eBay, BidBay, Common Sense and Justice

Calling Perry Mason. Wire Clarence Darrow and William Jennings Bryan.

All the great lawyers, real and imagined, please pay attention: Somehow, I expect that your services and skills will be required to help sort out eBay v. BidBay, circa 2001.

Indeed, even with all of history’s and television’s great legal minds at work, this case will prove a tough nut. Why? Because the justice system and common sense have never had a lot in common.

What’s in a Name?

Where should we start our analysis of eBay versus BidBay? Well, the names themselves seem like an obvious launching point.

Is eBay (Nasdaq: EBAY) a great name? Hell, no. It’s kind of crummy, actually. It doesn’t tell you a lot about what the company is or does.

But as a brand, it’s now a powerhouse, one of the world’s most recognizable and influential.

So what about the name BidBay? Thanks to the Bid part, at least you get some sense that there are auctions involved. But why the Bay?

There may be other explanations, but common sense tells you and me that it was a simple case of piggybacking. After all, eBay has spent years and millions of dollars searing the eBay name into the brains of consumers. Who wouldn’t want to borrow some of that clout?

Zooming In

It’s only when you look closer that you realize just how far one could argue that BidBay has gone to “borrow” from eBay. The home pages have the same color scheme. The logos of the two auctioneers both have offset letters in multiple colors.

On the left side of the eBay home page is a section labeled “Categories.” Ditto BidBay. In the lower middle of the page, eBay sports a section labeled “Featured Items.” BidBay, in the same location, has “Featured Auctions.” At the top of both pages is a search function. eBay’s says “find it!” and BidBay’s, “get it!” (They even borrowed the exclamation point!)

There are more similarities and, to be sure, some differences. In any event, the logical mind declares this and open-and-shut case.

Even if BidBay didn’t intend to steal eBay’s customers, it didn’t exactly break new ground when time came to design a corporate logo or a home page.

Dare to Compare

Unfortunately, this case is not being tried in the court of logic. So we need the best real and imagined legal minds of all time to help sort this out.

The question that remains to be answered is whether eBay was harmed by BidBay’s apparent parrot-like behavior. Proving that might be a stretch, given that by all publicly disclosed metrics, eBay’s growth has continued to run full-speed ahead straight through BidBay’s clone-like birth.

eBay says it has heard from users questioning whether eBay and BidBay are connected. If eBay can prove that someone mistakenly bought or sold something on BidBay under the impression they were getting the original, then eBay might have something that the courts can sink their teeth into.

Nervous System

Meanwhile, back in the court of common sense, BidBay’s claim that eBay is getting nervous, especially since BidBay is moving close to an initial public offering, sounds a bit dubious. Even in a robust stock market open to IPOs, that claim would ring a tad hollow. But now?

eBay has a market capitalization of about US$16 billion. BidBay hopes to raise $60 million through its IPO, $51 million of which it would get to keep.

Sure, David slew Goliath in a similarly one-sided matchup, but eBay is no heavy-footed galoot. It’s one of the best-executing companies of the modern economy.

The Verdict

Is eBay scared? Doubt it. Annoyed? You bet. The lawsuit will be a distraction to both sides, however, and BidBay can less afford it.

Hopefully, common sense will win out. And quickly. BidBay would keep its name, modify its look to something a bit more original, and everyone can move on.

But given the history of American justice, it probably won’t be nearly that simple.

What do you think? Let’s talk about it.