Pennsylvania Sues Woman For Selling Goods On eBay Without A License
from the if-we-don't-understand-it,-it's-probably-illegal dept
A few years back we wrote about states that were passing inexplicable laws requiring anyone selling goods on eBay for others to get an auctioneer's license, something that can be quite costly and sometimes requires a long-term apprenticeship. It appears just such a law is being used in Pennsylvania to go after a very successful eBay seller (via the Agitator). The story in that case is even more ridiculous, since the woman in question only began selling goods on eBay in order to be able to stay at home with her young daughter who was diagnosed with a brain tumor. Even though the woman stopped (and got a job outside the home) as soon as the state notified her that she was illegally selling goods, the state is still moving forward prosecuting her. While the state told the reporter that the maximum fine the woman faced is only $2,000, her lawyer read the charges in a way that suggested she could be on the hook for up to $10 million. The whole thing seems pretty pointless. Selling on eBay is quite different from running an auction house. If anything, laws like these seem designed to limit competition in an effort to protect an incumbent industry. As another eBay seller facing similar charges notes in the article: "It's like the buggy-whip manufacturer's deciding whether these newfangled automobile manufacturers can do it without a buggy-whip license."
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Filed Under: auction license, pennsylvania
Companies: ebay
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hrmm... nope
Now a hobby auctioneer... that's totally different, and completely exemptable. And there are already laws in place to define that fine line. No need for me to try it.
Anyways, the courts have largely ignored ebayers, and that is to the greater detriment of the public. It would be nice if SOMEONE started adding accountability back into online sales. I don't like ebay anyways, so I don't really care that it would kill them off.
ebay is an enabler for bottom feeders. It is not a healthy thing.
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Re: hrmm... nope
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Re: Re: hrmm... nope
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Re: Re: hrmm... nope
I don't agree with AC's "You are an idiot", but you certainly seem to make a compelling argument that you are grossly ill informed and perhaps even lack some critical reasoning skills. I simple Google for “eBay Fraud Statistics” will help you see the err of your logic (one would hope).
The vast majority of eBay sales are legitimate. According to fewer than 1 in 10,000 sales are “frauds” (~13,000 in 2005 out of many millions). eBay, it turns out, has a much lower fraud rate than newspaper ads had. Please note, I'm not much of an eBayer, I generally prefer other means to purchase and/or sell on-line, but requiring auction licenses is truly indefensible.
As for taxes, you already have to pay taxes, whether you sell one item for profit, or 500,000 on eBay or in a yard sale. There is no IRS exemption on income from sale of goods or services. It just so happens that the IRS will probably not come after you for selling lemonade at your lemonade stand, but by law, that is taxable income (if your total income exceeds the blah blah blah).
As for stating that they should have to pay Business Taxes, I say: what planet do you live on? I have owned or been a partner (or still own/am) in 3 LLCs, 1 LLP, 1 PLLC and 2 S-Corps. The 2 S-corporations paid business (read "corporate") taxes, but they were pre 1996. All 5 of my other companies paid zip, nada, nil in taxes. Individuals paid on the distributed income, but there were no business taxes. What have you been smoking for 10+ years? If your business has
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Re: Re: hrmm... nope
"If your business has
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Re: hrmm... nope
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Re: Re: hrmm... nope
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Re: Re: Re: hrmm... nope
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Re: hrmm... nope
Hey look everybody its another person talking when he/she knows nothing about the topic. I bet you have never even used ebay or not enough to know that "they are all scams"...
I have sold thousands on ebay and have bought thousands more and have only been scammed once on a 6 buck cd!
Paypal has coverage....free
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Re: Re: hrmm... nope
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Re: Re: Re: hrmm... nope
You're wrong. My feedback is around 5000, with about 4k from selling and another 1k from buying, and I have a second buyer's only Ebay account with 2000 feedback. Neither account is used much anymore, and I started with Ebay in late 1998, which blows both your theories out of the water.
