FEDERAL COURT RULES THAT EBAY IS A CRIMINAL ORGANIZATION

From: Steptoe_Newsletter@steptoe.com Sent: Thursday, August 21, 2008 12:47 PM Subject: E-Commerce Law Week, Issue 520 E-Commerce Law Week Issue 520, Week Ending April 16, 2008 Court Says eBay is a Criminal Enterprise. Seriously. A federal court in California recently held that eBay's allegedly false statements about the safety of its "Live Auction" service can support a claim against the company under section 1962(c) of the Racketeer Influenced and Corrupt Organization Act (RICO), a statute originally designed to go after organized crime. The ruling is at: http://www.steptoe.com/attachment.html/3504/520a.pdf For your information, 18 USC 1962(c), the section of RICO of interest here states: (c) It shall be unlawful for any person employed by or associated with any enterprise engaged in, or the activities of which affect, interstate or foreign commerce, to conduct or participate, directly or indirectly, in the conduct of such enterprise's affairs through a pattern of racketeering activity or collection of unlawful debt. Although the case involves a civil suit, the court's ruling in Mazur v. eBay Inc. amounts to a remarkable statement that eBay's description of its auction service constitutes criminal behavior. While the Federal Trade Commission has brought actions for "unfair" or "deceptive" acts in commerce against companies whose actual privacy practices did not live up to their stated policies, allowing RICO actions to be brought on the basis of similar misstatements is a giant leap - and could have enormous negative ramifications for websites. (c) Copyright 2008 Steptoe & Johnson LLP.