Interesting case where Ebay got sued b/c someone left negative feedback on a buyer
Longacre
Posts: 16,717 ✭✭✭
Although this is not really numismatic related, I found this case interesting (a lot of people post threads about Ebay, so hopefully no one minds this post). The case is from this year, and basically a buyer sued Ebay for defamation becauase a seller posted negative comments about him on a particular transaction (I guess it is better to sue the "deep pockets" rather than the seller who posted the negative comments). Ebay won at the trial level and the CA appeals court affirmed the ruling. The CA Supreme Court is now reviewing the case.
One of the items that I found particularly interesting is the court's comment that a seller on Ebay located in CA needs to file a "fictitious business name" statement on a regular basis with the state of CA (see the second paragraph in the "complaint" section; I also attached at the bottom a copy of the CA statute). Anyway, I found this interesting. I guess we should all watch out if we decide to "neg" people.
Court of Appeal, Second District, Division 3, California.
Roger M. GRACE, Plaintiff and Appellant,
v.
EBAY, INC., Defendant and Respondent.
No. B168765.
(Los Angeles County Super. Ct. No. BS288836).
Feb. 5, 2004.
Appeal from a judgment of the Superior Court of Los Angeles County. Thomas Willhite, Jr., Judge. Affirmed.
Roger M. Grace, in pro per, and Lisa Grace-Kellogg for Plaintiff and Appellant.
Cooley Godward, Michael G. Rhodes and Andrea S. Bitar for Defendant and Respondent.
CROSKEY, Acting P.J.
*1 Plaintiff Roger M. Grace ("plaintiff") appeals from a judgment of dismissal entered after the trial court sustained without leave to amend the demurrer to plaintiff's complaint filed by defendant eBAY Inc. ("defendant"). Plaintiff's suit seeks to hold defendant liable for allegedly defamatory material published on defendant's internet website by another defendant, Tim Neeley. The trial court concluded that under federal communications law concerning computer services, plaintiff's allegations cannot rise to a cause of action against defendant. We agree, and we affirm the judgment.
BACKGROUND OF THE CASE
1. The Complaint
According to plaintiff's complaint, defendant has an internet website whereat defendant conducts auctions of sellers' goods. The goods are described on the website and prospective buyers submit bids to defendant by e-mail.
Tim Neeley ("Neeley") is a merchant who utilizes defendant's website to sell goods. Neeley does business in Los Angeles and utilizes the fictitious business name "Crackerpopp," although he has not complied with the requirements of the fictitious business statute, Business and Professions Code, section 17910.
A person wishing to bid on items at defendant's auction website does so using a computer and internet service provider. Defendant charges the seller for use of its website. Defendant encourages buyers and sellers using its website to leave feedback about their auction transactions, and defendant is aware that users leave false and defamatory feedback in response to negative remarks made about them by others, but defendant does not warn of this possibility nor does it take action once told of the presence on its website of defamatory matter. Users of defendant's services have "feedback profiles."
Plaintiff was the successful bidder on items offered for sale by Neeley. Plaintiff left negative feedback about some of those transactions and in return, Neeley placed the following remark in plaintiff's feedback profile: "complaint: should be banned from ebay!!!! dishonest all the way!!!!" This allegation about plaintiff is harmful, malicious, known by Neeley to have no factual support and defamatory.
Although plaintiff informed defendant about the false and defamatory nature of Neeley's comments, defendant has refused to remove the comments. Defendant, on a daily basis, is publishing the false and defamatory comments made by Neeley because defendant keeps the comments on its website, and is doing so with knowledge of the falsity of the comments or in reckless disregard of the truth.
Plaintiff entered into a "user agreement" posted by defendant on defendant's website, and sellers must also enter into such a user agreement with defendant. Paragraph 6.2(e) of the user agreement provides that information provided by the user of the website must not be defamatory. Paragraph 9 of the user agreement gives defendant rights against a user if defendant, among other things, believes that the users actions may cause financial loss or liability for defendant or its users. One of those rights is to "remove your item listings." However, defendant has a policy against removing feedback if removal is based on its false and defamatory nature, but defendant does not mention that policy in its user agreement, and a person using the website is a third party beneficiary of these user agreements and would reasonably expect defendant to remove false and defamatory matter. Defendant breached its user agreement with plaintiff by not removing Neeley's false and defamatory remarks about plaintiff after plaintiff made a demand that plaintiff do so. Having a policy of refusing to remove libelous matter from its website is a violation of California's statute against unfair business practices, Business and Professions Code, section 17200.
Plaintiff sued defendant for libel, breach of contract, [FN1] and unfair business practices. [FN2]
FN1. In its extensive written ruling on defendant's demurrer, the trial court stated plaintiff acknowledged in his opposition to the demurrer that his breach of contract claim is moot.
FN2. Regarding the unfair business practice allegations, plaintiff asserts that by not withdrawing libel from its website, defendant is engaging in an unfair business practice, in contravention of Business and Professions Code section 17200. As discussed infra, a suit based on this allegation is precluded by federal law covering internet use.
