Op-Ed From CLO of Turo Michelle Fang: Whatever. It. Takes. How eBay Lost Its Moral Compass
If you happened to catch eBay in the headlines Monday, you probably shook your head in utter disbelief. Did at least six eBay employees set out on a months-long campaign of physical and virtual terror against blogger Ina Steiner?
June 16, 2020 at 02:03 PM
11 minute read
If you happened to catch eBay in the headlines Monday, you probably shook your head in utter disbelief. Did at least six eBay employees set out on a months-long campaign of physical and virtual terror against blogger Ina Steiner, which included the sending of a preserved pig fetus, fly larvae, live spiders and cockroaches, a bloody pig mask, pornography, adult entertainers, implied death threats, social media harassment laced with foul obscenities, defacement of property, and the purchasing of equipment to both commit breaking and entering and unlawful GPS monitoring of her automobile? It seems almost too far-fetched to possibly be true. And yet, James Baugh (former eBay senior director of safety and security), David Harville (former eBay director of global resiliency), Stephanie Popp (former eBay senior manager of global intelligence), Brian Gilbert (former eBay senior manager of special operations and one-time Santa Clara police captain), Stephanie Stockwell (former eBay intelligence analyst), and Veronica Zea (former intelligence analyst contractor with eBay), among others, stand accused of doing just that.
EBay used to be a darling of Silicon Valley. It was once a Fortune 100 company and ranked No. 14 on the list of the world's most valuable brands. When I was applying for in-house attorney jobs in the Bay Area in 2006 (before Facebook, before Apple had won back the world with its iPad and iPhones, before Airbnb, Netflix, Dropbox, Box, Uber, Lyft, Zoom, Twitter, Snapchat, TikTok or Postmates) there were three companies most lawyers wanted to work for in Silicon Valley: Google, eBay and Yahoo. While Google was further ahead in terms of popularity, it wasn't by much. In fact, after interviewing at Google and eBay on the same day, I called Google and withdrew my candidacy, accepting an offer from eBay on the spot, as it seemed like a more collegial environment.
I remember eBay showed the most heart-warming video on my first day of orientation that left me in tears. It contained inspiring stories about people whose lives were made better by the eBay community—the story of a WWII veteran who was reunited with his medals and a new community of visitors to his nursing home all due to the eBay community. Also, the story of a wheelchair-bound mother who supported her family by selling goods on eBay. I started my new job off with a true sense of purpose. I might not be a social justice lawyer, but I had the opportunity to do good.
During my nine-year career at eBay, I felt a sense of purpose and integrity in doing my job. I knew that Pierre Omidyar, eBay's founder and board chair, expected good from each of us and he demanded we comport ourselves accordingly. EBay CEOs Meg Whitman and John Donahoe spoke often of eBay's mission. Donahoe once spoke at a leader's day event about going on a retreat where he took a vow of silence and wore a string bracelet to remind him of always staying connected to eBay's purpose.
EBay's legal department was full of former prosecutors and other legal professionals whose prime directive was helping establish eBay as a highly ethical company and build productive relationships with law enforcement. In 2007, I was the in-house lawyer primarily responsible for the Tiffany v. eBay trial. During the trial I watched with pride as eBay's senior vice president of trust and safety, Rob Chesnut, who during his impressive 14 years with the DOJ successfully prosecuted CIA spy Aldrich Ames, testify with credibility in the witness box as to the myriad of ways eBay met and exceeded its legal and ethical obligations in its counterfeiting fight. Judge Richard Sullivan credited Chesnut's testimony in handing eBay a resounding trial victory, which was a credit to us all.
Fast-forward about 13 years from that trial and Monday we read with horror allegations in the DOJ's criminal complaint that eBay's then CEO remarked over emails and text to his chief communications officer about Steiner (the founder of EcommerceBytes, which covers stories on e-commerce companies and is regularly critical of eBay):
"Take her down."
"F*ck them."
"If you are ever going to take her down … now is the time."
And does his chief communications officer instead suggest that a blogger's stories aren't worth getting so exercised about? Or that he will arrange to get some strong op-eds in major publications to make these stories look weak? Or that EcommerceBytes (formerly AuctionBytes) has been dogging eBay with negative press coverage since 1999 and while largely frustrating that is just the way the free press works? No. If the allegations are proven true, he fuels the fire:
"We are going to crush this lady."
To make matters worse, he then forwards the big boss' text command to "take her down" directly to the assembled security team led by Baugh. The CCO allegedly tells Baugh's team he will take any heat from risky actions:
"Anything we can do to solve it should be explored."
I want to "see ashes."
"Whatever. It. Takes"
Baugh and his assembled team appear all too eager to appease and please the CEO and the CCO in their alleged thirst for Steiner's destruction. If the security team did even some of the things alleged, they appear to have broken a number of laws and acted deplorably. But based on the email, text and WhatsApp communications quoted in the complaint, Baugh and his team appeared to believe they were acting with purpose and with moral authority. I suspect that they believed Steiner was the perpetrator of bad deeds by her constant stream of negative stories and their laudable aim to protect eBay justified their "any means necessary" alleged criminal enterprise.
