A corporate governance lawsuit
against Craigslist by eBay seems "unethical" and is unfounded,
Craigslist said late
Tuesday.
EBay, a minority shareholder
in Craigslist, filed the lawsuit in Delaware's Court of Chancery Tuesday, alleging
that Craigslist's board of directors has entered into transactions that have
"unfairly diluted eBay's economic interest in Craigslist by more than 10
percent."
EBay didn't release details of the lawsuit. The complaint was filed under seal
because some of the information about Craigslist is governed by confidentiality
restrictions, eBay said in a news release. But eBay, which has owned a 28.4
percent stake in Craigslist since 2004, alleged that Craigslist CEO Jim Buckmaster
and founder Craig Newmark have breached their fiduciary duties.
Craigslist fired
back in a blog post. "We are surprised and disappointed by Ebay's unfounded
allegations, which came to us out of the blue, without any attempt to engage
in a dialogue with us," the blog post said. "Coming from a shareholder
that views craigslist as a prime competitor, filing suit without so much as
mentioning these assertions beforehand seems unethical, and hints at ulterior
motives."
Craigslist has treated eBay fairly as a minority shareholder and will continue
to do so, the blog post said. "Ebay has absolutely no reason to feel threatened
here -- unless of course they're contemplating a hostile takeover of craigslist,
or the sale of Ebay's stake in craigslist to an unfriendly party," it said.
EBay described the unnamed actions of Buckmaster and Newmark as "unilateral."
The Craigslist board has "disadvantaged eBay and its investment in Craigslist,"
a company official said in the eBay news release.
