The Baazee.com CEO, Avnish Bajaj, was arrested yesterday by the Delhi police due to the sale of the infamous mobile phone sex clip via his auction site. Baazee.com was recently acquired by eBay. Bajaj, a U.S. citizen and Harvard MBA in his early 30s, languished in a Delhi jail last night because of a tortured Indian theory of vicarious liability. It’s as if eBay CEO Meg Whitman were thrown in jail due to the sale of off-color items on eBay. The legal analogies in this case are phone companies and ISPs, where the high volume of traffic precludes censorship, rather than a common criminal case. The guy who should actually be in jail is the student who filmed and distributed the clip without his girlfriend’s consent. The Delhi court’s actions reek of opportunism to me– to take a stand on a high-profile case in a sexually repressed society. It’s all high-volume throat clearing.

Disclaimer: Bajaj is a friend of a friend.

Update: Bajaj was denied bail and remains in jail. Condoleezza Rice has asked the Indian government to guarantee him a fair trial:

The arrest of the Baazee CEO, who has been based in Mumbai for the past four-and-a-half years, has perplexed many in the Indian establishment as Bajaj has responded to summons to help the investigators probing the case. “He, as well as Baazee.com, had been cooperating in the investigations. The arrest has come totally out of the blue…”

Yesterday, Meg Whitman, CEO of eBay… called up from the US to reassure Baazee staff… Bajaj’s counsel Dinesh Mathur pleaded that his client had at no point attempted to evade the police. Moreover, with the site having more than 75 lakh listings, it was impossible to scan each and every item being traded.

Archaic Indian law apparently does not recognize electronic signatures:

Mathur said the video clip… was taken off the site after it was brought to the notice of Baazee officials that it was violating a user agreement… The magistrate, however, said the user agreement did not stand as it was not “signed” and was just a photocopy of a document.

The bullshit continues to fly.

Update 2: The Gray Lady finally cobbles together wire reports four days later.

Update 3: Bajaj has finally been granted bail, but his U.S. passport has been confiscated, and he may not leave India:

Some say Bajaj may have been the victim of overzealous Indian police, who wanted to appear on top of the case in the face of the widespread public outrage… law enforcement agencies and the courts may have been responding to demands from wealthy Indians whose children attend the school where the scandal erupted.

eBay harrumphed in an equally filmi fashion that it might have to quit India if its employee were not released:

Bajaj’s arrest triggered a diplomatic spat between the United States and India and a threat by eBay executives to reconsider doing business in a country that would toss one of their top managers in jail as a scapegoat. “This incident has certainly given us pause and raises concerns about the safeguards that are in place for businesses operating in India,’ said Henry Gomez, an eBay vice president in the United States.