Slashdot Mirror
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."
Bullshit. This happened to me once.
I had a max of say 100.01 and another bidder had bid 100.00 while the current high was substantially lower, so it showed 'You have been outbid the current high bid is 100.01' Now, they could bid at least 102.51 and take the lead or had figured that was just too much, either way, I see that they have homed in and I raise my cap to 125.00, suddenly my high bid is 102.50 rather than 100.01.
To shed a different light on this, there was another time a similar thing happened, but when I reloaded the page later it would revert back to my prior high bid, which can be handy for disguising what your actual new cap is. I'm sure they know all about it and had fiddled with the way it works.
It happened once to my knowledge, so I'm probably only entitled to a couple bucks, but it will be interesting to see how this plays out.
If the plaintiff wins this class action suit could cost eBay tens or hundreds of millions of dollars."
I think that's a gross exaggeration of the problem, however it could cost eBay a lot in man-hours auditting the results of every auction since the beginning to determine who is entitled to a refund.
A feeling of having made the same mistake before: Deja Foobar
The seller has to pay a fee to get an item listed, the seller has to pay another fee when money is sent via PayPal. That is the real price gouging.
[o]_O
From the article: "EBay automatically increases bids only when the maximum has been hit and when the prior top bid was between bidding increments. For example, bidding increments on items priced between $100 and $249.99 is $2.50. Block, however, raised his bid increment by $1.50." therefore his bid increment would not be enough to secure the item.
I've actually managed to outbid myself several times. It's very annoying.
...with a little more substance than the Reuters.com blurb can be found here.
"Give me taste, give me funk, give me fury, gimme some more."
Whoopty fucking doo.
We're talking about maybe a dollar more here?
And that amount is still below what you set you were willing to pay.
This seems more like a bug then some sort of evil scam.
Technology, the cause of and solution to all of life's problems.
In the first place, no one held a gun to his head to make him increase his maximum. In the second place, if he originally thought the item was worth x$, why increase it?
Learn to snipe, cherry boy.
whats a settnig? is it a type of fig or nut?
cha-ching. money baby... money
Just read the article, the last line of it summarises the entire lawsuit:
EBay had net revenue of $3.27 billion in 2004.
Ahh it is whoopty fucking doo though.
And a dollar is actually a lot for such schemes. For example it is illegal for a boss to shave a minute off of your clock time even though it may only be worth a few cents extra. Doing that could save a large company hundreds if not thousands of dollars per pay period. The people recieving the checks probably wouldnt notice either, but it is still cheating people of money and illegal.
The same reason the "money shaving" scheme in office space was wrong comes to mind.
WoW: Scheod 70 orc warlock on Shadowmoon
In the bad form of replying to my own post I found the help section on eBay that explains this policy. To quote:
I want peace on earth and goodwill toward man.
We are the United States Government! We don't do that sort of thing.
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!".
Actually once you get above $1k, the bid increments are much higher, so it could be $25-$50 difference. Multiply that enough times, and it is a big number. But ebay is not the beneficiary, the seller is, so...
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
Nobody seems to understand the problem here. It isn't about winning auctions. It's about eBay automatically increasing your bid for no real reason.
Here's the scenario:
You bid on an item for, say, $80.
Somebody comes along, bids $75.
Your bid is auto-incremented to $76 to beat out this other bidder.
You, getting nervous that somebody might usurp your spot with a max bid of $80, increase your maximum.
When you increase your maximum bid, eBay automatically increments the CURRENT bid value by the increment amount, EVEN THOUGH YOU WERE THE CURRENT HIGH BIDDER TO BEGIN WITH.
This is where the price gouging comes in. You are already the high bidder, you're just increasing your maximum bid. It shouldn't increase the current bid when the current high bidder increases his maximum, though. That is totally nonintuitive. The system interprets your maximum bid increase as a "competing bid" however and checks its max value against the current max bid value, and if greater, it "bids" on the item with the new max value, increasing the cost by the minimum increment, just as if ANOTHER bidder had come along and bid on the item at a higher value.
