Amazon seeks to consolidate investor class actions

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Update: 

• Amazon and two stockholders who recently filed separate lawsuits against certain company leaders have asked a Washington federal judge to consolidate their cases.
• Both lawsuits allege Amazon executives mishandled biometric data under Illinois privacy law and misled investors about it.
• In a motion filed July 7, the two plaintiffs, Stephen Nelson and Francis Gimbel, Jr, said their cases should be consolidated because they are both shareholder derivative actions brought on behalf of Amazon against the same executives, and they involve common questions of law.
• In Nelson’s case, it is alleged that Amazon’s top executives misled investors about the company’s compliance with the Illinois Biometric Information Privacy Act and subsequent litigation risks.
• In Gimbel Jr.’s case, it is alleged that the Amazon executives harmed investors by mishandling biometric data collection, securing contracts with third-party sellers and misleading compliance filings with the Securities Exchange Commission.

Amazon shareholder class Action lawsuit overview: 

• Who: Francis Gimbel, Jr. filed a class action lawsuit derivatively on behalf of Amazon.com, Inc. against a group of current and former Amazon officers, including founder and former CEO Jeff Bezos.
• Why: Gimbel claims Amazon officers misled shareholders in compliance filings, unlawfully stored biometric data, and made anti competitive contracts with third party sellers. 
• Where: The class action lawsuit was filed in Washington federal court. 

(06/15/2022)

Current and former Amazon officers harmed investors by mishandling biometric data collection, securing contracts with third-party sellers, and misleading compliance filings with the SEC, a new class action lawsuit alleges.

Plaintiff Francis Gimbel, Jr. claims a group of current and former Amazon officers, including founder and former CEO Jeff Bezos, failed to get written consent—among other Illinois Biometric Information Privacy Act (BIPA) requirements—before collecting and storing the biometric data.

Gimbel also argues Amazon misled the investing public in compliance filings with the SEC and other public statements about its “compliance with applicable laws and regulations.” 

Finally, Gimbel claims Amazon officers engaged in anticompetitive practices against third-party sellers by, among other things, entering into contracts with them which inflated prices for consumers and guaranteed the company “a minimum profit on each item sold.” 

“As a result of their misconduct and unbeknownst to the investing public, the Individual Defendants exposed Amazon to heightened risks of increased regulatory scrutiny, government investigations and enforcement actions, and legal exposure otherwise,” states the Amazon class action. 

Amazon board of directors accused of taking part in illegal acts

Gimbel claims Amazon’s Board of Directors’ had full knowledge of the allegedly illegal conduct and was itself involved in the “wrongdoing,” thus arguing that demanding the Board to “rectify” the situation would be “a wasteful, useless, and futile act.” 

Gimbel claims the current and former Amazon officers named in the complaint are guilty of unjust enrichment, wasting corporate assets, and breach of fiduciary duties. 

Plaintiff is demanding a jury trial and requesting injunctive relief along with appropriate equitable relief for themselves and other similarly affected Amazon investors. 

A separate class action lawsuit was filed against Amazon in April which alleged the company misled its investors about its compliance with BIPA regulations. 

Are you an Amazon shareholder who feels misled by the company? Let us know in the comments! 

The plaintiff is represented by  Frank J. Johnson and Michael I. Fistel Jr. of Johnson Fistel LLP, and Gregory F. Wesner of Herman Jones LLP.

The Amazon Shareholder Class Action Lawsuit is Gimbel v. Bezos, et al., Case No. 2:22-cv-00811, in the U.S. District Court for the Western District of Washington.

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