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Wed June 23 2010 16:11:20

eBay Fails to Show in Court to Defend Itself in PayPal Lawsuit

By: Ina Steiner

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The Detroit News reported that a federal court entered a default judgment against eBay in a lawsuit over its practice of forcing sellers to use PayPal. The lawsuit was filed on April 12, 2010 in Michigan.

I'm not entirely clear on why eBay failed to show up, in its motion to set aside the default eBay wrote, "Plaintiffs failed to properly serve these parties with the Summons and Complaint." 

eBay plans to use a recent legal victory to help its case. It wrote in the motion that it has a "meritorious defense to Plaintiffs' claims as shown by the fact that the claims asserted in this action were previously litigated and resolved in eBay and PayPal's favor in a substantially similar putative class action filed in the United States District Court for the Northern District of California," citingeBay Seller Antitrust Litigation, case #5:07-cv-01882-JF



In that case, the judge said lawyers for the sellers did not provide him with enough evidence to deny eBay's motion for summary judgment. According to the judge's order, to survive summary judgment on the issue of causal antitrust injury, Plaintiffs must "offer some evidence demonstrating the existence of an antitrust injury, which is to say injury of the type the antitrust laws were intended to prevent and that flows from that which makes defendant's acts unlawful."

eBay was also sued in California on May 12, 2010. That lawsuit charges that PayPal's practice of "holding" funds for up to 180 days in the accounts is fraudulent, because of the "systematic and arbitrary manner in which the freezing is done and the lack of information shared with affected customers."




Comments (36) | Permalink

Readers Comments

eBay Fails to Show in Court to Defend Itself in PayPal Lawsuit   eBay Fails to Show in Court to Defend Itself in PayPal Lawsuit

by: Kevin

Wed Jun 23 16:33:27 2010

This is great!  Using paypal is so important to ebay they either can't be bothered to show up or can't get the date straight.  

I bet if they would take a break from changing seller performance standards every 5 minutes little things like defending themselves in a lawsuit might not fall through the cracks so easily

eBay Fails to Show in Court to Defend Itself in PayPal Lawsuit   eBay Fails to Show in Court to Defend Itself in PayPal Lawsuit

by: Shirley Itstru

Wed Jun 23 16:35:13 2010

Who is eBay's counsel? Scooter Libby?

Are they convinced that they are above the law? Do they believe that laws don't apply and that the legal remedies are mere inconveniences that can be ignored on a whim?

eBay Fails to Show in Court to Defend Itself in PayPal Lawsuit   eBay Fails to Show in Court to Defend Itself in PayPal Lawsuit

by: hollow ground

Wed Jun 23 16:35:34 2010

Don't think for a minute that Ebay didn't show for a reason. As moronic the leadership is, one thing for certain they ain't stupid.

eBay Fails to Show in Court to Defend Itself in PayPal Lawsuit   eBay Fails to Show in Court to Defend Itself in PayPal Lawsuit

by: Rich

Wed Jun 23 16:40:30 2010

No big deal to Ebay.  If they lose they can do another fee hike on sellers.  Raising fees is their magic cure: it requires zero brain work and their stock is only down from $40 to $21 since 2005 when Meg Whitman began the magic fee hike cure.  Amazon was $40 five years ago and now is $130 and they don't raise fees or muscle Paypal on all users.  Gee; maybe raising fees and forcing Paypal has stunted growth?

eBay Fails to Show in Court to Defend Itself in PayPal Lawsuit   eBay Fails to Show in Court to Defend Itself in PayPal Lawsuit

by: Look Again

Wed Jun 23 17:28:54 2010

Hey fellas : more screwball rule changes on ebay's ugly sister half.com. Anyone else get THIS email notice?


Over the past few years, we have received feedback from our buyers about
the inability to track expedited packages on our Half.com website. This
becomes especially important during our back to school season for our
student buyers who would prefer to have complete visibility and
commitment on the delivery date & time of their expedited orders.
 
In order to improve the user experience, help generate incremental sales
for sellers and reduce communication overhead between buyers and sellers
related to tracking, Half.com will be making the following changes to
our shipping policy for expedited orders, effective July 12, 2010:


1. To improve trust, safety, and user experience on the site, beginning
July 12, 2010, sellers who offer expedited shipping will need to enter
tracking information into the Half.com website for all expedited orders
within 3 business days of making a sale.


Please note: The policy change outlined above only impacts orders where
the buyer has paid for expedited shipping. Sales with standard shipping
will not be affected by this policy change.


