eBay Is Suing Amazon Over Claims It Engaged In Illegal ‘Conspiracy’ To Poach Sellers

eBay Is Suing Amazon Over Claims It Engaged In Illegal ‘Conspiracy’ To Poach Sellers

Online marketplace eBay is again taking legal action against Amazon, claiming that managers at the e-commerce behemoth directed employees to actively and illegally pursue sellers on eBay’s platform to lure them to Amazon’s own.

The suit, filed this week in the United States District Court for the Northern District of California, is the latest development in an ongoing legal skirmish between the two companies.

This week’s filing alleges that a group of Amazon managers, including three named individuals, knowingly carried out “a conspiracy designed to infiltrate and exploit eBay’s internal member email system using fraud and false pretenses”, including by encouraging Amazon employees as well as eBay sellers to engage in behaviour prohibited by eBay’s terms of service.

The suit alleges that Amazon employees, both in the US and overseas, were tasked by managers with targeting and recruiting “high-value” sellers from eBay by setting up user accounts that were then used to reach out to those individuals.

The accounts allegedly used by Amazon sales reps were created “with no intent of ever using them to conduct legitimate business on eBay’s platform,” the suit alleges.

“Representatives were given quotas for recruiting sellers, and were expected to satisfy large chunks of those quotas by targeting and illegally recruiting eBay sellers,” the suit states.

“The Defendants and other Amazon managers directed and encouraged sales representatives to target certain types of eBay sellers who could supply trending items or fill holes in Amazon’s swath of product offerings. The Defendants and other Amazon managers provided lead lists to representatives filled with eBay sellers for the representatives to target.”

eBay prohibits the exchange of some information between users on its messaging platform, such as private contact information before a sale is completed. It also prohibits offers to buy or sell off of eBay or exchanges of information with the intent to do so.

As evidence that the alleged conduct was carried out with the knowledge that it violated eBay’s rules, the suit claims that Amazon employees were trained — by the named defendants as well as other Amazon managers — to use specific techniques to get around eBay’s violation detection tools.

According to the suit, workarounds for avoiding detection in messages included using periods in a provided phone number, changing the format of email addresses (for example, “JDoe at amazon dot com”), using variant spellings of Amazon’s name, and “virtually always” encouraging sellers to move the conversation off eBay as soon as possible.

The filing states the suit seeks “to put a stop to the Defendants’ racketeering conspiracy, to identify others who perpetrated it, to ensure that it does not happen again, and to obtain redress for the damage it has caused”.

A spokesperson for Amazon did not immediately return a request for comment.

This week’s lawsuit is the second against Amazon from eBay alleging seller poaching after it filed a similar suit last year. That suit is now in arbitration. A spokesperson for eBay said the new suit focuses specifically on “a criminal conspiracy” that allegedly saw Amazon managers direct employees to engage in illegal behaviour and set quotas for eBay seller recruitment.

“Based on new details brought to us, it is clear that Amazon’s illegal scheme to target eBay sellers is more coordinated, systemic and pervasive than originally thought,” an eBay spokesperson said in a statement by email. “There are laws to protect against anti-competitive and illegal tactics, and we have every intention of holding the company and specific ringleaders accountable.”