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January 18, 2020 02:02 am

PopSockets CEO Calls Out Amazon's 'Bullying With a Smile' Tactics

At a House Judiciary antitrust subcommittee on competition in the digital economy, PopSockets CEO and inventor David Barnett described how Amazon used shady tactics to pressure their smartphone accessory company. Mashable reports: "Multiple times we discovered that Amazon itself had sourced counterfeit product and was selling it alongside our own product," he noted. Barnett, under oath, told the gathered members of the House that Amazon initially played nice only to drop the hammer when it believed no one was watching. After agreeing to a written contract stipulating a price at which PopSockets would be sold on Amazon, the e-commerce giant would then allegedly unilaterally lower the price and demand that PopSockets make up the difference. Colorado Congressman Ed Perlmutter asked Barnett how Amazon could "ignore the contract that [PopSockets] entered into and just say, 'Sorry, that was our contract, but you got to lower your price.'" Barnett didn't mince words. "With coercive tactics, basically," he replied. "And these are tactics that are mainly executed by phone. It's one of the strangest relationships I've ever had with a retailer." Barnett emphasized that, on paper, the contract "appears to be negotiated in good faith." However, he claimed, this is followed by "... frequent phone calls. And on the phone calls we get what I might call bullying with a smile. Very friendly people that we deal with who say, 'By the way, we dropped the price of X product last week. We need you to pay for it.'" Barnett said he would push back and that's when "the threats come." He asserted that Amazon representatives would tell him over the phone: "If we don't get it, then we're going to source product from the gray market."

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