To put this time frame in context, eBay was fending off activist shareholders trying to force their hand on selling off StubHub and its classifieds businesses. No doubt eBay's leadership felt under a wholesale assault and Steiner was just one of the culprits. But it is all so very sad. Lives and careers ruined, and for what? What good has come from any of this? It is tragic for everyone involved, most especially for poor Steiner and her husband. I was never a fan of Steiner's, but she certainly earned nothing more than annoyance from the eBay teams and not the horrible cruelty and harassment that is alleged to have been perpetrated against her.
It may be trite but it is true nonetheless—the tone is set from the top. If the now-charged eBay employees believed that their boss would not have desired or tolerated threats, harassment and cyber stalking, they may not have gone down the very dubious path that they are alleged to have gone down. They appear to have known from the allegations in the complaint that they needed to hide their misdeeds from eBay's in-house lawyers. According to the electronic messages quoted in the complaint, the security team endeavored to thwart the attempts by the in-house legal department to investigate these crimes once alerted to them by the FBI, thereby committing more crimes in the process by allegedly destroying electronic evidence. Knowing, and having interviewed or hired, a number of the very fine lawyers who work in house at eBay now and some likely would have been involved in these investigations, I am not at all surprised by their diligence and desire to do good. While it appears that the security team knew their actions needed to be hidden from the eBay lawyers, they nonetheless felt they had been empowered to undertake—and lavishly expense—the actions that they did.
I can only assume that Federal Bureau of Investigation Special Agent Mark Wilson, whose affidavit was filed in support of the criminal complaint, wanted the reader to be left with the impression that eBay's former CEO and CCO set this criminal enterprise in motion because the DOJ hopes or intends to bring charges against one or both of these men in the future. I would surmise that the DOJ is betting that it can get one or more of the more junior players to flip on these executives in the hopes of avoiding jail time. Much more will be revealed in the coming weeks and months.
I am privileged to work at Turo with a highly ethical leadership team and an inspirational CEO, Andre Haddad, who expects and demands integrity from himself and each of his employees. Coincidentally, my boss and a number of my peers are ex-eBay employees as well. I have complete trust that not a single Turo employee would labor under the misimpression that their leadership team desired from them anything other than complete integrity. What are some of the behaviors I think leaders can employ to encourage ethical behavior from employees?
- Leading by example with integrity from the top down.
- Encouraging every employee from the most junior to the most senior to speak hard truths to power.
- Praising and rewarding demonstrated integrity from managers and employees, even when it can be uncomfortable or inconvenient.
These simple truths remind me of an amazing training workshop that I went through when I was in the eBay legal department. A former NASA astronaut came to speak at an offsite about leadership. He spoke of some of the lessons NASA learned after the tragic Challenger explosion. He said when they faced the hard truths of the failures of that fateful launch, one learning was that the most junior team members, like custodial crews, were not empowered to speak out when they saw a problem on launch day, because calling off a launch was so impactful and expensive. From then on, any single person at NASA could call off a launch if he or she thought they spotted a safety problem and would be publicly rewarded for doing so, even if the ultimate judgment was in error. That lesson really has stuck with me to this day and I try to live and lead by it.
When my former boss and mentor Michael Jacobson, eBay's first general counsel and Silicon Valley's longest-tenured GC, retired in 2015 after serving in the role for 17 years, I asked him about some of his proudest accomplishments during his long and successful reign. Half-jokingly he chuckled, "Part of my job was to keep the executives out of jail and I think I was pretty successful at that." Wise and simple words to live by and easily accomplished if you lead with integrity.
Michelle Fang serves as vice president and chief legal officer at Turo, the global leader in peer-to-peer car sharing. Fang's passion for online marketplaces started when she joined eBay in 2006, where she experienced the sense of community and purpose that marketplaces offer. During her nine-year tenure at eBay, Fang served in a number of leadership positions, including head of global intellectual property, head of North American litigation, and most recently, general counsel of StubHub. Prior to her marketplaces career, Fang worked in-house as a lawyer at NBC Universal and at the Quinn Emanuel Urquhart & Sullivan law firm. Fang is a graduate of University of California, Berkeley School of Law and UCLA. Fang is a passionate advocate for diversity and inclusion in the legal profession. In 2019, she galvanized over 240 GCs and CLOs to release a call to action letter encouraging law firms to further embrace diversity and inclusion. She is also a founding member of The Law in Technology Diversity Collaborative, which united Bay Area tech companies to offer diverse first-year law students with employment and mentorship opportunities.
Note: Defendants in a criminal case are presumed innocent until proven guilty. All allegations are taken from the court filings in United States v. Gilbert, USDC Mass., May 22, 2020 (20-cr-10098). I have no personal knowledge as to their truth or accuracy. The views expressed herein are mine alone and do not reflect the views of my past or present employers.
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