Misuse of Amazon data could be its downfall, lawsuit says – Multichannel Merchant
Amazon Echo Dot (Photo by Andres Urena on Unsplash)
An Amazon shareholder is suing founder and executive chairman Jeff Bezos, along with current CEO Andy Jassy, chief financial officer Brian Olsavsky, other executives and the entire board, claiming that improper use of customer data could lead to widespread mistrust and destroy the business.
According to a lawsuit filed by shareholder Stephen Nelson, as reported by the Seattle Times, at least 14 class action lawsuits and 75,000 individual cases could result in damages and judgments “astronomical to the point that the company could be put out of business if violations are not immediately addressed, stopped and corrected.
In the lawsuit, the Seattle Times says Nelson accuses Amazon management of misleading investors about how its alleged misuse of biometric data and potential breaches of Amazon’s biometric privacy law Illinois could result in financial and legal risks.
Amazon’s use of consumer biometric data, captured through the use of its Rekognition facial recognition technology as well as Alexa devices, and stored on Amazon Web Services, is the basis of much of the litigation it faces. faces, the retrial says. It also calls for the addition of cybersecurity and consumer privacy experts to Amazon’s board.
The board dismissed shareholder concerns about litigation exposure risks, according to the lawsuit, and the defendants signed “false statements” about Amazon’s compliance with state laws. This “jeopardizes and harms one of Amazon’s most important (and fragile) assets: consumer confidence,” the lawsuit states, according to the report. “Reputational damage is particularly devastating for technology companies like Amazon.”
Amazon, along with other ‘big tech’ companies, Google’s parent Alphabet, Facebook and Apple, have faced mounting pressure from Congress amid calls for them to break up over allegations of monopoly power . Additionally, the Federal Trade Commission investigated Amazon’s possible use of anti-competitive practices regarding its third-party sellers.