It's like you're bidding against yourself whenever you increase your maximum bid, and THIS is the price gouge that is to be disliked.
Reinvent the wheel only at either a lower cost, greater effectiveness, or your own personal enrichment and satisfaction.
Yeah I've noticed that. Another thing I have noticed when "shopping" around there. There will be an item with say a 7 day auction and it's on day 4 and there were 6 bidders. I see a number of instances where some are all of them bidders have been signed up as a buyer for 2+ years and bought nothing in all that time. But all of a sudden they decide they want the item I want. Hmmmmm.
My karma is not a Chameleon.
I've scored some really nice items on ebay, antiques and such.
The problem for me is two fold.
1) I can't see the items to get an appreciation of the quality, age, wear, and authenticity. I take the sellers word for it, which is generally very verbose and well described. I bid near top dollar and hope the seller is honestly describing the item. I'm a collector, not a bargain hunter.
2) A lot of people are on ebay, so if the verbose description of an item has the right words, all the collectors find the item. Raising the price for the seller.
The best deals have been from sellers who didn't know what they had, and listed it with some other unrelated item I was persuing as a package deal.
It's very hard to find a bargain price for a well listed well described item that it in any sort of demand.
The best purchases have been at top dollar for good merchandise I would not be able to find locally.
I think it's a win for everyone but the bargain hunting buyers.
Once again the little-guy gets the short end of the stick
Maybe the 'little guy' needs to be a little more careful with the pointy end of the stick, if he doesn't want the big guys to come and take the stick away.
This is a perfect example of a frivolous lawsuit. Some functional illiterate from the Land of Fruits and Nuts logged onto eBay and placed a couple of bids without having his mommy read him the eBay terms of service first. It's amazing (and frightening) how few eBay users actually understand how eBay auctions work.
Dahlmann tightly grips the knife, which he may have no idea how to use, and steps out into the plain.
One thing I can say is good, though, is that eBay doesn't nail bidders for a fee as well. I've had to shell some $$ in the past on other auctions and thought that was pretty scurvy, but it actually is practice at many large auction houses. Sothebys and the like didn't become famous for their charity to buyers and sellers.
Yeah, but acccording to themselves (IIRC) EBay are not auctioneers:-
From Ebay.com and also at Ebay.co.uk, they say that:-
3. eBay is Only a Venue.
3.1 eBay is not an auctioneer. Although we are commonly referred to as an online auction web site it is important to realise that we are not a traditional auctioneer. Instead, the Site acts as a venue which allows registered users to offer, sell, and buy just about anything which is legal, at any time, from anywhere, in a variety of price formats. We do not review listings provided by users, we never possess the items offered through the Site and we are not involved in transactions between buyers and sellers.
In short, they do a lot less than Sothebys and friends, so I don't consider this largesse in any way.
"Slashdot - News and Chat Sites Deviant". (Click "homepage" link above for details).
"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?
As someone put it well in another post, you should be bidding on the increments. Be thankful that eBay lets you occasionally get away with underbidding the next increment, rather than complaining when you do what you are supposed to.
I dunno, this sounds much ado about nothing to me. I havent bought anything of ebay in a while, but my rule of thumb was to make one bid; whatever the maximum I was willing to spend and *leave it the hell alone* until the auction was over. If you always bid your max and let ebay's proxy system work the way it's supposed to then you 1) never pay any more that what it takes to outbid the second highest bidder and 2) never get caught up in ridiculous bidding wars.
Another option is to use a sniping site (I used to use esnipe, which worked great. Havent tried it in a while). It would automatically place your bid for you a few seconds before the end of the auction, so you have no chance to re-raise your bid should it fall short. It encourages you to determine how much that item is worth to you first and bid your max.
