Small Traditions LLC/SCANDAL UPDATE

[Exhibitman]

Originally Posted by Snowman

Or that eBay got wind of the fact that there were plans in the works at PWCC to leave eBay completely and set up their own auction platform, so eBay retaliated in classic eBay fashion. Who knows why they actually did it, but to cut ties so publicly in the way that they did sure makes one wonder.

One thing is certain though. The premise of the email was clearly bullshit. eBay has never given two shits about shill bidding in the past. This was most likely about something other than cracking down on shill bidding. Perhaps the FBI was breathing down their neck and the legal team felt they had to make a drastic move to cover their asses. Or perhaps they wanted to damage the brand of a soon-to-be competitor who was already on their way out the door. I think those are the two most plausible scenarios. Time will tell. If it is cracking down on shill bidding though, surely that will become apparent via further actions against shill bidding. And if it's the FBI breathing down their neck, that will become apparent once all these indictments start rolling in (any day now... any day now...). But if neither of those things happens, then the scale begins to tip quite heavily toward them just trying to damage the brand of a competitor. Stay tuned, IMO.

It is definitely NOT about just damaging the PWCC brand. Taking a dump on a competitor to damage their brand is called "trade libel" (publication of matter disparaging the quality of another’s property, which the publisher should recognize is likely to cause pecuniary loss to the owner. The tort encompasses ‘all false statements concerning the quality of services or product of a business which are intended to cause that business financial harm and in fact do so. (City of Costa Mesa v. D’Alessio Investments,LLC (2013) 214 Cal.App.4th 358, 376) and if a $10 billion company does it just to thwart a competitor it will find itself on the receiving end of a massive lawsuit. The fact that eBay did what it did publicly and loudly means that it has solid evidence in hand sufficient to allow their corporate counsel to greenlight a statement that is otherwise textbook trade libel.

[packs]

I think people have been trying to point out that a seller's individual gross revenue is not the revenue eBay generates. So if someone is doing a hundred million in sales eBay's revenue lives in the eBay fees generated by those sales. They are not equal and eBay's revenue is dependent on hundreds of thousands of sellers and not any one.

[Snowman]

Originally Posted by Exhibitman

It is definitely NOT about just damaging the PWCC brand. Taking a dump on a competitor to damage their brand is called "trade libel" (publication of matter disparaging the quality of another’s property, which the publisher should recognize is likely to cause pecuniary loss to the owner. The tort encompasses ‘all false statements concerning the quality of services or product of a business which are intended to cause that business financial harm and in fact do so. (City of Costa Mesa v. D’Alessio Investments,LLC (2013) 214 Cal.App.4th 358, 376) and if a $10 billion company does it just to thwart a competitor it will find itself on the receiving end of a massive lawsuit. The fact that eBay did what it did publicly and loudly means that it has solid evidence in hand sufficient to allow their corporate counsel to greenlight a statement that is otherwise textbook trade libel.

How can you possibly say that it is "definitely NOT that" though? I assume you're a lawyer. Pay attention to the language used in that email. Their claim is that "individuals associated with PWCC engaged in shill bidding". That's a remarkably broad statement that could easily just mean that people who consigned with PWCC bid on their own auctions. Surely, their legal team carefully crafted that email so as to avoid any such lawsuits. If they had proof that PWCC employees were the ones doing the shill bidding, then why not just say so? After all, as you said, surely they wouldn't make such a claim without proof. But they in fact did not make such a claim. Probably because they did not have such proof.

To walk away from that email and assume that eBay meant anything other than people who consigned with PWCC would be jumping to conclusions based on assumptions. If that is in fact who eBay was referring to when they said "individuals associated with", then I think what they did should be criminal and that it should be considered trade libel. I'm also of the belief, based on my experiences with eBay and the experiences of several of my friends who have worked there (some of whom were executives) that this is most likely what happened.

[Exhibitman]

Originally Posted by Snowman

How can you possibly say that it is "definitely NOT that" though? I assume you're a lawyer. Pay attention to the language used in that email. Their claim is that "individuals associated with PWCC engaged in shill bidding". That's a remarkably broad statement that could easily just mean that people who consigned with PWCC bid on their own auctions. Surely, their legal team carefully crafted that email so as to avoid any such lawsuits. If they had proof that PWCC employees were the ones doing the shill bidding, then why not just say so? After all, as you said, surely they wouldn't make such a claim without proof. But they in fact did not make such a claim. Probably because they did not have such proof.

