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DOJ looks at fair competition in eBay dispute

The Justice Department queries eBay about the company?s efforts to block third-party auction search engines from accessing items listed for sale on its site.

The Justice Department has queried eBay about the company?s efforts to block third-party auction search engines from accessing items listed for sale on eBay, a company spokesman said today.

The preliminary investigation by the Justice Department?s antitrust unit focuses on eBay?s dispute with auction portals Bidder?s Edge and AuctionWatch, the eBay spokesman said. The department is studying the online auction market and looking into whether eBay?s moves are anti-competitive.

"Our dispute with Bidder?s Edge is a commercial one that concerns eBay?s right to prevent unauthorized intrusions into its computer system, and use of eBay content in a manner which confuses and misleads eBay users," Jay Monahan, eBay's senior intellectual property counsel, said in a statement. "We are confident that the court in the Bidder?s Edge matter will agree with our position and enjoin Bidder?s Edge from continuing its improper access."

A representative for the Justice Department declined to comment on the investigation.

The department?s actions do not imply that it will launch a formal investigation or file a suit against San Jose, Calif.-based eBay.

Federal regulators have increasingly scrutinized the practices of high-tech companies, including Microsoft and Intel. However, it has dropped inquiries into companies such as Cisco and Network Solutions.

eBay sent letters to several auction service sites last year asking them to stop searching its listings. The company has claimed that the auction search engines slow its servers, provide incomplete or inaccurate results, and are a violation of its intellectual property.

The Justice Department contacted AuctionWatch several weeks ago to talk with the San Bruno, Calif.-based company about its dispute with eBay, AuctionWatch chief executive Rodrigo Sales said. The agency contacted AuctionWatch "out of the blue," Sales said.

AuctionWatch resumed searching eBay's auctions earlier this month after overcoming the company's block. "We believe eBay's actions to be anti-consumer," Sales said.

eBay blocked AuctionWatch from searching its site last November. In December, the auction giant filed a suit against Bidder?s Edge after the Burlington, Mass.-based company resumed its search of eBay?s auctions.

The Justice Department?s inquiry was first reported by the Wall Street Journal.