eBay is accused of stealing confidential data from Craigslist

Sep 14, 2011 13:40 GMT  ·  By

The legal issues between eBay and Craigslist continue to mount. An ongoing lawsuit seeks to settle a dispute over allegations that eBay bought a stake in the listings site for anti-competitive reasons.

Meanwhile, US prosecutors have now started a criminal investigation over the claims and they seek to find whether eBay employees are guilty of stealing confidential information.

A subpoena has been issued to help prosecutors get more info on several eBay execs and employees.

Among those cited in the subpoena are Pierre Omidyar, the site's founder and chairman, and Joshua Silverman, who represented eBay on the Craigslist board.

"We will cooperate with any inquiry related to the disputes between eBay and Craigslist," eBay said in a statement.

"EBay believes that Craigslist's allegations against eBay are without merit," it said. "We will continue to vigorously defend ourselves, and we will aggressively pursue our claims against Craigslist."

The new probe is very much linked to ongoing litigation between the two companies.

Craigslist is accusing eBay of abusing its position and stealing confidential user information from the company in order to build a rival. eBay bought a stake in Craigslist, indirectly, and paid the company for some additional powers, such as veto right on certain decisions.

Meanwhile, it was also building its own listings site and Craigslist believes eBay only invested to get access to confidential data which would help it prop up its competing site.

In another lawsuit, now settled, eBay claimed that Craigslist illegally diluted its stake in the company, in an effort to make it lose its right to have a representative on the Craigslist board.

The judge in that lawsuit said that Craigslist was within its rights in removing the eBay representative from its board, but that it could not dilute eBay stake, of 28.4 percent, in the company.