Author: Derek S. Underwood, Esq.
While eBay has a complaint mechanism, and a mechanism to give “negative feedback” to sellers, sometimes a buyer wants a more substantial recovery against an online swindler.
Clients often contact us about eBay or other online auction fraud. Usually, they have purchased something online, but the seller has not provided the item, or else the item is significantly different from what they expected, or the seller misrepresented the condition of the item.
Unfortunately, if the seller is an individual in another state who has posted the item online for anyone to purchase, the buyer will most likely need to start a lawsuit against the seller in the state and county where the seller lives. For example, if a seller lives in Tampa, Florida and posts an item on eBay, and the buyer is a resident of Rochester, New York, the buyer would most likely need to file a lawsuit against the seller in Hillsborough County, Florida. Depending on the circumstances, the expense and complication of suing the seller in another state may not be worth it for the buyer.
While this may seem unfair to the buyer, it is based on the legal principle of personal jurisdiction. Put simply, a court only has authority over those individuals within its territory. In our example, the buyer’s local court (Monroe County, New York) would probably not have personal jurisdiction over the seller in Florida. Even though eBay and the Internet provides a means of interconnecting everyone, it does not currently interconnect everyone for the purposes of personal jurisdiction in court.
Luckily, there are exceptions to the general rules of personal jurisdiction. If the Florida seller in our example was a company with significant New York business or contacts, it may be possible to sue the seller in New York. In that case, the court would look at the nature and quality of the seller’s connections with New York state. The most obvious connections would be if the seller has offices in New York, or a New York Department of State certificate to transact business in New York.
However, even without such obvious connections, the seller may still be subject to jurisdiction in New York. Perhaps the seller has continuous income derived from New York or has systematically targeted New York buyers. Internet advertising, including Google search engine placement that targets New York, could show that the seller has significant connections to New York.
Aside from a lawsuit, other avenues that a buyer may be able to pursue against an online swindler include complaints with the US Postal Service or the FBI. A seller that deliberately sends an item through the mail, as part of a scam or fraud, may be committing mail fraud. In addition, there are also laws about scams and fraud via Internet and telephone communications, sometimes referred to as “wire fraud” laws, that may apply in a given case. If the seller is systematically swindling buyers as part of a scam, the FBI or other law enforcement agencies may be interested in investigating.
About the Author
Derek S. Underwood, Esq. is an attorney with Colman & Underwood.
