GLEASON V. FREEMAN
2008 WL 2485607 (2008)
NATURE OF THE CASE: Gleason (P) sued Freeman (D), sellers, for breach of contract, fraud,
and negligent misrepresentation and D moved for summary judgment and P for partial summary
judgment.
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: '[p]lease 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.
ISSUE:
RULE OF LAW:
HOLDING AND DECISION:
LEGAL ANALYSIS:
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