To walk away from that email and assume that eBay meant anything other than people who consigned with PWCC would be jumping to conclusions based on assumptions. If that is in fact who eBay was referring to when they said "individuals associated with", then I think what they did should be criminal and that it should be considered trade libel. I'm also of the belief, based on my experiences with eBay and the experiences of several of my friends who have worked there (some of whom were executives) that this is most likely what happened.

You need to pay attention to language, Travis. I wrote that eBay's statement "is definitely NOT about just damaging the PWCC brand." Just being about damaging the brand would be evidence of intent. As for your point, eBay sending out an email stating that "Recently, it was determined that individuals associated with a trading card seller, PWCC, have engaged in “shill bidding,”" is certainly a "statement concerning the quality of services or product of" PWCC and is certainly one that will cause it financial damage, if for no other reason than the lost profits on the canceled sales and the man-hour needed to relist all that crap on another site. That leaves the intent element of the tort. My point is that under those circumstances eBay's email blast would never pass legal vetting unless there was solid evidence in the file to back up the statement and therefore negate the possibility that it was done with intent to damage the business rather than to protect eBay's customers from further perceived predation with resulting tangential damage to PWCC's business. Otherwise I would expect PWCC to sue, but that will never, ever happen because it would mean that the PWCC crew would have to open their records of communications with every shill bidder and then answer questions under oath posed by trained cross-examiners. If PWCC is so wronged and so right in its actions, let's see the lawsuit to vindicate it. Personally, I am not holding my breath.

[Peter_Spaeth]

Of course I don't know, but like Adam my assumption would be that a corporation with a 50 billion dollar market cap would have internal controls such that a statement accusing a customer of shill bidding to be widely disseminated would be subject to rigorous review.

[Exhibitman]

Originally Posted by Peter_Spaeth

Of course I don't know, but like Adam my assumption would be that a corporation with a 50 billion dollar market cap would have internal controls such that a statement accusing a customer of shill bidding to be widely disseminated would be subject to rigorous review.

Agreed. Though I have seen some pretty bone-headed moves by in-house counsels in my career...

[Peter_Spaeth]

Originally Posted by Exhibitman

Agreed. Though I have seen some pretty bone-headed moves by in-house counsels in my career...

Yes but at the level of an ebay for the most part in my experience you're dealing with very good lawyers.

[Lorewalker]

I would also have to assume eBay's move was with the FBI's "nudging" too. Highly doubt eBay was just now able to identify shill bidding with PWCC--whether it as by consignors, employees or both.

[Eric72]

Originally Posted by Peter_Spaeth

Yes but at the level of an ebay for the most part in my experience you're dealing with very good lawyers.

Skilled lawyers, yes.

I'm not so sure they're good.

[Snowman]

Originally Posted by Peter_Spaeth

Of course I don't know, but like Adam my assumption would be that a corporation with a 50 billion dollar market cap would have internal controls such that a statement accusing a customer of shill bidding to be widely disseminated would be subject to rigorous review.

I feel like I keep having to point this out, but this is the problem. Nowhere in that email did eBay actually accuse PWCC of shill bidding. Yet somehow, nearly everyone still walks away with that assumption.

[BobC]

Originally Posted by Snowman

I feel like I keep having to point this out, but this is the problem. Nowhere in that email did eBay actually accuse PWCC of shill bidding. Yet somehow, nearly everyone still walks away with that assumption.

Travis, you're not wrong, but you know how people can be. They'll read something quickly and walk away with the first thing that pops into their head. And in this instance, I think most people get the impression from that Ebay email that PWCC was directly involved somehow in the shilling claims. So even if someone slows down and carefully reads the statement to ascertain the correct, true meaning of what was being said in it, it can still be argued that the average person will take a negative position against PWCC from it, and thus there is damage being done to their reputation. Reminds me of how Bill Clinton (who is/was a lawyer) argued on the stand against allegations towards him from the Monica Lewinsky situation, about how he did not have certain relations with her. I'm pretty sure sure most people were saying to themselves, "Yes, you did!", but being a lawyer is very often about the precise meaning of words, and their perception by the parties involved and affected.

I still would like to also see the actual terms of use agreement PWCC had with Ebay, and wonder if that could hold any clues or answers as to why Ebay said and did what they did in regards to PWCC.

[Lorewalker]

Originally Posted by Snowman

I feel like I keep having to point this out, but this is the problem. Nowhere in that email did eBay actually accuse PWCC of shill bidding. Yet somehow, nearly everyone still walks away with that assumption.

