Antitrust Law Daily Wrap Up, ADVERTISING—9th Cir.: eBay cleared of consumer’s false advertising, unfair competition claims, (Jan 27, 2015)

By Greg Hammond, J.D.

A user of eBay, Inc.’s online marketplace could not state valid false advertising and unfair competition claims against eBay for a supposed delay between the time an item is posted and the time the item’s listing actually appears on eBay.com. The U.S. Court of Appeals in San Francisco affirmed an order for summary judgment and dismissal by the federal district court in San Jose, finding that no factual basis supports an award of restitution (Ewert v. eBay, Inc., January 26, 2015, per curiam).

Background. Plaintiff Michael Ewert is a user of the online marketplace eBay.com. He brought claims for breach of contract and violation of California’s False Advertising law (FAL) and Unfair Competition Law (UCL), alleging: (1) there was a delay between the time a seller posts an item to the online marketplace and the time the listing actually appears in search results; and (2) eBay allegedly raised fees for existing “Good ‘Til Cancelled” listings (GTC claim). Ewert appeals the district court’s order of summary judgment in favor of eBay for all claims concerning the alleged search delays, and the district court’s order of dismissal and denial for leave to amend the GTC claim.

Summary judgment. According to the court, summary judgment was properly granted on Ewert’s claims for equitable relief under the FAL and UCL. Ewert sought monetary restitution under a pro rata refund theory, but he failed to produce any evidence to counter eBay’s expert testimony that a pro rata refund was an improper measure of restitution. Consequently, Ewert failed to demonstrate a factual basis to support an award of restitution under a pro rata theory, and the district court’s summary judgment order with regard to the FAL and UCL claims was affirmed.

Dismissal. The appellate court also determined that the lower court did not abuse its discretion when it granted dismissal of Ewert’s claims and denied him leave to amend. Rather, the district court properly determined that Ewert failed to allege a breach of an express contract term, and that the FAL and UCL claims were therefore subject to dismissal for lack of a predicate injury.

The case number is 12-17251.

Attorneys: Kevin K. Eng. (Markun Zusman Freniere & Compton LLP) for Michael Ewert. Michael Graham Rhodes (Cooley LLP) for eBay, Inc.

Companies: eBay, Inc.

Cases: Advertising AlaskaNews ArizonaNews CaliforniaNews HawaiiNews IdahoNews MontanaNews NevadaNews OregonNews WashingtonNews