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Re: Re: Re: Re: hrmm... nope
You're wrong. My feedback is around 5000, with about 4k from selling and another 1k from buying, and I have a second buyer's only Ebay account with 2000 feedback. Neither account is used much anymore, and I started with Ebay in late 1998, which blows both your theories out of the water.
*******************************************************
Not to mention the auction and turbo-list software available. eBay sellers who make any amount of money list hundreds of auctions daily. ....In addition, the vast majority of powersellers run legitimate businesses on eBay and DO HOLD business licenses.
In my ten years on eBay, I've been scammed once... by a minor who had no business on eBay, and had used his parent's account.
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Re: Re: Re: hrmm... nope
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I wouldn't rely on Paypal to help you.
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Re: hrmm... nope
#2 anyways is NOT a word
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Re: Re: hrmm... nope
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Re: hrmm... nope
I was so sorry to hear that you got sniped while trying desperately to acquire that last beanie baby for your collection. This is a perfect example of the unfair, competitive attitude that is so prevalent on that electronic den of iniquity! Even had you won, I'm sure that the item in question, one "Romper" the puppy, would never had been delivered in the first place.
Let me ask you, what SHOULD people be allowed to do without a license? Apparently you are the authority, please, correct all of societies ills for us.
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Re: hrmm... nope
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Re: hrmm... nope
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Re: hrmm... nope
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Wrong
I have been duped a few times, but paying attention to seller feedback is worth its weight in gold. I've made lots of money and saved lots of money buying new things that would be twice as much in the stores. Unhealthy? Now that is just sick.
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Re: hrmm... nope
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Re: hrmm... nope
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Re: hrmm... nope
"Mostly" implies at least 51% of the sales are scams with no resolution. That's complete BS. I have no doubt that some scams are occurring and that some of those scams are unresolved. But to claim that the majority of sales on ebay are scams is ignorant. I think Coward is right, you are an idiot.
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Re: hrmm... nope
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Re: hrmm... nope
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Re: hrmm... nope
If it were highly illegal, Ebay wouldn't be allowed to allow mass individuals to participate in that activity. Also they'd be liable for an accomplice. Either way, the courts as you've pointed out, have largely ignored ebayers. Therefore, since this is known, it's improper to suddenly go after some lone woman trying to save money to help her dying child. The way it works is you change the system at the upper end. Not pick on the woman selling from her apartment. But the fact that you want "accountability" presupposes that she was doing something wrong to begin with. As if you are some low life law official eager to fry her. Well if you are, you need to stop being a bottom feeder your self and stop trying to be part of a movement that condones twisting laws in order to take advantage of the weak, elderly or sick or anyone for that matter. And you don't like ebay. Well no surprise there.
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Re: hrmm... nope
If it were highly illegal, Ebay wouldn't be allowed to allow mass individuals to participate in that activity. Also they'd be liable for an accomplice. Either way, the courts as you've pointed out, have largely ignored ebayers. Therefore, since this is known, it's improper to suddenly go after some lone woman trying to save money to help her dying child. The way it works is you change the system at the upper end. Not pick on the woman selling from her apartment. But the fact that you want "accountability" presupposes that she was doing something wrong to begin with. As if you are some low life law official eager to fry her. Well if you are, you need to stop being a bottom feeder your self and stop trying to be part of a movement that condones twisting laws in order to take advantage of the weak, elderly or sick or anyone for that matter. And you don't like ebay. Well no surprise there. And yes, as others have pointed out. You're an idiot, and not because peoples opinions differ from yours. The reasons supporting that are glaringly obvious.
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Re: hrmm... nope
If the people bought the item(s)they are selling why should they be penalized.
