eBay to pay $59M in settlement with U.S. Department of Justice

eBay reached an agreement with the U.S. Department of Justice to fully resolve the DOJ’s inquiry regarding products sold on the eBay marketplace alleged to violate certain laws administered by the Drug Enforcement Administration. Under the terms of the agreement, eBay will pay $59M and implement enhanced processes regarding its monitoring and reporting of listings that violate eBay’s terms of service. eBay expressly denies the DOJ’s allegations and the settlement does not include any admission of wrongdoing. eBay issued the following statement: “Maintaining a safe and trusted marketplace for our global community of sellers and buyers is a fundamental principle of our business. eBay is proud of its well-recognized, proactive and voluntary efforts to remove the products that were the subject of the government’s inquiry from our marketplace. While eBay acted lawfully and denies the DOJ’s allegations, we determined that this agreement is in the best interest of the company and its shareholders as it avoids the costs, uncertainty and distraction associated with protracted litigation. eBay’s actions to remove products that could be used for counterfeit pills – including dies, molds and pill presses – prior to any request from the DOJ or other authorities, and years before the government turned its attention to these products, prevented tens of thousands of potentially problematic listings from appearing on our marketplace. Government officials have repeatedly commended eBay for our partnership with law enforcement and efforts to support investigations into illegal pill press usage.” As previously disclosed, eBay has accrued for probable losses in connection with this DOJ inquiry. eBay will fund the payment contemplated in the settlement through cash on hand.