Craigslist data shared by eBay workers, official says

December 10, 2009|Randall Chase, Associated Press

GEORGETOWN, Del. - Employees of Web auction site eBay shared confidential information gained from Craigslist with other employees developing eBay’s own online classifieds business, an eBay executive said yesterday.

Brian Levey said that information eBay gained as an investor and board member of Craigslist was forwarded to employees developing eBay’s Kijiji domestic classifieds business.

Levey, an eBay lawyer who described himself as the “legal quarterback’’ of the company’s 2004 acquisition of a minority interest in Craigslist, said he didn’t think a confidentiality agreement precluded eBay employees from sharing confidential Craigslist information. “As long as it was complying with the confidentiality agreement, I think the view was, it’s fine,’’ said Levey, who suggested that the confidentiality agreement was meant to prevent disclosure of Craigslist information to third parties.

Levey was testifying in a lawsuit in which eBay accuses Craigslist of diluting eBay’s minority interest after a falling out in 2007. Craigslist contends in its own lawsuit that eBay used its stake in Craigslist to gain information for its own use.

In response to Levey’s testimony, an eBay senior vice president, Alan Marks, issued a statement saying eBay was allowed to compete against Craigslist in the classifieds market, including in the United States.

“EBay had hoped it would collaborate with Craigslist to expand the classifieds business,’’ Marks said. “. . . EBay was allowed to evaluate its minority investment in Craigslist, which it did throughout the relationship.’’

But in his cross-examination of Levey, Craigslist’s attorney, Michael Clyde, suggested that eBay used confidential business data not just to evaluate its investment, but in forming a broader strategy for participating globally in the online classifieds market.

Clyde questioned Levey at one point about an e-mail he had sent to other eBay employees who were working on Kijiji but whom Clyde said had no responsibility for Craigslist. The e-mail included years of historical financial data from Craigslist. “I think it’s a reasonable assumption to say it was not in the public domain,’’ Levey said.