Craigslist Countersues eBay (It’s Getting Ugly)

Craigslist vs. eBay

So apparently there is really no love lost between these two. Note to eBay: next time you might want to think of a more innocuous “code name”.

Online classifieds leader filed a countersuit on Tuesday against business rival eBay Inc, alleging eBay used its minority stake in Craigslist to steal corporate trade secrets.

In addition to unfair competition and fraudulent business claims, the countersuit accuses eBay of copyright infringement and using misleading advertising on Google Inc to run ads for its rival Kijiji site that appeared to be Craigslist ads.

The lawsuit demands that eBay restore all shares of Craigslist owned by eBay or for the court to require eBay to divest its holdings in Craigslist. The suit asks eBay to disgorge profits tied to the business and for punitive damages.

The complaint alleges a plot by eBay to use its position as a minority shareholder and its position on the board to pressure Craigslist into a full-scale acquisition deal by eBay.

Barring that, Craigslist argues eBay used its position to gather competitive information that led to the launch of eBay’s rival classifieds business. It charges eBay code-named this its “Craigslist killer” in internal strategy discussions. [Reuters/]