eBay subpoenaed in DoJ commissions-fixing probe
More miracles of the 'new economy'
The US Department of Justice (DoJ) has subpoenaed documents from eBay relating to an investigation of auctioneers Sotheby's and Christie's amid allegations of price-fixing of commissions, the Associated Press reports. eBay disclosed in a filing with the Securities and Exchange Commission on Thursday that the government is examining its changes in commissions and buyer's premiums and "discussions, agreements or understandings with other auction houses." The request stems from a federal investigation begun in 1997 of Sotheby's and Christie's, which together control 95 percent of the US $4 billion worldwide auction market. eBay warned shareholders that the cost of defending itself in the investigation could adversely affect earnings and divert management attention from its regular business. The company also said other suits could follow. This week, eBay revealed it had contacted police after bidders complained they had not received the merchandise from a California man doing business on the site. eBay says it gets complaints from about one in every 25,000 transactions. "A large number of transactions occur on the eBay Web site," the company said in its SEC filing. "As a result, the company believes that government regulators have received a substantial number of consumer complaints about the eBay Web site which, while small as a percentage of its total transactions, are large in aggregate numbers." ®