Class Member Objects to eBay Listing Fee Class Action Settlement

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A Class Member has objected to a $6.4 million class action settlement with eBay Inc. saying that the online marketplace is trying to “screw over” Class Members who don’t opt out because it prevents them from filing class action lawsuits against eBay in the future under a broad definition.

The eBay class action settlement is aimed at resolving allegations by plaintiff Richard Noll from a 2011 class action lawsuit, alleging that eBay charges recurring listing fees to sellers without informing them of the practice. The settlement was reached in January.

The class definition that Class Member Reginald Burgess is objecting to includes anyone in the United States “who (1) place [‘Good Til Cancelled’] Listings on eBay that commenced during the Class Period and (2) were charged Disputed Fees.” The Class Period for stores is March 30, 2010 to June 19, 2012, and the class period for core listings and motors listings is Sept. 16, 2008 to June 19, 2012.

“There is nothing ‘fair’ about this settlement — it creates a class out of thing air — where the narrow circumstances of the Richard Noll scenario have been expanded by defendants to cover anyone as an eBay member who ever posted a ‘good til cancelled ‘ listing — and never complained about it,” Burgess says in his objection to the eBay class action settlement.

“Aside from giving a minuscule amount of a payment to Class Members — eBay seeks a release against the Class Members they have created that covers any and all litigation based on any eBay policy or scenario that could be brought in the future or could have been raised as an issue in this suit,” Burgess explains. “That could be any thing as to how eBay operates.”

Burgess argues that eBay’s goal with the settlement is to try to get lead plaintiff Richard Noll to keep quiet about its allegedly deceptive practices.

“EBay settles from a position of strength — not arms length — offering $15,000 to each of the [lead] plaintiffs to shut up and take the settlement to screw over the class as class representatives and this kind of thing is NOW not favored in the 9th Circuit [Court of Appeals] — and is arguably no longer lawful,” Burgess contends in his objection to the eBay class action settlement.

“If Mr. Noll receives $15,000, so too should each class member also,” Burgess adds.

Class Members “are bound by the terms of the settlement,” if they don’t opt-out of the eBay class action settlement, which is where the objecting Class Member says that this is “where the meat lies,” in what is known as the Class Members’ Release, which states that eBay or any of its subsidiaries cannot be sued based on “any of the legal, factual, or other allegations made in the Action, or any legal theories that could have been based on the allegations for the action.”

Burgess takes issue with the fairness of the class action process itself, saying that it doesn’t allow Class Members to object until after a judge has granted preliminary approval to the class action settlement.

According to the class action lawsuit filed by Noll, eBay charged sellers hidden fees to the tune of $50 million. Under the class action settlement, $4.5 million will go to 1.2 million Class Members and $1.6 million to attorneys’ fees.

Class Members are automatically paid by eBay, according to the terms of the class action settlement, unless they choose to opt-out.

Burgess contends that if this eBay class action settlement is allowed to continue, it will allow the online marketplace to escape another “potentially larger” class action settlement in Cambell v. eBay. The objector argues that eBay is trying to “rush to make THIS settlement in Noll v. eBay  happen first and fast” to prevent that settlement from going through.

“This court cannot approve this settlement as drafted so broadly — and as the release alone harms the class by eclipsing the members’ rights for nothing they did,” Burgess concludes.

Burgess is asking U.S. District Judge Edward J. Davila that a new class counsel be appointed in addition to the court denying the class action settlement. The class counsel is expected to file a response.

The class is represented by Keith R. Verges, Parker D. Young and Raymond E. Walker of Figari & Davenport LLP, Vera Brooks of Thompson & Brooks and Shawn T. Leuthold.

EBay is represented by John C. Dwyer, Whitty Somvichian and Candace Jackman of Cooley LLP.

Burgess represents himself.

The eBay Listing Fee Class Action Lawsuit is Noll et. al v. eBay Inc. et al., Case No. 5:11-cv-04585, in U.S. District Court for the Northern District of California.