On 10/17/2018 eBay, Inc filed a Contract - Business lawsuit against Amazon com, Inc. This case was filed in Santa Clara County Superior Courts, Downtown Superior Court located in Santa Clara, California. The Judges overseeing this case are Walsh, Brian C and Kuhnle, Thomas. The case status is Pending - Other Pending.
Pending - Other Pending
Santa Clara County Superior Courts
Downtown Superior Court
Santa Clara, California
Walsh, Brian C
Superior Court of California
Cooper, Lindsay Marie
Lozano, Valerie Anne
Grable, David Michael
Williams, Jenna G.
Acquah, Michael K
Hueston, John Charles
Kaba, Moez M
Superior Court of CA, County of Santa Clara
Notice CMC 2-7-20 at 10am in D5: Comment: CMC set for 2/7/20 at 10am in D5
CV-5100 HRG 4 19 19: Comment: HRG 4/19/19 - signed/TEK
Order: Comment: 18cv336315 order re mtn to compel arb
David M. Grable Declaration HRG 4-19-19: Comment: Declaration of David M. Grable In Support Of Plaintiff eBay Inc.'s Opposition To Defendant Amazon.com, Inc.'s Motion To Compel Arbitration
Opposition to Motion to Compel Arbitration HRG 4-19-19: Comment: Plaintiff eBay Inc.'s Opposition To Defendant Amazon.com, Inc.'s Motion to Compel Arbitration
Request Judicial Notice HRG 4-19-19: Comment: Request For Judicial Notice In Support of Defendant's Motion To Compel Arbitration
Motion Compel Arbitration HRG 4-19-19: Comment: Notice of Motion and Motion to Compel Arbitration; Memorandum of Points and Authorities In Support of Defendant Amazon.com, Inc.'s Motion to Compel Arbitration
Notice Undocumented Action Complex Fee: Comment: $550.00 Complex fee paid by check, taken on Notice of undocumented action.
Proof of Service Summons and Complaint: Comment: Proof of Service of Summons
Proof of Service Summons and Complaint: Comment: Proof of Service of Summons
Proof of Service: Comment: Proof of Service of Order Designating Case Complex
Order Deeming Case Complex and Staying Discovery and Responsive Pleading Deadline: Comment: Order Deeming Case Complex and Staying Discovery and Responsive Pleading Deadline signed/TEK
Summons Issued Filed:
Civil Lawsuit Notice: Comment: 1st CMC set for 2/1/19 at 10am in D5; assigned to Hon. Thomas E. Kuhnle
Civil Case Cover Sheet: Comment: COMPLEX
Complaint (Unlimited) (Fee Applies): Comment: Complaint
Conference: Case Management - Judicial Officer: Kuhnle, Thomas; Hearing Time: 10:00 AM; Comment: (3rd CMC) Discovery and responsive pleading deadline stayed, as of 10/31/18, when the case was deemed complex.Read MoreRead Less
Notice - Notice CMC 2-7-20 at 10am in D5: Comment: CMC set for 2/7/20 at 10am in D5Read MoreRead Less
Hearing: Petition Compel Arbitration - Complaint (Unlimited) (Fee Applies): Motion Compel Arbitration HRG 4-19-19: Request Judicial Notice HRG 4-19-19: Opposition to Motion to Compel Arbitration HRG 4-19-19: David M. Grable Declaration HRG 4-19-19: Minutes Non-Criminal: Order: CV-5100 HRG 4 19 19: Judicial Officer: Kuhnle, Thomas; Hearing Time: 9:00 AM; Result: Heard: Granted; Comment: Motion by Defendant Amazon.com, Inc. to Compel Arbitration (set by the Court at the 2/1/19 CMC; with briefing schedule, as follows: moving papers due 2/22/19; opposition due 3/22/19; reply due 4/5/19)Read MoreRead Less
Conference: Case Management - Minutes Non-Criminal: CV-5100 HRG 4 19 19: Judicial Officer: Kuhnle, Thomas; Hearing Time: 10:00 AM; Result: Held; Comment: (2nd CMC) Discovery and responsive pleading deadline stayed, as of 10/31/18, when the case was deemed complex.Read MoreRead Less
Order - Order: Comment: 18cv336315 order re mtn to compel arbRead MoreRead Less
Minute Order - Minutes Non-Criminal:Read MoreRead Less
Minute Order - Minutes Non-Criminal:Read MoreRead Less
Stipulation and Appointment of Official Reporter Pro Tempore - CV-5100 HRG 4 19 19: Comment: HRG 4/19/19 - signed/TEKRead MoreRead Less
Statement: Case Management Conference - 2629300_5312019.04.1: Comment: Joint Case Management Conference StatementRead MoreRead Less
Response/Reply - 2612498-01_5962019-0: Comment: DEFENDANT AMAZON.COM, INC.'S REPLY IN SUPPORT OF MOTION TO COMPEL ARBITRATIONRead MoreRead Less
