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Ina Steiner EcommerceBytes Blog
News and insight focusing on ecommerce.
by Ina Steiner, Editor of EcommerceBytes.com
Wed Aug 1 2012 14:51:20

Seller Sues eBay Over Unpaid-Items Relisting Policy

By: Ina Steiner
Sponsored Link
When is an eBay order not really an order? When the buyer clicks Buy It Now but does not pay for the item. One Florida seller is apparently so fed up with his experience dealing with a deadbeat that he sued eBay this week over its policies in dealing with the issue.

In a lawsuit filed this week, the plaintiff, Luis Rosado, says eBay "delists" listings when buyers click the "Buy It Now" button. "However, eBay does not require the buyer to actually pay for the item before delisting it." If the sale does not occur, eBay does not compensate sellers who have paid to list the item for the full duration, he claims.

According to the lawsuit, "eBay refuses to fully refund their listing fees under any circumstances or, alternatively, provide the remainder of days to relist their items without incurring additional fees. This includes instances where eBay affirmatively commands the seller not to complete the transaction."

The plaintiff states that while prospective sellers know they won't receive a refund if their item runs its course and does not sell, "they have no reason to suspect their item may be delisted prematurely by a prospective buyer clicking the "Buy It Now" button but not paying."

The lawsuit states, "Plaintiffs and class members are entitled to and seek through this action restitution of, disgorgement of, and the imposition of a constructive trust upon all profits, benefits, and compensation obtained by Defendant from its improper conduct as alleged herein."

Courthouse News has a nice recap of the lawsuit and Rosado's experience in listing his car on eBay Motors. This case may be more limited than it first appears since eBay Motors works a bit differently from eBay.com listings - class action lawsuits define the class very specifically. (Note: I always get emails asking for the contact information of plaintiff's lawyers, so here it is: Initiative Legal Group APC in Los Angeles, www.initiativelegal.com.)

eBay.com's Unpaid Items policy can be found on this page and states: "When an unpaid item case closes without payment from the buyer, sellers are eligible to receive a final value fee credit to their eBay seller account. Also, if they relist the item and it sells the second time, eBay may refund the insertion fee for the relisting. Learn more about how the free relist policy works."

eBay is actually considering making a change to its Buy It Now policy. The company conducted a survey of sellers last week and asked several questions about cancelled Buy It Now orders, including this question: "How would you feel if all "Buy It Now" orders were placed on hold for 30 minutes to allow buyers to cancel their purchase?"

What do you think of eBay's unpaid items policy, and the possibility of a 30-minute cancellation window? And, how big a problem are deadbeats on eBay?




Comments (35) | Leave Comment | Permalink
Readers Comments

Perminate Link for Seller Sues eBay Over Unpaid-Items Relisting Policy   Seller Sues eBay Over Unpaid-Items Relisting Policy
This user has validated their user name. by: Ming the Merciless
       
Wed Aug 1 15:03:34 2012
From my perspective, deadbeat buyers have substantially decreased in recent years with one, extremely atypical situation involving thousands of dollars and one non paying buyer.

It really annoys me when a buyer asks to cancel that the only cancellation choice I have as a seller is to check off that it was a "mutual" decision when, in fact, it was the buyer's decision alone.

I think ebay should explore the possibility of fining buyers who cancel or don't pay. Of course, ebay won't because they solicit, encourage, aid, and abet buyer fraud.

The criminal Ho counts these uncompleted sales as GMV so no skin off his back.

Ho, Ho, hey, hey
How many small businesses
Did Ho kill today?
Perminate Link for Seller Sues eBay Over Unpaid-Items Relisting Policy   Seller Sues eBay Over Unpaid-Items Relisting Policy
by: RCL This user has validated their user name.
       
Wed Aug 1 15:20:46 2012
''the possibility of a 30-minute cancellation window''--that is the stupidest idea yet. Buy It Now Unless You Change Your Mind Within 30 Minutes. Complete idiots. Could we sellers PLEASE have some certainty as to when a sale is transacted? Every sale is already conditional if returns are allowed--isn't that enough interference? Can eBay possibly throw any more unpredictability into a seller's business at eBay? (Rhetorical-I know they can and will.)

Perminate Link for Seller Sues eBay Over Unpaid-Items Relisting Policy   Seller Sues eBay Over Unpaid-Items Relisting Policy
This user has validated their user name. by: Ric
       
Wed Aug 1 16:32:40 2012
The concept of a 30 minute window for cancelling a Buy It Now purchase is flat out preposterous.

The title "Buy It Now" is pretty self explanatory to all but a few feeble minded buyers eBay seems to write all of their policy around.

eBay can and should end the issues with non paying bidders and the methodology is really obvious and quite simple for them to deploy.

