Stamps.com Asserts Breach of Contract Claim Against PayPal and eBay
SANTA MONICA, Calif, — June 25, 2003 – Stamps.com (Nasdaq:STMP – News) today confirmed it has filed a lawsuit against PayPal, Inc. and eBay, Inc. (Nasdaq:EBAY) for breach of contract, breach of the implied covenants of good faith and fair dealing, and interference with contract, among other claims, with respect to the license agreement signed between Stamps.com and PayPal in June 2002.
By the terms of the agreement, Stamps.com and PayPal agreed that Stamps.com technology would be made available to allow PayPal users to buy and print postage online from their PayPal accounts. The parties contemplated that the service would be made available to PayPal users by the holiday season of 2002.
Stamps.com believes that PayPal did not live up to its contractual obligations in the agreement. Specifically, Stamps.com believes PayPal did not work to launch the Stamps.com functionality in any reasonable time frame, made misrepresentations to Stamps.com and acted in bad faith. Stamps.com is also alleging that eBay improperly interfered in the Stamps.com and PayPal relationship. Stamps.com seeks to recover damages to compensate Stamps.com for the lost value of the agreement as well as additional damages due to PayPal and eBay bad faith and interference.
“Litigation is always viewed as a last resort, but given the fact that Stamps.com made a considerable investment towards this relationship, we felt we had to take this action,” said Ken McBride, Stamps.com’s chief executive officer. “Of course, we remain hopeful that the parties can work out their differences.”
Stamps.com’s complaint was filed Tuesday, June 24, 2003, in Superior Court of the State of California in Los Angeles County.
Stamps.com (Nasdaq: STMP) is a leading provider of Internet-based postage services. Stamps.com enables customers to print U.S. Postal Service-approved postage with just a PC, printer and Internet connection. The company targets its services to small businesses, home offices, and individuals, and currently has partnerships with companies including Auctionwatch, CompUSA, Earthlink, HP, Microsoft, NCR, Office Depot and the U.S. Postal Service.
“Safe Harbor” Statement under the Private Securities Litigation Reform Act of 1995: This release may contain forward-looking statements that involve risks and uncertainties. Important factors, including the company’s ability to complete its products and obtain regulatory approval, which could cause actual results to differ materially from those in the forward-looking statements, are detailed in filings with the Securities and Exchange Commission made from time to time by Stamps.com, including its Annual Report on Form 10-K for the fiscal year ended December 31, 2002, its subsequent Quarterly Reports on Form 10-Q, and its Current Reports on Form 8-K, if any. Stamps.com undertakes no obligation to release publicly any revisions to any forward-looking statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.
Stamps.com, the Stamps.com logo, NetStamps and Hidden Postage are trademarks of Stamps.com Inc. All other brands and names are property of their respective owners.
Stamps.com Investor Contact:
Stephanie Von Allmen