Notice - Notice Undocumented Action Complex Fee: Comment: $550.00 Complex fee paid by check, taken on Notice of undocumented action.Read MoreRead Less
Proof of Service - Proof of Service: Comment: Proof of Service of Order Designating Case ComplexRead MoreRead Less
First Paper Filed - Fee - Comment: $550.00 Complex Fee payment paid, taken on notice of undocumented action.Read MoreRead Less
Order: Deeming Case Complex - Order Deeming Case Complex and Staying Discovery and Responsive Pleading Deadline: Comment: Order Deeming Case Complex and Staying Discovery and Responsive Pleading Deadline signed/TEKRead MoreRead Less
Proof of Service: Summons DLR (Civil) - Proof of Service Summons and Complaint: Comment: Proof of Service of SummonsRead MoreRead Less
Proof of Service: Summons DLR (Civil) - Proof of Service Summons and Complaint: Comment: Proof of Service of SummonsRead MoreRead Less
Summons: Issued/Filed - Summons Issued Filed:Read MoreRead Less
Civil Lawsuit Notice - Civil Lawsuit Notice: Comment: 1st CMC set for 2/1/19 at 10am in D5; assigned to Hon. Thomas E. KuhnleRead MoreRead Less
Civil Case Cover Sheet - Civil Case Cover Sheet: Comment: COMPLEXRead MoreRead Less
Complaint (Unlimited) (Fee Applies) - Complaint (Unlimited) (Fee Applies): Comment: ComplaintRead MoreRead Less
QUINN EMANUEL URQUHART & SULLIVAN, LLP David M. Grable (Bar No. 237765) davegrable @ quinnemanuel.com Valerie Lozano (Bar No. 260020) valerielozano @quinnemanuel.com 865 South Figueroa Street, 10" Floor Los Angeles, California 90017-2543 Telephone: (213) 443-3000 Facsimile: (213) 443-3100
Lindsay M. Cooper (Bar No. 287125) email@example.com 50 California Street, 22nd Floor San Francisco, California 94111 Telephone: (415) 875-6600 Facsimile: (415) 875-6700
Attorneys for eBay Inc.
10/17/2018 10:41 AM Clerk of Court
Superior Court of CA, County of Santa Clara
Reviewed By: R. Walker
eBay Inc., CASE NO.
Amazon.com, Inc., and Does 1-25
1. Over the past several years, Amazon has perpetrated a scheme to infiltrate and exploit eBay’s internal member email system. Amazon did this to recruit high-value eBay sellers to Amazon. The breadth and scope of Amazon’s conduct is startling. Since 2015, dozens of Amazon sales representatives in the U.S. and overseas set up eBay member accounts to access eBay’s “M2M” email system and used that system to solicit many hundreds of eBay sellers to sell on Amazon’s platform. Amazon’s misuse of eBay’s M2M system has been coordinated, targeted, and designed to inflict harm on eBay. Indeed, one of the Amazon sales representatives who participated in this scheme described the team he worked on as a “hunter/recruiter team which actively searches for sellers we believe can do well on the [Amazon] platform.”
2. Amazon’s scheme violated eBay’s User Agreement and policies, and induced eBay sellers to do the same. These rules prohibit eBay members from using the M2M system to solicit people to sell off the platform. Such controls are critical to the success of a company like eBay that operates a virtual platform bringing buyers and sellers together. To protect privacy and further maintain the integrity of the platform, these rules also prohibit users from exchanging personal contact information over the M2M system (which could otherwise be used to move discussions regarding transactions off the platform, exposing eBay customers to increased fraud risk).
3. In furtherance of Amazon’s scheme, its representatives opened eBay accounts with no intent of ever using them to conduct legitimate business on eBay’s platform. One Seattle-based Amazon representative opened three accounts in the course of a few weeks, sending solicitation emails to eBay sellers within minutes of opening each separate account. Others waited less than five minutes between opening an account and sending solicitation messages. Some Amazon representatives never used their eBay accounts to buy or sell, but instead, only to try to lure sellers off the eBay platform. To get access to such accounts, the Amazon representatives fraudulently promised to abide by the User Agreement and policies, without any intent to do so.
