Amazon Greece fight heats up

Amazon.gr, sued by Amazon.com, strikes back with allegations of its own.
Written by Michael Fitzgerald, Contributor and  Joel Deane, Contributor

Greg Lloyd Smith, the Greece-based businessman sued by Amazon.com for an allegedly "thinly veiled shakedown" over his Amazon.gr and Amazon.com.gr sites, says he is planning a countersuit against the e-retailing giant for, among other things, allegedly hacking his site.

"We will sue them. There is no two ways about it," said Smith, managing director of CITI Services, which owns "Greece's Biggest Bookstore", Amazon.gr. "They are trying me in the media. They are sullying our name and they are trying to destroy us."

Meanwhile, Amazon.com spokesman Bill Curry dismissed Smith's charges as "pure drivel".

Amazon.com filed suit in Delaware federal court on Wednesday, accusing Smith of violating the federal Racketeer Influenced Corrupt Organisation (RICO) statutes, which were written to combat organised crime. According to the Amazon.com suit, Smith and his wife, Aikaterini Theochari, approached it on 3 May, offering to sell the Seattle-based online retailer a controlling interest in CITI Services for $1.63m. Amazon.com also sued CITI Services in Syros, Greece, claiming unfair competition over the use of the Amazon.gr and Amazon.com.gr domains. (CITI Services is a US company registered in Milford, Del.; it owns CITI Services, which is registered in England, Wales and Greece, and runs Amazon.gr.)

Curry claimed the effort to get Amazon.com to try to buy CITI "was a thinly veiled shakedown".

Speaking from Greece on Thursday via telephone, Smith, who said he is a US citizen, strenuously denied Amazon.com's charges, and complained he was characterised as a "mobster" and a "Greek squatter" in an earlier ZDNN story.

"These allegations of being a mobster and a squatter] are really unacceptable to me. We took the name with every intention of operating, and do operate, the Amazon Greece site," he said. "We have the legal right to use the name here [in Greece]. They do not." Smith said Amazon.com's RICO filing "has no basis whatsoever. It gets used to scare people. Well, it doesn't scare us."

CITI will file its own suit against Amazon.com in Delaware next week, Smith said, for allegedly hacking Amazon.gr on 23 July and deleting its book database. He also alleged Amazon.com had been attempting to overload his site's servers by "pinging" its ad banners. "They're pinging our banners. It ties up the server and can cause the server to crash," he said.

However, Amazon.com's Curry dismissed Smith's charges. "This is not something that's going to be resolved by him and us arguing in the media. It's going to be resolved in court. That's the reality of it," he said. "I have been to his site to see what he is ripping off from Amazon.com... It doesn't mean I am hacking his site. It's all pure drivel."

While Smith initially approached Amazon.com via a letter dated 27 October, 1998, the central issue in the Amazon.com suit is Smith's 3 May letter to Amazon.com CEO Jeff Bezos -- the letter that Curry calls "a thinly veiled shakedown". In that letter, which CITI faxed to ZDNN, Smith told Bezos that Amazon.gr is "now open for business", then sketched out "an opportunity to you and your company".

"As you are aware, Amazon.com is prevented in Greek law from owning a .gr domain name... In other words, even if we wanted to sell this site to your company we could not," Smith wrote, then pointed out that the site's parent US company, CITI Services, was planning an IPO.

"The owner of the US-based company owns and controls, among other things, the assets in Greece... Therefore, at this time, Amazon.com could obtain the entire block of shares -- representing 49 percent of the corporation for $980,000," he wrote.

"Amazon.com may not wish to take what would be considered a minority share in this company. Therefore I can confirm that my wife and I would be willing, at this time, to part with either a portion of or our entire holding at $8 per share -- a further $1,632,000. As you know, this company owns barnesandnoble.gr, book.gr and several other lucrative domains."

Smith told ZDNN that it was "outlandish" to consider his 3 May letter to Bezos extortion. He also said he was withdrawing CITI Services's IPO because he had a "gentleman's agreement" with an unnamed US company to sell CITI for $30m.

Editorial standards