In an ongoing fight over ad listings, data company 3Taps has made good on its threat to file an antitrust claim against classified giant Craigslist.
In a claim filed Monday in San Francisco federal court, 3Taps accuses Craigslist of operating as an “unchallenged monopolist” to pull in $100 million to $300 million per year. 3Taps asks the court to declare that Craigslist is violating Section 2 of the Sherman Act, a law that forbids companies from abusing dominant market power.
In particular, 3Taps claims that Craigslist is perpetuating a monopoly through four types of acts: sending sham cease and desist letters against potential competitors; making overly broad copyright claims; imposing improper license terms on users; and “ghosting” (making posts with links to competitors invisibile to other users.
The monopoly allegations are the latest turn in a legal dust-up that began this summer when Craigslist filed a copyright complaint against 3Taps and popular apartment hunting site, PadMapper.
The debate turns on who owns the classified ads on Craigslist at a time when up-and-coming companies are creating tools that can show the information in new, visually attractive formats. PadMapper, for instance, lets house hunters see listings superimposed on maps of a neighborhood. Meanwhile, some critics complain that Craigslist’s design and interface is stagnant and stuck in the 1990s.
For its part, Craigslist has suggested that these companies are free-riding on infrastructure that it developed.
The new court filing by 3Taps (embedded below) is fairly dramatic for this type of document and appears geared to further a media strategy aimed at swinging public opinion against Craigslist. But the company’s CEO Greg Kidd also appears to be playing for the win in court by hiring the white shoe law firm Skadden Arps. Here are some selected portions from the complaint (highlights are mine) :
Just as Google, Bing, Ask, or any other general search engine facilitate efficient searches, 3taps enables user-authored ads on craigslist (or any similar public advertising sites) to be efficiently searched. 3taps’ technology provides a previously unrealized public benefit, by enhancing the accessibility of the classified ads of potential sellers by potential buyers. […]
This also falsely insinuates that craigslist broadly serves humanity as a “free” service, a grossly misleading characterization given craigslist’s accumulation of enormous and largely undisclosed profits, a pattern and practice of predatory lawsuits (such as this one) aimed at obstructing innovation
3taps denies copying any “craigslist content.” craigslist is neither the owner nor exclusive licensee of any “content” posted to craigslist.com by any third party creator
it has become a de facto common carrier for U.S. online marketplace exchange postings, giving craigslist an ability to command and dictate terms and conditions in consumer classified markets, control and obstruct innovation in those markets, and engage in anticompetitive behaviors consistent with monopoly power.
As an unchallenged monopolist across these various markets, craigslist has generated revenues somewhere between $100-$300 million per year, and that’s without sinking any significant costs into research and development or innovation.
Court records show that PadMapper received an extension of time to file a defense to Craigslist’s copyright claim against it. For more background on the case, see Craigslist, 3taps & the court battle for the soul of public data by ReadWriteWeb.