Craigslist vs. eBay: what you won’t find in company PR releases
It was speculated when eBay purchased over 25% share in Craigslist that eBay is on a fishing (not phishing) expedition to observe craigslist’s success and then copy it. It is a known fact that beyond it’s founder’s innovative idea to create an online auction, eBay’s executive team has not invented anything since. eBay’s management is great at spending it’s cash on mostly miss (Skype) sometimes hit (PayPal) acquisitions. Less then a month ago we have commented on a eBay vs. Craigslist lawsuit which set the stage for Craigslist initiating their own proceedings against eBay. The full document is available here and it provides some interesting insights into what allegedly goes on behind the scenes. Read the document, it provides a peak into the world of corporate espionage, false advertising, deception and other corporate shinnanagans you won’t find in official company press releases.
eBay is certainly not a stranger to being accused of unfair play and facing substantial fines and penalties for it’s mistakes. Here is a abbreviated history of some legal processes she has faced or is currently litigating:
August 11, 2003 SHARE PRICE 25.46
eBay Accounts for Lawsuit Loss: The auction giant shaves $30M from Q2 results after a patent verdict against it was upheld last week but says it will appeal. February 28, 2008 Case MercExhange vs. eBay settled, As a part of the settlement, eBay purchased all three patents from MercExhange involved in the lawsuit, and related technology and inventions, as well as a license to another search-related patent portfolio that was not asserted in the lawsuit
July 30, 2004 SHARE PRICE 39.16
PayPal Sends Users Notice of Class-Action Lawsuit Settlement: PayPal and plaintiffs reached a settlement in the class-action lawsuit stemming from 2002, when two PayPal users filed class action lawsuits against the online payment service owned by eBay. Some of the accusations by the plantiffs were that, as of early 2002, PayPal was understaffed, hid its customer service phone numbers to save money, had rude and unhelpful phone staff, did not answer customer service email, and “without notice or warning, erroneously and unnecessarily” limited or closed accounts and then made it difficult to restore the accounts.
June 22, 2004 SHARE PRICE 43.60
Tiffany Sues eBay over Fakes : Tiffany said 73% of items purchased on eBay in a study it conducted were counterfeit
April 29, 2005 SHARE PRICE 31.71
Tentative Settlement Reached in eBay Stock ‘Spinning’ Lawsuit : the settlement calls for the payment to eBay of $3 million by Meg Whitman, Pierre Omidyar, Jeffrey Skoll and Robert Kagle, who are officers/directors/controlling stockholders of eBay, and a payment to eBay of $395,000 by Goldman Sachs Group, eBay’s investment banking firm.
In June 6 2006 SHARE PRICE 31.59
Net2Phone, Inc. filed a lawsuit in the U.S. District Court for the District of New Jersey (No. 06-2469) alleging that eBay Inc., Skype Technologies S.A., and Skype Inc. infringed five patents owned by Net2Phone relating to point-to-point Internet protocol. The suit seeks an injunction against continuing infringement, unspecified damages, including treble damages for willful infringement, and interest, costs, and fees
August 7 2006 SHARE PRICE 24.12
Louis Vuitton Malletier and Christian Dior Couture filed two lawsuits in the Paris Court of Commerce against eBay Inc. and eBay International AG. Among other things, the complaint alleges that we violated French tort law by negligently broadcasting listings posted by third parties offering counterfeit items bearing plaintiffs’ trademarks, and by purchasing certain advertising keywords. The plaintiffs seek approximately EUR 37 million in damages.
September 6 2006, SHARE PRICE 27.53
Parfums Christian Dior, Kenzo Parfums, Parfums Givenchy, and Guerlain Société also filed a lawsuit in the Paris Court of Commerce against eBay Inc. and eBay International AG. The complaint alleges that we have interfered with the selective distribution network the plaintiffs established in France and the European Union by allowing third parties to post listings offering genuine perfumes and cosmetics for sale on our websites. The plaintiffs in this suit seek approximately EUR 9 million in damages and injunctive relief
April 26th, 2007 SHARE PRICE 34.22
eBay, PayPal face court action Class action alleges unfair monopoly: eBay warned shareholders yesterday that it is facing a possible class action suit in the state of California and is likely to be hit by more patent cases. The suit alleges that eBay and PayPal acted “to improperly ‘monopolise’ the forms of payment that sellers can use on eBay”.
August 2007 SHARE PRICE 33.54
class-action lawsuit in which attorney John Fabry stated, “eBay has been deceiving millions of consumers over the years by claiming their auctions start when submitted, when in reality they do not begin for at least several hours, and up to 24 hours. However, the clock starts running on your selected auction time even though eBay hasn’t posted it yet
Jan. 10, 2008 SHARE PRICE 30.36
Lawsuit Filed against eBay Over Coin Listing Policy: The American Numismatic Association (ANA) and the Professional Numismatists Guild (PNG) are suing eBay for defamation and unfair and deceptive trade practices
May 13, 2008 SHARE PRICE 31.41
Craigslist has filed a countersuit against eBay, alleging that the auction site used its minority stake in Craigslist to engage in unfair and unlawful anticompetitive behavior, false advertising, trademark infringement, and other misdeeds.
Update: 5-15-2008 Craigslist illustrates on their blog how eBay uses deceptive advertising on Yahoo providing a screenshot of advertisements eBay ran up even on the morning of 5-14-2008. Interestingly enough, if you try to search on Yahoo for www.craigslist.org or craigslist.org those deceptive ads no longer appear.