Jeff Bezos, founder and CEO of Amazon and the world’s richest individual, has been called before the House Judiciary Committee to explain how the ecommerce giant uses data on third-party merchants. The lawmakers, in submitting the request, said a recent report about Amazon’s practices contradicted the company’s previous statements to the committee and “appear to be misleading, and possibly criminally false or perjurious.”
An Amazon spokesman declined to comment on the request for Bezos to testify.
In a letter dated May 1 and addressed to Bezos, the House lawmakers wrote that they expected Bezos to appear voluntarily but added that “we reserve the right to resort to compulsory process if necessary.”
The letter cited a Wall Street Journal April 23 report that Amazon employees — as “standard operating procedure” — used sensitive business information from third-party sellers on its platform to develop competing products. If that’s true, the House members wrote, “then statements Amazon made to the Committee about the company’s business practices appear to be misleading, and possibly criminally false or perjurious.”
In response to the WSJ report, Amazon said, “As we told the Wall Street Journal and explained in our testimony, we strictly prohibit employees from using non-public, seller-specific data to determine which private label products to launch. While we don’t believe these claims made in the Journal story are accurate, we take these allegations very seriously and have launched an internal investigation.”
The Democrat-led House Judiciary Committee last year launched a probe into Amazon’s powerful position in digital commerce, along with investigations of Apple, Facebook and Google. In testimony before the committee in July 2019, when asked about Amazon’s use of third-party seller data, Amazon associate general counsel Nate Sutton said “[W]e do not use their individual data when we’re making decisions to launch private brands.”
In September, the committee requested documents related to Amazon’s relationship with sellers, including Amazon’s use of third-party sellers’ data. “Amazon has not made an adequate production in response to this request, and — seven months after the original request — significant gaps remain,” the lawmakers alleged in the May 1 letter.
The letter requesting Bezos to testify was signed by Rep. Jerrold Nadler (D-N.Y.), who is chairman of the House Judiciary Committee, along with representatives from both sides of the aisle. However, Rep. Jim Jordan (R.-Ohio), the committee’s ranking Republican member, did not sign it. In a statement via a rep, Jordan said Republicans have questions for Amazon but that they “wonder what Judiciary Democrats’ true motivations are” and whether Dems want to break up companies like Amazon “simply because they are large successful businesses.”
Amazon’s sales have skyrocketed during the COVID-19 pandemic, and the company has hired thousands of additional workers to handle the demand. On Thursday, the company reported net sales of $75.5 billion for the first quarter of 2020, up 26% year over year. Bezos said Amazon expects to spend its operating profit from the first quarter — $4 billion or more — on coronavirus-related expenses in Q2.