US Prosecutors Begin Criminal Probe of eBay Employees

Posted 09/13/2011 at 2:53pm | by Ryan Whitwam

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According to a subpoena obtained by Reuters, US prosecutors are preparing a criminal case against eBay employees. At issue is the accusation that eBay abused its position on the Craigslist board to steal confidential trade secrets. Company spokespeople have indicated they will cooperate with any investigation, but they believe Craigslist’s allegations to be false.

The two companies have been battling it out in civil court for years after eBay launched a classified posting service very similar to Craigslist. A judge ruled last year that Craigslist was justified in removing an eBay employee from its board. Federal prosecutors apparently feel that the situation rises to the level of a criminal matter. "In February 2005, Pierre Omidyar requested information about Craigslist's approach to adding new cities as well as advance notice of plans to launch in new cities," the subpoena says.

Right now, this is just a preliminary investigation aimed as collecting documents and records that will inform the eventual grand jury. It is unclear how many individuals could be caught up in the criminal case.