hypothetical major problem with well respected board member

Peter_Spaeth · #1 01-26-2015, 05:29 PM

Quote:

Originally Posted by ibuysportsephemera

Sorry, but I disagree with the comments about bid rigging, reverse shilling, collusion, etc. I don't think these terms apply at all to this discussion. If the 2 bidders in this discussion were the only 2 bidders then all of those descriptions might apply. However, as I read the OP's first post, he said that 2 people agreed not to compete against each other in an auction that presumably could have had many more potential bidders. They did not control the rest of the bidders so there was not guarantee that their partnership would be successful. Just my 2�.

Jeff

I disagree, strongly. Even two buyers agreeing not to bid against each other is collusion and has a potential impact on price. Are you suggesting that if Ford and GM conspire to fix the price of cars, that isn't illegal because Toyota isn't in on it?

edhans · #2 01-26-2015, 05:42 PM

Quote:

Originally Posted by Peter_Spaeth

I disagree, strongly. Even two buyers agreeing not to bid against each other is collusion and has a potential impact on price. Are you suggesting that if Ford and GM conspire to fix the price of cars, that isn't illegal because Toyota isn't in on it?

Exactly what is the difference between this "bid rigging" and two (or more) friends who agree to buy a lot and divide it up? If my friend an I each want a few cards in a lot, are we really obligated to bid each other up? Sorry to appear dense, but I'm obviously missing something.

Peter_Spaeth · #3 01-26-2015, 05:47 PM

Quote:

Originally Posted by edhans

Exactly what is the difference between this "bid rigging" and two (or more) friends who agree to buy a lot and divide it up? If my friend an I each want a few cards in a lot, are we really obligated to bid each other up? Sorry to appear dense, but I'm obviously missing something.

It's a fine line, as has been mentioned, and I think it depends in part on your intent. If the intent is to pool resources to buy something you might not otherwise have been able to buy, or wouldn't have wanted to buy, it's ok; if the intent is to keep the price down by ensuring you and someone else don't independently bid, then it's not ok. Now in practice it can certainly be hard to tell the difference.

edhans · #4 01-26-2015, 05:52 PM

Quote:

Originally Posted by Peter_Spaeth

. Now in practice it can certainly be hard to tell the difference.

Nigh on impossible, I would think.

Econteachert205 · #5 01-26-2015, 05:54 PM

Quote:

Originally Posted by Peter_Spaeth

It's a fine line, as has been mentioned, and I think it depends in part on your intent. If the intent is to pool resources to buy something you might not otherwise have been able to buy, or wouldn't have wanted to buy, it's ok; if the intent is to keep the price down by ensuring you and someone else don't independently bid, then it's not ok. Now in practice it can certainly be hard to tell the difference.

I agree with this.

SMPEP · #6 01-26-2015, 06:02 PM

--------------------------------------------------------------------------------

Quote:
Originally Posted by SMPEP
I'm surprised the obvious answer hasn't been suggested:

Pistols at 40 paces. And if you're a good shot ... a great collection full of rare wonders will be on the market.

Bitch-slaps at three feet would be more entertaining for the rest of us...

Adam - I know better than to open that link! But I can imagine the entertainment.

nolemmings · #7 01-26-2015, 05:42 PM

Quote:

I disagree, strongly. Even two buyers agreeing not to bid against each other is collusion and has a potential impact on price. Are you suggesting that if Ford and GM conspire to fix the price of cars, that isn't illegal because Toyota isn't in on it?

Agreed, although your analogy might be a little strained in the sense that the market in your scenario is probably somewhat small and thus having a large percentage of its bidders collude would have a greater impact on price. Still, I'm not going to argue with an antitrust lawyer, at least not just yet, until Happy Hour is over

Still, partnering as described elsewhere in this thread also somewhat artificially affects the market and price. If few or no individuals can financially participate in the upper-end bidding for a lot and pooling is required, haven't you in essence manipulated the market as well? At least you've pretty much set some barriers.