When a buyer places a bid eBay should compel the buyer to approve the purchase from their PayPal balance before the transaction is finalized. The system would then confirm that the funds are available in the buyers account prior to allowing the bid to be placed. If the PayPal balance is not sufficient to cover the amount of the bid, the buyer could then be afforded the option to authorize the final bid be placed on their linked credit card if they are the winning bidder at auction close.

The way eBay and PayPal like to hold money in accounts, one would think they would have implemented this a long time ago.

The reason this has not been done is because eBay needs non paying bidders to help inflate their GMV.

When a buyer does not pay and the item is relisted to sell again, eBay adds the "sale" to their GMV even though payment is not made.

Wall Street should be demanding eBay to more accurately account for their reported GMV and disallow the current practice of counting sold items without completed payments as part of GMV and ignoring the cost of returned goods.

Investors would have a much clearer view of eBay's true marketplace health if eBay were held to more accurate and honest valuation of GMV.

To present a much more accurate picture, the formula for GMV should be as follows: Items Sold With Completed Payments minus Items Returned For Refunds equals GMV.

Perminate Link for Seller Sues eBay Over Unpaid-Items Relisting Policy   Seller Sues eBay Over Unpaid-Items Relisting Policy
by: mylifeisgood This user has validated their user name.
       
Wed Aug 1 16:50:35 2012
Just another waste of the courts time..........It will get tossed just like the rest of the lawsuits brought by whiners... Fleabays playground...You play by their rules and sign up to do so before you sell..
Perminate Link for Seller Sues eBay Over Unpaid-Items Relisting Policy   Seller Sues eBay Over Unpaid-Items Relisting Policy
This user has validated their user name. by: WOODJUNGLE! ON EBAY
       
Wed Aug 1 19:20:58 2012
I think this case has merit.  I'm curious to see how it turns out.  If a buyer doesn't pay for the item, the listing should be reinstated where it left off before the deadbeat clicked on the BUY IT NOW button.  There should be reimbursement fees for auctions as well if the buyer doesn't pay.  Especially when there are multiple bids and you potential lose the buyer that was in second position.
Perminate Link for Seller Sues eBay Over Unpaid-Items Relisting Policy   Seller Sues eBay Over Unpaid-Items Relisting Policy
by: longtimer This user has validated their user name.
       
Wed Aug 1 20:14:09 2012
Plaintiff: Non payment on buy it now and ebay didnt blah blah blah.

Judge: Did you tick the box that says ''immediate payment required''

Plaintiff: uh, no

Judge: Case dismissed
Perminate Link for Seller Sues eBay Over Unpaid-Items Relisting Policy   Seller Sues eBay Over Unpaid-Items Relisting Policy
This user has validated their user name. by: Rexford
       
Thu Aug 2 09:50:53 2012
FOTFL   Seriously, what company encourages buyers remorse?

The MBA boneheads at eBay continue to amaze.
Perminate Link for Seller Sues eBay Over Unpaid-Items Relisting Policy   Seller Sues eBay Over Unpaid-Items Relisting Policy
by: JustTheFacts This user has validated their user name.
       
Thu Aug 2 09:53:41 2012
Requiring immediate payment is NOT good for sellers scores which ebay holds against us because you cannot combined shipping.

It is bad enough when buyers pay before combined shipping THEN ask for combined shipping.

ebay charges us for the ENTIRE amount which includes the extra shipping charges and so does paypal.  At least with paypal you caan get the extra fees back but ebay you cannot with out spending even MORE time calling up ebay and even then often times they never really credit you for it, they just SAY they will.

Plus the time you have to spend to credit it through paypal.

Refunds take up too much time especially if you do a lot of transactions.

If your store sales multiple items to buyers at one time requiring immediate payment would only cause you problems becuase they want combined shipping and trust me, if they do not get it even if THEY pay before you  get a chance to combine and do not go through the time and trouble to refund, they WILL ding your DSRS and FB.

I average approx 8-10 items per sale (this is just an ball park average). It is also not unusual for them to order 20-30 per order, and there are several times when they hit ebays invoice limit of 40 items.

So again, there is no ONE SIZE FITS ALL.

The 30 min wait is usless as I think someone else mentioned because they ask to cancelhours and even days after they buy and we feel FORCED to cancel because we know the consiquences if we do not.