The third cause of action also alleges (1) defendant encourages and causes violations of Business and Professions Code section 17910 by encouraging persons to adopt fictitious business names to transact their business, without also admonishing them to comply with the fictitious business name statutes; and (2) defendant "promotes and effects an avoidance of the payment of sales tax by buyers in connection with sales by merchants, such as Neeley." Plaintiff alleges defendant should be enjoined from these alleged violations of state law. The complaint states plaintiff's third cause of action is maintained "in a representative capacity in a private attorney action." Apparently, plaintiff means a private attorney general action.
At the hearing on the demurrer, plaintiff advised the court that in light of the sustaining of the demurrer to the libel cause of action without leave to amend, plaintiff would not seek to amend the third cause of action.
[Edited to remove legal analysis]
DISPOSITION
The judgment of dismissal is affirmed. Costs on appeal to defendant.
We Concur: KITCHING and ALDRICH, JJ.
Cal.App. 2 Dist.,2004.
Grace v. eBAY, Inc.
2004 WL 214449 (Cal.App. 2 Dist.) Not Officially Published, (Cal. Rules of Court, Rules 976, 977)
*******************************************************************************
Here is the CA statute that indicates a filing needs to be done for persons who sell on Ebay:
West's Ann.Cal.Bus. & Prof.Code § 17910
West's Annotated California Codes Currentness
Business and Professions Code (Refs & Annos)
Division 7. General Business Regulations (Refs & Annos)
Part 3. Representations to the Public (Refs & Annos)
Chapter 5. Fictitious Business Names (Refs & Annos)
§ 17910. Persons required to file fictitious business name statement; time for filing
Every person who regularly transacts business in this state for profit under a fictitious business name shall:
(a) File a fictitious business name statement in accordance with this chapter not later than 40 days from the time he commences to transact such business; and
(b) File a new statement in accordance with this chapter on or before the date of expiration of the statement on file.
Text
One of the items that I found particularly interesting is the court's comment that a seller on Ebay located in CA needs to file a "fictitious business name" statement on a regular basis with the state of CA (see the second paragraph in the "complaint" section; I also attached at the bottom a copy of the CA statute). Anyway, I found this interesting. I guess we should all watch out if we decide to "neg" people.
Court of Appeal, Second District, Division 3, California.
Roger M. GRACE, Plaintiff and Appellant,
v.
EBAY, INC., Defendant and Respondent.
No. B168765.
(Los Angeles County Super. Ct. No. BS288836).
Feb. 5, 2004.
Appeal from a judgment of the Superior Court of Los Angeles County. Thomas Willhite, Jr., Judge. Affirmed.
Roger M. Grace, in pro per, and Lisa Grace-Kellogg for Plaintiff and Appellant.
Cooley Godward, Michael G. Rhodes and Andrea S. Bitar for Defendant and Respondent.
CROSKEY, Acting P.J.
*1 Plaintiff Roger M. Grace ("plaintiff") appeals from a judgment of dismissal entered after the trial court sustained without leave to amend the demurrer to plaintiff's complaint filed by defendant eBAY Inc. ("defendant"). Plaintiff's suit seeks to hold defendant liable for allegedly defamatory material published on defendant's internet website by another defendant, Tim Neeley. The trial court concluded that under federal communications law concerning computer services, plaintiff's allegations cannot rise to a cause of action against defendant. We agree, and we affirm the judgment.
BACKGROUND OF THE CASE
1. The Complaint
According to plaintiff's complaint, defendant has an internet website whereat defendant conducts auctions of sellers' goods. The goods are described on the website and prospective buyers submit bids to defendant by e-mail.
Tim Neeley ("Neeley") is a merchant who utilizes defendant's website to sell goods. Neeley does business in Los Angeles and utilizes the fictitious business name "Crackerpopp," although he has not complied with the requirements of the fictitious business statute, Business and Professions Code, section 17910.
A person wishing to bid on items at defendant's auction website does so using a computer and internet service provider. Defendant charges the seller for use of its website. Defendant encourages buyers and sellers using its website to leave feedback about their auction transactions, and defendant is aware that users leave false and defamatory feedback in response to negative remarks made about them by others, but defendant does not warn of this possibility nor does it take action once told of the presence on its website of defamatory matter. Users of defendant's services have "feedback profiles."
Plaintiff was the successful bidder on items offered for sale by Neeley. Plaintiff left negative feedback about some of those transactions and in return, Neeley placed the following remark in plaintiff's feedback profile: "complaint: should be banned from ebay!!!! dishonest all the way!!!!" This allegation about plaintiff is harmful, malicious, known by Neeley to have no factual support and defamatory.
Although plaintiff informed defendant about the false and defamatory nature of Neeley's comments, defendant has refused to remove the comments. Defendant, on a daily basis, is publishing the false and defamatory comments made by Neeley because defendant keeps the comments on its website, and is doing so with knowledge of the falsity of the comments or in reckless disregard of the truth.
