)--Barnes & Noble Inc. (BKS) filed suit Monday against Internet bookseller Amazon.com Inc., alleging that Amazon has made false advertising claims that it stocks a larger selection of books than Barnes & Noble.

The suit, filed in federal court in New York, says that Amazon is falsely claiming to be ''the world's largest bookstore,'' when in fact Barnes & Noble stocks more books than Amazon and can obtain any book Amazon can.

Amazon does not physically have most of the books it offers in stock at its warehouse, Barnes & Noble said, whereas Barnes & Noble stores stock as many as 170,000 titles, and both companies must order books they don't have in stock from wholesalers or publishers.

The suit appears to be the latest shot in a fierce battle to sell books over the Internet. Amazon has been doing so since 1995, and is expected to go public this week. Barnes & Noble is gearing up to offer books for sale on the Internet.

An Amazon spokeswoman said the company has not seen the suit and could not comment.

Barnes & Noble's allegations and Amazon's disputed advertising claims hinge on the question of whether it's proper for Amazon to tout itself as ''the world's largest bookstore'' when it actually stocks only a limited number of titles in its warehouse and must order most other titles for its customers.

Amazon says it offers 2.5 million titles for sale, far more than the largest physical bookstores. But Barnes & Noble insists that ''by any objective standard'' - sales volume, number of titles in stock, number of stores - it, not Amazon, is the world's largest bookseller.

''Amazon is not a bookstore at all. Rather, it is a book broker making use of the Internet exclusively to generate sales to the public,'' Barnes & Noble says in its suit.

Amazon's advertising claims ''are having an immediate detrimental impact upon the public by misleading consumers into thinking that Amazon stocks, carries or offers more titles than Barnes & Noble when it does not,'' according to the suit. ''Left unchecked, these false representations will result in significant losses of sales for Barnes & Noble.''

Barnes & Noble has demanded since January that Amazon stop making its claims, but Amazon has refused to do so, according to the suit.

Barnes & Noble is seeking a permanent injunction restraining Amazon from making the disputed advertising claims, and to have Amazon issue corrective advertising.

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