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Judge Throws Out Ebay Antitrust Lawsuit

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The most visited U.S. e-commerce site, EBay Inc., no longer faces a lawsuit by three sellers claiming it monopolizes the online auctions market and the method to pay for goods bought there. The judge ruled the sellers failed to show that they — or anyone else — had been injured by EBay’s alleged behavior.

In the suit, EBay was accused of anti-competitive behavior, including the acquirement of the PayPal peer-to-peer payment service in 2002. Paypal, purchased by EBay for $1.18 billion, processed more than 40 percent of the $52 billion in merchandise sold on EBay in 2006, the year before Michael Malone of Texas first filed the lawsuit.

The sellers sought class-action, or group status, and a finding that EBay violated antitrust laws and illegally restrained trade, plus an award for unspecified money damages. The group was forced to pay “artificially inflated and supra-competitive fees to EBay,” according to a consolidated complaint filed in May 2007.

“We are gratified that the court rejected plaintiffs’ claim as baseless,” EBay Deputy General Counsel Mary Huser said yesterday in an e-mailed statement. “With this meritless suit behind us, we can continue to focus on our core business of providing platforms that bring buyers and sellers together to transact online.”

“Plaintiffs challenge virtually everything that EBay has ever done,” the company said in court papers asking Fogel to throw out the lawsuit. “Every one of the acts identified by plaintiffs crosses no antitrust line.”

By: dotCOMreport Editor
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dotCOMreport Editor is our Chief Editorial department here at dotCOMreport most of our articles come through this department prior to being published here on the dotCOMreport.

6 Responses to “Judge Throws Out Ebay Antitrust Lawsuit”

  1. jeremy says:

    Talk about harm. Tens of thousands of sellers are about to go OUT OF BUSINESS IN THE NEXT MONTH! How is that for harm???? Ebay is now forcing sellers to have 99 percent or better DSR Ratings in all of 5 categories, or be relegated to 'substandard seller' More than one grade of less than 3 stars – PER HUNDRED, and your finished. Once achieved, paypal holds all proceeds of all sales that occur in the next 40 days, all proceeds being held for 21 days. Of the sale proceeds, the shipping is also withheld, leaving the seller to pay the shipping. 80 percent of the time, ebay fees will become due and collected a full seven days before the seller is paid. If uncollected, the seller account will be frozen and in default, leaving them subject to another six weeks of 21 day paypal freezes – for what? The monthly interest on the billion in frozen funds, or about 40 million dollars per month.

  2. megasheng says:

    Can i get a new one for this, f I had been able to accept a money order like I used to, I would have saved the $21.97 in PayPal fees and if I could have charged the actual shipping; again like I used to, I would have saved the other $5. So, I have been “harmed” nearly $27 (5%) on this sale alone by their exclusivity requirements.

  3. Captain Scott says:

    I just sold an item on eBay for a fair price of $725. I was forced to accept only PayPal as the form of payment. I was also forced to use eBay’s shipping calculator. All-tolled eBay/PayPal collected 97.72 in fees for this sale. In addition, eBay’s shipping calculator underestimated the shipping by right at $5. Together with the total fees, I incurred a 14% cost in this transaction. If I had been able to accept a money order like I used to, I would have saved the $21.97 in PayPal fees and if I could have charged the actual shipping; again like I used to, I would have saved the other $5. So, I have been “harmed” nearly $27 (5%) on this sale alone by their exclusivity requirements. I have other auctions ending soon; from which I expect the same financial results; after which I will NEVER AGAIN use either my 13 year old eBay account or my 11 year old PayPal account. They have become WAY too greedy in the current economic environment. So; include me in the NEXT class action suit against this monopoly if “harmed” individuals are needed!.

  4. None of the other online market place sites have their own payment processing system. eBay/Paypal is a monopoly whose strategy is to just side with the buyer.

    What needs to be done is to have a JURY TRIAL to determine this case and not a sole Judge.

  5. brian says:

    between ebay and paypal, they earn 20% of your sale and if the buyer asks for a refund, you obliged to pay them their full amount, and paypal represents itself as covering the cost for the buyer, but the fees remain, such that the service does absolutely nothing for the seller. It's a ripoff to use them to sell unless your profit margin on goods is well over 20%

  6. JohnCho says:

    Any lawsuit alleging antitrust or a monopoly is almost doomed to fail. Given ebays decline and competition from Amazon, eCrater, Bonanzle and other sites any claim ebay is a monopoly won't fly and proving antitrust is very very difficult. It's surprising a law firm even agreed to take this case.

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6 Comments 351 Views