So now it is someone else's fault that "nearly everyone still walks away with that assumption"? I am not a lawyer either but I don't think assumptions play a huge role in the judicial process.

For starters, maybe PWCC should not have placed themselves in the predicament they are now in--knee deep in fraud. Or do you see that as also someone else causing them all of this grief?

So do you love PWCC that much or do you just like playing the contrarian?

[Snowman]

Originally Posted by Lorewalker

So now it is someone else's fault that "nearly everyone still walks away with that assumption"? I am not a lawyer either but I don't think assumptions play a huge role in the judicial process.

For starters, maybe PWCC should not have placed themselves in the predicament they are now in--knee deep in fraud. Or do you see that as also someone else causing them all of this grief?

So do you love PWCC that much or do you just like playing the contrarian?

I mostly just like playing devil's advocate, or at least think that all sides should be considered in discussions. I hate when groupthink starts off with a set of assumptions (which are often invalid) and these discussions just build and build on top of them without those assumptions being challenged. This shill bidding topic is a prime example. People have been accusing PWCC of shill bidding (PWCC themselves, not just their consignors) for years. Before this whole eBay scandal blew up, whenever people were asked to provide evidence of these shill bidding claims, the crowd always pointed to the fact that PWCC got higher prices for their cards than other eBay sellers. This is of course absurd, and in no way constitutes evidence, or even suggests, that PWCC was shilling their own auctions.

As far as whether or not I "love PWCC"; no, I definitely do not. I have zero cards in their vault, and despite having consigned hundreds of cards in the past, I've never once chosen PWCC to handle my consignments. If they happen to have a card that I want up for auction, I will bid on it because I want the card and don't care who it comes from. As far as my experiences go with them, they haven't been positive. I bought a high-grade vintage card from one of their auctions a couple years ago and after it arrived I noticed that it was clearly trimmed on the left edge. Irrefutably trimmed. It was sharp as a knife and lighter colored than the other 3 edges. I took close-up photos of the edges which clearly showed what I was describing and asked to return the card. They threatened to ban me from all future auctions. I wasn't happy. I've also recently had another major issue with a high-end purchase that was extremely frustrating to deal with. But I don't let those experiences cloud my judgment about whether or not they have engaged in shill bidding. I believe it is in PWCC's best interest not to engage in shill bidding, and to furthermore prevent it to the extent they are capable. I do not believe that they shill bid, and am not capable of believing it without sufficient evidence. I believe they act in their best interests.

This whole discussion reminds me of all the conspiracy theories about all of the online poker sites "stacking the deck" to increase the rake (the amount deducted from each pot that goes to the house). It was very easy to demonstrate that this was not happening and that it would be extremely stupid for them to even try, yet if you were to poll 100 random online poker players, you would probably find that at least 30% of them believed the decks were in fact stacked against them.

[Snowman]

Originally Posted by Exhibitman

You need to pay attention to language, Travis. I wrote that eBay's statement "is definitely NOT about just damaging the PWCC brand." Just being about damaging the brand would be evidence of intent. As for your point, eBay sending out an email stating that "Recently, it was determined that individuals associated with a trading card seller, PWCC, have engaged in “shill bidding,”" is certainly a "statement concerning the quality of services or product of" PWCC and is certainly one that will cause it financial damage, if for no other reason than the lost profits on the canceled sales and the man-hour needed to relist all that crap on another site. That leaves the intent element of the tort. My point is that under those circumstances eBay's email blast would never pass legal vetting unless there was solid evidence in the file to back up the statement and therefore negate the possibility that it was done with intent to damage the business rather than to protect eBay's customers from further perceived predation with resulting tangential damage to PWCC's business. Otherwise I would expect PWCC to sue, but that will never, ever happen because it would mean that the PWCC crew would have to open their records of communications with every shill bidder and then answer questions under oath posed by trained cross-examiners. If PWCC is so wronged and so right in its actions, let's see the lawsuit to vindicate it. Personally, I am not holding my breath.

Clearly, I'm not a lawyer. I just take issue with your conclusion, not your language. I understand what you wrote. I just disagree with your claim that it is "definitely NOT about just damaging the PWCC brand". I am not saying that definitely is, I'm simply saying that I don't think you can rule it out. I also am of the opinion that the likelihood of it being the sole intent of that email is actually quite high, but that's just a personal opinion. My disagreement comes from your use of the words "definitely not" rather than "probably not".

