The lawsuit has been filed by eBay and its subsiduary company PayPal against Stephanie Tilenius and Osama Bedier in addition to Google and doesn't appear to be just about the fact that Google's Wallet uses similar algorithms to PayPal's system.

Instead the grounds for PayPal's complaint centers around the behavior of its two former senior executives who were recruited from PayPal to Google at a time when PayPal was negotiating with Google to become the default payment method for Android Market purchase.

At the point at which Stephanie Tilenius (who had been SVP of North America and Global Products at eBay) moved to Google part of her resignation agreement was not to recruit other PayPal employees to Google. However, according to PayPal she recruited Osama Bedier, formerly Vice President of Platform, Mobile, and New Ventures at PayPal, who in turn recruited other of his former colleagues.

According to PayPal Bedier took with him:

"intimate knowledge of PayPal's capabilities, strategies, plans, and market intelligence"

This combined with Bedier's failure to disclose to PayPal that he was interviewing for a job at Google while acting as the senior executive representing PayPal over its Android deal seems to be the crux of the lawsuit.