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Re: hrmm... nope
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Re: hrmm... nope
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Re: hrmm... nope
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Re: hrmm... nope
PA doesn't require a business license to operate a sole proprietorship nor do they require you to register as a business for same. If you are operating a business that requires the collection of taxes, THEN you have to register. Nowadays eBay handles that so no collection of taxes is necessary on behalf of the seller. However, even in 2008 when you posted this, there was no onus on online sellers to collect taxes for items sold out of state. And it's ridiculous to think an eBay seller should have to possess an auctioneer's license. The seller isn't conducting the auction; eBay is. If my gym goes out of business and HiBid sells off my equipment I don't need an auctioneer's license because I'm not the auctioneer. There is no sensible reason why it should differ for eBay sellers.
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Ebay
This lawsuit is BS, and the laws you mentioned are clearly not in the public interest. They are designed to protect retail industry at the expense of the people
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Re: Ebay
There are others who take advantage of the service and it's their corruption that has spoiled it for us. We need to punish those devious people, not the innocent people who are just putting their used items to good use - by recycling them on ebay.
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Re: Ebay
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Re: Ebay
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Amazing
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Re: Amazing
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read the article please
This was way beyond a hobby and small businesses still have to obey the law...
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Re: read the article please
I did read the article. As stated in the post, the problem was that she was selling goods for others.
That still doesn't explain why she needs a special auctioneers license.
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Re: read the article please
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Our money pays for our roads, libraries, police force, and so on up the line. I have no problem with people getting rid of things they don't need, selling a regular inventory over a long period of time is not like having a yearly Internet garage sale. Even if it was, in Oklahoma, you have to pay five dollars for a garage sale permit. In most states, once you start selling over a certain monetary amount, you are in business and you must pay taxes, just like everyone else.
I'm not saying that the case mentioned in the article is great, but the roads and services that we all use will be out of business if the little tax-evading guy has his way.
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that's funny
ebay is for bottom feeders. It is not healthy.
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and yes you are all stupid
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No need to worry...
Say what you want about Hellsvilla but I think she/he has a point about regulating people that operate full on businesses on ebay. If I open a brick and mortar store I have regulations to follow so why not for an online store. I'm not saying that the regulations can be copied verbatim mind you.
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keep on subject
if it were me in that position ID CONTINUE AND SELL EVEN MORE JUST TO P***S THEM OFF. Ebay is the auctioneer not the seller.
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doesnt make sence
but i do agree that if her business consists of selling good on ebay that she (or any one else) should have a business license, not because its over ebay just because its a license.
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eBay is not a "real" auction
I recall one "auction" in which I tried to participate for a high-end Sony ultra-lightweight laptop. The seller had put up six of them, each scheduled to close on the same day and none had a reserve price.
The result, he flooded his own little market. There were too few bids and weak, as well. Bidding stalled at $1,500 for units that retail list for $2,300. None of the items had more than three bidders and two had none.
They were all pulled from sale less than 24 hours before bid closing. That was a so-called Power Seller. Guess who eBay supported when bidders demanded that the sale be completed? So much for eBay's rules that say a bid is a contract.
I'm amazed anyone will buy there.
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Re: eBay is not a "real" auction
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State Laws
What to excpect next? How about throwing people in jail for having garage sales! It's next.
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Re: State Laws
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If PA wanted to take an aggressive approach, they would require a business license which would do a few things:
a) It would encourage entrepreneurship.
b) It would present better remedies for buyers.
c) Sellers could be more easily held accountable for their sales transactions.
I understand how and why PA did this, but I do not agree with how it was done. Hopefully, they will revisit the strategy and implement something that will motivate people instead of stressing them out.
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Scandalous
As for scammers on ebay; yep there's plenty of them. Every ebay I know has been scammed at some stage,including myself. Just check the ebay forums for evidence.
The scammers who scammed me continue to operate on ebay while ebay apparently ignores them (yes I have lodged complaints, the only action they took was a *temporary* suspension).
Ebay is great for CHEAP hard to find items but they badly need to sort themselves out.
