UPDATE: EBay Injunction May Benefit E-Tailers

A May court ruling that prevents content aggregator Bidder's Edge from collecting information from auction service eBay.com will help online retailers, according to an industry analyst.

Evie Black Dykema, senior analyst at Forrester Research, Cambridge, MA, said spidering sites level the playing field among retailers, enabling consumers to play off big vs. small and discount vs. premium. Last month's ruling could change that equation.

“I'd say that this definitely is an indication that the court believes the pendulum of power should swing back a bit toward retailers rather than the consumers that have been empowered by the Internet,” said Dykema, who closely follows online retail trends.

Effective June 8, the interim injunction by the U.S. District Court for the Northern District of California specifically stops Bidder's Edge, www.biddersedge.com, from using spiders, crawlers or any automated tool to track auctions on eBay. The court agreed with eBay that Bidder's Edge was trespassing on the auction site's property.

“It is one thing for customers to use a tool to check a site, quite another for a single commercial enterprise to do so on a repeated basis and then to distribute that information for profit,” Judge Ronald Whyte said in his decision.

The judgment has ramifications for countless online auction aggregators and comparison-shopping services that use automated tools to search the Web for bargains or on other parameters set by consumers.

But Bidder's Edge President/CEO James Carney — who will now approach the appellate court for an expedited appeal and a stay on the injunction — does not agree.

“The laws on trespass that the judge relied on were laws regarding personal property,” Carney said. “There clearly was nothing based on the Internet or anything close to this, so we feel these are good grounds to ask for this appeal and ultimately get it granted.”

Meanwhile, the court rejected eight other claims by eBay as grounds for an injunction against Bidder's Edge, a site that has had running acrimony with the Internet's leading person-to-person auction site since talks for a licensing deal broke down in December.

“We have said all along that this is not about the Internet or the practices of other aggregation sites,” said Kevin Pursglove, spokesman at eBay. “Our case is about the specific conduct of a single company, Bidder's Edge.”

EBay, San Jose, CA, currently has licensing agreements with four auction aggregators: AuctionRover.com, iTrack.com, Priceradar.com and Auctionworks. Each site features eBay searches separately from other rival auction services on its homepage — an arrangement that Bidder's Edge, Burlington, MA, found meddling.

Besides, Carney pointed out, eBay was an open Web site, inviting all to come and visit.

“It's a completely open environment and [a site on] the Web that wants to be private has log-ins and passwords,” he said.

Not so, according to eBay's Pursglove. Just because eBay has created an environment for public accessibility does not mean that anybody can come in, violate the user agreement and trespass without authorization, he said.

“EBay servers are private property, conditional access to which eBay grants to the public,” Pursglove said. “EBay does not generally permit the type of automated access made by Bidder's Edge. In fact, eBay explicitly notifies automated [services] that their access is not permitted.”

Bidder's Edge feels that eBay is purposely going through this process to emerge stronger in its dealings with other search services.

“My sense is that they're using this as a test case and then they'll go from there,” Carney said, adding that Bidder's Edge is exploring other, unspecified ways of tracking auctions on eBay that do not violate the court injunction.

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