EBay on Wednesday filed a complaint in California Superior Court alleging that Amazon "perpetuated a scheme to infiltrate and exploit eBay's internal member email system" in order to "recruit high-value eBay sellers to Amazon." EBay is demanding a jury trial for the suit.
The digital marketplace alleges that since 2015, Amazon representatives have established eBay seller accounts for the purpose of recruiting eBay's sellers to Amazon's own marketplace. "The breadth and scope of Amazon's conduct is startling," eBay attorneys said in the complaint. Amazon declined to comment to Retail Dive.
An eBay seller told the marketplace about such an overture from an Amazon representative, according to the document. EBay then "notified Amazon of the issues by letter, asked Amazon to cease and desist from such activity, and asked Amazon to provide additional information about the conduct," according to the court filing. "Amazon failed to confirm that it would cease and desist, and it did not provide any requested information."
In this legal shot across the bow, eBay did not hold back, bringing up a rash of allegations against Amazon that have surfaced in the media about its treatment of employees, both at its white collar offices and its warehouses as "part of a larger pattern of aggressive, unscrupulous conduct."
But the crux of the accusations rests on the stunning allegation that people on Amazon's behalf signed up as eBay sellers in order to grab that marketplace's top sellers for Amazon's marketplace.
Some of the sellers didn't even bother selling through eBay at any point, according to the complaint, with a few working to lure fellow eBay members to Amazon within five minutes of their first log-in. Some used multiple accounts and took pains to avoid detection by eBay, according to the complaint. "Amazon and its representatives knew that its scheme was wrong, as evidenced by the representatives' systematic efforts to avoid detection," eBay wrote in the filing.
Amazon has a lot resting on its marketplace these days, considering that for two years now at least half the goods sold there flow through those third-party sellers, a fact also found in court documents. Those sales are also more lucrative for Amazon because it reaps commissions and fees while spending much less on warehousing and fulfillment.
The activity violates the user agreement that those would-be sellers agreed to, eBay said. And it caused harm because it worked in many cases. The effort involved "large numbers of Amazon representatives, targeting many hundreds of eBay sellers, and spanning several countries overseas and many states in the United States (including California)," according to the filing.