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EcommerceBytes-NewsFlash, Number 2425 - December 01, 2010 - ISSN 1539-5065    2 of 4

Class Action Lawsuit Filed against Penny Auction Site

By Ina Steiner
EcommerceBytes.com
December 01, 2010




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A law firm has sued the operators of a so-called penny auction site that charges shoppers to bid on auction for high-end items at greatly reduced prices. Beckham & Mandel filed a class action lawsuit against QuiBids LLC in the U.S. District Court for the Western District of Oklahoma alleging deceptive and unfair trade practices and fraud.

The law firm wrote in a press release, "virtually none of the consumers who participate in these "auctions" will win the right to purchase such high-end item products at those greatly reduced prices."

The lawsuit alleges that the failure to win auctions is costly to QuiBids customers, and states:

In one e-mail promotion, QuiBids cites a customer winning a $20,000 Honda Civic automobile for $1,740.78 in a two-cent QuiBids auction. That price means QuiBids sold 87,039 bids which were used in that auction. At $0.60 per bid, QuiBids grossed $52,233.40 from the bids alone, an amount that dwarfs not only any savings realized by the winning bidder individually, but the retail cost of the car. This illustrates the critical difference between QuiBids and E-Bay - losing bidders on E-Bay do not pay anything.

The full complaint can be read on the Beckham & Mandel website.

About the author:

Ina Steiner is co-founder and Editor of EcommerceBytes and has been reporting on ecommerce since 1999. She's a widely cited authority on marketplace selling and is author of "Turn eBay Data Into Dollars" (McGraw-Hill 2006). Her blog was featured in the book, "Blogging Heroes" (Wiley 2008). Follow her on Twitter at @ecommercebytes and send news tips to ina@ecommercebytes.com.

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