EBay official: Employees shared Craigslist data

Dec 10, 2009 By RANDALL CHASE , AP Business Writer

(AP) -- Employees of Internet auction site eBay shared confidential information gained from Craigslist with other employees developing eBay's own online classifieds business, an eBay executive said Wednesday.

Brian Levey said that information gained as an investor in and board member of was forwarded to eBay employees developing eBay's Kijiji domestic classifieds business.

Levey, an eBay lawyer who described himself as the "legal quarterback" of the company's August 2004 acquisition of a minority interest in Craigslist, said he didn't think a confidentiality agreement precluded eBay employees from sharing confidential Craigslist information.

"As long as it was complying with the confidentiality agreement, I think the view was, it's fine," said Levey, who suggested that the confidentiality agreement was meant to prevent of Craigslist information to third parties.

Levey was testifying in a lawsuit in which eBay, which is based in San Jose, Calif., claims that Craigslist improperly acted to dilute eBay's minority interest after a falling out in 2007. Craigslist, based in San Francisco, contends in its own lawsuit that eBay used its stake in Craigslist to gain information for its own use.

In response to Levey's testimony, eBay senior vice president Alan Marks issued a statement saying eBay was allowed to compete against Craigslist in the classifieds market, including in the U.S.

"EBay had hoped it would collaborate with Craigslist to expand the classifieds business," Marks said. "It repeatedly offered expertise to Craigslist and encouraged them to invest the profits back into the business. In addition, eBay was allowed to evaluate its minority investment in Craigslist, which it did throughout the relationship."

But in his cross-examination of Levey, Craigslist attorney Michael Clyde suggested that eBay used confidential business information not just to evaluate its investment in Craigslist, but in forming a broader strategy for participating globally in the online classifieds market.

Clyde questioned Levey at one point about an e-mail he had sent to other eBay employees who were working on Kijiji but whom Clyde said had no responsibility for Craigslist. The e-mail included years of historical financial data from Craigslist.

"I think it's a reasonable assumption to say it was not in the public domain," Levey said.

Asked about whether he knew Craigslist officials would be upset when given 10 days notice that eBay was launching its own domestic classifieds site, Levey said he wasn't sure exactly how they would respond.

"I knew they wouldn't be ecstatic," he said.

In later testimony, Garrett Price, eBay's point man in the acquisition talks with Craigslist, said he repeatedly made clear to Craigslist executives that eBay planned to enter the online classified market overseas, and that while it hoped Craigslist would be its vehicle in the North American market, competition was a possibility.

"We were extremely transparent about our view of the business," said Price, who in a June 2004 e-mail to then-CEO Meg Whitman and other eBay executives, wrote that Craigslist founder Craig Newmark and CEO James Buckmaster understood that a proposed noncompete agreement was a deal-breaker for eBay.

Price compared payments that Newmark and Buckmaster demanded in order to concede to eBay's acquisition of its minority stake to "extortion" and described the running of Craigslist board meetings as "very amateurish."

Price also described his frustration in trying to work with Craigslist officials, saying every decision had to go through Buckmaster.

"You can't function in a rapidly changing environment on a global scale with that kind of organizational structure," he said. "God help that company if he gets hit by a bus."

Clyde was scheduled to begin his cross-examination of Price on Thursday, after which Newmark was expected to take the stand.

©2009 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Explore further: New approach to online compatibility

Related Stories

Whitman says eBay didn't misuse Craigslist data

Dec 07, 2009

(AP) -- Former eBay CEO Meg Whitman said Monday she was unaware of any attempt by the Internet marketplace to misuse confidential data from Craigslist to help eBay develop a competing online classifieds business.

Craigslist CEO asks SC AG to apologize for threat

May 18, 2009

(AP) -- The CEO of Craigslist is asking South Carolina's attorney general to apologize for threatening to prosecute the company if any advertisements on the Web site lead to a prostitution case.

Craigslist strikes back, files suit

May 20, 2009

Craigslist announced Wednesday that it had filed suit against a state attorney general who has threatened criminal charges against the online classifieds site in a dispute over "erotic services" ads.

Recommended for you

New approach to online compatibility

17 hours ago

Many of the online social networks match users with each other based on common keywords and assumed shared interests based on their activity. A new approach that could help users find new friends and contacts with a greater ...

Most internet anonymity software leaks users' details

Jun 29, 2015

Virtual Private Networks (VPNs) are legal and increasingly popular for individuals wanting to circumvent censorship, avoid mass surveillance or access geographically limited services like Netflix and BBC ...

WikiLeaks says NSA spied on French business

Jun 29, 2015

WikiLeaks has released documents that it says show that the U.S. National Security Agency eavesdropped on France's top finance officials and high-stakes French export bids over a decade in what the group called targeted economic ...

Google gets extended deadline to answer EU case

Jun 29, 2015

Brussels has given Google an extension until mid-August to answer an anti-trust case alleging that the tech giant abuses its search engine's market dominance, a company spokesman said Monday.

Facebook opens first Africa office

Jun 29, 2015

Facebook announced Monday it had opened its first African office in Johannesburg as part of its efforts "to help people and businesses connect" on the continent.

User comments : 0

Please sign in to add a comment. Registration is free, and takes less than a minute. Read more

Click here to reset your password.
Sign in to get notified via email when new comments are made.