In a world where brick and mortar auctions are often accompanied by online catalogs and "live" Internet bidding, it would appear few considered what might happen if that technology failed. Yet that is exactly what happened on Saturday, October 21st when one or more servers at eBay which support the live auction component of the site went down at approximately 11AM EST. At 11:24 AM eBay acknowledged the technical difficulties by generating a system announcement saying the situation would be resolved "as quickly as possible."

That turned out to be a matter of hours, not minutes.

According to eBay spokesperson Catherine England, "Our team corrected the problem and is currently in the process of reaching out to individuals who were impacted by the outage to apologize for the inconvenience."

Weeks later, however, the impact on the live auctions being hosted that afternoon has yet to be fully realized. It has left many participating auctioneers wondering who is liable for lost opportunities, missed bids, angry consignors and disappointed online bidders.

Apparently not eBay.

According to spokesperson England, "When appropriate, we may also refund related catalog fees to event organizers. I don't have any specific numbers on how many folks may have been impacted. My understanding is that most auction organizers chose to move forward with their events without participation from eBay Live Auction bidders."

eBay's website has numerous disclaimers concerning liability. According to eBay's Live Auction User Agreement, the auction venue offers no warranties or guarantees.

No Warranty. WE AND OUR SUPPLIERS PROVIDE OUR WEB SITE AND SERVICES "AS IS" AND WITHOUT ANY WARRANTY OR CONDITION, EXPRESS, IMPLIED OR STATUTORY. WITHOUT LIMITING THE FOREGOING, WE DO NOT WARRANT THAT THE SERVICE WILL BE UNINTERRUPTED OR ERROR FREE, OR THAT BIDS WILL BE RECEIVED BY THE AH OR INFORMATION REGARDING CURRENT PRICE WILL BE TRANSMITTED IN A TIMELY FASHION Liability Limit. IN NO EVENT SHALL WE OR OUR SUPPLIERS BE LIABLE FOR LOST PROFITS OR ANY SPECIAL, INCIDENTAL OR CONSQUENTIAL DAMAGES ARISING OUT OF OR IN CONNECTION WITH OUR SITE, OUR SERVICES, THE FAILURE OF ANY BID OR PRICING INFORMATION TO BE TRANSMITTED OR RECEIVED BY YOU OR THE AH IN A TIMELY MANNER

Exactly how many live auctions were affected is open to debate. Online discussion boards mention at least forty but no formal list has been provided by eBay of those participating on that particular Saturday.

According to Julian Ellison, founder and CEO of LiveAuctioneers (http://www.liveauctioneers.com), fifteen of their company's auctions were affected. LiveAuctioneers is a turnkey solution for auctioneers wishing to include online live bidding at their auctions, integrating the merchandise into an online catalog which is ultimately posted on eBay Live Auctions (http://www.ebayliveauctions.com).

Regardless of the total numbers involved, those affected found themselves in the unenviable position of deciding what to do: proceed with the auction, cancel, or wait it out. Many auctioneers like Charles Whitaker of the Charles A. Whitaker Auction Co., found themselves in the middle of the sale when the outage occurred. Whitaker had over 100 bidders registered with eBay Live including museums and private collectors from Japan, France and Italy.

He said, "We had less people in the chairs than usual at this auction" explaining that the Fall Vintage Clothing & Textile Auction is one of the firm's biggest sales of the year. "They used to come in from California or New Mexico but now they do it on the computer and save the airfare. I had opening left bids on eBay Live that were larger than what some of the items sold for to the floor. It definitely hurt us. Not so much on the high-end stuff, but the middle of the road."

Bob Ross, a partner in the vintage clothing auction, said it was his understanding all the online registered bidders for the sale were being sent letters from eBay, explaining what happened. "We work through ArtFact and they were really great and went right to eBay and requested the letters."

"It was a capacity issue," auctioneer Whitaker added. "They only had six servers and it wasn't enough to handle the volume. They've now added more servers and are up to sixteen." (eBay has not confirmed this.)

Whitaker said he wasn't sure about using eBay Live in the future. "I have to for certain things," he explained, adding that previously contracted auctions, like an upcoming Tasha Tudor sale, included an eBay Live component in the contract. "I'll have to use it for that auction, but I don't know about the future."

To make matters worse, the New Hope, PA auctioneer explained many of those bidding online did not know that their bids were not being executed by the eBay Live software. After the "real" auction was over, Whitaker said his firm received over one hundred emails from disgruntled online bidders. He said some people asked why he didn't stop the auction and run it the following weekend. "They just don't understand. I tried to explain to them, this is a live auction. You can't just stop it. There were people in the audience who came here to bid."

Speaking to me from his home in Vermont, Bob Ross explained that as one of the "top textile auction firms in the world," the company only puts approximately 25% of each of their auction listings on eBayLive. "There were some 1200 lots in this sale and only about 300 were online," he said, explaining it was a sort of "reward" to those who attend the auctions in person. He agreed with partner Whitaker that the Tasha Tudor sale slated for November would have most of its lots online, in order to reach the international collectors and museums.

Julian Ellison of LiveAuctioneers said stopping any of his firm's fifteen auctions was up to each auctioneer's discretion." Several tried to wait until they could run the applet, one cancelled the auction and put (it) to another day," he said.

