THE SETTLEMENT TERMS

The parties participated in mediation with the Honorable Read Ambler (Ret.) in an effort to resolve the Action. As a result of the mediation and in order to settle the allegations in the Action, eBay has agreed to cease the conduct alleged by making the following "curative disclosure" that is relative to the misrepresentations claimed by Plaintiffs:

In response to a system prompt, if a high bidder attempts to raise his maximum bid when such bidder is then between bid increments, eBay shall first disclose to such bidder the exact amount of any resulting bid increase that would otherwise occur by virtue of the bidder raising the maximum bid. By way of illustration only and using the facts set forth in paragraph 23 of the Complaint, upon raising the maximum bid once plaintiff had reached his existing bid maximum of $111.00, eBay would disclose whether raising the maximum bid level would result in the $111.00 bid being raised to the next bid increment over the last competitive bid of $110.00 and, if so, specify the exact amount to which the bid would be raised - that is, $112.50.

In addition, eBay has agreed to pay the sum of $2.1 million ("Settlement Fund"). The Settlement Fund will be distributed to one or more federally tax exempt charities chosen by Plaintiffs' Counsel and approved by the Court. None of the charities selected by Plaintiffs' Counsel and approved by the Court shall be directly or indirectly affiliated or associated with Plaintiffs or their counsel. Based on information provided by eBay to Plaintiffs' Counsel, the $2.1 million is estimated to be approximately 50% of the claimed damages and all other economic harm allegedly incurred by Members of the Class. Distribution of the Settlement Fund to charitable organizations is appropriate because any attempt to distribute the Settlement Fund to individual Members of the Class - whose average recovery would be less than $1.00 - would result in administrative costs that would consume any settlement proceeds.
eBay has also agreed to separately pay Plaintiffs' Counsel $800,000 for past and anticipated future attorneys' fees and expenses regarding the Action, subject to Court approval ("Attorney Fees"). This amount was negotiated and agreed to after the substantive provisions of the settlement were reached and after the memorandum setting forth the material terms of the settlement was executed. Plaintiffs' Counsel, subject to Court approval, intend to pay up to $104,300.00 and $150,000.00 to Glenn Block (or Glenn Block, P.C.) and Daniel Block (or DSB Consulting, Inc.), respectively, for their expert services in this Action from the Attorney Fees. Glenn Block was the original plaintiff in the Action and provided technical assistance to Plaintiffs' Counsel regarding eBay's auction practices, the allegations in the Action, the calculation of damages and economic harm, and due diligence. Daniel Block is Glenn Block's son and provided computer, programming and data mining expertise that was otherwise unavailable to Plaintiffs in a timely and efficient manner. Their expertise was unique and necessary for the successful prosecution of the Action.
eBay shall also separately pay, subject to Court approval, the three Plaintiffs named in the Amended Complaint, $1,000 to reimburse them for their time, costs and efforts in representing the Class.

If the Court approves the settlement, a judgment will be entered dismissing the lawsuit with prejudice against eBay and all of its past and present officers, directors, shareholders, employees, insures, agents, representatives, partners, joint-ventures, parents, subsidiaries, affiliates, and attorneys (the "Released Persons"). This means that Members of the Class will be barred from bringing their own lawsuit against any of the Released Persons relating to eBay's alleged practice of raising an eBay bidder's existing bid where no higher competing bid had been made, and where raising the bid was not necessary to meet a reserve minimum. If you do not want to be barred from bring your own lawsuit on such claims, you must validly and timely request exclusion from the Class, as set forth below.