US criminally accuses eBay of cyberstalking case
The Justice Department on Thursday charged eBay with stalking, witness tampering and obstruction of justice in a rare criminal case against a well-known Silicon Valley company.
The charges, which will be dropped under a deferred prosecution agreement if eBay maintains a good record over the next three years, stem from actions the company took in 2019 to undermine and silence the writers of an e-commerce newsletter who was slightly critical of some of his behavior. The intimidation efforts included various forms of cyberstalking and harassment that continued when the perpetrators were arrested.
In the agreement with the government, eBay will employ an independent monitor of compliance with corporate rules. It also agreed to pay a $3 million criminal fine, the maximum fine for his six felonies. The government will not pursue the case unless the company violates the agreement.
While the money is insignificant for a company that had more than $5 billion in cash on hand in its most recent quarter, the fame is not.
“EBay has engaged in absolutely heinous, criminal conduct,” said Joshua S. Levy, Acting Attorney General. “The company employees and contractors involved in this campaign put victims through hell in a terrifying campaign aimed at silencing their reporting and protecting the eBay brand.”
David and Ina Steiner, writers and publishers of a news site and blog called EcommerceBytes, live in Natick, Massachusetts; eBay is based in San Jose, California. During the harassment campaign, members of eBay’s security team flew to Boston to accelerate their activities against the couple personally. When they were caught, they began a cover-up and destroyed incriminating messages.
The forms of harassment include: threatening direct messages via Twitter, the social media platform now called X; attempts to install a GPS device on the Steiners’ car; placing advertisements for fictional sexual events in the Steiners’ home; and sending anonymous and creepy items such as a bloody pig mask to the couple’s home.
A 24-page document detailing the government’s charges, released Thursday, expands the number of eBay executives in the case. Previous documents named only two executives: the CEO and the Chief Communications Officer. Now there is a third director, identified as eBay’s senior vice president of global operations.
“Sometimes you just have to make someone an example,” read a text the chief communications officer sent to the senior vice president on May 31, 2019. “Justice,” the text continued. Then he said, referring to Mrs. Steiner: “We are too nice. She must be crushed.”
A spokesperson for Devin Wenig, eBay’s CEO at the time, had no comment. The other two former directors could not be reached.
said the Steiners in a statement on their website that they were targeted “because we gave eBay sellers a voice and because we reported facts that top executives were reluctant to expose publicly.”
Seven individuals working for eBay’s corporate security team were arrested for their actions against the Steiners in 2020. All pleaded guilty, and six of them were sentenced to prison or house arrest. Jim Baugh, who led the security team, was sentenced to 57 months in prison in September 2022. One person is still awaiting sentencing.
“The company’s conduct in 2019 was wrong and reprehensible,” eBay CEO Jamie Iannone said in a statement on the company’s website. He added that eBay “remains committed to maintaining high standards of conduct and ethics and to making things right with the Steiners.”
The Steiners’ attempts to reach a settlement with eBay failed long ago. The couple filed a lawsuit against eBay, which will go to trial next year.
“The Steiners’ goal has always been to have the government hold everyone involved criminally responsible, and this is a step in the right direction,” their attorney, Rosemary Scapicchio, said Thursday.