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Lawmakers: Amazon ‘may have lied to Congress’ about its business practices

The Washington Post logo The Washington Post 10/18/2021 Cristiano Lima, Taylor Telford
Members of Congress have asked Amazon to provide “exculpatory evidence” to corroborate testimony that certain executives, including founder Jeff Bezos, provided in 2019 and 2020 regarding the use of data from third-party sellers. © Mandel Ngan/AFP/Getty Images Members of Congress have asked Amazon to provide “exculpatory evidence” to corroborate testimony that certain executives, including founder Jeff Bezos, provided in 2019 and 2020 regarding the use of data from third-party sellers.

Members of a congressional panel questioned Monday whether Amazon executives misled them during sworn testimony, giving the company two weeks to provide documentation supporting their statements or potentially face a criminal referral.

In a letter addressed to chief executive Andy Jassy, lawmakers asked Amazon for “exculpatory evidence” to corroborate testimony its executives, including founder Jeff Bezos, provided to the House Judiciary Committee’s antitrust panel regarding its use of data from third-party sellers and its search-engine rankings. Otherwise, they said, the matter may be referred to the Justice Department for criminal investigation. (Bezos owns The Washington Post.)

According to recent investigations by the Reuters news agency and the Markup, a data journalism nonprofit, Amazon has systematically used data it collects from third-party sellers to launch copycat products and has given its own goods a leg up against competitors on its search engine, practices the company has testified to Congress it does not engage in or are against its policies.

“At best, this reporting confirms that Amazon’s representatives misled the Committee,” Reps. Jerrold Nadler (D-N.Y.), David N. Cicilline (D-R.I.), Ken Buck (R-Colo.), Pramila Jayapal (D-Wash.) and Matt Gaetz (R-Fla.) said in the letter. “At worst, it demonstrates that they may have lied to Congress.”

Last year, House Judiciary leaders questioned whether Amazon Associate General Counsel Nate Sutton misled Congress on the matter during a 2019 hearing, when he testified that the company does “not use any seller data … to compete,” nor “use any of that specific seller data in creating our own private-brand products.” Sutton also testified that Amazon’s search engine uses the “same criteria” to determine which products to surface to users.

The session was part of a sweeping investigation into whether Amazon and other digital behemoths are squelching competition online. The standoff arose after the Wall Street Journal reported in April 2020 that using individual seller data from vendors to launch competing products was “standard operating procedure” at Amazon, which disputed the investigation.

The lawmakers demanded that then-CEO Bezos testify about the issue and threatened to issue a subpoena. He voluntarily testified at a blockbuster hearing alongside the CEOs of Facebook, Google and Apple in July 2020.

When lawmakers pressed Bezos on Amazon’s handling of user data at the hearing, the tech mogul said that while the company does have a policy “against using seller-specific data to aid our private-label business,” he couldn’t “guarantee” that it has never been violated. Still, the two sides staved off a major legal confrontation over the matter at the time.

But the series of new reports on Amazon’s data practices in recent weeks have reignited concerns that the company may have misled the panel in past sworn testimony. A federal referral by House lawmakers to the Justice Department, which they are now threatening, would dramatically escalate the standoff.

The e-commerce giant has until Nov. 1 to provide documents and evidence to “clarify” its past testimony.

“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,” lawmakers wrote.

In a statement Monday emailed to The Post, an Amazon spokesman said that the company and its executives did not mislead the committee and that reporting calling its practices into question was “inaccurate.”

“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,” Amazon said in a statement. “We investigate any allegations that this policy may have been violated and take appropriate action.”

Amazon declined to comment on whether it would comply with the request for corroborating evidence.

Richard Painter, a White House ethics lawyer in the George W. Bush administration, said that criminal prosecutions for perjury are exceedingly rare but that congressional referrals for investigations are more common.

“The DOJ adheres to a quite high threshold for opening up investigations of criminal perjury, much less prosecuting,” he said in an interview Monday.

Rutgers Law School professor Stuart Green said that if the panel moves ahead with a referral, its case for a federal investigation could be bolstered by the fact that the effort has bipartisan backing.

“That would make me think that the Justice Department would be more inclined to bring a case than if it were divided on partisan grounds,” he said.

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