2. Sellers can enter tracking information when they mark transactions as
shipped via their My Account "Sales" page, through the PayPal shipping
label service (where delivery confirmation is free on Priority Mail and
discounted on other forms of U.S. Postal Service shipping), through the
CompleteSale API; or through File Exchange.


3. If tracking is not uploaded within 3 business days, expedited
shipping will be disabled on the seller's account and will not be
available as a shipping option on the seller's current and future
listings.


4. In order to re-enable expedited shipping, sellers must upload
tracking for all outstanding expedited orders within 3 business days
after the expedited shipping option was disabled; otherwise, expedited
shipping will be permanently disabled on the seller's account until the
seller contacts Half.com Customer Support to review and approve
re-enabling expedited shipping.


We believe this will be a positive change for both our buyers and our
sellers and look forward to a very successful 2010 for the Half
community.


Thank you,
Half.com





That means now I have to put in MORE fake confirmation #'s and/or just not do expediated shipping.

eBay Fails to Show in Court to Defend Itself in PayPal Lawsuit   eBay Fails to Show in Court to Defend Itself in PayPal Lawsuit

by: RicRoe

Wed Jun 23 18:02:52 2010

eBay/PayPal arrogance is once again on display.

They continue to believe they are above the law, and that a simple thing like showing up in court is a technicality which they need not concern themselves with.

I certainly hope that the judge in this case finds for the class and against eBay based not only on the merits of the case but for the corporations arrogance in failing to appear.


eBay Fails to Show in Court to Defend Itself in PayPal Lawsuit   eBay Fails to Show in Court to Defend Itself in PayPal Lawsuit

by: Marvin This user has validated their user name.

Wed Jun 23 19:26:09 2010

When you have congress in your back pocket you are above the law. Do a YoutTbe search for the video: ebay buys congress and you will see why the law means nothing to ebay/paypal.

eBay Fails to Show in Court to Defend Itself in PayPal Lawsuit   eBay Fails to Show in Court to Defend Itself in PayPal Lawsuit

by: Rich
Web Site

Wed Jun 23 19:48:48 2010

They may also have invoked their right against self-incrimination. Having sampled them all, I have had no major problems with PP or FeeBay. Sunny here in Oreeeeegon, with more predicted. 'Bout time!

eBay Fails to Show in Court to Defend Itself in PayPal Lawsuit   eBay Fails to Show in Court to Defend Itself in PayPal Lawsuit

by: mickeyfinn This user has validated their user name.

Wed Jun 23 23:49:44 2010

Look to Australia for inspiration!!

EBay Australia has taken a step back from forcing Paypal to be used.  It now requires that at least one of these must be used: 1. PayPal 2. Paymate 3. Merchant credit card. You can offer more options, but must have at least one of them.  The logic is simple - ensure buyers have at least one option where they can initiate a ''charge-back'' if needed. Fair enough.

The reason for the change is less obvious, but it is highly suspected to be related to the recent changes in Australia Fair Trading legislation.

Would it be too much to ask for a similar jab in the arm in eBay's homeland?

eBay Fails to Show in Court to Defend Itself in PayPal Lawsuit   eBay Fails to Show in Court to Defend Itself in PayPal Lawsuit

by: Troglodyte

Wed Jun 23 23:59:05 2010

Ebay couldn't invoke their right against self incrimination because this wasn't a criminal proceeding although it should have been.

The "antitrust injury" that sellers have sustained is being forced to pay fees to ayPal instead of being able to state in the product description that feeless money orders and checks would be accepted.

Mr. Donahoe, meet Mr. Sherman.

eBay Fails to Show in Court to Defend Itself in PayPal Lawsuit   eBay Fails to Show in Court to Defend Itself in PayPal Lawsuit

This user has validated their user name. by: Philip Cohen
Web Site

Thu Jun 24 02:29:55 2010

About two years ago, in Australia, eBay was forced to back down from attempting to mandate that sellers use PayPal exclusively for all non face-to-face payments; so eBay, as devious as ever, after futher negotiations with the ACCC, allowed the option of other methods but still mandated the offering of PayPal, and got away with that because that was no longer considered a restraint on trade/competition; naturally PayPal is listed most prominently and is selected by default.

A most obnoxious, unscrupulous organisation. Still, their day is coming, and next 21 July should be a most interesting evening, for starters …

eBay/PayPal/Donahoe: Dead Men Walking

eBay Fails to Show in Court to Defend Itself in PayPal Lawsuit   eBay Fails to Show in Court to Defend Itself in PayPal Lawsuit

by: 278895

Thu Jun 24 04:43:59 2010

How many similar lawsuits does paypal have now?
I saw this not long ago. It appears to be yet another separate one.

