Round one of the Windsor Auctions litigation took place on May 9th. Windsor had previously filed suit against eBay, because eBay gave access to an end time duration tool, which allowed staggered auction end times on live auction items and afforded high visibility in eBay core to a select few live jewelry auctioneers. Although Windsor contends that this created an unfair competitive advantage for these particular sellers, eBay contends, as part of a motion to dismiss Windsor’s action, that the tool in question was accessible to everyone, whether they were a direct customer of eBay or not.

The U.S. District court, where the Windsor action was filed has not issued a ruling yet; however, the judge is not going to dismiss the case in its entirety or without the ability to amend. The Judge is inclined to dismiss the federal antitrust claim on a purely technical ground.

After the filing of the complaint in this case and one week before eBay announced the closure of the live auctions platform, eBay terminated, on thirty days notice, all eBay user ID’s and passwords that were associated with or maintained by the CEO of Windsor.

Thereafter, on May 9, 2008, Live Auctioneers LLC terminated the un-expired contracts it still had in full force with Jewelry Auctions, Inc. and a United Kingdom based company owned and operated by Susan Allan.  Specifically in its letter of termination, Live Auctioneers stated that it was terminating these contracts for no other reason than the fact that eBay had made their own performance impossible by terminating Windsor’s user ID’s. Under these circumstances, Windsor at this time will amend its complaint to include punitive damages against eBay for tortious interference with the economic advantage of a continual relationship with Live Auctioneers.

How does a company such as Windsor, which was featured in the 2007 eBay Entrepreneur article entitled “Beyond Borders”, go from being recognized as a stellar seller on eBay to being banned indefinitely? “Simply put, we sued eBay and eBay shut us down in an effort to shut us up” stated Paul Fischer CFO of Windsor. “The inaction on eBay’s part to shut down this tool and/or offer it to ALL live auction sellers in order to level the playing field, allowed a select few sellers in the jewelry category to reap millions in sales and as they were direct to eBay clients, eBay did not have to share its fees with its partner Live Auctioneers” stated Fischer.

Just how far will Windsor go in pursuing their action against eBay? “What happened was an injustice to ALL live auction sellers and as we move forward, the potential claims against eBay by 900+ live auction sellers may just paper the walls of the court for years to come. It is my opinion that eBay is shutting down eBay Live Auctions not because its priorities have changed but, for the simple reason that the past, current and future liabilities of keeping the system operational outweighed the financial benefits of improving the system. It’s not known how many potential claimants there may be out there. The use of this tool may have affected millions of regular mom and pop sellers and even those who consigned their goods to be sold through some of the world’s largest and most respected auction houses”, stated Fischer.