eBay 2000 Annual Report Download - page 22

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eBay was informed that the inquiry includes an examination of its practices with respect to these transactions.
eBay has provided further information in connection with this ongoing inquiry. In order to protect the
investigation, the court has ordered that no further public disclosures be made with respect to the matter.
On March 24, 2000, ButterÑelds received a grand jury subpoena from the Antitrust Division of the
Department of Justice requesting documents relating to, among other things, changes in ButterÑelds' seller
commissions and buyer premiums and discussions, agreements or understandings with other auction houses, in
each case since 1992. eBay believes this request may be related to a publicly reported criminal investigation of
auction houses for price Ñxing. eBay has provided the information requested in the subpoena.
Should these or any other investigations lead to civil or criminal charges against eBay, we would likely be
harmed by negative publicity, the costs of litigation, the diversion of management time and other negative
eÅects, even if eBay ultimately prevails. eBay's business would suÅer if it were not to prevail in any actions like
these. Even the process of providing records and information can be expensive, time consuming and result in
the diversion of management attention.
A large number of transactions occur on eBay's websites. eBay believes that government regulators have
received a substantial number of consumer complaints about eBay which, while small as a percentage of its
total transactions, are large in aggregate numbers. As a result, eBay has from time to time been contacted by
various foreign, federal, state and local regulatory agencies and been told that they have questions with respect
to the adequacy of the steps eBay takes to protect its users from fraud. eBay is likely to receive additional
inquiries from regulatory agencies in the future, which may lead to action against it. eBay has responded to all
inquiries from regulatory agencies by describing its current and planned antifraud eÅorts. If one or more of
these agencies is not satisÑed with eBay's response to current or future inquiries, the resultant investigations
and potential Ñnes or other penalties could harm its business.
eBay has provided information to the antitrust division of the Department of Justice in connection with
an inquiry into its conduct with respect to ""auction aggregators'' including our licensing program and our
recently settled lawsuit against Bidder's Edge. Should the division decide to take action against eBay, we
would likely be harmed by negative publicity, the costs of the action, possible private antitrust lawsuits, the
diversion of management time and eÅort and penalties we might suÅer if we ultimately were not to prevail.
Privacy Policy
eBay believes that issues relating to privacy and the use of personal information relating to Internet users
are becoming increasingly important as the Internet and its commercial use grow. eBay has adopted a detailed
privacy policy that outlines how eBay uses information concerning its users and the extent to which other
registered eBay users may have access to this information. Users must acknowledge and agree to this policy
when registering for the eBay service. eBay does not sell or rent any personally identiÑable information about
its users to any third party; however, eBay does disclose information to sellers and winning bidders that
contains the seller's and winning bidder's name, email address and telephone number. eBay also discloses
certain personally identiÑable information to its subsidiaries and business partners in connection with the
provision of services by these entities. eBay also will disclose customer information in its possession (other
than credit card information) to a law enforcement agency or member of the eBay's VeriÑed Rights Owner
program that requests this information in connection with a civil, criminal or regulatory investigation. eBay
also uses information about its users for internal purposes in order to improve marketing and promotional
eÅorts, to analyze website usage statistically, and to improve content, product oÅerings and website layout.
eBay is a member of the TRUSTe program, a non-proÑt independent organization that audits websites'
privacy statements and audits their adherence thereto.
New and Existing Regulation of the Internet
eBay is subject to the same federal, state and local laws as other companies conducting business on the
Internet. Today there are relatively few laws speciÑcally directed towards online services. However, due to the
increasing popularity and use of the Internet and online services, many laws relating to the Internet are being
debated at the state and federal levels (both in the U.S. and abroad) and it is possible that laws and
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