Billing Glitches Anger EBay Sellers

A class action lawsuit charges the online auction giant with unlawful practices.

Nancy Spaulding, from North Ridgeville, Ohio, noticed something strange in her monthly invoice from EBay--listing fees and other items appeared to be double-billed and then credited back. There was so much back and forth, it was hard to tell if she had been overcharged. She's one of many EBay sellers to experience the problem since the auction site switched to a new billing system earlier this year. Spaulding, a longtime buyer turned clothing seller in the past year, has stopped listing items on EBay and doesn't know if she'll ever resume.

And in July, Spaulding and another plaintiff filed a class action suit against EBay. The suit accuses the site of engaging in unlawful and deceptive conduct with respect to its billing practices. EBay firmly denies the allegations and says that all problems have been corrected--a claim the suit apparently does not dispute.

Software glitches in the new system did cause some sellers to be double-billed for certain items, says Hani Durzy, an EBay spokesperson. EBay says that it became aware of such problems in April. However, although the extra charges appeared on the invoice, no one's account was actually debited, he claims, because the company immediately halted automatic payments for affected users (some users opt to have their debit card or credit card automatically charged upon receipt of each invoice).

The double-billing glitch was fixed "within weeks" of being discovered, according to Durzy. Users allege, however, that they continued to see incorrect totals on their invoices long afterward, and some of them complain that EBay suspended their accounts for nonpayment. Durzy admits that a small number of sellers were accidentally suspended, but he says that EBay corrected the problem within 72 hours.

The lawsuit was on hold at press time as both sides met with a judge to try to resolve the situation without a trial.