The first repercussions of shill allegations against PWCC have entered the litigation stage.
The Oregon-based company had its listings pulled from eBay on Aug. 17, 2021, as the marketplace giant accused “individuals associated” with PWCC engaging in shill bidding. eBay didn’t provide any specifics and PWCC has denied those allegations.
Now, one month later, a class action suit has been filed in federal court, alleging that PWCC used shill bidding to inflate the prices of items it was selling online.
The class-action suit, Latham v. PWCC Marketplace, LLC — spearheaded by New Orleans resident Gregory Latham — was filed in U.S. District Court for the District of Oregon, Portland Division, on Sept. 17. According to court documents, the plaintiffs, who are seeking a jury trial, are “all persons who purchased goods” from PWCC through an online auction.
As of 3 p.m. EDT on Aug. 17 — the day eBay pulled the listings — PWCC had over 17,000 live auctions available for bidding.
PWCC has sold a massive amount of consigned items through eBay and on its own website. In July 2021, PWCC sold more than 37,000 lots through its Premier Auction conducted on its own platform and continues to offer both auctions and fixed price listings there.
The lawsuit filed in Oregon alleges that PWCC violated Oregon’s trade practices and antitrust regulation laws under statute 646.608(v) and claims that the defendant “violated any of the provisions relating to auction sales, consignment sales, auctioneers, consignees or auction marts under ORS 698.640(d), whether in a commercial or noncommercial situation.”
ORS 698.640 lists the requirements for sales. Under ORS 698.640(d), an auctioneer “may not employ or use another bidder or buyer at an auction on behalf of the auctioneer.”
In layman’s terms, no shill bidding is allowed. The lawsuit claims that PWCC did just that, committing willful and/or reckless consumer violations due to shill bidding.
The plaintiffs, under the proposed class-action suit, are seeking minimum damages of $200 for every instance of alleged shill bids. According to the lawsuit, “on information and belief,” the alleged shill bidding resulted in damages to the proposed class in excess of $25 million.
The lead attorney for the plaintiff in the Latham class action suit is Oregon trial lawyer Nick Kahl, of Portland, who notes on the website of his small law firm that his practice focuses on representing consumers, small business owners or injured people. Kahl also served one term in the Oregon House of Representatives from 2009 to 2011.
Other attorneys for the plaintiff included in court documents are Lawrence J. Centola III and Jason Z. Landry, from the New Orleans law firm of Martzell, Bickford & Centola.
According to the lawsuit, Latham bought “numerous” cards online from PWCC, including from auctions. For one example, Latham stated that he paid $243.82 for a 1914 T213 Coupon Type 2 Eddie Collins. The card was graded a 2 by SGC — good condition.
There are two versions of this card — both show Collins wearing the uniform of the Philadelphia Athletics — Type 1 lists his team name at the bottom as “Philadelphia Amer.,” while Type 2 has “Chicago Amer.” at the bottom. Collins, who played for the Athletics in 1914, was traded to the White Sox after the season, as manager-owner Connie Mack was reeling from a World Series loss to the “Miracle” Boston Braves and the upstart Federal League, which was attempting to grab players from the American and National Leagues.
According to the lawsuit, Latham bid on the Chicago card, won the auction and paid $243.82 for the item on Aug. 11, 2020.
Latham contends that the prices of the auction were inflated by bidders that had some affiliation with PWCC, and the company has denied that.
PWCC has yet to respond to the lawsuit, but the company issued a statement immediately after eBay pulled the listings. The company said it was considering “all available legal options” and called eBay’s decision a “bad faith action to restrict PWCC’s privileges on eBay.”
While it is unclear whether other collectors will follow suit and take PWCC to court, the Latham case is certainly the opening salvo. It is a case that people in the hobby will be watching very closely.