EBay stalking scandal

Last updated
eBay stalking scandal
DurationLaunched in January 2019
MotiveDeter website authors who wrote negative material about EBay
TargetIna and David Steiner of EcommerceBytes
Arrests2
Convicted7
Charges7

The eBay stalking scandal was a campaign conducted in 2019 by eBay and contractors. The scandal involved the aggressive stalking and harassment of two e-commerce bloggers, Ina and David Steiner, who wrote frequent commentary about eBay on their website EcommerceBytes. [1] [2] Seven eBay employees pleaded guilty to charges involving criminal conspiracies. [3] [4] The seven employees included two senior members of eBay’s corporate security team. [5] Two members of eBay's Executive Leadership Team who were implicated in the scandal were not charged. [1]

Contents

Background

EcommerceBytes

EcommerceBytes is an online newsletter and e-commerce trade publication founded in 1999, four years after eBay was founded. Initially called AuctionBytes, the website offered advice to buyers in the early days of internet commerce. In the years after its founding, the website became a resource for sellers on a number of platforms, from Etsy to Amazon, a kind of trade publication for anyone whose business is selling items online. It is read primarily by sellers, but also by some corporate staff, including some who posted comments on their website. [6] The website not only offers advice, but also critiques of the corporate and policy changes at eBay and other e-commerce platforms. [6] For example, in April 2019, Ina Steiner reported there that eBay's then-CEO Devin Wenig was paid 152 times more than the typical eBay employee. [6]

Activist investor requests changes

In January 2019, Elliott Management, an activist hedge fund, [6] purchased a significant investment in eBay. They sent a letter to its board of directors requesting changes, such as replacing the CEO, [6] saying that eBay "as a public-company investment has underperformed both its peers and the market for a prolonged period of time." This was interpreted as placing additional demands on eBay management to produce results, leading to an atmosphere of heightened stress throughout the company. [7] [1]

Stalking and harassment

Members of eBay's executive leadership had long been bothered by the couple's posts. Under pressure in early 2019 to enhance performance, the company felt a new sense of urgency. For example, in April 2019, Wenig sent the post about how outsized his compensation was compared to typical employees to eBay’s chief communications officer at the time, Steve Wymer. [6] Wymer replied that eBay was "going to crush this lady." [6] Wenig texted Wymer weeks later: "Take her down." [6] Wymer took their concerns to the head of eBay's security division, Jim Baugh, whose team began harassing the Steiners at home and online. [6] Wymer texted Baugh that Ina Steiner was a "biased troll who needs to be BURNED DOWN"; that he wanted "to see ashes"; and that Baugh should do "whatever it takes." [8] [9]

The Steiners were harassed and threatened both online and physically in their home by deliveries of such things as a bloody pig mask, live cockroaches and spiders, a funeral wreath, and large orders of pizza. [5] [1] [6] Pornographic magazines with David Steiner’s name on them were sent to a neighbor’s house. [5] [1] [6]

Employees flew from California to Boston so they could vandalize the couple's Natick, Massachusetts home as well as stalk their personal vehicle. [1] [6] Plans were even made to break into the couple's garage and place a GPS tracker on their car. [1]

EcommerceBytes was not the only source of criticism; Wenig was also concerned about an anonymous persona named Fidomaster (also known as Dan Davis and unsuckEBAY) who frequently commented about eBay on Twitter, EcommerceBytes, and other online forums. [10]

The stalking and harassment campaign was designed to intimidate EcommerceBytes into changing their coverage of eBay, culminating in the "White Knight Strategy" which enlisted Brian Gilbert to pretend to come to the Steiners' aid in his official eBay capacity as an attempt to win goodwill and gain their help in unmasking the person behind the Fidomaster/unsuckEBAY account. [11]

Criminal charges

"This was a determined, systematic effort by senior employees of a major company to destroy the lives of a couple in Natick all because they published content that company executives didn’t like. For a while they succeeded, psychologically devastating these victims for weeks as they desperately tried to figure out what was going on and stop it."

Massachusetts US attorney Andrew Lelling

In June 2020, the U.S. Department of Justice charged six former eBay employees and contractors with conspiracy to commit cyberstalking and conspiracy to tamper with witnesses; [1] a seventh former employee was charged in July. [12]

Two former employees were charged and arrested. [5] They are: [1]

Five former employees were charged but not arrested. Each of these individuals was charged with conspiracy to commit cyberstalking and conspiracy to tamper with witnesses. All of them pleaded guilty to the charges. [3] They are: [1]

On January 11, 2024, eBay agreed to pay a $3 million fine as part of a deferred prosecution. [18]

Civil lawsuit

In July 2021, Ina and David Steiner filed suit against eBay Inc.; former CEO Davin Wenig; former Chief Communications Officer Steve Wymer; the seven defendants in the criminal case; and Progressive F.O.R.C.E Concepts (PFC), an independent security firm. [19] eBay's former SVP Global Operations Wendy Jones and Progressive F.O.R.C.E Concepts' CEO Steve Krystek were also added to an amended version of the complaint on March 1, 2023. [10]

The lawsuit claims that Wenig and Wymer "provided the other Defendants with carte blanche authority to terminate the reporting of the Steiners by whatever means necessary, with Defendant Wymer expressing '... I want to see ashes. As long as it takes. Whatever it takes.' Defendant Wymer promised the defendants he would 'embrace managing any bad fallout' if the plan went south, further directing, 'We need to STOP her.' The lawsuit further claims that "All of the horrific, vicious and sickening conduct that followed was committed by employees of eBay and PFC, while acting in the scope of their employment under the authority of and for the benefit of eBay and PFC." [19]