According to noted columnist Stephen Proffitt III, Esq.,Vice President and General Counsel for J. P. King Auction Company, Inc. (http://www.jpking.com), "While there is no prohibition in commercial law as embodied in the UCC (Uniform Commercial Code) that prevents an auctioneer from stopping an auction between lots, there could be issues in some jurisdictions under other controlling statutory, case, or regulatory law."

In other words, while the UCC doesn't prevent an auctioneer canceling mid-stream, differing local and state laws might well raise an issue.

Some auctioneers have taken to posting notices on their websites to deflect the public ire. The Rachel Davis Fine Arts firm was in the middle of their auction on October 21 when eBay Live went down. On her auction home page she posted a large disclaimer reading: "To all bidders please disregard the catalog sales results on ebaylive as a large portion are incorrect. We will respond to all emails after ebay has given us an explanation as to what occurred."

The Philip Weiss Auction firm of Long Island, NY posted on their homepage, "A Special Thank you to All the In House Bidders that stayed with us during the Ebay Live outage during the Saturday Sale, and we Apologize to all the Ebay bidders that were shut out because of this situation that affected All Auction Houses that had Ebay Live Sales going on at that time. Please note for future reference, Absentee Bids can be left with us through our own Website, email, Fax or Phone."

Both bidders and auctioneers have posted comments on eBay's Live Auctions Discussion Board. bbopbaby wrote: "I placed bids on several items from semi-annual C.A.Whitaker FALL VINTAGE CLOTHING auction and I was high bidder but have just found out that my bids didn't count since ebay was down for maintenance or technical difficulties off and on throughout entire afternoon of 10/21!!! I called Whitaker this a.m. and they had to explain what happened. They are NOT PLEASED to say the least. Not only does this affect the bidder, but they lost countless number of bids because so many people, like myself, rely on ebay to participate in live auctions. I was puzzled why pristine Civil War gowns estimated at thousands of dollars closed at $325. I thought it was a misprint! Has this affected anyone else? I would like a reply from ebay about this disaster."

Then there is the post by kimsold, which states: "I was the auctioneer for the Art Deco LA auction in North Hollywood on the 21st. At 10:20 am PT we went down. Bidders were calling and we would come up on a lot or 2 ever few minutes for about 5 minutes. We we(re) told we would be up in about an hour. We halted the auction, then about one hour later we came up for about 3 minutes then shut down again. Then I took nap and wished for the best. We were called by live auctioneers about 2:35 and told we we(re) working so I started back up on the lots where I felt we should be. Many bidders had been to preview and were at home or at other auctions that day to bid by computer and they were not able to get on line. We had to skip maybe 400 lots. Many people who left bids on ebay think that they got an item when it was not even offered on line. Some of the absentees were not even executed. An auction is competitive bidding and we did not have this nor did the bidders have a chance. The owner has canceled all bids that day and refusing any bidder to pick up there items after lot 38. He wants to offer the complete sale of day two again and ebay has refused to honor our request and to cancel the bids, The owner is contacting all of the bidders of the auction. We were damaged on the west coast much more than the east. Our sale that day had about 780+ lots. What a total mess this entire experience has been for me and the clients of Art Deco LA."

So ultimately, who does take the financial hit because of an outage or other technological glitch?

Apparently, everybody. The auction house in lost commissions; the consignor for lost dollars; bidders for lost merchandise and hours of viewing time; online companies in lost fees and credibility.

According to Julian Ellison at LiveAuctioneers, eBay is offering credits to the auction houses concerned.

eBay spokesperson Catherine English said, "We do understand that the disruption in service was very inconvenient for both auction organizers and bidders - we also want folks to be confident in the service moving forward as this particular issue has been fully resolved."

Unfortunately, it did happen again, with several auction houses affected the weekend of November 4 & 5th.

Tom Harris Auctions of Marshalltown, IA held a big two day estate sale that weekend and after it was over, sent out an email of apology to all their eBay bidders, explaining the "eBay Web site went down and everyone on eBay at the time could not bid on anything. We could not sell anything on eBay."

He added, "All items sold to our in-house buyers, even though they did not show that on eBay."

At least one online bidder said he received the following email concerning a different auction being hosted by eBay Live the same weekend:

"I understand that you registered to bid in Clars Auction's Live Auction on Saturday, November 4, 2006. On Saturday morning from 9am - 10:30am PST, eBay experienced a hardware-related problem with our Live Auctions technology. This issue may have prevented you from placing live bids on eBay Live Auction catalog listings during that time. Also, as a result of this issue, it's possible that absentee bids left on the items that were auctioned during that time were not executed. As a result, closing prices on the ended item pages may not reflect the actual outcome of the sale.

We understand that this situation may have caused you problems or frustration during your auctions, and we apologize for that. Steps have been taken to determine and resolve the root cause of this issue, and to prevent it from occurring in the future.

We appreciate your use of eBay's Live Auctions, and we hope you'll continue to participate in live auctions with us in the future.
Sincerely,
John McDonald"

eBay had not responded to AuctionBytes questions concerning the November 4, 2002 outage and other concerns by the time we went to press with this article on November 14th.

About the author:
*Kathy Greer, a former investigative reporter, for the past fifteen years has been the Senior Editor of "UnRavel the Gavel" (http://www.thegavel.net), a newspaper covering the New England auction scene.*