The Real Deal New York

Auction.com sued for alleged use of shill bidder

Suit claims the site and the property's loan holder worked together to boost sales price

December 26, 2014 11:45AM

California real estate

California real estate

Auction.com is being sued for allegedly inflating the price of one of its online listings through the use of a shill bidder.

Google invested $50 million in the site in March, according to the New York Post. The suit is expected to go to trial next year.

Village at Redlands Group claims in the lawsuit that Auction.com allegedly either used a shill or turned a bidder into one while auctioning off cottages for $7.4 million. The houses are located roughly 65 miles east of Los Angeles, the newspaper reported. VRG charges that a bid of $5.4 million would have been enough to secure the property. According to the lawsuit, Auction.com was working with the property’s loan holder to “unfairly inflate the price that would be paid by a qualified bidder,” the Post reported.

Property agents have complained about the website before, which uses anonymous bidders on behalf of sellers to make sure the minimum price for a property is met, according to the newspaper. Auction.com, however, doesn’t consider that a shill bid. The website has denied that it uses such bidders. [NYP]Claire Moses

  • Oouch

    Since the bankrupt owner was the party that placed the reserve bid, with a $25K deposit against a $6.67M bid, ha, yeah, that’s a shill. And it makes Auction.com sound as seamy and slimy as they come. Why in the world would Google waste their money on these folks? But, for Google, 50M is chump change.

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