The House Judiciary Committee sent a letter to Jeff Bezos on Friday demanding the Amazon CEO testify on whether the company lied to Congress about the data tactics it uses against third-party sellers.
An April 23 Wall Street Journal report said that employees use data from independent sellers on Amazon to launch competing products, despite the company’s denials that they use such tactics.
The Wall Street Journal had interviewed over 20 former Amazon employees, who revealed that some workers had used data from third-party sellers to launch their own competing, Amazon-branded products.
“If these allegations are true, then Amazon exploited its role as the largest online marketplace in the U.S. to appropriate the sensitive commercial data of individual marketplace sellers and then used that data to compete directly with those sellers,” the Judiciary Committee wrote in its letter.
Amazon has said that it restricts its private-label executives from accessing seller-specific data, but former employees told The Wall Street Journal that “those rules weren’t uniformly enforced.”
If an executive wasn’t able to access the data, they would also engage in a practice called “going over the fence” and ask Amazon business analysts to create reports with the information, the newspaper reported.
“If the reporting in the Wall Street Journal article is accurate, then statements Amazon made to the Committee about the company’s business practices appear to be misleading, and possibly criminally false or perjurious,” the committee’s letter read.
“In light of our ongoing investigation, recent public reporting, and Amazon’s prior testimony before the Committee, we expect you, as Chief Executive Officer of Amazon, to testify before the Committee,” the letter to Bezos added.
This is the first instance where the House Judiciary Committee has publicly demanded that a tech giant CEO testify, Politico reported.
The move is also supported by both Democratic and Republican House Judiciary members, including Rep. David Cicilline, the chairman of House Judiciary’s antitrust subcommittee.
“At best, Amazon’s witness appears to have misrepresented key aspects of Amazon’s business practices while omitting important details in response to pointed questioning,” Cicilline said in a statement.
“At worst, the witness Amazon sent to speak on its behalf may have lied to Congress.”
Amazon’s associate general counsel, Nate Sutton, told the antitrust subcommittee in July that the company does not use data from individual sellers to inform Amazon’s strategy in developing competing products, CNBC reported.
“We do not use any of that specific seller data in creating our own private brand products,” Sutton said at the time.
Judiciary Committee Chairman Jerry Nadler said the panel plans “to seek clarification from Amazon in short order, in light of this troubling report.”
“Amazon has had opportunities to correct the record on its business practices,” Nadler said. “It is deeply concerning that, beginning with the hearing last year, they may have misled Congress rather than be fully forthcoming on this matter, notwithstanding our repeated requests in this regard.”
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