I think our disconnect comes from this statement here, where you wrote

Originally Posted by Exhibitman

My point is that under those circumstances eBay's email blast would never pass legal vetting unless there was solid evidence in the file to back up the statement and therefore negate the possibility that it was done with intent to damage the business rather than to protect eBay's customers from further perceived predation with resulting tangential damage to PWCC's business.

To which I ask, "solid evidence to back up which statement"? The one that reads, "individuals associated with PWCC have engaged in shill bidding"? This is the phrase that matters. This is what the entire debate hinges on for me. Who are the "individuals associated with PWCC"? It is an entirely different claim to say that PWCC employees engaged in shill bidding than it is to say that random eBay users who consigned with them (which PWCC has no control over) engaged in shill bidding. Surely, you can appreciate the difference between those two claims.

There's a reason eBay's email was vaguely worded as to who actually committed the shill bidding. Perhaps I'm reading into it too much, but I don't think so.

[BobC]

Originally Posted by Exhibitman

You need to pay attention to language, Travis. I wrote that eBay's statement "is definitely NOT about just damaging the PWCC brand." Just being about damaging the brand would be evidence of intent. As for your point, eBay sending out an email stating that "Recently, it was determined that individuals associated with a trading card seller, PWCC, have engaged in “shill bidding,”" is certainly a "statement concerning the quality of services or product of" PWCC and is certainly one that will cause it financial damage, if for no other reason than the lost profits on the canceled sales and the man-hour needed to relist all that crap on another site. That leaves the intent element of the tort. My point is that under those circumstances eBay's email blast would never pass legal vetting unless there was solid evidence in the file to back up the statement and therefore negate the possibility that it was done with intent to damage the business rather than to protect eBay's customers from further perceived predation with resulting tangential damage to PWCC's business. Otherwise I would expect PWCC to sue, but that will never, ever happen because it would mean that the PWCC crew would have to open their records of communications with every shill bidder and then answer questions under oath posed by trained cross-examiners. If PWCC is so wronged and so right in its actions, let's see the lawsuit to vindicate it. Personally, I am not holding my breath.

+1,000

If PWCC does have anything even remotely not above board, they will not want to risk going to court and expose any of it. If they did, I can already picture FBI reps sitting in the front row at the trial taking notes.

[Snowman]

Originally Posted by BobC

+1,000

If PWCC does have anything even remotely not above board, they will not want to risk going to court and expose any of it. If they did, I can already picture FBI reps sitting in the front row at the trial taking notes.

Ya, I definitely agree with that. I don't think we'll be seeing PWCC filing suit against eBay even if it was libel.

[BobC]

Originally Posted by Exhibitman

It is definitely NOT about just damaging the PWCC brand. Taking a dump on a competitor to damage their brand is called "trade libel" (publication of matter disparaging the quality of another’s property, which the publisher should recognize is likely to cause pecuniary loss to the owner. The tort encompasses ‘all false statements concerning the quality of services or product of a business which are intended to cause that business financial harm and in fact do so. (City of Costa Mesa v. D’Alessio Investments,LLC (2013) 214 Cal.App.4th 358, 376) and if a $10 billion company does it just to thwart a competitor it will find itself on the receiving end of a massive lawsuit. The fact that eBay did what it did publicly and loudly means that it has solid evidence in hand sufficient to allow their corporate counsel to greenlight a statement that is otherwise textbook trade libel.

I hear you Adam, and don't disagree. Also saw Snowman's response to you, and can see the logic in some of his statements as well.

I guess I'm wondering if a huge factor in all this is exactly what is in the terms of use (or whaver they call it) agreement all seller's have to agree to before selling on Ebay. I haven't seen their current rules of what Ebay sellers must agree to and abide by. Also, because of the size/volume of PWCC's sales on their platform and the special sweetheart deal they apparently gave them on fees, is it not possible that Ebay could have had a special operating deal in place with PWCC that goes beyond the standard terms of use agreement they give to everyone else to sign off on? If so, there could be something in it that specifically protects Ebay from trade libel for determining and doing what they did. I guess one way we may find out is if PWCC were to ever bring a lawsuit against Ebay for being booted off their site by them.

But as others have speculated, I find it difficult to believe Ebay's lawyers weren't involved with this PWCC situation from start, and would be shocked if they hadn't already addressed this potential libel issue to make sure Ebay was protected in some way or manner. Again, I guess time will tell.