Grace v eBay is a new case in California (where else?) that is posing some interesting questions about intermediary liability, unfair contract clauses and online defamation. The case was brought by Roger Grace, an eBay seller who was subjected to a defaming campaign by another eBay user, who bought several items from him and then posted feedback that said “SHOULD BE BANNED FROM EBAY!!!! DISHONEST ALL THE WAY!!!!” apart from the annoying use of the caps lock key and the use of multiple exclamation marks (which, according to Terry Pratchett, is a sure sign of a diseased mind), the statement was deemed to be defamatory. Grace complained to eBay, they refused to remove the comments, and then Grace sued the seller and eBay for libel and violation of the unfair competition law. eBay then removed the comments.

The ruling exonerates eBay on the basis that their user agreement excludes liability in cases of defamation as they are exonerated “from claims, demands and damages (actual and consequential) of every kind and nature, known and unknown, suspected and unsuspected, disclosed and undisclosed, arising out of or in any way connected with such disputes.” It is interesting that this clause has been accepted in the U.S. because I believe that this clause would probably not stand to scrutiny in Europe.

eBayers, this case indicates that you can still leave negative feedback, but be fair (and please stay clear of the multiple exclamation marks!!!).

Categories: e-commerce

1 Comment


Anonymous · October 27, 2004 at 10:25 am

Actually I now recall discusing this and some concern whether a contract between Ebay and an Ebay SELLER was B2C – or B2B? And it could b argus that as most Ebay users are both buyers and selers it's not a consumer contract at all?Dan Burk also had the nice point as to what was the actual loss to the plaintiff's rep as he was the BUYER not the SELLER?!

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