4, Amazon and its representatives knew that its scheme was wrong, as evidenced by the representatives’ systematic efforts to avoid detection. eBay, like many websites, has automated their own written words, Amazon representatives clearly understood that “eBay monitors their messages pretty well for contact info,” that “eBay doesn’t allow phone numbers in these messages,” and that “ebay will not allow the exchange of email addresses in these messages[.]”
5. Rather than follow the rules, the representatives employed various techniques to circumvent detection by eBay. They changed the presentation of Amazon email addresses, for example: “You can write me at jdoe AT amazon DOT com;” “DoeJohn at Amazon dot com,” and “JDoe at amazon dot com.”! They also provided unconventional phone number formats, again, solely for the purpose of evading detection — telling eBay sellers, for example, that “you can write down 2.0.6. — 5.5.5. — 18.104.22.168. and then delete this message if you so choose.””
6. Amazon representatives virtually always sought to immediately move discussions off the eBay M2M system, observing, for example, that “Ebay does scan for key terms and they don’t exactly like us poking around. Honestly the easiest way to communicate about this would be on the phone.” And they acknowledged that they were doing so to avoid getting caught: “For my own security purposes I would rather not do that over Ebay though.” Amazon representatives even sought to disguise the company’s own name in messages so as to avoid detection, instead using variations on the Amazon name, such as “a-m-a-z-o-n,” “A.M.Z.N,” and “AMZ.”
7. Amazon’s illegal efforts to lure eBay sellers appear to be part of a larger pattern of aggressive, unscrupulous conduct. Just this year, for example, media outlets documented Amazon’s attempts to poach employees from one of its own customers, an insurance start-up that purchased
Amazon’s cloud computing services. Eugene Kim, Amazon’s aggressive poaching tactics in Israel
have start-ups threatening to abandon AWS, CNBC (Jan. 10, 2018, 5:00 PM),
aws.html. “Like an 800-pound gorilla with a hand grenade,” media outlets have reported that
Amazon sellers face an industry giant out for itself and providing “no justice for sellers.” Lydia
L' Amazon representatives’ email addresses, phone numbers, last names, and postal addresses
have been changed to generic ones throughout this Complaint.
> As noted above, Amazon representatives’ phone numbers have been changed to generic ones throughout this Complaint. DePhillis, The high-risk, high-reward world of selling stuff on Amazon, CNN (Oct. 9, 2018, 8:14 AM).
8. Internally, Amazon fosters a “bruising” corporate environment which “offers no pretense that catering to employees is a priority.” A 2015 New York Times article reported that “[t]he company 1s conducting an experimentpush white-collar workers to get them to achieve its ever-expanding ambitions,” and further reported as follows:
Many of the newcomers filing in on Mondays may not be there in a few years. The company’s winners dream up innovations that they roll out to a quarter-billion customers and accrue small fortunes in soaring stock. Losers leave or are fired in annual cullings of the staff — “purposetul Darwinism,” one former Amazon human resources director said. Some workers who suffered from cancer, miscarriages
and other personal crises said they had been evaluated unfairly or edged out rather than given time to recover.
Jodi Kantor & David Streitfeld, Inside Amazon: Wrestling Big 1deas in a Bruising Workplace, The
New York Times (Aug. 15, 2015), https://www.nytimes.com/2015/08/16/technology/inside-
amazon-wrestling-big-ideas-in-a-bruising-workplace.html? r=0. Former Amazon workers told the
Times reporter that “Nearly every person I worked with, I saw cry at their desk” and that “T would see people practically combust.” /d.
A Amazon’s clandestine efforts have borne fruit. Its representatives have discussed the success of their scheme with eBay seller prospects.
10. A few weeks ago, an eBay seller came forward to notify eBay about one such approach from an Amazon representative. eBay notified Amazon of the issues by letter, asked Amazon to cease and desist from such activity, and asked Amazon to provide additional information about the conduct. Amazon failed to confirm that it would cease and desist, and it did not provide any requested information.
12. This Court has jurisdiction over the subject matter of this action pursuant to Cal. Civ. Proc. Code § 410.10.
13. This Court has personal jurisdiction over Amazon.com, Inc. because, among other things, Amazon.com, Inc. has purposely availed itself of the benefits of doing business in California by regularly conducting commercial activities that impact California on a substantial, continuous, and systematic basis. Moreover, Amazon.com, Inc. has purposely directed its unlawful activity at eBay, a resident of California, with knowledge that its actions would harm eBay in its home state; has used Amazon.com, Inc. representatives with California addresses to perpetrate the scheme; has unlawfully solicited dozens of eBay sellers who reside in California; and has interfered with contracts, business relations, and prospective business relations eBay has with sellers in California.
