The claimants, who say they bought autographed sports memorabilia on the site that later proved to be faked, want the courts to rule that EBay has a duty of care to ensure that only legitimate goods are sold on its site.
EBay, which has mushroomed in size and profitability on the premise that it acts only as a sales forum, with no responsibility to vet goods, continues to argue that it cannot be held responsible for fraudulent transactions.
The claimants have won the first round in their fight – a Californian judge has ruled that the lawsuit may proceed, going against EBay’s request to have the case dismissed. California has a State law governing the sale of sports memorabilia.
The case is likely to hinge on whether it can be argued that EBay is a “content” rather than a “service” provider and, as such, whether it can be held responsible for the claims of its vendors. EBay argues that as it does not list items for sale or describe them, it cannot be deemed to be an auctioneer. A further argument the company is using to support its case – that it does not have the items in its possession at any time – is weaker
as the same may be said for some of the items sold online through major auction Websites such as sotheby’s.com.
The significance of the ruling can be set against the perspective of EBay’s size and worth. Several million items are thought to be on offer on the site at any one time and results released this week showed a $15.2m profit for the last quarter on a revenue of just under $103m from a turnover of $1.4bn.
If the claimants win their case, such volumes of trade could collapse under the bureaucracy needed to vet every item being offered for sale.
Lawsuit threat to EBay vision of ecommerce
SIX claimants have refiled a case against online sales giant EBay that, if successful, could deal a fatal blow to the company’s global status and have huge implications for Internet sales worldwide.