eBay noted in its 10K filing with the SEC that a class certification motion is scheduled for June 2009 in the Malone v. eBay Inc. antitrust class action lawsuit. In 2007, two eBay sellers filed separate lawsuits against the company, subsequently consolidated into one lawsuit. The plaintiffs will file their motion to certify a class, eBay will likely oppose the motion, in which case the plaintiffs would reply. The Court will then have a hearing to decide whether to certify a class of eBay sellers.
Class certification is a step in the process that determines whether the case may proceed on behalf of all sellers, some group of sellers, or it is not a case that can proceed on the collective behalf of sellers. This part of the case is not a determination of the merits of the claims. The Court may rule on class certification in the fall or by the end of year.
Malone filed his lawsuit in April 2007 and alleged that eBay "utilizes its nationwide monopoly of the on-line auction market to monopolize the available forms of payment that sellers can use on eBay." The second class-action complaint was filed by Ann Farmer and Todd Van Pelt on April 23, 2007. That lawsuit alleged that eBay possesses monopoly power in the online auction market, estimating it controls over 90 percent of the market in part due to the "network effect."
eBay's note about the lawsuit from its 10K filed on February 20, 2009:
*In March 2007, a plaintiff filed a purported antitrust class action lawsuit against eBay in the Western District of Texas alleging that eBay and its wholly owned subsidiary PayPal “monopolized” markets through various anticompetitive acts and tying arrangements. The plaintiff alleges claims under sections 1 and 2 of the Sherman Act, as well as related state law claims. The complaint seeks treble damages and an injunction. In April 2007, the plaintiff re-filed the complaint in the U.S. District Court for the Northern District of California (No. 07-CV-01882-RS), and dismissed the Texas action. In 2007, the case was consolidated with other similar lawsuits (No. 07-CV-01882JF). In June 2007, we filed a motion to dismiss the class action complaint. In March 2008, the court granted the motion to dismiss the tying claims with leave to amend and denied the motion with respect to the monopolization claims. Plaintiffs subsequently decided not to refile the tying claims. The class certification motion is scheduled for June 2009. We believe that we have meritorious defenses and intend to defend ourselves vigorously.*