Automatically increasing the leading bid to the next increment does sound shady, but by allowing himself to be influenced by ebay's "OMFG YOU MIGHT BE OUTBID!!!11" email, he's falling right in thier trap. Ebay takes a percentage of the final sale value, so anything they do to increase the sale price just puts more money in thier pocket.
I've been with Paypal since near its beginning and I've always been surprised that its made it since its margins are actually very low. So yeah, Paypal isn't doing that much gouging, at least on this issue... (it has other problems...)
.... if the one doing the gouging is making no extra money from it? That aside from the fact that: 1) (and most importantly) You agree to bid up to and including your maximum bid. Legally. As long as eBay doesn't put you up for more than that bid, STFU and go home. 2) The amount in question is generally about 2-3% of the sale price. Whoop-de-fucking doo. 3) It's probably a bug anyway.
The seller places the item for auction, waits a fixed amount of time, then gets money. At no time does he face any risk.
The buyer, on the other hand, has to sift through the items (and sellers DO spam keywords), place a bid, then wait around for days. He may likely be outbid, in which case the whole process starts over. If the buyer "wins", he then sends off his money in *hopes* that the seller will deliver. When/if the item arrives, it's often not in the condition described, or very often violates normal assumptions about what is salabled. ("Well gee, I didn't say it came with a power cord!!").
That's not to say this is all ebay's fault, the point is that ebay is great for selling, not great for buying.
You win!!!
First Death Post!!!
As the first Slashdotter to predict the eminent demise of the subject of the thread, you win one free bullet for use when you decide to blow your brains out because you can't deal with everyone else being so stupid.
As an added bonus, you receive and extra 'just in case I fuck it up' bullet because you, sir, also posted the ever enlightening 'I'm too good for you' post in which you describe how you are better than everyone else and will no longer associate yourself with the subject of the thread. Consider yourself in the good company of those who no longer watch TV, but feel the need to tell everyone.
Kudos to you sir and thank you for helping to keep Slashdot discussions packed full of meaningless, cynical, cliche posts. You hard work does not go unnoticed.
Help me take back Slashdot. When did 'News for Nerds' become 'FUD and Conspiracy Theories for Extremist Nutjobs'?
If you enter a proxy bid of $125, then you are entering into a contract with eBay and the seller to pay up to $125 if yours is the winning bid. If you end up winning at $102.50, then you should be happy for getting the item for $22.50 cheaper than you were willing to spend. It doesn't matter if you were initially willing to spend $100.01 before, your new bid of $125 supercedes this, and by your own free will. If you weren't willing to pay $102.50, then why did you place a bid of $125?
You see? You see? Your stupid minds! Stupid! Stupid!
here is something that might stop the last minute frenzy bidding ...
Each time a new bid is entered the auction will last at least another 5 minutes. That in my opinion will be more auction like, more sport like and also fair.
OK, everyone is complaining that this system doesn't make sense but lets break down what is going on.
Say I am bidding on an item and my maximum bid is £101.
The auction is currently at $90.
The auction has increments of £5.
Someone makes a bid of £100, my maximum bid is greater, but less than the increment so it is used.
The auction now stands at £101.
I'm getting worried that I might loose the auction as its right on the max, so I increase my bid to £120.
Ebay then increases the current bidding to £105.
This seems to be what the lawsuit is about, ebay raising the current bidding, when you increase your maximum bid just because your original maximum bid fell between increment levels. In this case it fell between £100 and £105.
If I originally had bid £120, instead of £101 then when the other bidder placed a bid of £100, my bid would not have incremented to £101, but instead to £105 as that is the next incremental level.
If ebay is found to be at fault then they may have to set it so that you can only bid on the increment levels.
If ebay just change the system so that the current bidding price increases when you increase your bid then bots will probably be written to take advantage. They will just place a bid 1p above the next incremental level, if it fails then 1p above the next level. Keep going until you reach your maximum bid. In the case of the example auction that I highlited above the bid could save £4.99, so it would seem like a way of saving money.
At the risk of repeating stuff I posted elsewhere in more depth, it's probably worth pointing out one thing:-
Conflict of interest.