14, Venue is proper in Santa Clara County under Cal. Civ. Proc. Code § 395.5 because, among other things, that 1s where Amazon’s liability arises, where contracts with which Amazon interfered were made and intended to be performed, and where breaches that Amazon induced occurred.
15. Plaintiff eBay Inc. (“eBay”) is a Delaware corporation, with its principal place of business in San Jose, California.
16. eBay connects more than 175 million active buyers with millions of sellers around the world, empowering people and creating opportunity through connected commerce. Founded in 1995 1n San Jose, California, eBay is one of the world’s largest and most vibrant marketplaces for discovering great value and unique selection. From the outset, it has served as an online community dedicated to bringing together buyers and sellers in an honest and open marketplace. eBay is a pure open marketplace in that it does not own inventory, and thus, does not compete with its sellers. In 2017, eBay enabled $88.4 billion of gross merchandise volume.
17. Sellers on eBay may list items for sale, and when an item is purchased, eBay notifies at any given time. Today, approximately 89% of items sold on eBay are fixed price, while 80% of items sold are new. IL. AMAZON
18. Defendant Amazon.com, Inc. is a Delaware corporation, with its principal place of business in Seattle, Washington.> Founded as an online bookstore in the 1990s, Amazon today is a tech giant that sells virtually anything imaginable. In 2017, Amazon generated over $177 billion in revenues and over $3 billion in net income. In contrast to eBay, Amazon sells products directly on its marketplace — including through private label businesses — oftentimes competing directly against its third-party sellers.
19. The lion’s share of Amazon’s revenues come from product sales, and it 1s constantly under pressure, and searching, to increase the number of sellers on its platform. As Amazon’s CEO explained in his letter to shareholders in Amazon’s 2017 annual report, Amazon customers “are divinely discontent” and “[t]heir expectations are never static — they go up.” He explained that Amazon “didn’t ascend from our hunter-gatherer days by being satisfied” and it “cannot rest on [its] laurels in this world. Customers won’t have it.” Given this mindset and business model, it is no surprise Amazon has taken to unlawful methods to recruit high value sellers to supply its platform. Indeed, the sales Amazon makes through third-party sellers are becoming increasingly important. In 2017, for the first time in Amazon’s history, more than half of the units sold on Amazon
worldwide were from third-party sellers. III. FACTS
A. eBay Membership, User Agreement, and Policies
20. eBay permits potential buyers and sellers to become members on its platform. Membership entitles users to various privileges, including the abilities to sell on eBay and to communicate using eBay’s M2M internal email system. eBay also offers its sellers a number of tools to increase their sales velocity and to monitor and run their online businesses.
21. As a condition to becoming an eBay member, a visitor must agree to the eBay User Agreement. The User Agreement sets forth the terms of the agreement between eBay and each of its members and rules for use of eBay that the members agree to follow. It states at the outset that:
This User Agreement, the Mobile devices terms, and all policies and additional terms posted on and in our sites, applications, tools and services (collectively “Services”) set out the terms on which eBay offers you accessServices. You can find an overview of our policies here. All policies and the Mobile devices terms are
incorporated into this User Agreement. You agree to comply with all of the terms of this User Agreement when accessing or using our
Services. 22. Elsewhere in the User Agreement, members agree not to “breach or circumvent any laws, third party rights or our systems, policies or determinations of your account status . . . or
circumvent any technical measures we use to provide the Services.” Moreover, members also agree not to ‘“distribute or post spam” and “unsolicited or bulk electronic communications.” The agreement explicitly confers in eBay “sole discretion” to limit, suspend, or terminate user accounts belonging to users that eBay believes to be “abusing eBay” and to take “technical and/or legal steps to prevent you from using our Services.” 23. Among the policies members agree to follow i1s the Member-to-member contact
policy, which provides in relevant part as follows:
Members can send messages to each other through eBay. We
encourage open communication between our members but we don’t
allow our members to use these options to send spam, offers to buy
or sell off eBay, threats, profanity, or hate speech. We also don’t
allow members to offer, reference, or request email addresses, phone
numbers or other contact information, physical addresses, web 24.
between users for fraud, abuse, spam, and other violations of eBay’s policies.
Spam is defined as “an email (or part of an email) that is both unsolicited and commercial in nature.”
eBay also has a policy about Offers to buy or sell off eBay. That policy provides in
relevant part as follows:
We don’t allow our members to use eBay to contact each other to make offers to buy or sell items outside of eBay. Also, members can’t use information obtained from eBay or any eBay systems to contact each other about buying or selling outside of eBay.
