Gleason v. Freeman

2008 WL 2485607 (2008)

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Nature of the Case

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Facts

(Elvis Presley still lives; he teaches law school.) D listed an auction on eBay for their historic home, formerly owned by Elvis Presley. D hired Stephen Shutts to act as their agent for the auction. P et al formed a partnership to participate in the auction using P's eBay account to pre-qualify and bid on the house. Ps consented to eBay's terms and conditions of use, which stated that auction-style advertisements of real property do not involve legally binding offers to buy and sell. Real Estate auctions are simply a way for sellers to advertise their real estate and meet potential buyers. Shutts added the following statement to D's auction page: 'Please note that bidding on eBay is a legally binding contract in which the winner commits to following through on the purchase.' D asked Shutts about this language, and he told them that it was used to deter frivolous bidders. Mike Curb, offered to stop the auction and immediately buy the house. Ds informed Curb they would only stop the auction if he was willing to pay $ 1,300,000.00, which he declined to do. Before P's final bid, Shutts informed P that D planned to keep possession of the house for sixty days after closing. On May 14, 2006, bidding ended, and Ps received an automated email from eBay notifying them that their bid of $905,100.00 was the winning one. Immediately after the auction closing, Ds received and rejected a $1,000,000.00 offer for the house from Mike Reno, another interested buyer. On May 16, 2006, D's attorney, sent the parties a 'proposed sales contract' that she had used on previous real estate auctions. The parties negotiated a deposit amount of $5,000.00 from each of the three buyers, and D sent a new 'proposed sales contract' on May 21, 2006, with those amounts and the sixty-day possession term included. On May 24, 2006, P returned the signed contract with the time of possession provision crossed out, along with a check in the amount of $5,000.00 to be held in escrow as a deposit on the house. D then sent out an email to all the parties informing them that P would like to talk to the sellers about the sixty-day provision. On May 27, 2006, Mike Curb renewed his offer to buy the house for $ 1,000,000.00. Mike Curb and D signed a contract for the sale of the house on May 30, 2006. Ps filed this action on July 17, 2006, claiming breach of contract, fraud, and negligent misrepresentation.