Terminated eBay Vendor Gets Day in Court Against eBay–Crawford v. Consumer Depot
4 01 2010By Eric Goldman
Crawford v. Consumer Depot, Inc., 05-3242 (Tenn. County Ct. Dec. 9, 2009)
Essex and Consumer Depot are competitors in the eBay consignment business. According to the court, prior to 2005 Essex used to allow its employees to bid on its auctions, and in 2004 one of its executives was personally suspended for shill bidding. Consumer Depot allegedly accused Essex of shill bidding, sparking a lengthy multi-front battle between the two companies (dating back to summer 2005).
In 2005, eBay suspended Essex for alleged shill bidding. eBay says it made an independent assessment (easily supported because of Essex’s past practices) and didn’t rely on reports from Consumer Depot. While Essex was negotiating with eBay over possible reinstatement, Essex tried to unload its warehouse by hiring independent contractors who worked very closely with Essex. eBay decided that this end-run was uncool and terminated Essex. Essex eventually sued eBay for the termination.
eBay defended in part on its user agreement. Essex attacked the user agreement in a number of ways, including:
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