Buyers and sellers aren’t allowed to share or request direct contact information prior to completing a sale. They also can’t use information they’ve obtained on eBay to contact each other to buy or sell off eBay.
eBay explains the purpose behind this policy to members within the policy itself:
Offers to buy or sell outside of eBay are a potential fraud risk for both buyers and sellers, and are not protected by the eBay Money Back Guarantee and other buyer protection programs. Additionally, these offers may be an attempt to avoid eBay fees. This is unfair to other sellers and violates our policies.
For years, and unbeknownst to eBay, Amazon has been engaged in a systematic,
coordinated effort to infiltrate and exploit eBay’s proprietary M2M system on eBay’s platform to
lure top eBay sellers to Amazon. The scheme i1s startling in breadth — involving large numbers of
Amazon representatives (“Amazon reps”), targeting many hundreds of eBay sellers, and spanning
several countries overseas and many states in the United States (including California).
Since 2015, dozens of Amazon reps have obtained and used eBay M2M accounts to
target eBay sellers and solicit them to sell on Amazon. Many of these Amazon reps set up and used
their eBay accounts from devices linked to Amazon IP addresses. For example:
eBay accounts “alexityrel0”; “arataa-7"’; “kjaneekev” accessed eBay from IP address e eBay accounts “bryabec3”; “savvyseller19894”; and “stacsisso0” accessed eBay from IP address 22.214.171.124, which is registered to Amazon.
e cBay accounts “cousl41” and “kenmil-7” accessed eBay from IP address 126.96.36.199, which 1s registered to Amazon.
28. Many Amazon reps began solicitation activity almost immediately after opening eBay accounts and gaining access to the M2M system, demonstrating they never intended to abide by eBay’s User Agreement. For example:
¢ ¢Bay account “arataa-7” (tied to an address in Burlingame, California) was created on October 17,2016, at 1:35 PM, and sent its first solicitation message that same day, just four minutes later, at 1:39 PM.
¢ cBay account “kenmil-7” (tied to an address in Seattle, Washington) was created on August 11, 2016, at 4:33 PM, and sent the first of many solicitation messages that same day, just five minutes later, at 4:38 PM.
¢ eBay account “stacsisso-0” (tied to an address in Seattle, Washington) was created on March 1, 2017, at 4:37 PM, and sent a solicitation message at 4:40 PM, just three minutes later.
29, Some Amazon reps appear to have used multiple accounts to exploit the eBay proprietary M2M system. One individual appears to have created at least three accounts, called “savvyl110257; “savvyseller15-5”; and “savvyseller19894” within a few week span in 2016.
¢ cBay account “savvyl11025” (tied to an address in Seattle, Washington) was created on September 22, 2016 at 4:24 PM, and sent its first message that same day, just six minutes later, at 4:30 PM. ¢ e¢Bay account “savvysellerl5-5” (opened in the same name as savvyl1025 and tied to a different address in Seattle, Washington ) was created on October 2, 2016, at 8:28 PM, and sent its first of five solicitation messages that same day, just five minutes later, at 8:33 PM. e “savvyseller19894” (opened in the same name as the above two “savvy” accounts and tied to the same Seattle, Washington address as savvyl11025) was created on October 13, 2016, at 3:16 PM, and sent its first message that same day, just eight minutes later, at 3:24 PM. Collectively, these three “savvy’” accounts sent more than 120 solicitation emails while making zero bids, zero purchases, zero listings, and zero sales on the eBay platform.
30. Amazon reps often described to targeted eBay sellers how they were operating as a
team. Examples of such communications abound: “I am part of what you would call a
hunter/recruiter team which actively searches for sellers we believe can do well on the platform”™; at Amazon that recruits a finite number of high-potential sellers.” Another observed that “[w]e’re recruiting heavily.”
31. Further evidencing that Amazon coordinated this scheme from its headquarters, the team’s solicitation communications often followed a similar pattern. Amazon reps would send a cold-call email to an eBay seller, introducing themselves as Amazon employees. The Amazon rep often would explain to the eBay seller that Amazon has observed and i1s impressed by the seller’s activity and/or operation, and that the rep would like the seller to consider selling on Amazon. The rep often would explain alleged benefits associated with selling on Amazon. The Amazon rep then often provided his or her contact information (often an amazon email address), and asked the eBay seller to engage in further communication about selling on the Amazon platform through a means other than the eBay M2M system.
