Pomerantz Appointed Co-Lead Counsel in Amazon.com Securities Litigation

On July 22, 2022, U.S. District Judge John H. Chun of the Western District of Washington appointed Pomerantz LLP as Co-Lead Counsel on behalf of Menora Mivtachim Insurance Ltd., Menora Mivtachim Pensions and Gemel Ltd., The Phoenix Insurance Company, Ltd. and The Phoenix Provident Pension Fund Ltd. – the Co-Lead Plaintiffs, and the class, in Joyce v. Amazon.com, Inc., 22-cv-617 (W.D. Wash.). This securities action alleges that Amazon.com, Inc. ("Amazon" or the "Company") misled the market by concealing that it had engaged in anticompetitive behavior.

Amazon is a multinational company that engages primarily in the businesses of e-commerce, cloud computing, digital streaming and artificial intelligence. The Company is a leading online retailer, utilizing its e-commerce platform to sell both third-party merchandise and its own private-label products.

Allegations against Amazon include that: (i) the Company engaged in anticompetitive conduct in its private-label business practices, including giving Amazon products preference over those of its competitors and using third-party sellers' nonpublic data to compete with them; (ii) the foregoing exposed Amazon to a heightened risk of regulatory scrutiny and enforcement actions; and (iii) as a result, the Company'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 (The “WSJ”) 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 share price fell by 3.2%.