Judge: Rulings tomorrow Craigslist v. EBay
SAN FRANCISCO — While probably everyone but the Craigslist folks hope that the ruling expected tomorrow from California Superior Court Judge Richard Kramer the in Craigslist vs. EBay is the end of the ongoing battle between the two classified advertising giants battle, that probably won’t be the case.
The two-day bench trial seems more to be a hearing to determine if Craigslist Inc. and its part owner EBay Inc. face off yet again, this time perhaps in front of a jury as requested by Craigslist. After sitting in on the first day’s proceedings we’re betting a jury trial is going to happen in 2012.
The case heard today was a parallel to EBay Holdings Inc. vs. Craigslist, Inc., a case decided last September in Delaware. The judge in that case, Chancellor William Chandler III, ruled that EBay was not entitled to have a member on the board of Craigslist because it competes directly with Craigslist, but said that Craigslist had adopted a shareholder rights plan as a “punitive response” to EBay and he rescinded Craigslist’s effort to reduce EBay’s stake in the company. There’s a lot more background here, here, here, here and here on our site; there’s no need for a full recap in this post.
We’ll spell it out in more detail tomorrow, but the issues at hand at their simplest are: EBay argued that the Delaware ruling not only addressed and resolved all issues, but also determined that Craigslist had no culture of its own. Craigslist therefore couldn’t legally accuse EBay of fraudulence in failing to act according to that culture, as it had purportedly promised Craigslist’s CEO Jim Buckmaster it would before Buckmaster and Craigslist founder Craig Newmark signed an early contract with EBay.
Craigslist countered that the Delaware judge simply said that Craigslist had failed to prove its culture to the his satisfaction, and that he had repeatedly declined to rule on issues such as fraud and unfair competition, as they were reserved for the pending California case.
There was also a lot of back and forth about Craigslist presenting itself initially as a nominal defendant in Delaware and later as an actual defendant, and whether or not EBay Holdings Inc., the plaintiff in Delaware, was the same entity as EBay Inc., the defendant in California. Also at issue is whether the fact that the different players and different time frames made for a different transaction, and therefore the right to a second trial in San Francisco.
If his questions to the EBay attorney before him were any indication, Kramer would seem to be leaning Craigslist’s way. In explaining that the Delaware judge had said Newmark and Buckmaster hadn’t proven there was a defined culture at Craigslist that was relevant in this case, EBay attorney Michael Rhodes asked, “How much clearer could he have been?” “He could have said there is no culture,” responded Judge Kramer.
More tomorrow. Stay tuned here, or in limited tweets at @classifiedtiger. Search #craigvebay.