EBay are acting both as an auctioneer and as a proxy bidder on your behalf. The line between the two roles gets blurred in practice by the EBay system, but their purpose is clearly different; one is working for you, one is out to get your money.
Increasing your maximum bid should be akin to phoning up the proxy (automatic) bidder during the auction and informing him that *if* you are outbid, he should counter up to your new maximum bid.
"Slashdot - News and Chat Sites Deviant". (Click "homepage" link above for details).
When EBay says "someone has outbid you with a bid of $100, do I hear $105?", your automatic bidder won't bid $101; so your analogy is flawed.
If I read the article correctly, your statement is exactly what the lawsuit is about. The guy was expecting to win with a bid of $101.50 (or somesuch) and ended up paying 102.50 because the system increnments in $2.50 amounts in this dollar range. So, eBay is in effect saying "do I hear $102.50?" It looks at the proxy bid and sees that someone is willing to bid that much, and places the bid on behalf of the bidder, who now complains because he could have won for $101.50, even though eBay (using its well-documented rules) "said", "Do I hear $102.50?"
There's a big difference between saying eBay is an auctioneer (which I did not do) and likening (which means 'comparing' in my dictionary) them to an auctioneer.
"I'd rather be a lightning rod than a seismometer." -Ken Kesey
When PayPal first started they claimed to make their profit from the interest while your money sits in their accounts. When you send someone money, they take it right away. When you want to cash out, they write a check and it takes a few days or a week. Better yet for them, you maintain a positive balance. All the while they are earning interest on that money. It may not seem like much, but when you have millions and millions of users, many with hundreds of dollars on their balance.
Somehow PayPal manageges not to be classified as a bank either, which has been a hot topic in the past. They get to skirt much of the federal regulations.
I don't know if this is still their business model, but if so, i think it's great. Customers get a cool service and they make money as a byproduct of the service. It's a win-win situation when it works.
TODO: come up with a clever sig
Let me ask you do you think it is right that a person should be able to bid against himself?
Let's turn the question around. Why do you think a court of law is more qualified to design an online auction system than, say, eBay?
If you have a problem with eBay's rules and procedures, there is a very simple remedy that doesn't involve the legal system at all: don't use eBay. Unfortunately for the members of the eBay user community who will ultimately have to pay the costs associated with this lawsuit, there are big bucks to be made in the professional-victim business.
Dahlmann tightly grips the knife, which he may have no idea how to use, and steps out into the plain.
What right do they have to that?
Because those are the terms of putting an item up for sale on their website.
Irritable, left-wing and possibly humorous bumper stickers and t-shirts
People think that they are "sticking it to the evil corporations" with all their frivolous lawsuits.
They sue big "evil" company for millions of dollars.
Big "evil" company considers this a cost of doing buisness, and passes the cost down in the price of the goods they sell.
We, the people, then pay for it in higher cost of goods and services.
Perhaps you don't buy from Ebay, but no part of the economy is exempt from the lawyer tax.
Or it least, it was, the last time I used it years ago. The trouble is it's so easy to abuse.
You know the exact time the auction will end. You can price snipe at the last minute.
You can determine the high bidders maximum bid. Most people will bid an even amount, say, $100. Bid $96, see the current at $100, and you know you can bid $105 at the last moment. See above.
Surprised as I am to find myself saying this, the largest auction house on the internet could stand to learn a thing or two from a game feature. WoW's auction house avoids both these issues. You don't know when an auction will end, only a range, and bids delay the end of the auction by a small amount. And there is no proxy bidding, so you don't know how high someone might be willing to go.
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.
I completely disagree, if you're careful, then you can often get things on eBay for much less than a retail store, the only downfall is the possibility of being outbid, thus the automatic bid system. I bought some RAM on eBay and it cost about half what it would have from anywhere else, and besides the seller taking a while to ship the RIMMs I was very pleased. I then sold a mohterboard and just kept the money in my PayPal account and don't get hit with any extra fees, I assume that when I try to transfer to my bank account these fees will come into effect but if I buy something else, then I can use the money in PayPal to pay for it.
