Feds charge eBay over employees who sent live spiders and cockroaches to couple; company to pay $3M

Online retailer eBay Inc. will pay a $3 million fine to resolve criminal charges over a harassment campaign waged by employees who sent live spiders, cockroaches and other disturbing items to the home of a Massachusetts couple, according to court papers filed Thursday.

The Justice Department charged eBay in a criminal information with stalking, witness tampering and obstruction of justice. The employees already were prosecuted in the extensive scheme to intimidate David and Ina Steiner more than three years ago. The couple produced an online newsletter called EcommerceBytes that upset eBay executives with its coverage.

EBay has entered into a deferred prosecution agreement that could result in the charges against the California-headquartered company being dismissed if it complies with certain conditions, according to the U.S. attorney’s office in Massachusetts.

“EBay engaged in absolutely horrific, criminal conduct. 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,” acting Massachusetts U.S. Attorney Josh Levy said in an emailed statement.

The Associated Press sent an email to eBay seeking comment Thursday.

The Steiners, the newsletter’s publisher and editor, have also sued the e-commerce giant in federal court, describing how cyberstalking and upsetting deliveries of anonymously sent packages upended their lives.

Ina Steiner received harassing and sometimes threatening Twitter messages as well as dozens of strange emails from groups like an irritable bowel syndrome patient support group and the Communist Party of the United States.

Along with a box of live spiders and the cockroaches, the couple had a funeral wreath, a bloody pig mask and a book about surviving the loss of a spouse show up at their door. Their home address also was posted online with announcements inviting strangers to yard sales and parties.

The harassment started in 2019 after Ina Steiner wrote a story about a lawsuit brought by eBay that accused Amazon of poaching its sellers, according to court records.

A half-hour after the article was published, eBay’s then-CEO, Devin Wenig, sent another top executive a message saying: “If you are ever going to take her down … now is the time,” according to court documents. The executive sent Wenig’s message to James Baugh, who was eBay’s senior director of safety and security, and called Ina Steiner a “biased troll who needs to get BURNED DOWN.”

Baugh was among seven former employees who ultimately pleaded guilty to charges in the case. He was sentenced in 2022 to almost five years in prison. Another former executive, David Harville, was sentenced to two years.

Wenig, who stepped down as CEO in 2019, was not criminally charged in the case and has denied having any knowledge of the harassment campaign or ever telling anyone to do anything illegal. In the civil case, his lawyers have said the “take her down” quote was taken out of context and the natural inference should be that he was referring to taking “lawful action,” not “a series of bizarre criminal acts.”

Baugh, whom prosecutors described as the mastermind of the scheme, at one point recruited Harville to go with him to Boston to spy on the Steiners, authorities said. Baugh, Harville and another eBay employee went to the couple’s home in the hopes of installing a GPS tracker on their car, prosecutors said. The trio found the garage locked, so Harville bought tools with a plan to break in, prosecutors said.

Harville’s attorneys have said he had no involvement in or knowledge about the threatening messages or deliveries sent by his colleagues.

Baugh’s lawyers have said their client faced relentless pressure from Wenig and other executives to do something about the Steiners. Baugh alleged he was then pushed out by the company when “an army of outside lawyers descended to conduct an ‘internal investigation’ aimed at saving the company and its top executives from prosecution.”