[Milsurplus] EBay starts (Free) Classified Site - OT

[Bruce]

Hello,


In April 2008, eBay announced it was suing Craigslist to "safeguard its 
four-year financial investment."  eBay claimed that in January 2008, 
Craigslist executives took actions that "unfairly diluted eBay's economic 
interest by more than 10%."  In response, Craigslist filed a countersuit 
against eBay in May 2008 "to remedy the substantial and ongoing harm to 
fair competition" that Craigslist claims is constituted by eBay's actions 
as Craigslist shareholders.


 From TechCrunch
---------------
Following the lawsuit eBay filed against Craigslist two weeks ago, 
Craigslist is punching back today. In a countersuit (complaint embedded 
below), Craigslist wants back the 28.4 percent of its shares that eBay 
bought in 2004. It also wants the court to award Craigslist eBay’s related 
profits, and punitive damages on top of it all. Craigslist is accusing eBay of:

     "unlawful and unfair competition, misappropriation of proprietary 
information, deceptive passing-off, business interference, false 
advertising, phishing attacks, free-riding, trademark infringement, 
trademark dilution, and breaches of fiduciary duty."

The complaint ... goes on to allege that eBay used its position as a large 
minority shareholder to try to learn competitive secrets from Craigslist, 
while launching competitor Kijiji in Europe. Now that Kijiji has entered 
the U.S. and is going straight for Craigslist, the gloves are off.


 From the Craigslist Blog:
-------------------------
Delaware Trial Begins

Trial starts in Delaware today, with eBay claiming craigslist’s directors 
acted inappropriately in implementing governance measures designed to 
protect the long term mission and values of craigslist.

Separately, craigslist has filed suit in California charging eBay with 
unlawful and unfair competition, misappropriation of proprietary 
information, business interference, false advertising, phishing attacks, 
and breaches of fiduciary duty. This suit will proceed after the Delaware 
trial, but will probably not be presented to the jury until late 2011.

Delaware testimony will encompass eBay’s 2004 purchase of craigslist stock 
from a former shareholder.  craigslist is a private company that does not 
publish its financial information, and eBay and craigslist both agreed that 
the terms of this transaction should not be made public. However, these 
details will now likely be subject of testimony at trial.

As a condition for its 2004 stock purchase from a former shareholder, eBay 
insisted on acquiring special rights over Craig’s and Jim’s shares (e.g. 
rights-of-first-refusal over any sale of their shares), and special rights 
from craigslist (e.g. veto rights over mergers and acquisitions), for which 
it collectively paid $16 million. This sum was distributed to craigslist’s 
shareholders, in part because had it not been distributed, eBay would have 
had a pro rata claim on any portion retained by the company, effectively 
paying itself for the rights it purchased.  eBay’s special rights 
terminated in 2007, when it launched Kijiji in the US.

Also subject to testimony will be eBay’s misconduct, and abuses by eBay of 
its position as a shareholder of craigslist - evidence of and suspicions 
regarding which informed the craigslist board when the corporate governance 
protections in question were researched, deliberated upon, and ultimately 
adopted.


73, Bruce WA8TNC
=============================
joldenburg2 at new.rr.com wrote:
> What's even odder than the fact that e-bay owns Craigs list is this site looks 
> exacly like Craigs list on the search area home page. The e-bay style photo's on 
> the item list's is nicer  though. 
>  
> Perhap's this is the first move on them phasing out Craigs List??????????? 
> ---- David Stinson <arc5 at ix.netcom.com> wrote: 
> 
> =============
> I thought Ebay bought part of Craig's List.
> Why on Earth would they go to the expense
> to compete with their own investment?  
> And how do "free" classifieds make money for them, anyhow.