There is some drama going down between Craigslist and eBay, and it ain't pretty. eBay announced yesterday that it had filed a lawsuit against Craigslist and two of its executives in order to "protect its investment" in the company. The lawsuit was filed under seal, leaving everyone—including, apparently, Craigslist CEO Jim Buckmaster—to guess exactly what eBay believes has been going on behind the scenes.

Four years ago, eBay acquired a little over a quarter of Craigslist's ownership (approximately 28 percent)—a somewhat mysterious decision, at the time. It became even more mysterious when eBay launched its own classified ad service in the US last July, Kijiji, openly telling Ars that Kijiji was a competitor to Craigslist. "Yes, Craigslist is a competitor, but we feel there's room for two or more classified sites, and we plan to bring our expertise of bringing buyers and sellers together from eBay to Kijiji," eBay director of corporate communications Hani Durzi told us at the time.

Something happened between then and now, however, that soured relations between the two companies. eBay claims that this January, Buckmaster and Craigslist founder Craig Newmark did something that "unfairly diluted eBay's economic interest in Craigslist by more than 10 percent." Whatever that something was, eBay says that the two breached their fiduciary duties and ultimately violated Delaware law.

"The recent actions by the Craigslist directors have disadvantaged eBay and its investment in Craigslist," eBay Senior VP Mike Jacobson said in a statement. "Since negotiating our investment with Craigslist's board in 2004, we have acted openly and in good faith as a minority shareholder, so we were surprised by these recent unilateral actions. We are asking the Delaware court to rescind these recent actions in order to protect eBay's stockholders and preserve our investment."

Buckmaster, on the other hand, has already shot back a response to the lawsuit. In a posting to the official Craigslist blog last night, he said that the allegations came to Craigslist "out of the blue, without any attempt to engage in a dialogue with us." Buckmaster denied that eBay's stake in the company has been unfairly diluted and that Craigslist has always treated (and will continue to treat) eBay fairly as a minority shareholder, despite the lawsuit.

He then delved into a couple of theories of his own. "Coming from a shareholder that views Craigslist as a prime competitor, filing suit without so much as mentioning these assertions beforehand seems unethical, and hints at ulterior motives," Buckmaster pointed out. "eBay has absolutely no reason to feel threatened here—unless of course they're contemplating a hostile takeover of Craigslist, or the sale of eBay's stake in Craigslist to an unfriendly party."

Without any more details disclosed to the public, it's hard for the outside observer to make a judgment on who has the upper hand in this situation. Buckmaster's blog post sounds a little like he's making excuses, plus, the man isn't exactly known for being very diplomatic. On the other hand, he does have some points—particularly in relation to eBay simultaneously being a shareholder and competitor. We'll have to wait until more evidence surfaces about eBay's allegations in order to find out more.