I'm not an expert at corpo terminology either, so maybe "middle management" is wrong, but I'm certain "senior director" is still not part of the executive ranks.
Wikipedia has an overview about all of this: https://en.wikipedia.org/wiki/EBay_stalking_scandal
I don't think the employees/managers were just fall guys, but I don't believe for a second the execs knew nothing about what they did. And I find it suspicious that the employees seemingly plead guilty without a lawyer, as the article you're quoting says.