I think this question has much to do about NOTHING except making it look like ebay is "trying" to protect sellers.  When in truth it provides NOTHING but an even bigger opportunity for buyers to secure items while they continue looking for it cheaper somewhere else.  If they find it they cancel the sale with you, if they don't then they decide if or when they will pay for it.  In the meantime you cannot sell it because they kept it out of your stock.
Perminate Link for Seller Sues eBay Over Unpaid-Items Relisting Policy   Seller Sues eBay Over Unpaid-Items Relisting Policy
by: 10 year seller This user has validated their user name.
       
Thu Aug 2 10:23:31 2012
EBay has made a confusing mess of everything. Every fix creates a new problem.

What's the point of buy it now?
Perminate Link for Seller Sues eBay Over Unpaid-Items Relisting Policy   Seller Sues eBay Over Unpaid-Items Relisting Policy
by: Ron This user has validated their user name.
       
Thu Aug 2 10:33:45 2012
I agree with JustTheFacts.  The more that eBay has tried to control things, issues have just become more muddy, because one size does not fit all.

Donahoe should have learned the KISS rule in business school - "Keep it Simple Stupid".  I really yearn for the days when eBay was a hands-off website, self-policed by the members.
Perminate Link for Seller Sues eBay Over Unpaid-Items Relisting Policy   Seller Sues eBay Over Unpaid-Items Relisting Policy
This user has validated their user name. by: Anonymous Annie
       
Thu Aug 2 14:16:08 2012
A completely HORRIBLE idea!

During this ''30 minute window''... is the item visible to OTHER BUYERS who might be interested in making a prompt purchase? Or does it become invisible? Or would be visible with a ''sale pending'' notification icon added to the listing?

How many legitimate, interested and qualified buyers will move on to another item while someone's item is ''on hold''?

There also the potential for abuse. Dishonest sellers could put their competitors' items ''on hold'' on a regular basis so that competing merchandise has been rendered unavailable throughout the day, or over a holiday weekend.

eBay execs and policy makers are out of the gourd! Completely insane. They've lost their collective minds.
Perminate Link for Seller Sues eBay Over Unpaid-Items Relisting Policy   Seller Sues eBay Over Unpaid-Items Relisting Policy
by: pace306 This user has validated their user name.
       
Thu Aug 2 18:45:22 2012
lol its SO stupid on eBays part .... what? give the buyer 30mins to look around and find it cheaper somewhere else (either on eBay or elsewhere) and then let them back out?  

How does that help eBay? How does it help sellers?

There must be a catch, and if I know eBay ... its MONEY.

''Sir/Madam ... for a small amount you can cancel your purchase. Please remember that an agrement to purchase is considered an online contract, one that has real world implications. However for a small fee we will intervene with the buyer and cancel the sale''

Wanna bet?
Perminate Link for Seller Sues eBay Over Unpaid-Items Relisting Policy   Seller Sues eBay Over Unpaid-Items Relisting Policy
This user has validated their user name. by: Doc
       Web Site
Thu Aug 2 19:00:14 2012
This latest lawsuit was over a car sale. I started to blog about it on EBMS, but why even bother wasting the time and energy.

On vehicles a 'private seller' can not request an immediate deposit on a vehicle BIN listing like a registered dealer.

Y'all know the old saying.. The House always wins. Yep your first 5 vehicle listings are FREE! But when a sport bidder clicks a buy-now for kicks eBay bills the seller $125!

There ain't nothing FREE on eBay. LOL!
Perminate Link for Seller Sues eBay Over Unpaid-Items Relisting Policy   Seller Sues eBay Over Unpaid-Items Relisting Policy
This user has validated their user name. by: Doc
       
Thu Aug 2 19:01:43 2012
BTW: On EBM Vehicle bids and BIN listings are NON BINDING. LOL!
Perminate Link for Seller Sues eBay Over Unpaid-Items Relisting Policy   Seller Sues eBay Over Unpaid-Items Relisting Policy
by: the paper gallery This user has validated their user name.
       
Thu Aug 2 22:47:10 2012
DON'T BID UNLESS YOU MAKE UP YOUR MIND BEFORE YOU BID...SIMPLE  DON'T BID
Perminate Link for Seller Sues eBay Over Unpaid-Items Relisting Policy   Seller Sues eBay Over Unpaid-Items Relisting Policy
by: doboy This user has validated their user name.
       
Thu Aug 2 23:04:29 2012
Fleecebay has yet again come up with another idea generated to cripple the smaller seller.  Why not give a newborn infant 30 minutes to change it mind and go back to the womb for another 9 months?  

You are held responsible for what you do behind the wheel of a car.  Why should you not be held responsible for what you do with the click of a mouse?
Perminate Link for Seller Sues eBay Over Unpaid-Items Relisting Policy   Seller Sues eBay Over Unpaid-Items Relisting Policy
by: JoyfulA This user has validated their user name.
       
