eBay to pay $3M fine after employees mailed live spiders, cockroaches to couple

Ecommerce giant eBay has agreed to pay a $3 million criminal penalty for harassing and intimidating a Massachusetts couple in retaliation for their 2019 coverage in an online newsletter and for obstruction of the investigation that followed, according to the U.S. Attorney for Massachusetts.

According to eBay’s admissions, between approximately Aug. 5 and Aug. 23, 2019, Jim Baugh, eBay’s former senior director of safety and security, and six other members of eBay’s security team targeted David and Ina Steiner for their roles in publishing a story in their newsletter, EcommerceBytes, that reported on a lawsuit eBay had filed that accused Amazon of poaching its sellers.

Senior executives at eBay were frustrated with the newsletter’s tone and content, and with the comments posted beneath the newsletter’s articles. The harassment campaign arose from communications between those executives and Baugh, according to the office of acting U.S. Attorney for Massachusetts, Joshua Levy.

Baugh and his co-conspirators executed a harassment campaign that included sending anonymous and disturbing deliveries to the victims’ home, including a book on surviving the death of a spouse, a bloody pig mask, a fetal pig and a funeral wreath and live spiders and cockroaches; sending private Twitter messages and public tweets criticizing the newsletter’s content and threatening to visit the victims at their residence in Natick, Massachusetts; and traveling to Natick to surveil the victims and install a GPS tracking device on their car, per Levy’s office. The harassment also featured Craigslist posts inviting the public for sexual encounters at the victims’ home.

“eBay engaged in absolutely horrific, criminal conduct,” Levy said in a press release Thursday. “The company’s employees and contractors involved in this campaign put the victims through pure hell, in a petrifying campaign aimed at silencing their reporting and protecting the eBay brand.”

“We left no stone unturned in our mission to hold accountable every individual who turned the victims’ world upside-down through a never-ending nightmare of menacing and criminal acts. The investigation led to felony convictions for seven individuals, all former eBay employees or contractors, and the ringleader (Baugh) was sentenced to 57 months in federal prison.”

According to Levy’s office, the Steiners spotted the eBay surveillance team and contacted local police. After learning of the Natick Police Department’s investigation, Baugh made false statements to police and internal investigators, and he and his team deleted digital evidence related to the cyberstalking campaign and falsified records intended to throw the police off the trail.

In a statement released Thursday following the announcement of the Justice Department fine, eBay CEO Jamie Iannone apologized to the Steiners and noted the company had new leadership in place (Devin Wenig served as eBay CEO at the time of the harassment incidents but stepped down in 2019) and had implemented new oversight policies.

“The company’s conduct in 2019 was wrong and reprehensible,” Iannone said. “From the moment eBay first learned of the 2019 events, eBay cooperated fully and extensively with law enforcement authorities. We continue to extend our deepest apologies to the Steiners for what they endured.

“Since these events occurred, new leaders have joined the company and eBay has strengthened its policies, procedures, controls and training. eBay remains committed to upholding high standards of conduct and ethics and to making things right with the Steiners.”

In a Thursday statement the Steiners published on their website the couple notes eBay agreed to a deferred prosecution agreement under which the company will comply with three years of monitoring by an independent overseer.

The Steiners said they believe they were targeted by eBay executives and employees “because we gave eBay sellers a voice and because we reported facts that top executives didn’t like publicly laid bare.”

“After today’s announcement, we remain determined to push for answers and do whatever we possibly can to ensure that no corporation ever feels that the option exists for them to squash a person’s First Amendment rights,” the Steiners wrote.