Peter_Spaeth · #8 01-26-2015, 05:49 PM

Quote:

Originally Posted by nolemmings

Agreed, although your analogy might be a little strained in the sense that the market in your scenario is probably somewhat small and thus having a large percentage of its bidders collude would have a greater impact on price. Still, I'm not going to argue with an antitrust lawyer, at least not just yet, until Happy Hour is over

Still, partnering as described elsewhere in this thread also somewhat artificially affects the market and price. If few or no individuals can financially participate in the upper-end bidding for a lot and pooling is required, haven't you in essence manipulated the market as well? At least you've pretty much set some barriers.

Todd price fixing is still per se illegal, before or after Happy Hour, so the specifics of my example don't really matter. Hypothetically, because as we all know this would never be prosecuted, a showing of price impact isn't necessary, it's assumed.

I Only Smoke 4 the Cards · #9 01-26-2015, 06:28 PM

Quote:

Originally Posted by Peter_Spaeth

Todd price fixing is still per se illegal, before or after Happy Hour, so the specifics of my example don't really matter. Hypothetically, because as we all know this would never be prosecuted, a showing of price impact isn't necessary, it's assumed.

I have never someone discuss price fixing on such a small level.

nolemmings · #10 01-26-2015, 06:36 PM

Quote:

Todd price fixing is still per se illegal, before or after Happy Hour, so the specifics of my example don't really matter. Hypothetically, because as we all know this would never be prosecuted, a showing of price impact isn't necessary, it's assumed.

I didn't say it wasn't illegal, or that a certain element of damage or quantum of proof was needed. Your comment seemed to liken the two situations and as a practical matter they are worlds apart.

Quote:

Nothing illegal about the above mentioned agreement.

Disagree completely.

Peter_Spaeth · #11 01-26-2015, 06:39 PM

Quote:

Originally Posted by I Only Smoke 4 the Cards

I have never someone discuss price fixing on such a small level.

Your grammar is as flawed as your legal analysis.

The discussion is purely technical, as acknowledged repeatedly.

ibuysportsephemera · #12 01-26-2015, 06:03 PM

Quote:

Originally Posted by Peter_Spaeth

I disagree, strongly. Even two buyers agreeing not to bid against each other is collusion and has a potential impact on price. Are you suggesting that if Ford and GM conspire to fix the price of cars, that isn't illegal because Toyota isn't in on it?

Everyone is entitled to their opinion but for me the comparison of Ford and GM has no bearing on this discussion. Ford and GM are not participating in an auction.

In the broad sense of the definition, collusion usually relates to an illegal act (but not always) for a dishonest purpose. I don't see anything wrong with 2 parties that are familiar with each other agreeing to partnership to save themselves money. As I stated, they were not the only potential bidders and there were no guarantees that they would be the high bidders (which is why this certainly isn't bid rigging).

If the 2 parties knew that they were the only bidders, then it certainly would be collusion, bid rigging, etc. But if this was a normal auction/ auction house, there is no way for the partners to know who the other bidders are or what the outcome would be.

Jeff

ibuysportsephemera · #13 01-26-2015, 06:07 PM

People have used the term bid-rigging. It really is an incorrect usage for this discussion. Typically the term is used when parties collude and the outcome of the bid is guaranteed. Because this was an auction with anonymous participants, there was no way to guarantee the outcome.

Jeff

Peter_Spaeth · #14 01-26-2015, 06:46 PM

Quote:

Originally Posted by ibuysportsephemera

People have used the term bid-rigging. It really is an incorrect usage for this discussion. Typically the term is used when parties collude and the outcome of the bid is guaranteed. Because this was an auction with anonymous participants, there was no way to guarantee the outcome.

Jeff

Suppose 15 very low pop commons in 9 are available in an auction in individual lots, and the three top set registry guys, each of whom need them all, agree to allocate their bids so as not to bid against each other in the hope that each comes away with 5. Suppose there are also other anonymous people who will bid on some as well. Are you saying this is not collusive? (I don't care for and haven't used the term bid rigging.)

