That's the trick with many "Strategic Lawsuits." You intimidate someone into capitulation. Sometimes the target simply cannot afford to fight back, or in the case of amazon, simply doesn't care to bother fighting back. If they went to court with Amazon, Amazon would eat their lunch and feed GW the bag.
But GW's betting that the author doesn't have the means to fight back, and Amazon will not think it's worth the hassle to defend one self-published ebook out of the thousands.
Similar lawsuits have been used to silence critics of both corporate and government policy. In your blog, you criticize my position on panda shiving, and I sue you for slanderous libelizational defamatory inflectation. You'd beat me in court... but you'd need to be able to afford the lawyers to fight me for a few years...