Controversies

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Controversies

In 1999, the Amazon Bookstore Cooperative of Minneapolis, Minnesota sued Amazon.com for trademark infringement. The cooperative had been using the name "Amazon" since 1970, but reached an out-of-court agreement to share the name with the on-line retailer.[59] The company has been controversial for its alleged use of patents as a competitive hindrance. The "1-click patent"[60] is perhaps the best-known example of this. Amazon's use of the one-click patent against competitor Barnes and Noble's website led the Free Software Foundation to announce a boycott on Amazon in December 1999.[61] The boycott was discontinued in September 2002.[62] On February 22, 2000, the company was granted a patent covering an Internet-based customer referral system, or what is commonly called an "affiliate program". Reaction was swift and negative. Industry leaders Tim O'Reilly and Charlie Jackson spoke out against the patent,[63] and O'Reilly published an open letter[64] to Bezos protesting the 1-click patent and the affiliate program patent, and petitioning him to "avoid any attempts to limit the further development of Internet commerce". O'Reilly collected 10,000 signatures[65] with this petition. Bezos responded with his own open letter.[66] The protest ended with O'Reilly and Bezos visiting Washington, D.C. to lobby for patent reform. On February 25, 2003, the company was granted a patent titled "Method and system for conducting a discussion relating to an item on Internet discussion boards".[67] On May 12, 2006, the USPTO ordered a re-examination[68] of the "One-Click" patent, based on a request filed by Peter Calveley, who cited as prior art an earlier e-commerce patent and the Digicash electronic cash system.[citation needed] Amazon has opposed efforts by trade unions to organize in both the United States and the United Kingdom. In 2001, 850 employees in Seattle were laid off by Amazon.com after a unionization drive. The Washington Alliance of Technological Workers (WashTech) accused the company of violating union laws, and claimed Amazon managers subjected them to intimidation and heavy propaganda. Amazon denies any link between the unionization effort and the lay-offs.[69] Also in 2001, Amazon.co.uk hired a US management consultancy organization, The Burke Group, to assist in defeating a campaign by the Graphical, Paper and Media Union (GPMU, now part of Amicus) to achieve recognition in the Milton Keynes distribution depot. It was alleged that the company victimized or sacked four union members during the 2001 recognition drive and held a series of captive meetings with employees.[70][71] Amazon has a Canadian site in both English and French, but is prevented from operating any headquarters, servers, fulfillment centers or call centers in Canada by that country's legal restrictions on foreign-owned booksellers. Instead, Amazon's Canadian site originates in the United States, and Amazon has an agreement with Canada Post to handle distribution within Canada and for the use of the Crown corporation's Mississauga, Ontario shipping facility.[72] The launch of Amazon.ca generated controversy in Canada. In 2002, the Canadian Booksellers Association and Indigo Books and Music sought a court ruling that Amazon's partnership with Canada Post represented an attempt to circumvent Canadian law,[73] but the litigation was dropped in 2004.[74] Amazon at one time carried two cockfighting magazines and two dog fighting videos although the Humane Society of the United States (HSUS) contends that the sale of these materials is a violation of U.S. Federal law. The Humane Society of the United States has filed a lawsuit against Amazon.[75] A campaign to boycott Amazon purchases gained momentum in August 2007 after the much publicized dog fighting case involving NFL quarterback Michael Vick.[76] On May 21, 2008, Marburger Publishing agreed to settle with the Humane Society by requesting that Amazon stop offering their magazine The Game Cock for subscription. The second magazine named in the Humane Society lawsuit, The Feathered Warrior, remains available.[77] A 2004 glitch in Amazon.ca's review system temporarily revealed that many well-established authors were anonymously giving themselves glowing reviews, with some revealed to be anonymously giving "rival" authors terrible reviews.[78][79] According to Amazon, those reviews have since been removed or made non anonymous. In March 2008, sales representatives of Amazon's BookSurge division started contacting publishers of print on demand titles to inform them that for Amazon to continue selling their POD-produced books, they would need to sign agreements with Amazon's own BookSurge POD company. Publishers were told that eventually, the only POD titles that Amazon would be selling would be those printed by their own company, BookSurge. Some publishers felt that this ultimatum amounted to monopoly abuse, and questioned the ethics of the move and its legality under anti-trust law.[80] In 2008, Amazon UK came under criticism for attempting to prevent publishers from direct selling at discount from their own websites. Amazon's argument was that they should be able to pay the publishers based on the lower prices offered on their websites, rather than on the full RRP.[81][82] In June 2008 Amazon UK drew criticism in the British publishing community following their withdrawal from sale of key titles published by Hachette Livre UK. The withdrawal is apparently intended to put pressure on the publisher to provide levels of discount described by the trade as unreasonable. Curtis Brown's managing director Jonathan Lloyd was quoted in The Bookseller magazine as saying: "I think the entire industry of publishers, authors and agents are 100% behind [Hachette]. Someone has to draw a line in the sand. Publishers have given 1% a year away to retailers, so where does it stop? Using authors as a financial football is disgraceful."[83][84] In 2008 New York passed a law that would force online retailers to collect sales taxes on shipments to New York State residents.[85] Shortly after the law was signed, Amazon.com filed a complaint in the New York Supreme Court objecting to the law.[85] The complaint wasn't based on whether in-State customers should pay tax, but was based on the long standing practice of it being the responsibility of the customer to report the sales tax (known as use tax in this case) and not that of the out of State businesses.[85] The lawsuit was tossed out of court in January 2009 when New York State Supreme Court Justice Eileen Bransten stated that "there is no basis upon which Amazon can prevail."[86] On April 12, 2009, it was revealed that some erotic, lesbian, gay, bisexual, transgender, feminist and politically liberal books were being excluded from Amazon's sales rankings.[87] Various books and media were flagged as "Adult content" (including children's books, self-help books, non-fiction, and non-explicit fiction), with the result that works by established authors like E. M. Forster, Gore Vidal, Jeanette Winterson and D. H. Lawrence were now unranked.[88] The change first received publicity on the blog of author Mark R. Probst, who reproduced an e-mail from Amazon customer service describing a policy of de-ranking "adult" material.[87][88] However, Amazon later said that there was no policy of de-ranking LGBT material and blamed the change first on a "glitch"[89] and then on "an embarrassing and ham-fisted cataloging error" that had affected 57,310 books.[90] In April 2009, BusinessWeek magazine reported that Amazon.com was one of 25 US companies that paid the least US taxes. Amazon.com paid a 4.1 percent annual tax rate, far less than the standard 35 percent corporate rate, based on an analysis of the company's financial figures for 2005-2008. According to SEC filings, this rate was caused in part by lower tax rates for Amazon.com's international subsidiaries.[91] See also: Criticism of Amazon Kindle remote content removal In July 2009, The New York Times reported that Amazon.com deleted all customer copies of certain books published by MobileReference[92], including the books 1984 and Animal Farm from users' Kindles. This action was taken with neither prior notification nor specific permission of individual users. Customers did receive a refund of the purchase price and, later, an offer of an Amazon gift certificate or check for $30.[93] In September 2009 it emerged that Amazon was selling defamatory mp3 music downloads falsely suggesting a well known Premier League football manager was a child sex offender. Despite a campaign urging the retailer to withdraw the item, they refused to do so citing freedom of speech[94]. The company was finally forced to withdraw the item when legal action was threatened.[95] However, they continued to sell the item on their American, German and French websites.