Sexual intercourse is kicking death in the ass while singing. ~Charles Bukowski
I mentioned this in another post, but it bears repeating. eBay is--first and foremost--an auction house.
They behave like other auction houses do, and increase bids in an incremental fashion. This prevents ninja-bidders at the last second from bidding pennies more then someone else and winning the auction. (Imagine that you're bidding on a 4.1M dollar house, and someone comes in with 0.01 seconds to go and bids $4,100,000.01).
This practice is NOTHING NEW. Where eBay had to modernize the concept was the fact that everyone is a proxy bidder on their site, no one is bidding in person. This means that they follow the other rules that auction houses follow, which is that when two proxy bids are registered for the same amount, the first person whose proxy bid arrives gets the bid, and the other person has already been outbid.
This is effectively the same thing that would happen were one to visit an actual, honest-to-God auction house. Two people would raise their paddles at the same time. The auctioneer would pick one of them (probably the one whom he sees first), and would accept a bid from them. The other person would either then keep their paddle up for the next bid increment, or they would put it down because that really was the highest dollar amount they were willing to pay.
Ignorance of how auctions work shouldn't entitle one to any amount of payout in a lawsuit. It should entitle one to a swift "ha ha" and a kick in the pants for wasting the rest of our time.
I currently have no clever signature witicism to add here.
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.
What eBay says is basically that you are invalidating your original proxy bid if you place a new maximum bid, so it (the proxy system) increases your previous maximum of $5.02 up to the minimum increment above the opposing bidder's $5.00 bid. With your initial proxy bid you had the advantage of placing the bid first, so even if the opposing maximum bid was exactly equal to yours, you would still win. By placing a new maximum bid you invalidated that time advantage and reset the proxy system. Your previous maximum of $5.02 is no longer high enough above the opposing bid to be a valid bid, so your bid is increased to the next increment to make it valid under their system.
It all has to do with time, and whether the proxy system should be reset by a new maximum bid or continue to consider the old maximum as a valid bid and leave it alone, even if it wouldn't have qualified if it hadn't been your previous maximum. It's described fairly clearly when you read the help files on proxy bidding, so I doubt this will hold up in court. I'm looking at it from all sides and can't really find fault with eBay. You agreed to use their system, they described how the proxy bidding works (including what happens if you place a new maximum bid), so I can't see that there is really anything heinous going on. There is no manipulation, it's all above board for once.
If you want to save a dollar here and there, stick with your original maximum bid and quit futzing with the proxy system, or snipe it with a precise amount. Either way, don't complain when you lose the auction.
It's still a value for used items. It's a great place to save money if you don't mind getting something used, or to make it if you have something you no longer need. For example I got a Hafler P1500 off there for like $150. A quick search on the net shows that $350 is about the minimum you can get one new for. Well I don't need a new one, it's a solid state amplifier, it's highly unlikely to break if properly cared for. So I picked one up used. I was happy, I saved $200, the seller was happy, he got $150 for something he didn't need.
You are right that new goods generally aren't that good a value. That only generally happens in the event of overstock. Some companies eBay overstock becuase it's cheap and easy. However buying used gear is often the way to go. No, you don't want to do that for low-end consumer gear, that stuff breaks quick. However a deceant idea is to just spend a bit more on some used pro gear.
For example, if you want a VCR, you are looking at like $20-50 for a cheapie, and probably $100 for a "good" one. Not likely to be all that high quality, and not likely to last. Or, you could cruise to eBay and find a used pro unit. There's a JVC pro editing SVHS VCR going for like $100 right now. Thing is 6-years old, but guess what? They are built to last, it'll still probably work in 15 years if you take care of it and it will look a shitload better than a cheapie consumer deck.
