Amazon accused of lying about its business practices to Congress

Members of Congress have accused Amazon executives of misleading or lying to an antitrust committee about its business practices, following recent reports that the company uses third-party seller data to copy products and promotes those versions in search results. The representatives, all members of the House Judiciary Committee’s antitrust subcommittee, are considering whether to ask the Department of Justice to undertake a criminal investigation.

In the letter to chief executive Andy Jassy, Reps. David Cicilline, Ken Buck, Pramila Jayapal, Jerrold Nadler and Matt Gaetz asked Amazon to provide “exculpatory evidence” to back up testimony from executives )(including former CEO Jeff Bezos) to the subcommittee in 2019 and 2020, according to The Wall Street Journal. Bezos told the committee last year that the company doesn’t allow employees to use data from individual sellers to bolster its own product lines, though “couldn’t guarantee” that the company hasn’t misused such data. The company’s associate general counsel, Nate Sutton, said in a 2019 testimony that Amazon doesn’t “use individual seller data directly to compete” with third-party sellers.

An investigation published by Reuters last week suggested Amazon India “ran a systematic campaign” of copying other companies’ products and manipulating search results to promote them. The Markup also reported that Amazon places its own products above competitors’ goods in search results, including ones with higher customer ratings. The representatives said the reporting directly contradicts sworn testimony from Bezos, from whom Jassy took over in July, and other executives.

“We strongly encourage you to make use of this opportunity to correct the record and provide the Committee with sworn, truthful, and accurate responses to this request as we consider whether a referral of this matter to the Department of Justice for criminal investigation is appropriate,” the lawmakers wrote in the letter. “At best, this reporting confirms that Amazon’s representatives misled the Committee. At worst, it demonstrates that they may have lied to Congress in possible violation of federal criminal law.”

The House Judiciary Committee has been looking into this issue since 2019 as part of a broader investigation of competition in digital markets. The representatives gave Jassy until November 1st to respond to the letter. “We’re giving Amazon one last chance to come clean about how they abuse other seller’s data and unfairly advantage their own products,” subcommittee chair Cicilline wrote on Twitter. “We cannot continue to allow Big Tech to destroy small businesses.” 

“Like other retailers, we look at sales and store data to provide our customers with the best possible experience,” Amazon told The Wall Street Journal. “However, we strictly prohibit our employees from using non-public, seller-specific data to determine which private label products to launch. While we don’t believe these claims are accurate, we take these allegations very seriously and have launched an internal investigation.”

An Amazon spokesperson provided the following statement to Engadget:

Amazon and its executives did not mislead the committee, and we have denied and sought to correct the record on the inaccurate media articles in question. As we have previously stated, we have an internal policy, which goes beyond that of any other retailer’s policy that we’re aware of, that prohibits the use of individual seller data to develop Amazon private label products. We investigate any allegations that this policy may have been violated and take appropriate action. In addition, we design our search experience to feature the items customers will want to purchase, regardless of whether they are offered by Amazon or one of our selling partners.

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