eBay sued for online slander
2003-01-24 09:41
Los Angeles - A Los Angeles man who says he was libelled in eBay's "feedback" section of its website has sued the online auction house for refusing to remove statements he says damaged his reputation.
Analysts say the case, sparked by an online sale of vintage Hollywood magazines, cuts to the heart of what makes eBay work: the power of buyers and sellers to keep an eye on each other.
Robert Grace, publisher of a Los Angeles legal newspaper, sued eBay and Hollywood memorabilia dealer Tim Neeley this week in a California Superior Court after the website refused to remove negative comments Neeley made after selling Grace six vintage entertainment magazines.
According to the lawsuit, Neeley said Grace "should be banned from eBay", and was "dishonest all the way" for alleging in the online forum that the magazines he bought had arrived late and in a worse condition than advertised.
In his lawsuit, Grace demands $2.5 million in punitive damages from eBay and $100 000 from Neeley.
A spokesperson for eBay said the company would not comment on pending litigation. Neeley said Grace started the battle of words by complaining in eBay's signature feedback section about the condition of the "Radio TV Digest" magazines he bought. The magazines dated from the 1940s and 1950s, he said.
Grace said when he asked Neeley for a retraction, the memorabilia dealer replied: "Get a life, dude."
eBay warns its users they could be held responsible for fallout from libellous comments they make in "feedback", where buyers and sellers can rate each transaction.
"You are responsible for your own words," a warning on the site states, in part. "You should be careful about making comments that could be libellous or slanderous. You will not be able to retract or edit feedback you left."
Suit asks for filters
Grace, an attorney, said he would not have filed suit over the postings "except for the fact that eBay's policy needs to be revised".
"Once they are advised that something isn't true and they just shrug their shoulders, that is arrogant," Grace said. "They can control content and for them to fail to do so is unconscionable."
The suit asks a judge to force the cyber-auctioneer to filter words like "fraud, liar, cheater, scam artist, con man" from the site, or to warn users of the prospect of potentially libellous retaliation if they complain about a seller.
One analyst doubted whether the suit would have much impact on the wide-open cybermarket.
"One of the cleverest things they did was saying, 'We are not responsible, we are only a platform,"' said analyst Safa Rashtchy for US Bancorp Piper Jaffrey. "eBay is like Teflon cookware: nothing sticks to it."
Although eBay has successfully fended off similar suits, an erosion of the feedback system's credibility could be devastating, said Rashtchy.
"If this or other lawsuits over feedback were to succeed ... it would be hugely negative for eBay. eBay's success is largely because of this feedback system," he said.
The lawsuit also demands that buyers and sellers, who use aliases in eBay transactions, register their screen names with the state of California as fictitious business names, and that eBay be forced to collect state sales tax.