Thu Aug 2 23:20:56 2012
Sometimes I get a sale when there's just enough time to get the item packed and to the post office that day. If I'm supposed to wait awhile to see if the prospective buyer cancels, that package can wait till tomorrow.

This policy just slows down commerce and keeps me from "exceeding customers' expectations."
Perminate Link for Seller Sues eBay Over Unpaid-Items Relisting Policy   Seller Sues eBay Over Unpaid-Items Relisting Policy
by: Eagle This user has validated their user name.
       
Thu Aug 2 23:27:36 2012
I only buy on Ebay just for the fact of the problems I read about from sellers. Lately, I have basically quit buying due to the fact Ebay allows shilling, non-payers, and other similar stuff happen. I would spend time searching for item(s) only to get out bid by single increment at the final (quote hammer) of the auction and then see the same exact item relisted by the seller 1-2 weeks later either due to return, NPB, or other reason. The ''Buy Now and change your mind in 30 minutes'' is nothing short of silly! As a buyer, I can see why this non-payment may be happening because Ebay almost always throws in your face and shows the same item you just bought as cheaper under the ''Similar Items'' or Sellers Other Items'' window that pops up right after you click on ''Pay Now''. (I see it constantly when I purchase a ''Buy Now'' from the Daily Deals'' email I get everyday.)
Bottom line, any seller that doesn't actually profit from a sale due to NPB's or constant returns should not be charged a single penny for relist or other fees!!
Perminate Link for Seller Sues eBay Over Unpaid-Items Relisting Policy   Seller Sues eBay Over Unpaid-Items Relisting Policy
by: used2luv2sell This user has validated their user name.
       
Thu Aug 2 23:44:41 2012
The past 2 months I've had at least 4 buyers who have bid and then not paid for their items.  I am a part time small seller, and even compared to other years, this is a large number for me.  
3 of these buyers had 0 feedback.  They bid, didn't pay, didn't answer my nice email asking if they'd like to end the transaction - they silently made me go through the 4 day wait period.  Of course, they all got their invisible strike from Ebay - at least Ebay says they did, which is totally meaningless since no one can see them!  Why are these people protected?????
Then this past week, I had a guy with 15 fb win an item & he wrote pretty quickly to say he will pay asap, but he had a glitch with Paypal.  Several days later I wrote to tell him he could send a money order if need be, but he wrote back that it's just a matter of paypal mailing him something to confirm the address - should be done by Wednesday.  I called PP & they said he can still pay while we are doing that.
By Sunday, I still didn't have payment 8 days after purchase of a BUY IT NOW!  So, I started the procedure.
Who has to pay the price of this?  Of course, the seller!  I then had to wait another 4 agonizing DAYS for this moron to have the chance to pay for the item.  In the past I have relisted before the 4 days were up because I don't want to sell to this moron if he pays after this.
Why should the seller be told to wait 4 more days when this ''contract'' was a buy it now?
Also, why is it only a CONTRACT to the seller.  Ebay doesn't HOLD A SINGLE BUYER TO THE CONTRACT!  And if the buyer changes his mind, I don't want to force them into the contract and ''earn'' myself a set of 1's!  But Ebay should swing the hammer at the buyers account and make it known and shown that they bid and DID NOT PAY!  
Make a DID NOT PAY button on the buyers FEEDBACK - DUH!
Perminate Link for Seller Sues eBay Over Unpaid-Items Relisting Policy   Seller Sues eBay Over Unpaid-Items Relisting Policy
by: comet This user has validated their user name.
       
Thu Aug 2 23:57:55 2012
There COULD be ways to make some form of IMMED PAYMENT REQ work taking a number of factors into consideration.

This as we know will never happen on ebay.

And  as far as the absurd "30 Minute Get Out OF Jail Free Card" goes---

Fell off my chair laughing.

Do the flea brained idiots at ebay REALLY think these trigger happy lookie loos are going to go back and actually PAY for the item????    If they can't remember or commit to pay in EIGHT DAYS what makes them think a 30 minute window is going to get them running over to PreyPal and hitting the PAY MY SELLER button???

I suspect too that there would be "steps" that the SELLER would need to do---ie hoops of fire to jump thru---to "register" the fact that the buyer did NOT pay and "opted out" of the sale  BEFORE the seller got ANY credit towards the failed sale--and even force the SELLER to be responsible to go and RELIST the item.  And probably FORCE the hapless seller to PAY for that privilege too.

Do WE get a 30 minute "window" to go review the FB of the "winning bidder" and see if WE want to continue the sale with THEM???

Nah didn't THINK so.  
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