Craigslist on Tuesday launched a legal counterattack against eBay, which sued Craigslist in Delaware two weeks ago for violating its rights as a minority shareholder.
"We filed a complaint in California today, charging eBay with 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," said Craigslist CEO Jim Buckmaster in a blog post.
Buckmaster said that Craigslist is asking the Superior Court in San Francisco to put a halt to eBay's alleged misconduct, to force eBay to make restitution to Craigslist and return related profits, to restore the Craigslist shares that eBay owns to Craigslist, and to impose punitive damages on eBay.
In 2004, eBay acquired a minority stake in Craigslist from a former shareholder. Since that time, the Craigslist filing alleges, eBay has "engaged in conduct designed to harm Craigslist, its users, and consumers in California and elsewhere."
The Craigslist complaint, for example, claims that eBay placed on Google ads that purported to direct users to Craigslist but instead sent them to Kijiji, a community site owned by eBay that competes with Craigslist.
EBay's supposed motivation for this and other alleged skullduggery cited in the complaint was to gain control of Craigslist. Having failed to achieve that goal, Craigslist claims that eBay wants to promote Kijiji to kill off Craigslist.
"Sadly, we have an uncomfortably conflicted shareholder in our midst, one that is obsessed with dominating online classifieds for the purpose of maximizing its own profits," Buckmaster said in a blog post made following the filing of eBay's lawsuit two weeks ago.
EBay's lawsuit paints a somewhat different picture. In its legal filing, the company accuses Craigslist founder Craig Newmark and Buckmaster with planning to dilute eBay's investment in Craigslist and to diminish eBay's voting power as it relates to Craigslist. It also accuses the pair of adopting Poison Pill rules that inhibit eBay's ability to sell its Craigslist shares to anyone other than Newmark, Buckmaster, or their company.