Internal corporate investigation

After being contacted by law enforcement, eBay hired a law firm to investigate the harassment. [6] The investigation concluded in September 2019, and all of the people charged with crimes plus the chief communications officer Steve Wymer were fired. [6] The investigation found that neither Wenig nor Wymer "directed or knew that criminal acts would follow." [20] Wymer was hired the next year as the head of a local branch of the Boys & Girls Clubs of America, a children's charity that knew about Wymer's involvement in the harassment scandal. [6] [21] [22]

The CEO Wenig's messages were deemed "inappropriate" by eBay, but eBay's internal investigation concluded that the CEO did not know about the stalking and harassment activities. [6] Wenig left eBay in September 2019, with a US$57 million severance package. [6] After the harassment scandal became news, Wenig was re-elected to the board of General Motors. [6]

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References

  1. 1 2 3 4 5 6 7 8 9 10 11 Streitfeld, David (2020-09-26). "Inside eBay's Cockroach Cult: The Ghastly Story of a Stalking Scandal". The New York Times. Archived from the original on 2020-12-13. Retrieved 2020-09-26.
  2. ↑ Barrett, Brian (2020-09-26). "Former eBay Execs Allegedly Made Life Hell for Critics". Wired. Archived from the original on 2020-09-18. Retrieved 2020-09-26.
  3. 1 2 "2 former eBay employees indicted in harassment campaign". Associated Press. 2020-11-03. Archived from the original on 2021-12-28. Retrieved 2021-12-28. James Baugh, 45, who was eBay's senior director of safety & security, and David Harville, 48, former director of global resiliency, were indicted on charges including stalking through interstate travel. [...] Five other former employees have pleaded guilty in the case.
  4. 1 2 Richer, Alanna Durkin (12 May 2022). "Final ex-eBay employee in cyberstalking case pleads guilty". Associated Press . Archived from the original on 17 May 2022. Retrieved 17 May 2022.
  5. 1 2 3 4 Durkin Richer, Alanna (2020-06-15). "Feds: eBay staff sent spiders, roaches to harass couple". Associated Press. Archived from the original on 2022-04-30. Retrieved 2021-12-28.
  6. 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 Damiano, Mike (2 December 2021). ""Take Her Down": Inside eBay's Stalking Campaign against a Natick Couple". Boston Magazine . Archived from the original on 2021-12-28. Retrieved 2021-12-28.
  7. ↑ "Elliott Management Sends Letter to Board of Directors of eBay". BusinessWire. January 22, 2019. Archived from the original on October 29, 2020. Retrieved September 29, 2020.
  8. ↑ "SanJoseSpotlight". 5 December 2022. Archived from the original on 2023-02-23. Retrieved 2023-02-23.
  9. ↑ "Forbes". Forbes . Archived from the original on 2023-02-23. Retrieved 2023-02-23.
  10. 1 2 "Inside The eBay Cyberstalking Scandal: Battle For Justice Rages On". Value Added Resource. 28 February 2023. Archived from the original on 1 July 2023.
  11. ↑ "eBay Cyberstalking: A Threat To Free Speech & First Amendment Values". Value Added Resource. 27 March 2023. Archived from the original on 27 March 2023.
  12. ↑ Herrera, Sebastian (2020-06-15). "Justice Department Charges Former eBay Staff With 'Cyberstalking Campaign'". The Wall Street Journal. Archived from the original on 2020-09-20. Retrieved 2020-09-27.
  13. 1 2 3 4 "Two Former eBay Employees Sentenced for Aggressive Cyberstalking Campaign". October 11, 2022. Archived from the original on February 24, 2023. Retrieved February 24, 2023.
  14. 1 2 "Two Former Ebay Employees Plead Guilty to Aggressive Cyberstalking Campaign Targeting Natick Couple" (Press release). U.S. Department of Justice, U.S. Attorney’s Office, District of Massachusetts. 2020-10-08. Archived from the original on 2021-12-28. Retrieved 2021-12-28.
  15. 1 2 3 "Two Former eBay Employees Plead Guilty to Aggressive Cyberstalking Campaign Targeting Natick Couple" (Press release). U.S. Department of Justice, U.S. Attorney’s Office, District of Massachusetts. 29 October 2020. Archived from the original on 28 December 2021. Retrieved 28 December 2021.
  16. ↑ "Former eBay Staffer & Santa Clara Police Captain Charged With Harassing Newsletter Editor". CBS SF Bay Area. July 7, 2020. Archived from the original on September 27, 2020. Retrieved September 29, 2020.
  17. ↑ "Former eBay Employee Sentenced for Role in Aggressive Cyberstalking Campaign". 27 July 2021. Archived from the original on 3 August 2021. Retrieved 3 August 2021.
  18. ↑ "Justice Department charges eBay over employees who sent live spiders and cockroaches to Natick couple; company to pay $3 million". The Boston Globe. January 11, 2014.
  19. 1 2 "Lawsuit: eBay tried to "terrorize, stalk, and silence" couple that ran news site". ArsTechnica. 21 July 2021. Archived from the original on 1 March 2023. Retrieved 1 March 2023.
  20. ↑ Morton, Liz (2022-12-07). "eBay Sued By Insurance In Cyberstalking Case, Exec Political Ties Revealed". Value Added Resource. Archived from the original on 2023-03-01. Retrieved 2023-03-01.
  21. ↑ "Boys & Girls Clubs of Silicon Valley Names Steve Wymer President and Chief Executive Officer". Boys & Girls Clubs of Silicon Valley. 10 September 2020.
  22. ↑ Howey, Brian; Nguyen, Tran (4 January 2023). "Disgraced eBay exec wielded power at San Jose City Hall". San Jose Spotlight.
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