EBay Accuses Amazon Managers of Conspiring to Poach Its Sellers

SEATTLE — EBay has accused three Amazon managers of illegally conspiring to poach its sellers, escalating a monthslong feud between two of the country’s largest e-commerce companies.

In a lawsuit filed Wednesday in the United States District Court for the Northern District of California, eBay says the Amazon managers directed dozens of workers to illegally use eBay’s private messaging system to solicit sellers onto Amazon’s platform. The suit, which claims violations of the Racketeer Influenced and Corrupt Organizations Act, says the employees’ actions were “coordinated, targeted and designed to inflict harm on eBay.”

EBay first raised concerns that Amazon was poaching its sellers last fall in a lawsuit that has since moved to arbitration. In the new case, eBay says the outreach was not a few rogue employees but part of a larger effort within Amazon, with managers giving lower-lever employees lists of eBay sellers to target.

The anticompetitive behavior is being alleged at a touchy time for Amazon. Regulators and lawmakers in Washington are intensifying their scrutiny of the company’s market power, with some looking at its relationship with third-party sellers. In a recent hearing, for example, lawmakers pressed Amazon on whether the company used data from marketplace sellers to inform its own competing lines of private label products, which Amazon said it did not do.

Amazon declined to comment on the lawsuit.

Attracting and keeping top sellers is critical to both companies, which want to provide a wide selection at low prices. Over time, the business models of the two have somewhat converged, making them more direct competitors for both consumers and sellers. The companies often prefer that a seller list products on only one marketplace, to maximize inventory and potentially give exclusive access to certain products.

While eBay started as an online auction company, now 90 percent of its sales are made at a fixed price. More than half of Amazon’s sales are for products sold by third-party merchants, rather than from inventory Amazon buys directly from vendors.

EBay’s complaint centers on the use of its private messaging system, which is intended for communications between buyers and sellers.

EBay prohibits using the messaging system to solicit sellers or to share contact information for communicating by phone or email. But the suit says the Amazon managers told staff members how “to set up and use eBay member accounts” for the purpose of soliciting “many hundreds of eBay sellers to sell on Amazon’s platform.”

The most senior Amazon manager named holds a midlevel title, head of global seller recruitment and success, according to the complaint.

The poaching dispute started last fall when eBay sent Amazon a cease-and-desist letter, saying a seller told it that an Amazon representative had tried to recruit the seller over the internal messaging system. EBay then sued Amazon in California Superior Court.

Amazon initially said it was investigating the claim. In court, Amazon petitioned to move the case to arbitration, where eBay’s user agreement requires disputes be adjudicated. In April, a judge granted that request, finding eBay’s arbitration clause to have a “broad” scope that covers the claims. The case remains in arbitration.

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In the new complaint, eBay says, “representatives were given quotas for recruiting sellers, and were expected to satisfy large chunks of those quotas by targeting and illegally recruiting eBay sellers.” It also says different Amazon representatives “sometimes sent literally identical pitch emails,” indicating coordination.

The filing does not lay out evidence for how eBay came to believe that the attempts to poach sellers and evade detection were orchestrated by the three specific managers named in the suit. David Grable, eBay’s lawyer at Quinn Emanuel Urquhart & Sullivan, said the new complaint was based on information provided by a whistle-blower of sorts who had contacted the company.

While the training may not have been explicit, the outreach to sellers was, the suit says. EBay cites multiple fake accounts that gained access to its site via an internet address registered to Amazon in Seattle. It includes messages from 2016 to 2018 recruiting sellers that offered a range of items, including shoes, refurbished computers and tools.

According to the suit, one Amazon employee sent an eBay seller a message saying, “I am part of what you would call a hunter/recruiter team which actively searches for sellers we believe can do well on the platform.” That same account and others made clear that the users were aware eBay scanned emails for such activity.

“I am not sure if eBay will allow this to go through, but I will try,” the representative wrote, before adding a phone number and an email address at “Amazon dot com.”

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