New lawsuit accuses PWCC of massive shill bidding

[Peter_Spaeth]

Presented without comment.
https://www.nytimes.com/athletic/632...-sports-cards/

[BobbyVCP]

Now did ALT file against PWCC and Brent? Or is it with Fanatics that has been the owner for almost 2 years now..I could not read the article since it requires payment

[samosa4u]

I'm a subscriber:

Sports card marketplace Alt filed a lawsuit against former auction house PWCC — now owned by Fanatics — alleging fraud and breach of auctioneer’s duty, according to a lawsuit filed Wednesday in New York Supreme Court.

The complaint alleges PWCC conducted a widespread, years-long scheme of shill bidding, using internal and external actors to artificially inflate auction prices for high-value sports trading cards. Alt alleges PWCC retained access to confidential maximum bid information to drive up prices and mislead buyers.

Alt is asking for at least $13.7 million, which is the total losses the company estimates it sustained attributable to PWCC’s alleged fraudulent conduct. Alt is also seeking additional compensation for punitive damages.

Between 2021 and 2023, Alt said it spent more than $10.7 million on PWCC’s platform while winning 707 auctions and obtaining 809 items. In late 2023, Alt alleges to have learned that PWCC’s leadership knew about shill bidding and directly encouraged and allowed other external parties to place fake bids on certain auctions, boxing out the authentic bidders and artificially inflating prices.

Alt also alleges that PWCC flagged when high net worth bidders, such as Alt, were participating in PWCC auctions, and arranged, solicited and encouraged shill bids to increase the bidding.

“For years, customers around the world trusted PWCC’s assurances that when they made a bid on a sports card on their site, that those transactions were fair, transparent and free from manipulation — today’s complaint shows that those assurances were patently untrue,” Alt CEO Leore Avidar said in a statement to The Athletic. “PWCC’s leadership knowingly engaged in fraudulent practices, inflating auction prices and skewing the fair market value for the entire collecting community, including against one of its biggest competitors, Alt.

“This lawsuit is about more than just one company, it’s about ensuring the integrity of the trading card market as a whole and holding bad actors accountable.”

A PWCC spokesperson said both sides had conducted discussions for months before Wednesday’s lawsuit, including evidence for Alt’s claims. The spokesperson said Alt provided none and this is attempt at a “payday.”

“Alt has filed a completely baseless lawsuit against PWCC that lacks any substantive evidence,” the spokesperson said. “Even though the accusations they are claiming occurred before PWCC changed ownership in May 2023, we carefully looked into their allegations and found zero evidence to support their claims.”

This isn’t the first time PWCC has been accused of shill bidding. Leading online marketplace eBay suspended PWCC from selling items on its platform in August 2021 after eBay determined PWCC had engaged in shill bidding on auctions.

“eBay’s policies and standards were designed to ensure a trusted marketplace where our community can transact with confidence,” eBay said in a statement sent to customers in 2021 when explaining the PWCC ban. “If we determine that a buyer or seller is not acting in good faith, eBay takes this seriously and takes action.”

PWCC began its own auction platform after the eBay ban. Fanatics announced the purchase of PWCC in May 2023. The company launched its own auction platform, Fanatics Collect, replacing the PWCC brand soon after its launch in July 2024.

In the lawsuit filed Wednesday, Alt claims that PWCC “engaged or was complicit” in bid manipulation in auctions that included the following cards Alt purchased through PWCC:

- 2017 Panini Prizm Patrick Mahomes Gold rookie card, numbered to 10, Professional Sports Authenticator (PSA) grade 10: $528,000
- 2003 Exquisite Collection Kobe Bryant Limited Logos patch auto, numbered to 99, PSA 10: $360,000
- 2018 Panini Prizm Josh Allen Gold Vinyl rookie, numbered to five, PSA 10: $264,000


Alt also questions the legitimacy of a PWCC auction surrounding the Luka Dončić 2018 National Treasures Logoman patch autographed one-of-one BSG 9 graded rookie card that sold for $3.12 million in 2022. The same card sold in a private sale for $4.6 million in March 2021, via Card Ladder.

Alt dropped out of the bidding for the card, but alleges “(a) a member of Group 1 (a group of approximately six individuals Alt alleges fraudulently and collusively bid up items in PWCC auctions) was the seller, and other members of Group 1 submitted shill bids to drive up the price of this card, (b) the winning bidder did not complete the auction sale by paying the winning price to PWCC, (c) PWCC nevertheless publicized this ‘sale’ as if it had actually been consummated, and (d) PWCC discussed with members of Group 1 a private sale at a different price from the ‘winning’ auction price.”

[Peter_Spaeth]

Thank you did not realize the story was behind a paywall.

[Peter_Spaeth]

In case anyone is interested.
https://iapps.courts.state.ny.us/nys...JTmduWtbJ6hA==

[raulus]

Favorite passage so far:

The frequency with which other bidders matched or closely approached Alt’s maximum bids was especially unlikely in legitimate auctions because, during that time period, Alt had idiosyncratic incentives to acquire inventory to jump start its own marketplace, which led Alt to submit maximum bids that it considered abnormally high.

Translation:

We were doing stupid stuff and bidding like drunken sailors because we had our own monetary reasons for wanting to rip other people off ourselves. The fact that we weren't winning everything hands down with our stupid bids is a clear sign that the fix was in!