eBay Files Suit Against Amazon For Soliciting Sellers

Online commerce platform eBay has filed a lawsuit against Amazon claiming the eCommerce giant was trying to steal its sellers through eBay’s private messaging system, according to a report by The New York Times.

This is the second lawsuit eBay has filed against Amazon; the first one is in arbitration. The latest one was filed on Wednesday (July 31) in the United States District Court for the Northern District of California. In the latest suit, eBay alleges that Amazon managers told subordinates to use eBay’s private messaging service, which is meant for sellers and buyers to communicate, to try and recruit sellers from the platform.

The lawsuit is saying that Amazon violated the Racketeer Influenced and Corrupt Organizations Act, and claims that Amazon’s actions were “coordinated, targeted and designed to inflict harm on eBay.”

In the earlier lawsuit, eBay alleged that a few Amazon employees had reached out. The new suit alleges a much larger, coordinated effort from Amazon with managers providing workers with lists of eBay sellers to target.

Scrutiny of Amazon and other large tech companies has increased lately by the government, citing antitrust and monopoly concerns, and the new lawsuit isn’t going to put any of those issues to rest for Amazon. 

Both eBay and Amazon have a similar sales model, even though eBay used to be more known as an auction site. Lately, 90 percent of its goods are sold at a fixed price. More than 50 percent of Amazon’s sales are from products offered by third-party vendors. 

Both eCommerce companies also prefer that sellers list only on one marketplace.

Company policy prohibits use of the eBay messaging system for anything other than what it’s intended for, and especially not to solicit sellers or share info to communicate by other means. The suit alleges that Amazon managers instructed staff on how “to set up and use eBay member accounts” so they could get “many hundreds of eBay sellers to sell on Amazon’s platform.”