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Do I need a yardsale license
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Re: Do I need a yardsale license
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Re: Do I need a yardsale license
Same goes for any business. No, Ebay isn't a real "auction" but people who sell on Ebay are sellers. That means they own a business and should pay taxes on it and (depending on the state) should have a vendor's license to do so. Just like the garage/yard sales, if you only sell one or two things the government won't say much, but if you are selling daily then you should be paying taxes and have a license.
I buy and sell occassionally on Ebay, so I know how they work. Ebay cannot legally send out forms to the IRS (or anyone else for that matter) from sellers, because they don't know how much money is exchanged. There is no way for them to prove that money was received or sent. That is the way they stay out of any legalities regarding licenses.
I do have a problem with Paypal, though. Ebay is now demanding that buyers and sellers only go through Paypal and the fees are outrageous. There is no way that sellers can even make money without charging huge fees to the buyers because of all of the fees. Ebay also likes to raise their fees every now and then, so I'm sure eventually we will no longer have to worry about Ebay because noone will be able to make any money because they will be paying too much money in fees.
That's my story and I'm sticking to it! :)
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Nope again
They do the same thing with their pet bank, paypal. By very carefully studying the law for loopholes, they manage to evade all forms of financial institution regulation by ensuring that they do not meet the legal definition for one.
The entire business model of both ebay and paypal is built upon evading legal responsibilities. But by all means, be a lemming, support their right to rebel against the man using technicalities that go against the intention of the law. Have a blast at it.
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Re: Nope again
Just like we allow telcom, oil , pharmacorp and HMO's. They all do the same things ( legal loopholes , off shore financial holdings, avoiding patent expiry by using the same drugs to treat different ailments thus being granted a new patent on the same drug to keep a monopoly going etc)
Almost all industries use the same tactics to keep profits up.
Don't hate the player ( ebay ) hate the game ( making more money by any means available ) The whole system is skewed so that those with the most money and therefore the most power have the biggest say in what goes on in our lives. Ebay is not taking money out of the big business of high end auction houses. They are giving average people the ability to shill their still useful but unwanted goods. And yes there are people who make a living at it but hardly the kind of cash that the big guys make.( Christie's , Sotheby's etc ) This is just another attempt to make a mountain out of an anthill.
Now if she was selling ten of thousands of dollars worth of merchandise a quarter then yes she should start paying taxes on that money but there is hardly a precedent for requiring a license to list an item whos auction is then carried out by a computer unless of course you can issue a license to the machine.
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Another waste of taxpayers' money
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Another example of an outdate, misapplied law.
Lawyers love to argue things which clearly have no application to the laws as they were written, but some self-righteous judge out there will legislate from the bench to solve such a case instead of sending it to the legislature to fix. There's also some egotistical bureaucrat out there refusing to allow someone to not pay for something even if it doesn't meet with the intention of the current laws. SO much for "Life, Liberty, and the Pursuit of Happiness," unless of course you have a license to do so.
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Re:
Part of your liscencing requirement covers knowing your legal responsibilities. Like not being able to sell a CZ ring as a diamond ring, which happens all the time on Ebay. People come in with thier Ebay receipts for gold and diamond jewelery and want insurance appraisals and we have to inform them that they got ripped.
If the sellers held business liscenses, they would be subject to prosecution by the state, not just civil suit by the injured buyer, and, in some places, would have to have a bond covering their sales that would be forfeit to the cheated buyer in the event of a decietful or fradulent sale.
In addition, state prosecution does not cost the injured buyer any additional money, whereas a civil suit would cost quite a bit of additional money, and in some places, the injured buyer would have to prove that the seller *knew* that the item was fake before selling it.
So keep complaining about the greedy government, guys. Just keep on...
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Sue?
TechDirt has been using the word "sue" when it means "prosecute". Doesn't "sue" mean civil litigation?
Even if "sue" is technically correct, it would make a lot more sense if TechDirt could use "prosecute" when it means criminal litigations.
