A battle of the mega-marketplaces is underway. According to reports, 23-year old San Jose, California-based eBay demanded that its 24-year old Seattle, Washington-based rival cease its “unlawful and troubling scheme to solicit eBay sellers to move to Amazon’s platform” in violation of California’s Comprehensive Computer Data Access and Fraud Act, as well as eBay’s user agreement and policies. In that letter, eBay also requested that Amazon reveal the names and addresses of any Amazon representatives involved in the alleged multi-year, multi-continent scheme, as well as sales from any eBay sellers that have vacated the eBay platform in favor of Amazon as a result.
The letter, which was dated October 1 and demanded a response from Amazon by October 5, appears to be “an effort [by eBay] to assess damages [ahead] of a potential lawsuit,” according to Bloomberg, which also states that eBay’s demands very well could mean that eBay will seek monetary damages and injunctive relief in court if the companies cannot resolve the matter between themselves.
The telling letter comes amidst claims by eBay that Amazon employees have been creating eBay accounts and then using the platform’s member-to-member email system to poaching eBay marketplace sellers. Late last month, “an eBay seller alerted the company to [Amazon’s] alleged campaign after the person was contacted by an Amazon employee, under false pretenses, attempting to recruit the person to switch platforms, according to a person familiar with the investigation,” Bloomberg reported.
eBay alleges that it has identified more than 50 Amazon employees across the globe who are involved in the unlawful scheme to lure some of the platforms’ most valuable assets – their individual sellers – away from eBay and on to Amazon, the latter of which boasts more customers, sales, and faster growth. But according to Bloomberg, “Some sellers still prefer the eBay platform since it is a pure marketplace, meaning eBay doesn’t compete with its merchants for sales like Amazon” is readily doing by introducing no small number of privately-owned labels in categories ranging from household goods to apparel and accessories.
Amazon also actively competes with its sellers by “optimizing word-search algorithms, analyzing competitors’ sales data, [and] using its customer-review networks — to steer shoppers toward its in-house brands and away from its competitors.” Legal experts have suggested that this behavior could ultimately give rise to antitrust and monopolization claims being lodged against the $1 trillion entity that is Amazon.
This all comes as prominent U.S. trade organization, the American Apparel and Footwear Association, is pushing the U.S. Trade Representative to include various international arms of Amazon to its annual blacklist of bad actors thanks to the giant’s failure to adequately cut down on the widespread availability of counterfeit goods on its site.