e-Bay Arbitration Clause Not Applicable in Private Disputes

The Court of Appeals of Tennessee, in Danevans v. Phillip Matlock, et al., has ruled that the arbitration clause in e-Bay's User Agreement cannot be employed in disputes between users. In particular, in this case, the plaintiff alleged that he had purchased an antique Dr. Pepper dispenser after his bid was accepted on e-Bay's Internet auction site. He continued to assert that the defendant proceeded to sell the dispenser to another party. An action was commenced and the plaintiff alleged damages for breach of contract, violation of the Consumer Protection Act and inducement to breach of a contract. E-Bay's User Agreement contains an arbitration clause that provides that all disputes are to be arbitrated as opposed to being litigated. The defendant brought a motion for summary judgment stating that the terms of the agreement called for arbitration. The Appeals Court, in affirming the trial court's decision, held that the arbitration clause did not apply to private disputes between vendors and purchasers. The court stated that the arbitration clause "does not contemplate binding arbitration relative to "˜user-to-user' controversies" and that the clause applies to disputed between e-Bay and the users. For a copy of the decision, visit: http://makeashorterlink.com/?U2A852113 Concerned about the legal aspects of doing business online, contact Amy-Lynne Williams (awillimas@dww.com) or Heather Watts (hwatts@dww.com) of DWW