eBay suing Craigslist

[chris4404]

The online auction giant eBay is suing the popular internet community ad site Craigslist to "safeguard its four-year financial investment". In a statement, eBay claimed that in January, Craigslist executives took actions that "unfairly diluted eBay's economic interest by more than 10%". No details of those actions were given by eBay.

In its company blog, Craigslist said it was surprised and disappointed by eBay's "unfounded allegations". The company said eBay's legal action "came to us out of the blue".

The case, which is sealed, has been filed in a court in Delaware, where Craigslist is registered. In a press statement, eBay claims that Craigslist's founder Craig Newmark and its chief executive Jim Buckmaster adopted unspecified measures in January that have disadvantaged eBay and its investment. eBay's general counsel Mike Jacobson said: "Since negotiating our investment with Craigslist's board in 2004, we have acted openly and in good faith as a minority shareholder, so we were surprised by these recent unilateral actions. He continues: "We are asking the Delaware court to rescind these recent actions in order to protect eBay's stockholders and preserve our investment."

Craigslist, the seventh most popular English-language page on the Web, hit back in a blog. "We have always treated eBay fairly as a minority shareholder, and plan to continue doing so, despite this unfortunate development," it said. "eBay has absolutely no reason to feel threatened - unless a hostile takeover of Craigslist, or the sale of eBay's stake in Craigslist to an unfriendly party, is their ultimate goal."

Article

[lexandro]

I saw this on the wires earlier. Seems like ebay is just out to cut the competition as much as it can. Why they are suing a site they have already got shares in is beyond me.

[WindtalkerCS]

It would appear that they are not suing for money, but rather just forcing craiglist to undo something that ebay does not agree with. Correct me if I'm wrong.

[Librarian]

Ebay can go to hell, I just hate it when big business gets so **** obnoxious.

[siegen]

eBay claims that Craigslist's founder Craig Newmark and its chief executive Jim Buckmaster adopted unspecified measures in January that have disadvantaged eBay and its investment.

Like not charging people through the anus to sell stuff?

[NokiaNokia]

Google has shares of Craigslist not Ebay.

[TDOGZZ]

Originally Posted by NokiaNokia

Google has shares of Craigslist not Ebay.

^^strange,is this why ebay is nervous or p1$$3d?

[Mindwarp]

However, a recent rough valuation by technology blogger Henry Blodget suggested that Craigslist could be worth as much as $5bn if it charged for more of its listings, perhaps one reason why eBay is now so keen to assert its investment.

http://www.telegraph.co.uk/money/mai.../cnebay124.xml

[Vertigo Boost]

greedy SOBs. I figure they are only after money. They are long past due for their death. ebay should just roll belly up and die.

[jevans64]

eBay ISN'T directly after money in this case. They are ****ed because they have less voting power in Craigslist's business decisions and have less stake in the company.

I'm not an investment expert, but I would assume that Craigslist's board authorized the sale of additional stock or did a stock split w/o notifying eBay. This would dilute eBay's stake in Craigslist which would give them less power against other shareholders. Those extra shares were probably bought up by other members of the board or bought up by Google, etc.

eBay has a legitimate claim if additional stock was issued but they were not informed of the board action; however, if eBay WAS given notice and THEY didn't act on it, then TOO BAD for eBay. They can call a waaaambulance.

[JEEwing]

Just for the record...Craigslist is a privately traded company. But much like a publicly traded one, investors have stakes in a company's success and the company has an obligation to ensure their investors interests are upheld.

Ebay has a stake in Craiglist of something along the lines of 28%. According to court papers......Craigslist took actions that would have reduced Ebay's interests to 11%.

Now imagine you, the personal (also private) investor loosing a percentage of interest in a large company that you put millions of dollars into. Done without so much as a vote of yours or notice therein. We're not talking about Ebay being greedy as much as just trying to protect their due interests. And this isn't anything like a split stock or reverse split. Your percentage of interest would be upheld in those instances. We're talking about doing something (we don't know what yet) that fundamentally decreases your percentage of interest.

This may sound moot.......but if there is ever an IPO.........that's a lot of loot you lost there sonny. I'm no fan of Ebay but I can certainly understand their postition.

[bftek]

Sounds like craigslist might be in big doo doo...

[WiCKeD]

Pro eBay

It's all just speculation until we have more details.

I could have sworn reading eBay tried to buy Craigslist and Craig Newmar told them it was not happening... They are just whining because "Kijiji" was a flop. This is how corporations pout.

[NameTaken45]

craigslist is ending up just like ebay. who cares

[Jason]

How is Craigslist anything like eBay? It's free to list items to see... eBay is not... lol...

If I was Craig I would not have even let eBay obtain .00001% stock in the business...

Linus Torvalds might as well just hand over his control of Linux to Microsoft... The world is doomed...

[NameTaken45]

i said ending up like.