Friday, May 2, 2008
We're finally getting a look at the complaint in the eBay-Craigslist lawsuit. According to a Craigslist blogpost, it's all about the ads.
1. Ebay is suing us for implementing a shareholder rights agreement, which it has called a “poison pill”. Here is a 2004 filing by Ebay regarding an increase in authorized shares, which it reserves the right to use for the purpose of implementing a poison pill:
2. Ebay is suing us for offering each of our shareholders the opportunity to exchange their shares for an incrementally larger number of shares bound by a “right of first refusal” agreement, whereby shares must be offered to craigslist on the same terms offered to any other potential acquirer. It had previously insisted that craigslist shareholders be bound by a right of refusal agreement, and has from time to time bound shareholders of Ebay and its various subsidiaries by right of first refusal agreements.
3. Ebay is suing craigslist for implementing an indemnification agreement, which calls for craigslist to pay legal fees for craigslist directors and officers should they be sued individually in the course of their duties. Here is a 1998 filing by Ebay regarding a similar indemnification agreement for its own directors and officers;
4. Ebay is suing us for implementing staggered board elections. Here is a 1999 filing by Ebay indicating that Ebay itself is no stranger to staggered board elections:
eBay now has a competing online ad site, Kijiji. Craigslist considers that this site competes directly with it and wants to reacquire the shares that eBay purchased in Craigslist some years ago. Read more here.