By James V. DeLong
“Whom the gods would destroy, they first make mad.” —Euripides
Amazon abruptly de-platformed Parler last week, terminating its web services hosting account with a speed and lack of notice clearly designed to ruin the company.
Amazon covered up this action by a fig leaf of allegations that Parler did not adequately control incitements to violence, or that someone might sometime use Parler to suggest that someone think about using violence, ignoring the extent to which Facebook, Twitter, and other social media freely allow all sorts of Progressive groups to glorify, incite, and condone violence.
By doing this, Amazon has exposed itself to an impressive spectrum of risks, both legal and business. Parler has already filed suit.
Most obvious are contract liabilities. Amazon clearly violated its terms of service, which require adequate notice. In addition, a fundamental of contract law is that every contract contains an implied covenant of good faith and fair dealing, an obligation violated by destroying a company at the behest of a competitor or political opponent.
Parler also alleges violation of the antitrust laws in that Amazon’s action was designed to help another of its hosting customers, Twitter, a clear transgression if there was any communication between the two.
Moving on, some serious civil rights claims exist. If Amazon and Twitter talked about this action with government officials, then those officials are liable for violating Parler’s constitutional rights in several ways, which makes Amazon and Twitter a part of a conspiracy to this end. Violation of First Amendment free speech rights is the most obvious. Also, though, Amazon and Twitter seem to be interfering with Parler’s efforts to find alternative hosting and legal representation, which would, I submit, transgress the Privileges & Immunities clause of the 14th Amendment.
Given the incestuous current relationship between Big Tech and the Democrats, it is almost a certainty that such conversations took place.
The media, naturally, pooh-poohed the claims and trotted out various experts to minimize them. In fact, though, Amazon’s defenses look thin and would, I would bet, crumble in actual litigation, given an honest court.
The dubious legality of Amazon’s action raises two possibilities about the role of Amazon’s lawyers in this affair, both of which are disturbing.
The first is that the censors did not ask the lawyers, but simply did it or overrode legal cautions. This would mean that the company’s employees are out of control and indifferent to the welfare of the company itself, answerable only to the demands of their woke religion. Note, in particular, that cutting off Parler was of no benefit to Amazon, which bore no responsibility for Parler’s supposed failure to police its users.
The second is that the lawyers gave them the go-ahead on the grounds that thelegal profession is now so corrupted that no court would dare to find for Parler, however meritorious its case. (The courts’ refusal to hear about election fraud supports this theory.) Also, just as lawyers who tried to represent Trump were bullied and intimidated, Amazon might feel certain of its ability to prevent Parler from obtaining adequate representation.
Take your pick of these possibilities, but either creates big business risks for Amazon.
Assume that you are chief information officer of a large company. How can you justify using Amazon as your host server, knowing that you are now naked to the whims of its censors or to the machinations of a competitor with better connections at Amazon than you have? And that Amazon is contemptuous of your ability to get legal relief? Today’s action seems to be a combination of ideology and avarice, but pure financial corruption will not be far behind.
Furthermore, if the CIO queries Amazon about it, what can the company do to reassure him? Nothing. One of the most important assets of any organization is the ability to make a credible promise, and Amazon has, in one stroke, destroyed this asset in a way that is impossible to fix.
When I sometimes get gloomy about the long-term economic prospects in the U.S., a friend in the investment community likes to remind me that America has a big competitive advantage in the form of the rule of law, or “the insiders aren’t allowed to rob you blind!” Amazon has decided to prove him wrong.
As a matter of business prudence, it will be hard for a CIO to justify staying with Amazon. This will be especially true for global companies, which rightly fear the incestuous relations between Big Tech and the new administration. Moving operations offshore looks sensible, if you can find a nation less subject to this toxic stew of woke madness and crony greed.
If you think corporations all over the world are not thinking about this, recognize that directors’ liabilities have expanded greatly over the past few years, largely at the behest of the left. Consult a handbook published by the Seattle-based law firm Perkins Coie on the duties of corporate directors, and judge how well a director meets these if he does not weigh seriously the risks of placing the corporation’s existence at the whims of anonymous Amazon bureaucrats.
The hosting service is the most important part of Amazon’s business, and the deplatforming of Parler will ramify on the consumer side. Asking conservatives to boycott Amazon is not a good idea, because it is an important outlet for small businesses and independent authors. But action is still possible. One can seek out alternatives, or use Amazon to search for products and then order elsewhere. One can return things more readily, or switch from Prime TV to Roku. For Amazon to motivate 75 million conservatives to find ways to annoy it is a dubious business strategy. (Amazon’s directors had better read that handbook, too.)
None of these consequences will play out quickly, but forces have been set in motion that will, in the long run, be detrimental to Amazon.
So, in addition to Euripides, consider an observation of Robert Conquest: “the behavior of any bureaucratic organization can best be understood by assuming that it is controlled by a secret cabal of its enemies.” Or, perhaps, re-read “Ozymandias.”