Class Claims EBay Ad Program Flopped

SAN FRANCISCO (CN) - EBay didn't deliver on its promises to sellers who paid $39.95 for its "Featured Plus!" service that was supposed to bump their ads to the top of a search page, customers say in a federal class action.

Lead plaintiff Custom LED, of New Jersey, says the service was "completely nonfunctional" for certain periods, particularly in the second half of 2011, because of bugs in the program.

But it says eBay continued to promote and charge for the service on its eBay Motors website, even after it acknowledged that "a known bug" had caused the service to stop working.

EBay sold Featured Plus! as a way for sellers to have their items appear in a separate section at the top of the search results page. Priority in search results can dramatically improve the likelihood that a prospective buyer will see an item and purchase it, since it is not unusual to have thousands of matches for a search.

But the class claims that only searches done within eBay's eBay Motors website were given priority treatment, and prospective buyers had to select "Best Match" in the sort-by box for their listings to appear in the featured section, or the listing would not come up at the top of the results.

If a potential buyer searched for "high-intensity headlights" - a product Custom LED has listed for sale and for which it paid the $39.95 Featured Plus! Fee - the company's product listing would be prioritized only if the buyer had begun the search within eBay Motors and had selected the appropriate one of the seven filtering options, according to the complaint.

"Consequently, many listings placed for free get higher priority than listings for which sellers paid for the Featured Plus! option," Custom LED says.

Typical listing fees are often free, and always are less than $1, according to the complaint.

Custom LED seeks punitive damages for breach of contract, unfair business practices, false advertising and fraud.

It is represented by Shawn Leuthold of San Jose, and by Figari and Davenport of Dallas.

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