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e-Bay wants a seat on Craigslist board

Bob Moon Dec 7, 2009
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e-Bay wants a seat on Craigslist board

Bob Moon Dec 7, 2009
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TEXT OF STORY

Stacey Vanek-Smith: Imagine Pepsi with a seat on Coke’s board of directors. Well, that’s essentially what e-Bay is fighting for in a case that goes before a Delaware court today. e-Bay wants a seat on the board of Craigslist. Bob Moon has more.


Bob Moon: When e-Bay bought just over 25 percent of Craigslist back in 2004, it got a seat on the board and made no secret that it wanted to learn how to get into the online classified market. Soon after, it launched a rival classified site called Kijiji. And then came the lawsuits.

e-Bay claims Craigslist execs quietly sold new shares, diluting e-Bay’s stake just enough to throw it off the board. Craigslist accuses e-Bay of stealing confidential information.

The whole case has securities lawyer Jacob Frenkel scratching his head:

Jacob Frenkel: It borders on the incredible for a competitor to have a seat on that board.

Craigslist leads the U.S. market, but e-Bay’s classifieds rule in numerous foreign countries.

Peter Zollman writes the Classified Intelligence Report. He says e-Bay sees the growth it needs in classifieds:

Peter Zollman: Because it is such an important business, and such a lucrative business in many cases, that looks like it’s going to be one of the keys for e-Bay for the next few years.

But attorney Jacob Frenkel wonders if there’s something else at stake:

Frenkel: This case very much smacks of bruised egos battling it out.

We’ll hear from execs on both sides starting today.

I’m Bob Moon for Marketplace.

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