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eBay Accused of Price Gouging Scheme
Symbiot writes "eBay is being sued in a Calilfornia court for a practice that the plaintiff, Glenn Block of Pennsylvania, claims artificially raises the amount of a bid. The practice combines the warning emails that eBay sends out when you are the highest bidder and your bid is at your maximum, with the bid increment mechanism. It seems that if your original maximum bid settnig prevents your current bid from falling on an increment then your current bid will be raised to the next increment as soon as you raise your maximum. If the plaintiff wins this class action suit could cost eBay tens or hundreds of millions of dollars."
Just read the article, the last line of it summarises the entire lawsuit:
EBay had net revenue of $3.27 billion in 2004.
So, eBay is price gouging an -auction- whose parameters [set increments] are defined well before the customer participates?
Perhaps I'm missing some nuance of law, but this seems like something that eBay's lawyers [and the judge] will toss into the street with a nice lengthy brief which summarizes to "RTFM!".
Something bothers me about the nature of civil suits and monetary awards in this country.
Why is it that we make it a habit of running off with as much money as we possibly can from a lawsuit?
The purpose of suing for this sort of stuff should be twofold: 1) to regulate company action by means of threat and penalty AND 2) reparations. Nowhere in those two clauses do I find any justification for "screwing the other guy over because he did it to me first."
It seems to me that few suits are about that anymore. While its true that you are entitled to sue if a company takes advantage of you, often times the rabidity with which "wronged" plaintiffs style their demands leads me to wonder if they are simply taking advantage of the momentary shift in power.
In that scenario, it's no longer about punishing the one who took advantage of you because he could. It's about turning around and taking full advantage of him, because now you can.
I liken this to a physical auction where the auctioneer is saying, "I have $100, do I hear $150, $150?" He's looking for $150, not for some dimwit to yell $110. If he gets no bites at $100, he may sell at $100 or ask for $125. What he doesn't do is throw it open for said dimewit to say, "I'll give you $100.01."
"I'd rather be a lightning rod than a seismometer." -Ken Kesey
"therefore his bid increment would not be enough to secure the item"
That is not correct if I understand you right, so your comment should not be moderated Insightful.
The proxy bidding system is what eBay is using to manipulate some buyers, and thus milk higher FVFees from eBay sellers.
A person CAN win an auction if their high bid is not a full official increment above the lower bidder. This happens in the following situation:
I bid $5.02 on an auction first. Then you bid $5 in the final seconds, in an attempt to snipe my bid which is showing as the starting price of $0.99. I win the auction with a winning bid of $5.02, even though the next increment should be $5.25.
My appology if you meant this and I wasn't understanding what you were saying in your post.
Why slashdot? Why not?
Except that that's not what happens. This issue only happens when someone else bids $80.
Your bid is now $80, but you still win because you were there first.
However, if you *then* bump your max bid higher, it'll bump your current bid up an increment.
Know how you solve this problem? Actually make your max bid the maximum amount you're willing to pay for the item to start with, like you're supposed to.
If you're raising your bid after your initial bid, you deserve an idiot tax. Changing bids reflects a complete misunderstanding of the basic premise of the eBay auction.
my sig's at the bottom of the page.
I'm sorry, you're oversimplifying. When you specify a new maximum bid of $125, you are agreeing to pay that much if that's what's required to win the auction. In this case, it's not. $100.01 is what's required to win the auction, and that's what you've already bid.
The reason that this is a dubious lawsuit is that the behavior is already described by eBay's documentation. That doesn't mean it's the right way to do things.
Why shouldn't eBay force people to bid when they raise their maximum? For the same reason that they shouldn't force people to always pay their "maximum bid" amount. There may be reasons why this lawsuit is BS, but yours isn't one of them.
There are no trails. There are no trees out here.
Not only is this summary 1/4 as long as the article summary published by Slashdot, it displays a superior level of understanding by its author. More importantly, it encourages readers to read the entire article, rather than pissing them off with typos or stupid statements like this
and this
This is a case where, if I were a schoolteacher and "symbiot" was my student, I would encourage plagiarism.
What nobody is talking about is that there are two aspects to the proxy bidding system: the maximum bid and the timestamp associated with that bid. Each named bidder is only allowed one such pair to control their bidding.
.09 cents, less than the next increment? It is the timestamp of your proxy bid. But when you change the value of your proxy, you changed the timestamp.
The plaintiff here wants to get out of this one "max/timestamp pair" situation with the best of both worlds -- they want to use the later and larger max, but they also want to keep their earlier timestamp, which allows them a non full increment bid.
Think of it this way: you told it to max you out at 100.09. Somebody else bid it up to 100.00. What makes you think you have the right to increase that by
The kicker here is that the priviledge of winning by less than the bid increment comes with a definite disadvantage -- your auction opponent looks out and sees his bid of 100.00 beat by your bid of 100.09. He should fairly be able to ask "why is that jerk not required to bid up to the increment". The only fair answer is if he can rely on the fact that your 100.09 top bid reveals that you are maxed out and that he surpass your proxy max by bidding 101.09. If you are allowed to raise your proxy max without raising your current bid, he should be able to bid 101.09 and force you to bid 102.09. Instead, your new proxy max and timestamp puts you with the high current bid of 101.00 and forces your opponent to bid 102.00, which gives you an advantage towards winning the item since this is higher than the alternative where they could bid 101.09. This may be enough of an advantage to cause you to win. In short -- there was NO GUARANTEE you would have won with your original 100.09, since you are not able to decide for your opponent what his course of action would have been.
The reason the plaintiff will lose this case is that
1) the rules were clear ahead of time
2) raising your proxy max invalidates your old proxy timestamp which is what permitted the non-increment raise
3) there is no guarantee your original high bid would have won (and thus no proof of harm)
4) You cannot prove that you didn't actually pay LESS because of this system.
A) you were less vulnerable to sniping because your opponents could no longer infer that your current bid was your proxy max, and
B) your opponents would have had to raise two full increments above their previous bid to test you.