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auctioneer's license... who's the auctioneer?
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eBay
It is becoming very annoying to hear the so-called brick and mortar businesses decry the success of online market places. Most of my largest eBay purchases have been from B/M business who have joined the online sales community. As far as I know, there are no restrictions that prevent any retail establishment from selling online as well as face-to-face. With gasoline prices over 3 bucks per gallon, is it any wonder people shop online?
Not saying that there are never any scams online b/c there are. Is eBay a great, caring institution? Of course not. It is a heartless corporation with profit as its bottom line. EBay did not invent this. It copied it from the oil companies and other corporate giants. Big government is equally heartless and corrupt. The online market model does work and its probably here to stay. Consumers, businesses and governments need to realize this and learn to deal with changes.
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Amazon Does It Better.
Hellsvilla's Disciple is of course correct. I use Amazon Marketplace, mostly to buy used books, and for various other odds and ends. Amazon does make an explicit linkage between sale transaction and money transfer, and thereby becomes the reseller of record. In effect, Amazon gets paid for assuming legal responsibility. Amazon's model is not technically an auction. That is, the Amazon seller is expected to have a fairly good idea of what goods are worth, and quote a price accordingly. If the goods do not sell, they can go back later and quote a lower price. E-bay allows this as an auxiliary mode ("Buy it Now"), but it is less widely used. Implicit in Amazon's thinking is that used goods are generally not worth very much, and may even be worthless. If an out-of-production item were truly valuable, the manufacturer would have resumed production, ergo, an out-of-production item is not likely to be worth very much. E-bay, on the other hand, is designed around the assumption that yard sale items are potentially worth a lot of money. Predictably, that kind of model attracts con-men.
Now, of course, there are improvements which Amazon could, and should, make. For example, Amazon could purchase "indicia" postage from the post office on behalf of the seller, and Amazon could lobby the post office to improve its tracking system. This would give Amazon independent knowledge of when goods had been shipped. Similarly, Amazon could furnish the seller with a supply of envelopes, boxes, etc. bearing a distinctive Amazon Marketplace logo ("Smith & Jones, an Amazon Marketplace trading partner," or words to that effect). These kind of things have no "street value," and the dishonest seller would have less opportunity to get his paws on actual money, while, at the same time, it would be possible to reduce the honest seller's out-of-pocket expenses, save him paperwork, etc.
Amazon is rather like Google. They are both companies which succeed, not because they are so talented, but because their competitors are so dumb. "Don't be Evil" is such a simple idea, but it seems to be beyond the comprehension of most dot-com businessmen.
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Re: Hmmmm..... Nope
What the woman was doing should be commended, but their is no excuse for being ignorant. She is selling things FOR OTHER PEOPLE FOR A PROFIT, therefore she is a business. You can not use the excuse "I did not know I was speeding officer" they would slap you with a ticket no matter what.
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Any time the government (local or federal) sees that someone, somewhere is making money, they come up with some new license requirement, or tax that will ensure that you can't make a profit.
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And you know this because...
Please provide some back-up of you opinion.
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Hmmm..nope
I buy a few things on EBay too.
I am both an idiot and a bottom feeder BIGTIME. However, I have yet to be ripped off. That means I am one of the brighter idiot bottom feeders.
2) A consignment business obviously should be licensed and taxed.
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What is this coming to?
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Re: What is this coming to?
Is it right? Debatable. Is it enforceable? Not in most cases. But it is the rule, at least in my home state.
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E-bay
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I have one question
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Yes another example of the Gov't double, triple, q
If I sell something I own, without a business license, that means that I paid sales taxes on it already. I also paid income taxes on the money that I made so that I could purchase said item. So by the time I own it, I've already been taxed twice on that money.
Now, if I want to sell it, I'm being told that I should for out for taxes AGAIN? I thought this country stood for FREE TRADE.
