Tech

House Judiciary Committee asks Jeff Bezos to testify about whether Amazon misled Congress

Key Points
  • The House Judiciary Committee is asking Amazon CEO Jeff Bezos to testify.
  • Top Democrats on the committee previously said they suspected Amazon of lying to Congress over its private label strategy.
  • The committee said the earlier testimony may be "criminally false or perjurious."
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House Judiciary panel asks Amazon CEO Jeff Bezos to testify

The House Judiciary Committee demanded on Friday that Jeff Bezos testify after Democratic leaders said they suspected Amazon of lying to Congress.

The Democratic-led committee threatened to subpoena Bezos if he does not comply. 

Amazon's stock fell after the announcement.

Seven bipartisan members of the committee said in a letter to Bezos that a recent Wall Street Journal report on Amazon's use of third-party seller data appears to show that Amazon may have misled Congress in previous statements. 

"If the reporting in the Wall Street Journal article is accurate, then statements Amazon made to the Committee about the company's business practices appear to be misleading, and possibly criminally false or perjurious," they wrote.

Amazon's stock fell 7.6% Friday, a day after the company reported earnings. The company has pledged to invest its expected $4 billion Q2 profit into coronavirus-related efforts.

The Journal investigation found Amazon employees used nonaggregated or easily identifiable data from third-party sellers to figure out which products to make on its own. The report was based on interviews with more than 20 former Amazon employees and documents reviewed by the Journal. 

The report appeared to contradict testimony by Amazon's associate general counsel Nate Sutton at a July hearing before the House Antitrust Subcommittee, which is investigating Amazon and three of its peers on antitrust grounds.

At the hearing, Sutton said Amazon does not use individual seller data to determine its strategy, a tactic that would likely be considered anti-competitive. Advocates for strong antitrust enforcement, like Sen. Elizabeth Warren, D-Mass., have argued that companies should not be able to own and compete on a marketplace because it could encourage unfair practices. 

Bezos is the only CEO of the big four tech firms — Amazon, Apple, Google and Facebook — who has never before testified in front of Congress. The company has faced scrutiny over the past year as lawmakers and regulators assess issues of privacy and dominance among tech companies. In addition to the House Antitrust Subcommittee investigation, Amazon also faces a probe by the Federal Trade Commission, according to Bloomberg.

House Antitrust Subcommittee Chairman David Cicilline, D-R.I., who is one of the seven signatories of the letter, said last week the report shows that Amazon "may have lied to Congress" in its previous testimony to the subcommittee. House Judiciary Chairman Jerrold Nadler, D-N.Y., who also signed the letter, previously said that if true, the Journal's report "raises deep concerns about Amazon's apparent lack of candor before the Committee regarding an issue that is central to our investigation."

Friday's letter said it was important for Bezos to testify as CEO and would "reserve the right to resort to compulsory process if necessary."

The letter was also signed by the top Republican on the subcommittee, Rep. James Sensenbrenner of Wisconsin, subcommittee Vice Chairman Joe Neguse D-Colo., and Reps. Pramila Jayapal D-Wash., Ken Buck, R-Colo., and Matt Gaetz, R-Fla.

The top Republican on the full committee, Rep. Jim Jordan, R-Ohio, is not listed as one of the signatories. Jordan was newcomer to the antitrust probe after replacing Rep. Doug Collins, R-Ga., in the position as Collins pursues a Senate bid. A Republican spokesperson for the Judiciary Committee said in a statement, "Of course our Members have questions for Amazon and want to get answers for the American people. But we wonder what Judiciary Democrats' true motivations are. Earlier this year, they said companies like Amazon should not exist and should be broken up simply because they are large successful businesses."

Collins and Sensenbrenner threatened in February to "not participate in an investigation with pre-conceived conclusions that America's large tech companies are inherently bad, cannot be allowed to exist in society, and must be broken up." The comment came after a video from a fundraising event showed Nadler talking about "changing the distribution of power" and "breaking up all the large companies," though not specifically referring to the tech industry.

An Amazon spokesperson declined to comment on the letter. A spokesperson previously told CNBC, "It's simply incorrect to suggest that Amazon was intentionally misleading in our testimony."

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