32. An example of such a pitch is as follows:
Hi there, Hope you are well! I manage the apparel category at Amazon and came across you guys with a really cool selection. I was curious to see — have you looked at selling on Amazon? Because this 1s a personal invite, I could get you up and running quickly, opening you up to a whole new audience for you guys. Let me know your thoughts and if you’d like my help in getting started! John Doe Business Development XXXX XXXX Ave, Seattle, WA 98XXX Direct: (206) XXX-XXXX jdoe at amazon dot com][.]*
Another solicitation similarly offers:
Hello, My name is John Roe and I am part of the apparel business development team at Amazon.com. I am specifically working to find new selection for our Clothing & Accessories store. I came across your eBay storefront and I believe your apparel selection will lend well to the Amazon Apparel Category. I would like to speak with you to discuss a possible fit for your products on Amazon, so that you can sell directly to our customers. We are providing the integration support necessary to help our recruited Apparel merchants get up and running quickly. Please email or call me at XXX-XXX-XXXX as soon as possible so we can discuss how to get started. Ilook forward to hearing from you! John Roe | Amazon Services LLC Business Development Executive XXXX XXXX Ave. | Seattle, WA | 98XXX p: 206. XXX . XXXX jroe at amazon dot com].]
4 Amazon representatives’ email addresses, phone numbers, last names, and postal addresses have been changed to generic ones throughout this Complaint. 33. Indeed, different reps sometimes sent literally identical pitch emails, as illustrated below, first by the solicitation email from “Adam”:
To whom 1t may concern, Good afternoon. My name i1s Adam I work in the shoes category at Amazon. I came across your store and really like the selection that you offer and your fantastic feedback. Have you ever considered selling on Amazon as well? If so, I'd like to chat with you about the platform. I hope to hear back from you. Best Regards, Adam — and then by the identical pitch email from “Eric™:
To whom it may concern, Good afternoon. My name is Eric I work in the shoes category at Amazon. I came across your store and really like the selection that you offer and your fantastic feedback. Have you ever considered selling on Amazon as well? If so, I'd like to chat with you about the platform. I hope to hear back from you. Best Regards, Eric
34, Amazon even sought to improve the effectiveness of its scheme by learning from mistakes and spreading that learning to higher-ups at the company. For example, when one target seller declined an Amazon rep’s solicitation, the rep responded: “I will make a note in your file with me to reflect that. May I ask why though you would not want to expand to AMZ as well? It will help me explain to my supervisor why I am closing out your file.”
35. Amazon and its representatives understood that this conduct was wrong, and in violation of eBay’s User Agreement and Policies. Amazon reps often discussed with eBay sellers the specific eBay policies that the reps knew they were breaking. For example, one eBay seller, cognizant that engaging in negotiations over eBay’s M2M interface breached eBay’s policies, responded to an Amazon rep’s solicitation, “I don’t want to receive anything through eBay messages and violate their policies.” The rep acknowledged the seller’s “reservations.” Others similarly acknowledged that “eBay doesn’t allow phone numbers in these messages” and that “ebay will not allow the exchange of email addresses in these messages[.]”
36. Indeed, Amazon has rules for its own platform to prevent the same misconduct
Amazon perpetrated on eBay's platform. For example, Amazon’s “Prohibited seller activities and order fulfillment and related customer service) and emails related to marketing communications of any kind are prohibited.” That policy further provides that:
Any attempt to circumvent the established Amazon sales process or
to divert Amazon users to another website or sales process is
prohibited. Specifically, any advertisements, marketing messages
(special offers) or “calls to action” that lead, prompt, or encourage
Amazon users to leave the Amazon website are prohibited. This
might include the use of emails, hyperlinks, URLSs, or web addresses
within any seller-generated confirmation email messages or any
product/listing description fields.
37. Understanding that they were breaking the rules, Amazon reps engaged in systematic efforts to circumvent eBay’s detection tools, finding creative ways to share their contact information with eBay sellers. These anti-detection measures often took the form of spelling out non-word portions of email addresses and using punctuation and other words to break up telephone numbers. For example, one rep acknowledged he could not send a seller his contact information, instead choosing to write his phone number as “206-555-553535,” remarking that “the funky typing is because eBay doesn’t allow for info like this to normally be put into messages[.]” That same rep notified another seller that he could be reached at “206 phone 555 number 5555 (read between the words) since eBay doesn’t allow phone numbers in these messages.” One seller was told that “[y]ou can write me at Jdoe AT amazon DOT com. Sorry for the weird format but Ebay looks for things like this in their messages and wont allow me to send if I type out my address regularly.” Other Amazon reps explained the need for these techniques, for example: “Ebay does scan for key terms and they don’t exactly like us poking around.”
38. In carrying out Amazon’s scheme, its reps perpetrated a fraud in opening eBay user accounts, violated the User Agreement and policies themselves, and caused eBay sellers to violate their contracts with eBay as well, including the obligationssystem to: (1) discuss offers to sell off eBay; or (2) exchange email addresses, phone numbers, or other contact information.
