This excerpt taken from the AMZN 8-K filed Jul 25, 2006.
In March 2006, the Superior Court of New Jersey terminated our contract with Toysrus.com LLC but declined to award damages to either party. We continued to provide services to
Toysrus.com during the contractual wind-down period in Q2 2006, but Toysrus.com is contesting the amount of fees owed to compensate us for that work. This fee dispute reduced our income from operations for Q2 2006 by approximately $20 million, and
the fee dispute together with the termination of the Toysrus.com contract reduced our operating cash flows and free cash flows for Q2 2006 by approximately $20 million. Had we not retained $13 million against payments otherwise due to Toysrus.com,
our operating cash flows and free cash flows for Q2 2006 would have been lower by that amount. We are appealing the trial courts initial rulings in Toysrus.coms favor regarding the contract termination and the fee dispute.