Before eBay, there was a contingent of lonely, fat housewives and weirdos that collected tons of goofy, worthless crap that nobody cared or knew about. After eBay, this contingent of social malcontents has found a place on the net where they can let their obsessive pathology run wild. If you don't believe me, look at eBay's forums and see all the ADD/bipolar people complaining their their treasure hunt game is rigged. If you think Slashdotters are antisocial nerds, you have no idea... eBay locals make AOL people look like the M.I.T. graduation class.
Remember folks, this is the site that gave us the virgin mary grilled cheese sandwich. Of course it's populated by a bunch of loonies who are desperately looking to get their 15 minutes of fame and move out of their trailers. Why is Slashdot giving these people any publicity? Every other day someone is threatening a class action against eBay because they got negative feedback over the 18-century electric can opener they sold being claimed as bogus.
I have had enough problems with ebray that I will not buy from there. Did you know that if you camplain, the seller can block you from buying again. It happened to me. I purchased something (a Sabre saw) from the Sears eBray store that was sent broken. (Physically in two pieces - and it was not caused by the shipper! Also it was the 3rd or 4th thing I had bought from them.) They treated me like dirt and it took a long time for them to agree to take it back - so of course I gave them a negative feedback. A few months later, I tried to buy something else from them and I was blocked. The reply was that they did it because I gave negative feedback. - Thus the feedback ratings are at best a sham. The real funny thing is that I went into my local Sears and bought a better similar item on sale for less.
This message was brought to you by "Lack of Sleep."
How about this one...
I place a $50 bid on a item currently at $40, and of course become the highest bidder at $40.50. A few hours later, eBay tells me I've been outbidded, but then a few minutes later sends meanother email to tell me the latest bid has been withdrawn, and I am again the highest bidder... at precisely $50! if that doesn't smell of shill bidding...
Anyway, I was prepared and willing to pay fifty bucks, but hey! anyone likes a discount!
Xavier
Do I make sense? Please report if not.
This is not "price gouging". This is nothing evil on eBay's part. So what if they get an extra cent from whatever small fraction of auctions in which this occurs? They didn't do this for the money, they did it because it was easier and not significantly better than any other way.
There's a lot of discussion here about whether or not increasing your maximum ought to constitute a new bid. eBay decided when they implemented the bidding system that it would. It was strictly an implementation question Odds are the people on the business end never comprehended such a distinction could exist.
Think about the bidding system. Each auction has a list of bids associated with it. If eBay is implemented with a relational database backend, they have a (very very large) table of bids. The table has columns for all the necessary info about a bid (auction it's connected to, user who made the bid, maximum value, time it was bid). When somebody bids, a new row is created in the table of bids. The question is what happens in the abstract case of "raising one's maximum". Let's look at this more practically.
"Raising one's maximum" is defined as entering a bid in an auction where one is already the maximum bidder. Simply determining if this is the case requires answering a few questions:
- Who is the winning user, and how large is their bid?
- Is the user making this bid that user? (I.e., is the current user already the winner).
- Is the new bid's maximum greater than the previous maximum (the previous winning bid)
Depending on how eBay is implemented, this may result in another database query. It probably won't, but it's certainly additional CPU time and complexity. The engineers may have decided not to write this special case, to save a little bit of computation. (And when you have as many bids per second as eBay does, it definitely helps.)In the absence of the special case as above, a new bid by the winning bidder is treated precisely the same as a new bid by a non-winning bidder -- i.e., it can be no lower than the next increment above the current price.
IANAL, and I don't know what legally constitutes "price gouging" or whatever the exact charges in the suit are... but this certainly doesn't seem to have any merit.
In conclusion, this was not an evil move on eBay's part. They're not trying to make a buck off anybody (they're already succeeding beyond anybody's wildest, most avaricious dreams at doing exactly that). This behavior is logical, documented, and most likely the product of an implementation decision. Case has no merit... wouldn't it be nice if for once the judge saw it that way too?
Save time now so you can waste it later