39. Amazon’s scheme was far-reaching: it coordinated its solicitation activities across
various foreign and domestic subsidiaries as part of a global conspiracy. Reps located in the United sending similar messages, employing similar solicitation strategies, and using similar anti-detection measures 1n furtherance of this common scheme.
40. Amazon’s efforts have borne fruit. Its representatives have discussed the success of their scheme with eBay seller prospects.
41. eBay realleges each and every allegation set forth in Paragraphs 1 through 40, inclusive, and incorporates them by reference herein.
42. As described in more detail herein, to become an eBay member, a visitor must agree to the eBay User Agreement. The User Agreement sets forth, in writing, rules and policies for use of eBay that the members agree to follow, thereby creating written contracts between eBay and its members. eBay’s User Agreements with its members are valid and enforceable.
43. Amazon reps created eBay member accounts and, in doing so, agreed to the terms of the eBay User Agreement. Amazon and its reps were thus aware of the existence and terms of the User Agreement between eBay and its members.
44, Amazon had its reps prevent performance by eBay’s member-sellers under their User Agreements with eBay; make eBay’s member-sellers’ performance under such agreements more difficult; and/or cause eBay member-sellers to breach such contracts. Amazon reps intentionally encouraged and induced eBay member-sellers to breach by, among other things, encouraging them to use the M2M system to share “email addresses, phone numbers or other contact information and “to make offers to buy or sell items outside of eBay.”
45. Amazon and its reps intended to disrupt performance of eBay member-sellers’ contracts with eBay, and they intended to cause eBay member-sellers to breach those contracts. These actions have caused eBay member-sellers to breach their contracts with eBay and have disrupted performance under those contracts.
46. eBay has suffered harm as a result of the coordinated efforts of Amazon reps, and 47. Amazon reps committed these acts within the scope of their employment, and Amazon coordinated, supported, and ratified the scheme under which Amazon reps did so.
48. The conduct of Amazon and its reps was fraudulent, malicious, oppressive, and in willful disregard of eBay’s rights.
49, eBay realleges each and every allegation set forth in Paragraphs 1 through 48, inclusive, and incorporates them by reference herein.
50. eBay has an ongoing economic relationship with its member-sellers that probably would have resulted in economic benefit to eBay. When sellers sell items on eBay, eBay receives a fee for facilitating the transaction.
S1. Amazon and its reps were aware of eBay’s economic relationship with its member- sellers.
52. Amazon reps engaged in wrongful conduct by, among other things, fraudulently entering into User Agreements with eBay without any intent of abiding by promises in those Agreements (as described more fully herein); breaching their own User Agreements with eBay; and/or engaging in conduct that violated Cal. Penal Code § 502(c)(3) (as described more fully herein).
33. By and through the wrongful conduct of its reps, Amazon intended to disrupt eBay’s relationship with its member-sellers, or it knew that disruption of the relationship was certain or substantially certain to occur.
54. eBay’s relationship with its member-sellers was disrupted.
53. eBay has suffered harm as a result of the coordinated efforts of Amazon and its reps to disrupt eBay's relationship with eBay's member-sellers, and this conduct was a substantial factor in causing this harm.
56. Amazon reps committed these acts within the scope of their employment, and 57. The conduct of Amazon and its reps was fraudulent, malicious, oppressive, and in willful disregard of eBay’s rights.
58. cBay realleges each and every allegation set forth in Paragraphs 1 through 57, inclusive, and incorporates them by reference herein.
59. To carry out Amazon's scheme, its reps made misrepresentations and/or omissions regarding use of the eBay M2M messaging system. As discussed in more detail herein, Amazon reps opened eBay M2M accounts for the specific purpose of targeting eBay sellers as part of a scheme to solicit them to sell on Amazon. Amazon and its reps knew that their planned activities would violate the terms of eBay’s User Agreement. As a condition to becoming eBay members and thereby gaining access to the M2M system, Amazon reps promised to abide by the terms of eBay’s User Agreement, despite never intending to do so. Amazon reps failed to inform eBay that they really intended to misuse and abuse the M2M system for the purpose of attempting to move sellers to Amazon.
