Updated from 7:43 a.m. EST
, the Internet's largest auctioneer, rose marginally in Friday trading despite news that the
was investigating the Internet's largest auctioneer for anticompetitive practices.
eBay closed up 2 7/8, or 2%, to 168 1/4.
A Justice Department spokesman confirmed the investigation.
eBay would only go so far as to say in a statement, "We have had some discussions with staff at the Justice Department regarding eBay and the online trading business generally."
The preliminary investigation by the Justice Department's antitrust division, still in the early stages, will not necessarily result in legal action against eBay.
eBay has sought to block aggregators such as "shopping bots" and "crawlers" from accessing its Web site. The software searches the Internet for the lowest price of a product, among other things, and is widely used by comparison shopping sites or search engines. In some cases, the searches can be intrusive or even destructive.
The Justice Department has met with two of eBay's smaller rivals,
, according to
The Wall Street Journal
eBay does license access to its site to some online crawlers but says that unauthorized entry has slowed down or damaged its systems. However, in December, eBay filed a lawsuit against Bidder's Edge, alleging unfair business practices, computer fraud and misappropriation for trespassing on eBay's computers. Bidder's Edge denied eBay's claims when the suit was filed and expects to respond in a filing in U.S. District Court in San Jose on Monday.
"We believe the contact with DOJ may have been prompted by auction listing aggregators, such as Bidder's Edge, whom eBay currently is suing over the issue," Jay Monahan, eBay's senior intellectual property counsel, said in a statement. "Our dispute with Bidder's Edge fundamentally is a commercial one that concerns eBay's right to prevent unauthorized trespassing into its computer system, and use of eBay content in a manner which confuses and misleads eBay users."
And last November, eBay moved to block AuctionWatch after the companies failed to reach a licensing agreement. Last month, AuctionWatch bypassed eBay's blockage with a technical solution so it now offers eBay listings on its site again.
"The interesting question is, 'Can they keep these barriers up?'" commented analyst Faye Landes of
Thomas Weisel Partners
. "If they can't, that could hurt their business model." She rates eBay a market perform and her firm has done no underwriting for the company.
She points out that
has not tried to block the bots, even though customers can use them to find cheaper prices elsewhere on the Web. "They haven't hurt Amazon materially because Amazon is giving such a great package of services, from its content to
ordering feature. There are a million things to keep the consumer there."
eBay, based in San Jose, Calif., might argue that it has the same hold over its customers, but in reality it is much more of a clearinghouse than a merchant. It does not own the content on the site, either the products or reviews, and it does not control the shipping of items that have been auctioned off, since the sellers will do that on their own. Because eBay has less control, it is seen as more vulnerable.
In related news, eBay also announced it would ban items from its Web site that promote hate groups such as the
Ku Klux Klan
. The ban came after a request from an organization that works with victims of hate crimes.
Last year, eBay banned sales of firearms, alcohol and tobacco.