eBay now has its hands full with two lawsuits aimed at the eBay Live Auction platform. One eBay Live Auction seller is suing eBay for affording an unfair competitive advantage to another eBay Live Auction seller who's being sued (along with eBay in an unrelated lawsuit) for allegedly shill bidding on the platform.

eBay Live Auctions (eBay, Inc.) has not been without its hiccups with its live auction platform. In October 2006, GoAntiques, which sells its wares on eBay Live Auctions, was accused of creating the appearance that a live auction was taking place when, in fact, a computer was generating the bidding to protect reserves. Judge Sargus for the Southern District Court of Ohio approved a class settlement on behalf of consumers.

Now it appears that Hot Jewelry Auctions, which operates under the eBay user names of Paramount-Auctions, Jewelry-Overstock-Auctions and WJoutlet has been sued for shill bidding on eBay Live Auctions.

In a separate matter, Windsor Auctions, Inc. operating under the eBay user name WindsorAuctions-USA has sued eBay under federal antitrust laws and California's anti-competition laws. Windsor's suit alleges that George Molayem (who operates Hot Jewelry Auctions) had use of a tool, which afforded Mr. Molayem the opportunity to batch upload his products/listings in small groups on an hourly basis, thus, driving his listings through the front of eBay core during an entire twelve-hour auction event. In essence, Mr. Molayem's products flowed through eBay core ahead of ALL other live auction sellers and even those of regular eBay sellers within the jewelry category.

eBay has demanded that the court dismiss the suit contending that Windsor Auctions could have gone to eBay directly and taken advantage of all of the tools offered to eBay direct clients. However, Windsor Auctions was directed by eBay Live Auctions to Live Auctioneers, LLC when it originally applied to eBay Live in 2005.

According to Live Auctioneers, LLC website, Live Auctioneers issued a press release dated July 16, 2004 in which Live Auctioneers announced that eBay had entered into a seller referral agreement whereby eBay Live Auctions sends live auction clients directly to Live Auctioneers. Windsor Auctions began selling on eBay Live in July 2005.

eBay has also informed Windsor Auctions that their eBay user names (corporate and personal) will be suspended on April 6th. The suspension affects WindsorAuctions-USA, JewelryAuctions and all personal user names associated with the CEO of Windsor Auctions. On April 11th, eBay and their attorneys will appear in court to argue their motion to dismiss, in the interim, WindsorAuctions-USA will be suspended five days before the hearing of the motion.

WindsorAuctions-USA has traded on eBay for over three and a half years and has maintained a feedback rating of 99.9% and has sold over 27,000 items through eBay Live. In fact Windsor Auctions was a centerfold featured article in eBay Entrepreneur entitled "Beyond Borders" in April 2007. This begs the question of why eBay would suspend a user, which has proven itself over a period of years to be an exceptional eBay seller.  

In contrast, Hot Jewelry Auctions has message boards on CNET devoted to its business practices and complaints filed on RipOffReport.com (keyword - Paramount Auctions). No doubt, the suspension of WindsorAuctions-USA will cast suspicion upon eBay, as a retaliatory response to Windsor Auctions in exercising its constitutional right to file an action against eBay.

As this story unfolds, we will post hundreds of pages of documents and emails for the public to review, as this story simply boggles the mind. Our next article will focus on how eBay core listings may have been severely affected by eBay Live Auction listings and how the use of the auction duration tool was utilized to achieve top eBay core listing placement.