Feds accuse San Jose’s eBay of illegally peddling poisons, emissions-control defeaters

Some products cause pollution, others threaten health and life, U.S. Department of Justice alleges.

The U.S. Department of Justice is accusing Bay Area e-commerce giant eBay of illegally selling tens of thousands of banned and restricted pesticides, and allowing such sales to continue even after it was ordered to stop.

In a lawsuit filed last week, prosecutors also claim eBay broke additional federal laws by selling devices used to bypass vehicle emissions controls, and thousands of items containing the deadly solvent methylene chloride, which is linked to increased risk for several types of cancer.

“Some of these products cause motor vehicles to emit … massive amounts of air pollution,” the lawsuit alleges. “Others pose an imminent, and in some cases potentially lethal, danger to human beings. eBay has the power, the authority, and the resources to stop the sale of these illegal, harmful products on its website. It has chosen not to.”

San Jose’s eBay, which connects vendors with buyers and takes price-based sales fees, said Friday that the Justice Department’s “actions are entirely unprecedented and eBay intends to vigorously defend itself.”

According to the lawsuit filed Wednesday by the Justice Department on behalf of the U.S. Environmental Protection Agency in New York federal court, the EPA contacted eBay in 2017 about listings on its platform for unregistered, misbranded or restricted-use pesticides. The agency asked for information on how eBay was addressing sales that were not compliant with the federal act governing pesticides, but the company said it was not subject to that act, the lawsuit claims.

In June 2020, the EPA ordered eBay to stop selling certain pesticides, but the company continued offering “numerous” unregistered, misbranded or restricted-use products, including some named in the order, the lawsuit alleges. Despite a second order in July 2021, eBay continued listing such pesticides, as recently as July 28 of this year, the lawsuit claims. The company illegally sold at least 23,000 pesticide items since 2016, the lawsuit alleges.

The Justice Department also alleges that eBay offered or sold more than 343,000 devices for bypassing mandatory vehicle-emissions controls between January 2017 and September 2020. The products, which can cost $1,000, significantly increase pollution that harms public health by increasing emissions of hazardous particulate up to 37 times and boosting output of other dangerous compounds up to 1,000 times, according to the lawsuit.

Such “defeat devices” have been the target of recent enforcement actions. The EPA in 2020 reported that more than 500,000 diesel pickup trucks in the United States had such units installed. In August, Sacramento-area company Sinister Diesel pleaded guilty to criminal charges and was hit with $1 million in fines and penalties for selling defeat devices for diesel trucks over the previous 10 years. Last year, the EPA fined two companies, one in Arkansas and one in Canada, a total of $1.8 million to settle charges they sold the devices for diesel trucks.

The lawsuit also targets alleged sales of methylene chloride, a solvent banned in the U.S. for distribution since 2019 that has killed people through vapor exposure. The company distributed more than 5,600 items containing the compound  — in concentrations of 30% to 100% — after the ban, the lawsuit claims.

The company, which reported $9.8 billion in revenue last year, said in an emailed statement Friday that it dedicates significant resources, state-of-the-art technology and worker training “to prevent prohibited items from being listed on the marketplace.” The company said it blocks and removes “more than 99.9% of the listings for the products” at issue in the lawsuit.

The lawsuit notes that eBay has policies prohibiting sales of illegal products. The company uses an automated tool for identifying goods violating its policies, conducts “manual sweeps” for products that get past the tool, and employs a “fraud and risk” team that can suspend or restrict sellers trying to evade its controls, according to the lawsuit.

However, the lawsuit claims eBay’s sales algorithms have “promoted, encouraged, and induced” illegal transactions on its platform through search results and suggestions for “related” products, along with emails and coupons. In one purported example in the lawsuit, eBay allegedly sent an email with a $5 eBay coupon to a potential buyer who had previously viewed a defeat device for a Ford pickup truck, with a message calling the illegal product a “must-have.”

In another alleged example, an EPA investigator looked at a listing for a product containing methylene chloride and later received an email saying the item was “re-listed,” the lawsuit claims.

“The email also identified and encouraged the purchase of eight ‘Similar Picks,'” the lawsuit alleges. “Seven of the ‘Similar Picks’ were products containing methylene chloride.”