Online Retailer Hits PayPal With Class Action
Thursday, June 10, 2010
http://www.courthousenews.com/2010/06/10/27970.htm



At
any rate, missing court appearances is never a good thing, but does ebay really think they are above the law, or can side step and end run around it?
It's scary to think that any company can have that sort of influence and power.
It will be funny when something or someone knocks them down a few notches.

eBay Fails to Show in Court to Defend Itself in PayPal Lawsuit   eBay Fails to Show in Court to Defend Itself in PayPal Lawsuit

by: AC_in_Mich

Thu Jun 24 10:18:33 2010

As a seller in Michigan, does this mean that I can now offer other payments than Paypal or do I have to wait for it to go through the courts?

eBay Fails to Show in Court to Defend Itself in PayPal Lawsuit   eBay Fails to Show in Court to Defend Itself in PayPal Lawsuit

by: Red Ink Diary This user has validated their user name.

Thu Jun 24 13:41:47 2010

@ AC_in_Mich

This was a Federal suit filed in Federal Court. The jurisdiction of state courts are limited by their boundaries, the federal court system covers the entire nation.

You will have to wait until the Judge issues a ruling before taking action. eBay has requested the default be set aside on the grounds they were improperly served. The certified mail return receipt certificate showing a signature on delivery should prove the lack of truth in that allegation.

eBay's legal department are not infallible. They missed a deadline in the Australian Competition and Consumer Commission hearings, but the ACCC graciously allowed them to file late before ruling against them.

eBay Fails to Show in Court to Defend Itself in PayPal Lawsuit   eBay Fails to Show in Court to Defend Itself in PayPal Lawsuit

by: Denise

Thu Jun 24 17:00:28 2010

LOL Maybe the letter went to Customer Service by mistake and we know that dept. is non-existent

eBay Fails to Show in Court to Defend Itself in PayPal Lawsuit   eBay Fails to Show in Court to Defend Itself in PayPal Lawsuit

by: Troglodyte

Thu Jun 24 17:11:04 2010

@ Philip Cohen

Was that you who placed a strangle on ebay stock this week? LOL!!

eBay Fails to Show in Court to Defend Itself in PayPal Lawsuit   eBay Fails to Show in Court to Defend Itself in PayPal Lawsuit

by: Lawrence A Dickerson

Thu Jun 24 22:55:53 2010

re:Look again comment

"That means now I have to put in MORE fake confirmation #'s and/or just not do expedited shipping."

The fact is that sellers actually do  apply false tracking numbers,another thorn in the bloody wound of the very people who blame eBay for low pressure on their toilet flow.

I certainly hope that you didn't think this was cute and original.It violates every ethical and moral fiber of a buyer's being and it should incense every seller as well.

eBay Fails to Show in Court to Defend Itself in PayPal Lawsuit   eBay Fails to Show in Court to Defend Itself in PayPal Lawsuit

by: On Lies and Secrets This user has validated their user name.

Thu Jun 24 23:24:15 2010

Hooray for those who are testing the legality of these sketchy Paypal rules in a court of law.  I hope the default judgment stands.  The suggestion that they weren't properly served seems like a smoke and mirrors lawyering trick to try and confuse the issue, cast doubt and change the subject.  I hope the court doesn't fall for it and holds the company accountable.  

eBay Fails to Show in Court to Defend Itself in PayPal Lawsuit   eBay Fails to Show in Court to Defend Itself in PayPal Lawsuit

by: 461838

Fri Jun 25 00:36:46 2010

@Lawrence A Dickerson
Tell us all how you feel about ebay failing to appear in court?
Does that violate any ethical and/or moral standards? Are you outraged, or do you accept that ebay and paypal are above the law?

The chattering class wants to know

eBay Fails to Show in Court to Defend Itself in PayPal Lawsuit   eBay Fails to Show in Court to Defend Itself in PayPal Lawsuit

This user has validated their user name. by: Philip Cohen

Fri Jun 25 04:06:06 2010

@ Troglodyte,

If you mean did I decide to dump all my eBay stock? You betcha! I got tired of waiting for a dividend out of all that cash they supposedly have stashed away overseas. Funny, seems as though many others have had the same idea. <$21 today; I wonder what it will be after 21 July? Should be able to buy it all back real cheap on the 22nd.

Gee, I hope I don’t really sound that silly.

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