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Book giant attacks Amazon

Barnes & Noble sues online bookseller Amazon.com over advertising claims.

Barnes & Noble (BKS) hit online bookseller Amazon.com with a one-two punch today, filing a lawsuit against the company and opening its own Web site to conduct sales.

The timing of both assaults could not have come at a worse time for Amazon, which is preparing to launch an initial public offering as early as tomorrow.

Under the lawsuit, filed in New York federal court, Barnes & Noble alleges that Amazon engaged in false advertising by claiming that it stocks a larger selection of books than Barnes & Noble, according to a Dow Jones report.

The lawsuit alleges that Amazon describes itself as the "world's largest bookstore," while carrying a limited number of titles in its warehouse and having to order titles for customers. The brick-and-mortar bookstore chain claims it stocks more books than its Internet counter-part and can order additional titles.

Amazon declined to comment on the suit or Barnes & Noble's plan to launch its own Internet site. "We have not seen the suit, so we can't comment on anything," Amazon spokeswoman Kay Dangaard said.

Barnes & Noble is scheduled to announce its online store tonight, which will use Hewlett-Packard (HWP) hardware and Microsoft (MSFT) software for ordering books.

The new site, which is scheduled to launch officially tomorrow, will also use Firefly Network's agent software to present users with suggested titles based on reading preferences. This service will go head to head with Amazon, which maintains 400,000 titles in its warehouse.

The Internet company is looking to boost its growth by raising up to $33.9 million in an IPO of 2.5 million shares. Amazon currently has an estimated pricing range of $12 to $14 a share.

The company reported losses of $2.3 million for the quarter ended December on revenues of $8.5 million.