n a skirmish between two Internet heavy hitters with a tangled relationship, eBay Inc. has convinced a court that it was wronged by antitakeover moves adopted by Craigslist after eBay started encroaching on its online classifieds turf in the U.S.
A judge ruled Thursday that Craigslist founderÂ CraigÂ Newmark and CEO Jim Buckmaster violated their responsibilities to eBay â€” which bought a stake inÂ Craigslist in 2004 â€” with changes they implemented that diluted eBay’s share from 28.4 percent to 24.9 percent and made it harder for eBay to sell the interest.
Craigslist made the changes in 2008 after determining that eBay had changed from a partner to a threat.
That shift happened after eBay launched a U.S. version of its Kijiji classifieds site â€” which competed directly with Craigslist â€” and started buying online ads steering Internet users looking for Craigslist to its own sites,Buckmaster testified in a nine-day trial.
The judge, William Chandler III of Delaware’s Court of Chancery, ordered Craigslist to reverse the steps that diluted eBay’s stake in Craigslist. However, he allowed another step that Craigslist took to keep eBay at bay to stand. That move made it harder for eBay to unilaterally name a director to Craigslist’s board.
“EBay brought this suit to protect its own shareholders and preserve its valuable investment in Craigslist,” Michael Jacobson, eBay’s general counsel, said in a statement. “The evidence presented at trial demonstrated that the actions were taken by Mr. Buckmaster and Mr. Newmark to benefit themselves at the expense of eBay, and we are gratified that the court recognized these actions were both unfair and unlawful and rectified the situation.”
Craigslist, which is based in San Francisco, representatives did not immediately respond to a message from The Associated Press.