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Ruling Restores Ebay's Stake in Craigslist

NEW YORK ( TheStreet) -- Ebay (EBAY - Get Report) proclaimed itself "victorious" in its shareholder dispute with online classifieds company Craigslist.

The San Jose, Calif.-base online auctioneer issued a press release saying a judge in the Delaware Court of Chancery had ruled in Ebay's favor in the shareholder suit filed against Craigslist and its founders, Jim Buckmaster and Craig Newmark.

"The ruling overturns a series of unlawful transactions undertaken by Craigslist's majority shareholders to dilute eBay's minority share in the company," Ebay said in its statement, adding that: "The ruling rescinds a poison pill and right of first refusal adopted by the controlling shareholders in January 2008 and restores eBay's 28.4 percent share in Craigslist."

Specifically, Ebay said the judge found that Buckmaster and Newmark had "breached their fiduciary duty of loyalty" with their actions.

Shares of Ebay ticked higher in afterhours action, most recently changing hands at $24.41. Based on Thursday's regular session close at $24.30, Ebay shares were up about 4.4% so far in 2010.

-- Written by Michael Baron in New York.

>To contact the writer of this article, click here: Michael Baron.

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Disclosure: TheStreet's editorial policy prohibits staff editors, reporters and analysts from holding positions in any individual stocks.

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