PS this isn't just a hypo. I have seen an email where a leading collector proposed just this to another collector, who to his credit ignored the proposal.

vintagetoppsguy · #15 01-26-2015, 06:52 PM

So Larry is guilty of collusion by NOT bidding?

sflayank · #16 01-26-2015, 07:08 PM

i was just contacted by the winner of the auction...
here is the email...
Saw thread. Do whatever you need to do. I am not home. Was in Kentucky guiding
daughter through a divorce. My wife took it hard. It is our 40th anniversary and
after divorce was final I booked us on a Circle South American cruise on the
Oceania Regatta. You can check their web site. We won't be home until sometime
in April. Cards are still at home as far as I know. Not a high priority at the
moment.

Sophiedog · #17 01-26-2015, 07:22 PM

Quote:

Originally Posted by sflayank

i was just contacted by the winner of the auction...
here is the email...
Saw thread. Do whatever you need to do. I am not home. Was in Kentucky guiding
daughter through a divorce. My wife took it hard. It is our 40th anniversary and
after divorce was final I booked us on a Circle South American cruise on the
Oceania Regatta. You can check their web site. We won't be home until sometime
in April. Cards are still at home as far as I know. Not a high priority at the
moment.

What auction were the cards in?

vintagesportscollector · #18 01-26-2015, 08:04 PM

Quote:

Originally Posted by sflayank

i was just contacted by the winner of the auction...
here is the email...

It's a little late now and can't be undone, but I don't think appropriate to post this guys response. I am sure with a little research his identity is easily discovered. I am sure he does not want his personal life aired in such a manner, nor want it to be known he is away for three months. I would delete, but again too late.

ramram · #19 01-26-2015, 08:38 PM

Quote:

Originally Posted by sflayank

i was just contacted by the winner of the auction...
here is the email...
Saw thread. Do whatever you need to do. I am not home. Was in Kentucky guiding
daughter through a divorce. My wife took it hard. It is our 40th anniversary and
after divorce was final I booked us on a Circle South American cruise on the
Oceania Regatta. You can check their web site. We won't be home until sometime
in April. Cards are still at home as far as I know. Not a high priority at the
moment.

I would HIGHLY suggest you do NOT indicate who this person is now that you've indicated he's out of town for a long period of time and his cards are at his house!!!! Time to lock this thread Leon.

ibuysportsephemera · #20 01-26-2015, 07:04 PM

Quote:

Originally Posted by Peter_Spaeth

Suppose 15 very low pop commons in 9 are available in an auction in individual lots, and the three top set registry guys, each of whom need them all, agree to allocate their bids so as not to bid against each other in the hope that each comes away with 5. Suppose there are also other anonymous people who will bid on some as well. Are you saying this is not collusive? (I don't care for and haven't used the term bid rigging.)

Peter...I was just mentioning bid-rigging in general...I wasn't pointing it at you.

I agree that the example that you are using above is definitely collusive. The more people that get involved, the more of an enterprise it becomes and then it certainly is limiting a sellers chance of maximizing his profits.

My comments are strictly related to the OP's description of 2 friends agreeing to partner-up to participate in an auction that they might or might not win.

I was once at a local auction house that had a bunch of sports memorabilia. Myself and 1 other person bid against each other on almost every lot. We cost each other a lot of money. Fast forward a few years and I run into this person again in Brimfield (he is a dealer). We recognize each other and laugh at how much money we cost each other. We agreed that if we ever saw each other again at an auction we would compare notes prior to the auction. I don't think that there is anything wrong with this type of agreement. As I stated earlier, there is the potential for others to bid and no guarantees of price in an auction setting.

Jeff

Fred · #21 01-26-2015, 07:10 PM

Jeff, the one nice thing about your scenario is that you're both present and you'd be able to see if your abstaining bidding buddy was trying to screw you...

As mentioned before, I've see THREADS on the THIS BOARD asking people to PARTNER up on auction lots. Is that considered collusive? If so, then why would something illegal be allowed to occur so openly on this board?

Rollingstone206 · #22 01-26-2015, 07:24 PM

I could care less who the other party is I just want to see what baseball cards are causing this commotion

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