Dismissal of DOJ Lawsuit Against eBay

By Jonathan Stempel

NEW YORK (Reuters) – A federal judge has dismissed a lawsuit from the U.S. Department of Justice (DOJ) accusing eBay of breaching environmental laws. The lawsuit claimed eBay allowed the sale of hundreds of thousands of harmful products on its platform, including pesticides and devices designed to evade motor vehicle pollution controls.

U.S. District Judge Orelia Merchant, presiding in Brooklyn, determined that Section 230 of the Communications Decency Act protects online platforms like eBay from liability regarding user content.

The judge stated that eBay’s technical and administrative support for sellers does not significantly contribute to the alleged illegal nature of the products, meaning eBay does not act as a “publisher or speaker” for these sellers.

Judge Merchant also clarified that eBay was not considered a “seller” of the contested products as it did not physically possess or hold ownership of them. She rejected the government’s claim that eBay’s monetary transactions made it a seller.

The DOJ did not promptly respond to comments about the ruling. Similarly, eBay and its legal representatives have not issued statements.

In its complaint from September 2023, the DOJ accused eBay of permitting the sale of over 343,000 aftermarket “defeat” devices that enable vehicles to improve performance while bypassing emissions controls. Additionally, the company faced allegations for allowing sales of 23,000 unregistered, misbranded, or restricted-use pesticides.

eBay also reportedly distributed more than 5,600 hazardous paint and coating removal products containing methylene chloride, a chemical associated with serious health risks including brain and liver cancer.

The government charged that eBay’s actions violated multiple regulations, including the Clean Air Act, the Federal Insecticide, Fungicide, and Rodenticide Act, and the Toxic Substances Control Act.

The case is titled U.S. v. eBay Inc (NASDAQ:EBAY), U.S. District Court, Eastern District of New York, No. 23-07173.