Plaintiff entered into a "user agreement" posted by defendant on defendant's website, and sellers must also enter into such a user agreement with defendant. Paragraph 6.2(e) of the user agreement provides that information provided by the user of the website must not be defamatory. Paragraph 9 of the user agreement gives defendant rights against a user if defendant, among other things, believes that the users actions may cause financial loss or liability for defendant or its users. One of those rights is to "remove your item listings." However, defendant has a policy against removing feedback if removal is based on its false and defamatory nature, but defendant does not mention that policy in its user agreement, and a person using the website is a third party beneficiary of these user agreements and would reasonably expect defendant to remove false and defamatory matter. Defendant breached its user agreement with plaintiff by not removing Neeley's false and defamatory remarks about plaintiff after plaintiff made a demand that plaintiff do so. Having a policy of refusing to remove libelous matter from its website is a violation of California's statute against unfair business practices, Business and Professions Code, section 17200.
Plaintiff sued defendant for libel, breach of contract, [FN1] and unfair business practices. [FN2]
FN1. In its extensive written ruling on defendant's demurrer, the trial court stated plaintiff acknowledged in his opposition to the demurrer that his breach of contract claim is moot.
FN2. Regarding the unfair business practice allegations, plaintiff asserts that by not withdrawing libel from its website, defendant is engaging in an unfair business practice, in contravention of Business and Professions Code section 17200. As discussed infra, a suit based on this allegation is precluded by federal law covering internet use.
The third cause of action also alleges (1) defendant encourages and causes violations of Business and Professions Code section 17910 by encouraging persons to adopt fictitious business names to transact their business, without also admonishing them to comply with the fictitious business name statutes; and (2) defendant "promotes and effects an avoidance of the payment of sales tax by buyers in connection with sales by merchants, such as Neeley." Plaintiff alleges defendant should be enjoined from these alleged violations of state law. The complaint states plaintiff's third cause of action is maintained "in a representative capacity in a private attorney action." Apparently, plaintiff means a private attorney general action.
At the hearing on the demurrer, plaintiff advised the court that in light of the sustaining of the demurrer to the libel cause of action without leave to amend, plaintiff would not seek to amend the third cause of action.
[Edited to remove legal analysis]
DISPOSITION
The judgment of dismissal is affirmed. Costs on appeal to defendant.
We Concur: KITCHING and ALDRICH, JJ.
Cal.App. 2 Dist.,2004.
Grace v. eBAY, Inc.
2004 WL 214449 (Cal.App. 2 Dist.) Not Officially Published, (Cal. Rules of Court, Rules 976, 977)
*******************************************************************************
Here is the CA statute that indicates a filing needs to be done for persons who sell on Ebay:
West's Ann.Cal.Bus. & Prof.Code § 17910
West's Annotated California Codes Currentness
Business and Professions Code (Refs & Annos)
Division 7. General Business Regulations (Refs & Annos)
Part 3. Representations to the Public (Refs & Annos)
Chapter 5. Fictitious Business Names (Refs & Annos)
§ 17910. Persons required to file fictitious business name statement; time for filing
Every person who regularly transacts business in this state for profit under a fictitious business name shall:
(a) File a fictitious business name statement in accordance with this chapter not later than 40 days from the time he commences to transact such business; and
(b) File a new statement in accordance with this chapter on or before the date of expiration of the statement on file.
Text
Always took candy from strangers
Didn't wanna get me no trade
Never want to be like papa
Working for the boss every night and day
--"Happy", by the Rolling Stones (1972)
Didn't wanna get me no trade
Never want to be like papa
Working for the boss every night and day
--"Happy", by the Rolling Stones (1972)
0
Comments
It is time Ebay and Paypal are dragged to court and whacked.
Maybe, but not for this. What kind of idiot would take eBay to court over a single line Internet posting from another user? This must be costing tens of thousands of dollars in fees alone.
Free Trial
Ebay drives you crazy enough to do anything.
MCDBA MCSD MCSA
http://www.sqlgeek.org
Jerry
No. Having a "user name" or "logon name" is not the same as a ficticious business name.
If your checks and money orders are made out to you (your legal name) then that's not ficticious.
If people are sending checks made out to "crackerpopp" or "jones coin co." or something, and you're cashing them, then yes, filing the ficticious business name statement is probably right.
Of course, depending on volume of business and other circumstances, a business licence or a resale licence might be appropriate, maybe someone can comment on the requirements for that.
But I feel sure that most ebay sellers don't need to file for ficticious business name.
edit: as far as the lawsuit itself, it seems silly to me; they're giving too much weight to a single feedback. Is the plaintiff's business reputation so fragile that a single comment ruins it? or is this an opportunity for yet another frivolous lawsuit?
Liberty: Parent of Science & Industry
Dave
Why, they'll just sue Ebay.
-Khayse
I would use ....unacceptable, late, wrong, untimely, contrary, and stuff like that.
No reason to open yourself to more grief than lies in wait for you otherwise.