What is the appropriate course of action, from an in-house leader's perspective, when federal prosecutors accuse six former employees, several of whom held senior roles, of conspiring to terrorize a blogger and her husband with thinly veiled death threats, a bloody pig mask and prank deliveries of pornography magazines, live roaches, fly larvae and spiders? 

EBay Inc. general counsel Marie Oh Huber and chief people officer Kristin Yetto responded, at least in part, by sending a memo Monday to staffers stressing that the allegations were "deeply troubling" and deviated from the San Jose, California-based e-commerce firm's cultural values. 

"The actions of the former employees are completely unacceptable and simply do not align with who we are at eBay. We do not tolerate this kind of behavior, and the company has apologized to the affected individuals," Huber and Yetto wrote in the staff memo obtained by Corporate Counsel.  

"You know we're committed to conducting our business ethically, consistent with our cultural values and eBay's Code of Business Conduct & Ethics," they added. "We prioritize ethics topics in compliance training and ask leaders to make the discussion of business ethics a regular topic in conversations with their teams. Why? Because how we do things is just as important as what we do." 

Attempts to speak with Huber were unsuccessful. She and Yetto stated in the memo that they expected "news stories and attention" from the case, and asked employees to avoid engaging with reporters. 

Several former in-house leaders at eBay were shocked and saddened to see the company involved in such a scandal, which has resulted in felony conspiracy, cyberstalking and witness tampering charges against the six ex-employees. 

"Very sad," Mike Jacobson, who served as eBay's top lawyer from 1998 to 2015, wrote on LinkedIn. 

"I'm stunned," remarked Rob Chesnut, eBay's former senior vice president of global trust and safety.

"It's mind-boggling," Michelle Fang said Tuesday in an interview. She served as eBay's head of litigation and global intellectual property and, later, as general counsel of StubHub when it was an eBay company. She left StubHub in 2015. 

"I think I'm grieving for a place that feels gone in terms of the integrity that I felt like I was a part of when I worked there," she added. 

Fang was so disturbed by the allegations in the complaint that she stayed up all night writing an op-ed about eBay losing its moral compass. She blamed the company's executive leadership for setting the wrong tone at the top. 

"In this case, there's no indication whatsoever that the legal department was aware of this," she noted. "They seemed like they were trying to cooperate earnestly with [law enforcement] but they were thwarted by this group of employees who started destroying materials." 

According to the complaint, the ex-employees in question lied to in-house counsel, refused to meet with eBay's outside counsel during an investigation, and deleted data from their work phones. 

Still, eBay's legal department, which Corporate Counsel honored as "Compliance Department of the Year" in 2019, is left to deal with the fallout from the case, which could erode the relationship that the company built over several years with law enforcement agencies in an effort to combat crime, according to Fang. She remains in touch with several in-house lawyers at eBay.  

"It's gut-wrenching," she said. "I can imagine the lawyers who are there that I know, just how in knots I'm sure they are that this was happening underneath their watch and they [the former employees in question] were thwarting their efforts to do the type of work they were hired to do." 

In separate interviews, Fang and Chesnut both homed in on inflammatory language that two of eBay's top brass, identified in the complaint only as "Executive 1" and "Executive 2," used in messages about Ina Steiner, co-founder and editor of EcommerceBytes, and her husband, after they published critical blog posts about eBay and its business practices. 

For instance, Executive 1 told Executive 2 in a text message: "We are going to crush this lady."

In another exchange, Executive 2 ranted about Steiner and her husband in an email, writing that their posts gave him "ulcers, harms employee moral [sic], and trickles into everything about our brand. 

"I genuinely believe these people are acting out of malice and ANYTHING we can do to solve it should be explored," the executive added. "Somewhere, at some point, someone chose to let this slide. It has grown to a point that is absolutely unacceptable. It's the 'blind eye toward graffiti that turns into mayhem' syndrome and I'm sick about it. Whatever. It. Takes."

"When you're a leader at a company, there's a real danger to using phrases like that," Chesnut said, referring to the executive's "Whatever. It. Takes." statement. 

Fang said, "My concern is what kind of culture exists at a company where not one, not two, not three or four or five but more employees interpret 'Whatever it takes' to full empowerment to go on an alleged crime spree?"

She added, "No one that works for me would ever interpret 'Whatever it takes' to commit a crime. I don't hire people like that and no one would ever think that I would condone or reward that type of behavior."

One of the defendants, James Baugh, former senior director of safety and security at eBay, held out Executive 2's email as evidence that the company's leadership supported the harassment campaign, which occurred in 2019, according to the complaint. EBay fired the involved employees in September, according to Huber and Yetto's memo, and named a new CEO earlier this year. 

Aside from sending the roaches, spiders and larvae, Baugh and his co-defendants allegedly advertised the Steiners' residence on Craigslist as the location of a swingers party and an estate sale. They also sent the couple a book about surviving a spouse's death and, later, a sympathy wreath, according to the complaint. 

An attorney for the defendants, William Fick of Fick & Marx in Boston, did not respond to messages seeking comment. 

"The eBay I knew would never have allowed something like this to happen," said Chesnut, who left the company in 2008.

"A recovery from this has to come directly from the top," he added. "There needs to be a very clear message from all leaders, the general counsel, the CEO, that this is not what we're about."

Below is the memo from Huber and Yetto to staff:

Team,

Today we issued a press release following indictments against former eBay employees announced today by the U.S. Attorney's Office in Massachusetts. Neither eBay nor any current employee was indicted.

For some background and context, in August 2019, local law enforcement in Massachusetts contacted eBay about suspicious actions by security personnel toward a blogger, who writes about eBay, and her husband. The people responsible for these actions hid them from the company. Upon learning about these allegations, we immediately launched a comprehensive investigation into the matter. As a result of the investigation, our company terminated all involved employees in September 2019. We also fully and extensively cooperated with law enforcement. To preserve the integrity of law enforcement's investigation, we have not previously communicated about this matter until today.

The details of this case are deeply troubling, particularly given the emphasis we place on living and working in line with our Cultural Values every day.

The actions of the former employees are completely unacceptable and simply do not align with who we are at eBay. We do not tolerate this kind of behavior, and the company has apologized to the affected individuals.

You know we're committed to conducting our business ethically, consistent with our Cultural Values and eBay's Code of Business Conduct & Ethics. We prioritize ethics topics in compliance training and ask leaders to make the discussion of business ethics a regular topic in conversations with their teams. Why? Because how we do things is just as important as what we do.

Our success is based on openness, honesty, integrity and trust. If you see something that raises an ethical question, we want you to speak up. Raise any concerns, whether that is with your colleagues, a people manager, your supervisor, or the VP of your team. You can also always feel comfortable contacting anyone on the People Team, a Business Ethics Officer, the Compliance team or the Integrity Helpline. When you speak up, you're helping keep eBay a great place to work.

We expect these developments to trigger news stories and attention. Please don't engage and if you receive an inquiry from the media, investors or analysts, send it to [email protected].

We have an outstanding team across the organization and colleagues who make eBay a great company. Let's continue to serve our customers and make a positive difference for everyone who depends on us.

Thank you for your dedication and hard work.

Sincerely,

Kristin & Marie

Kristin Yetto, Chief People Officer

Marie Oh Huber, Chief Legal Officer