Make no mistake, requiring me to get a license, pass a test, take a course, or anything of the like is a TAX like any other. The state doesn't use licenses to regulate garage sales in Oklahoma, they use the $5 to line the pockets of state government as another TAX.
What it all comes down to is how much are the American People willing to be nickel and dimed by their own government before they speak up and say "TAX ME ONCE SHAME ON YOU, TAX ME TWICE, SHAME ON ME."
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Re: Yes another example of the Gov't double, tripl
No, you are not being told that. The buyer is the one who is responsible for paying the sales tax. When you buy from a brick and mortar store they COLLECT the sales tax from you and pass it along to the state, they don't pay it themselves. When you buy something online "tax free" (such as from Amazon, Newegg, etc.) you are legally required to report your purchase and submit the appropriate sales tax to your state (of course none of us do that but it is the law).
Also, the term "free trade" does not mean that trade is free of charges, it refers to the freedom to engage in trade.
Also your argument about double dipping is flawed, have you ever bought a used car? When you purchase something that is new to you (even if it's used) sales tax is still owed to the state (it is a tax on the sale of goods, hence the name). Maybe this doesn't seem fair but if you use cars as a simplified example to deconstruct it, the manufacturer paid sales tax on the materials used to make the car so does that mean you shouldn't have to pay sales tax?
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Ridiculous overtaxation and regulation
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Caveat Emptor? I think not.
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On the one hand this on the other hand that
But my gripe with Ebay is that its chock full of obsessive-compulsive bidders, who will always 'snipe' you at the last moment purely for the pleasure of 'winning' - even if it means them paying more for the item than it costs new.
I've several times been outbid for something by someone who clearly doesn't care that its available cheaper than their bid from normal retailers.
It makes it great for sellers but quite useless for sane buyers. Most of the time I find items are available cheaper, often new, e.g. on Amazon marketplace (where its the sellers who compete to undercut each other), than they go for on Ebay. Sometimes Amazon itself is cheaper than the ebay reserve price. At least for cds and computer games. Consequently I haven't bought anything on ebay for years.
I mess the old yahoo auction site. There sellers seemed to outnumber bidders, so you rarely had to bid against anyone!
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YOU FOOLS!
If you don't think sniping is a scam, then I pity you.
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Re: YOU FOOLS!
...........................................................
Most 'snipers' only bid the highest price they are willing to pay for a widget. Some bid at the last minute, some use software.
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Re: YOU FOOLS!
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PA Is Where ......
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Karma is a bitch.
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Um... Being on-line is a very valid difference...
On-line is not the same as your home or yard.
On-line is not the same as your brick-and-mortar store.
Because it's not your home or yard.
It's not a brick-and-mortar store.
And there are different governing bodies.
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Don't think... just OBEY! (and pay your tax)
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Re: Just a Number
Those that think that they are above what you say here,.. are surely kidding themselves. We are infact just a bunch of numbers out here. Not much less than slaves to our politicals and servents to our states. We can say what we want about all that is expected of us...while where moving in their prescribed direction shaking our heads, and bitching about it.
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A change is coming
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Ebay
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The suit
" TAXATION WITHOUT REPRESENTATION "
" THE ALL KNOWING OF LICENSE's"
Our very movements, interests, decissions, plans, achievements, goals, life styles, ownerships, and more are their security.
This lady is clearly being made an example of by the order,for all to see.
GREED
is the force punishing her.
Total and complete dis-connection between those that are able to really LIVE their lives and those of us who try to make a life is the reality
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Ebay
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Funny
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why get a license is not collecting tax?
If she was selling on consignment, she had no upfront expense since the items were still the property of the owners and not her (that's what consignment is). and since she was selling online, the chances are slim that she had many (if any) sales in PA, not to mention that she could have just denied any PA sales altogether.
This is illogical - almost as bad as many of the rediculous comments on this post.
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[ link to this | view in chronology ]