Amazon.com, Inc.
“Amazon’s dual role as a host of third-party sellers in its marketplace and a seller in that same marketplace has resulted in Amazon unfairly exploiting its access to its competitors' data and information."
Emma Gilmore
Emma Gilmore
On July 22, 2022, U.S. District Judge John H. Chun of the Western District of Washington appointed Pomerantz LLP as Co-Lead Counsel in a proposed securities class action against Amazon.com, Inc. The complaint alleges that Amazon deceived investors through the anti-competitive misuse of confidential third-party seller data to benefit its private-label business.
Pomerantz represents Co-Lead Plaintiffs Menora Mivtachim Insurance Ltd., Menora Mivtachim Pensions and Gemel Ltd., The Phoenix Insurance Company, Ltd. and The Phoenix Provident Pension Fund Ltd. The litigation is on behalf of persons and entities that purchased or acquired Amazon stock between February 1, 2019 and April 5, 2022.
Allegations against Amazon include that the company made false, positive statements about its business prospects, while failing to disclose that it was engaging in anticompetitive conduct in its private-label business practices. The anticompetitive tactics included giving Amazon products preference over those of its competitors and using third-party sellers' nonpublic data to compete with them. These practices exposed Amazon to a heightened risk of regulatory scrutiny and enforcement actions. Further, Amazon’s revenues derived from its private-label business were, in part, the product of impermissible conduct and thus unsustainable.
The truth began to emerge on March 9, 2022, when Bloomberg reported that the U.S. House Judiciary Committee had requested that the DOJ open a criminal investigation into Amazon and certain of its executives for allegedly lying to Congress during a 16-month congressional investigation into anticompetitive practices. According to Bloomberg, Amazon representatives, including then-current CEO Bezos, had testified before Congress that the Company “forbids employees from using data from third-party sellers to compete against them or craft rival products.”
Then, on April 6, 2022, The Wall Street Journal reported that, for over a year, the SEC had been probing how Amazon had disclosed to the market information regarding its employees’ use of data from sellers on its e-commerce platform. The WSJ also reported that the U.S. House Judiciary Committee had proposed legislation aimed at “reining in tech giants,” including one measure which targeted Amazon’s private-label business by making it unlawful for a company to use the nonpublic data of a third-party seller to compete with them or for an e-commerce platform to give its own products preference over the products of competitors.
On this news, Amazon’s stock price fell $105.98 per share, or 3.2%, to close at $3,175.12 per share on April 6, 2022.
Pomerantz’s Amazon litigation is led by partners Emma Gilmore and Jeremy A. Lieberman, with attorneys Dolgora Dorzhieva and Villi Shteyn.
Joyce v. Amazon.com, Inc., 22-cv-617 (W.D. Wash.)
Class Period: February 1, 2019 - April 5, 2022
For violations of the Securities Exchange Act of 1934