60. Amazon reps’ true intent when making these material misstatements and/or omissions is evidenced by, among other things, the following, which is described in further detail above: (1) Amazon reps began solicitation activity within minutes of opening eBay accounts and gaining access to the M2M system; (2) Amazon reps used multiple accounts to exploit the M2M system; (3) Amazon reps used their M2M accounts solely to target eBay members, never buying or selling goods on the eBay platform; (4) Amazon reps worked as a coordinated team, often sending similar—and sometimes identical—solicitation messages to different eBay members; and (5) Amazon reps’ explicit and stated goal was to recruit high-value eBay sellers away from eBay to Amazon; (6) Amazon reps used particular, often similar methods to circumvent eBay’s detection systems, for example by using non-conventional methods of writing out email addresses and phone numbers; (7) Amazon reps regularly sought to move discussions off of eBay’s M2M system, to avoid detection; and (8) Amazon reps consistently violated eBay’s User Agreement, for example by contact each other to make offers to buy or sell items outside of eBay” in violation of the eBay User Agreement and related policies (and using systematic efforts to circumvent eBay’s detection tools as they were doing so).
61. Amazon reps made the above-described misrepresentations and/or omissions knowingly, or with reckless disregard for the truth, at the time they were made.
62. Amazon and its reps intended that eBay would rely on the above-described misrepresentations and omissions.
63. eBay reasonably relied on Amazon reps’ misrepresentations and/or omissions.
64. e¢Bay has suffered harm as a result of the coordinated efforts of Amazon and its reps, and this conduct was a substantial factor in causing this harm.
65. Amazon reps committed these acts within the scope of their employment, and Amazon coordinated, supported, and ratified the scheme under which Amazon reps did so.
66. The conduct of Amazon and its reps was fraudulent, malicious, oppressive, and in willful disregard of eBay’s rights.
COUNTI1V: VIOLATION OF CALIFORNIA PENAL CODE § 502(c
67. eBay realleges each and every allegation set forth in Paragraphs 1 through 66, inclusive, and incorporates them by reference herein.
68. To facilitate transactions on eBay’s e-commerce platform, eBay allows interested buyers and sellers to communicate using eBay’s M2M system, on the condition that those buyers and sellers become eBay members and agree to eBay’s User Agreement.
69. eBay’s M2M system constitutes “computer services” under Cal. Penal Code § 502(b)(4). eBay owns and operates one or more computers, computer systems, computer networks, computer programs, and data that facilitate and permit operation of the M2M system.
70. Amazon caused its reps to knowingly and without permission use the M2M system, in violation of California Penal Code § 502(¢)(3).
71. Amazon, by and through its reps, willfully violated the provisions of California Penal 72. The conduct of Amazon and its reps was fraudulent, malicious, oppressive, and in willful disregard of eBay’s rights.
73. eBay has suffered irreparable harm as a result of Amazon’s activities and will continue to suffer irreparable injury that cannot be adequately remedied at law.
74. eBay realleges each and every allegation set forth in Paragraphs 1 through 73, inclusive, and incorporates them by reference herein.
75. Amazon, by and through the unlawful conduct of its reps, violated Cal. Pen Code § 502(c)(3) and, in doing so, engaged in unlawful business acts and practices in violation of the Unfair Competition Law (“UCL”).
76. Amazon and its reps engaged in fraudulent business acts and practices by, among other things, fraudulently gaining use of eBay’s M2M system by agreeing to eBay’s User Agreement without intending to comply with its terms; thereafter using eBay’s M2M system to send communications designed to solicit eBay member-sellers to move to Amazon, in violation of the User Agreement; inducing eBay member-sellers to breach their User Agreements with eBay; and using deceptive techniques to evade detection of the scheme by eBay.
1. As a direct and proximate result of the above mentioned acts in violation of section 17200, eBay has suffered harm. These acts were a substantial factor in causing this harm.
78. eBay is informed and believes, and on that basis alleges, Amazon has been unjustly enriched at eBay’s expense.
79. eBay has suffered irreparable harm as a result of Amazon’s activities and will continue to suffer irreparable 1njury that cannot be adequately remedied at law.
WHEREFORE ¢Bay prays that this Court enter judgment 1n its favor on each and every claim for relief set forth above and award it relief, including but not limited to an Order:
1. Permanently enjoining Defendants, their subsidiaries, affiliates, successors, employees and all other persons acting in concert or in participation with them from
misusing the M2M system or eBay platform to solicit eBay member-sellers;
2. Awarding eBay monetary relief, including damages sustained by eBay in an amount to be determined at trial;
3. Restitution of Defendant’s unlawful proceeds, including an accounting of any and all revenue derived from any sellers recruited as a result of Defendant’s scheme described herein;
4. Awarding eBay punitive and exemplary damages in such amount as may be awarded at trial;
3. Awarding attorneys’ fees;
6. Awarding interest according to law; and
7. Awarding such other and further relief as this Court may deem just and proper.
Plaintiffs hereby demand a trial by jury on all issues so triable.