Judge dismisses landmark $100m claim against EBay

The claimants wanted $100m compensation after buying autographed sports memorabilia, that later turned out to be faked, on the site. They argued that, contrary to EBay’s trading conditions, the Internet company could be held responsible for fraudulent transactions on its site. EBay had argued that as a “service” rather than a “content” provider, it simply provides a platform for sales, with all risks and responsibilities remaining with buyers and sellers.

The claimants made headway in October when the courts ruled that there was a case to answer – under Californian state law there are specific regulations governing the sale of sports memorabilia – and several other states were reportedly keeping a close eye on events with a view to taking a lead from the outcome of the Californian case. However, the judge in the most recent hearing did not agree with the plaintiffs’ claim that as EBay created categories for memorabilia, this pointed to the company endorsing the authenticity of whatever was listed in those categories. Giving a category a name was not the same as giving a description to an item listed in it, Judge Linda Quinn ruled.

The claimants intend to resubmit the argument in a forthcoming hearing, with their counsel saying that if he fails to change the judge’s mind he will appeal on his clients’ behalf.

So while EBay was pleased with the courts confirming its “no liability” status, the challenge is not over yet.