Samsung accuses India antitrust body of detaining employees, seizing data unlawfully

By Arpan Chaturvedi and Aditya Kalra

NEW DELHI (Reuters) – Samsung has accused India’s competition watchdog of unlawfully detaining its employees and seizing data in a raid carried out in connection with an antitrust investigation on Amazon (NASDAQ:) and Walmart (NYSE:)’s Flipkart, a legal filing shows.

Samsung is embroiled in the Competition Commission of India’s (CCI) investigation that in August concluded that the South Korean giant and other smartphone companies broke anti-trust laws by colluding with Amazon and Flipkart to exclusively launch products online.

Samsung’s Oct. 11 filing in the High Court in northern city of Chandigarh seeks to quash the investigation findings related to conduct of the company, arguing the CCI had illegally seized material from its employees during a 2022 raid at one of Amazon’s vendors.

Three Samsung employees were present in the vicinity of the search when the watchdog’s officials detained them, seized their phones and copied all the confidential and privileged data, the company said in its 32-page filing, which hasn’t been made public.

“The entire search exercise undertaken … is patently illegal and any material collected thereunder should not be relied upon and should be promptly returned,” the Indian unit of South Korea’s Samsung Electronics (KS:) wrote.

The CCI “should be prohibited from using or relying upon the data and information unlawfully collected,” it added.

Samsung and the CCI did not respond to Reuters queries.

Samsung has obtained an injunction from the High Court that has put on hold the CCI proceedings, but the court has not yet ruled on its requests to return the data seized and to not allow the commission to rely on it.

The CCI has challenged Samsung and 22 other parties that have won similar injunctions from high courts across India, and last week asked the Supreme Court to hear all challenges together, saying the companies were trying to scuttle the investigation.

The CCI investigation had found that Amazon and Flipkart both breached competition laws by favouring select sellers on their platforms. Amazon and Flipkart have repeatedly denied wrongdoing, even as brick-and-mortar retailers continue to complain about their deep discounting and other practices.

In its court filing Samsung also asserted that it was wrongly found to have breached competition laws in collusion with Amazon and Flipkart, even though it had been cooperating with the watchdog and providing information only as a third-party in the case.

The inclusion of smartphone makers in the Amazon and Flipkart investigation could increase legal and compliance headaches for the likes of Samsung.

In the August investigation reports, the CCI noted that Samsung was involved in the practice of exclusive phone launches on Amazon and Flipkart, saying “exclusivity in business is anathema” and against free and fair competition.

According to Counterpoint Research Samsung is one of India’s biggest smartphone player with a 14% market share. Datum Intelligence estimates that 50% of phone sales were online last year, up from 14.5% in 2013.