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Data firm hits Craigslist with monopoly claim

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 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.



7 Responses to “Data firm hits Craigslist with monopoly claim”

  1. RaptorOO7

    Surprise, surprise, when a company gains majority market share and they don’t want competition cutting in they do whatever they can legally and otherwise to thwart the success of others (I know a company just like that). Twitter could be accused of the same tactics as Craigslist, and like Twitter, Craiglist is failing to offer the consumers what they want, need and are demanding. Features and benefits that in 2012 can be and should be easily developed.

    Twitter grew based on the success of their developer base and users joined in and once the big names found it Twitter exploded. Now they want to control everything. Craigslist is the same, both are in effect becoming a common carrier and with that they need to be better stewards of end users data to which they do not own, but instead the consumer owns and they (Twitter and Craigslist) carry and deliver that data.

  2. Tim Keley

    Even if they were to be found to be a monopoly, Craigslist would be a monopoly for the people’s benefit. I admire that this is put forward for everybody to utilize FOR FREE! He could have sold out many times for huge money, yet we still have the same free service to buy or sell stuff at no charge. 3tap must be stopped. I imagine they will be producing the next Meg Whitman to unleash their self saturated political candidacy on us regular folk. Does everything good need to monitized for a select few people to get rich off of the masses? Craig is one of the few good ones. People before profits, 3tap. We all could use one less apartment hunters guide.