3TAPS, INC.'S ANSWER AND COUNTERCLAIM Case No. CV-12 ...

123456789101112131415161718192021222324252627283TAPS’ ANSWER AND COUNTERCLAIM“interoperation with craigslist.” There is no legitimate business justificationfor this provision. Rather, this term is a blatant effort to prevent theemergence of any competitor to craigslist.“Ghosting” and Other Dirty Tricks“Ghosting” is craigslist’s well-documented practice of refusing to uploadposts or transmit messages that it believes are linked to its competitors,while falsely informing users who upload posts to craigslist from third partycompetitor sites that such content actually has been posted or transmitted forother users to view. In fact, while the user receives a confirmation and canview his or her own post, the post is “ghosted” from anyone else oncraigslist. craigslist engages in “ghosting” under the guise of targeting spam;while minimizing spam is a legitimate goal, in reality, craigslist is ghostingto target and prevent craigslist competitors from gaining traction with users.In addition, purely for anticompetitive purposes, craigslist recently hasdemanded that Google cease maintaining caches of craigslist data.Importantly, craigslist still allows Google and other general search enginesto access its site and index its data. craigslist only seeks to eliminate caches(i.e., records of the indexed content) because it knows that 3taps has sourcedcraigslist content from these caches. In fact, as part of its overallanticompetitive scheme, craigslist’s instruction to Google to cease cachingoccurred within forty-eight hours of the removal of the exclusive licenserequirement from its Terms of Use and shortly after craigslist filed suitagainst 3taps, thus confirming the specific anticompetitive intent underlyingcraigslist’s actions. Again, there is no legitimate business rationale forcraigslist’s behavior. Rather, this conduct, like “ghosting,” is just another“dirty trick” intended to restrain competition.17. Through this multifaceted scheme, craigslist has sucked the oxygen out of theinnovation demanded by consumers and will continue to do so unless enjoined by this Court.Moreover, craigslist already has caused 3taps significant injury—in the form of millions of dollarsof lost sunk cost investments and lost opportunities with its partners. Unless enjoined, the harm to3taps caused by craigslist’s anticompetitive scheme could be in the hundreds of millions—if notbillions—of dollars, in addition to the harm it has already suffered.JURISDICTION & VENUE18. This court has federal question jurisdiction over this action under 28 U.S.C. §§ 1331,1332, and 1337, because this counterclaim is filed under Sections 4 and 16 of the Clayton Act (15U.S.C. §§ 15, 26) to recover damages caused by, and to secure injunctive relief against craigslistfor it past and continuing violations of Section 2 of the Sherman Act (15 U.S.C. § 2), as alleged30CASE NO.: 12-CV-3816-CRB