SecProbe.io

CORRESP
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  6350 South 3000 East

  801.947.3100 phone

  Salt Lake City, Utah 84121

  801.944.4629 fax

August 4,
2010

H. Christopher Owings

Assistant Director

United States Securities and
Exchange Commission

Division of Corporation
Finance

Mail Stop 3561

100 F Street, NE

Washington, D.C. 20549

Re:                               Overstock.com, Inc.

Registration Statement on Form S-1

Filed May 14, 2010

File No. 333-166871

Form 10-K for the Fiscal Year Ended December 31, 2009

Filed March 31, 2010

Definitive Proxy Statement on Schedule 14A

Filed April 9, 2010

Form 10-Q for the Fiscal Quarter Ended March 31, 2010

Filed May 4, 2010

File No. 000-49799

Dear Mr. Owings:

Set forth below are the
responses of Overstock.com, Inc. (the “Company,” “we” “us” or “our”), to comments received from the
staff of the Division of Corporation Finance (the “Staff”) of the
Securities and Exchange Commission (the “Commission”) by letter dated August 4,
2010, with respect to the Company’s Form S-1 initially filed with the
Commission on May 14, 2010, File No. 333-166871 (the “Registration Statement”).

For your convenience, each
response is prefaced by the exact text of the Staff’s corresponding comment in
bold, italicized text.

Form 10-K for the Fiscal
Year Ended December 31, 2009

Note
16.Commitments and Contingencies, page F-35

5.                                      We
note your response to comment five from our letter dated August 3, 2010.
Please revise your proposed Commitments and Contingencies disclosure to also
include the aggregate amount accrued for all contingencies. Show us what your
disclosure will look like revised.

In
response to the Staff’s comment we have modified our proposed June 30,
2010 Form 10-Q disclosure that we submitted in our letter dated August 3,
2010 as follows (with the changes underlined):

Legal Proceedings

From
time to time, the Company receives claims of and becomes subject to consumer
protection, employment, intellectual property and other commercial litigation
related to the conduct and operation of the Company’s business and the sale of
products on the Company’s Website. In connection with such litigation, the
Company may be subject to significant damages. We may also be subject to
equitable remedies and penalties. Such litigation could be costly and time
consuming and could divert or distract Company management and key personnel
from its business operations. The Company does not currently believe that any
of its outstanding litigation will have a material adverse effect on its
financial statements or business. However, due to the uncertainty of litigation
and depending on the amount and the timing, an unfavorable resolution of some
or all of these matters could materially affect the Company’s business, results
of operations, financial position, or cash flows.

On
February 2, 2007, along with five shareholder plaintiffs, the Company
filed a lawsuit in the Superior Court of California, County of San Francisco
against Morgan Stanley & Co. Incorporated, Goldman
Sachs & Co., Bear Stearns Companies, Inc., Bank of America
Securities LLC, Bank of New York, Citigroup Inc., Credit Suisse
(USA) Inc., Deutsche Bank Securities, Inc., Merrill Lynch, Pierce,
Fenner & Smith, Inc., and UBS Financial Services, Inc. In
September 2007, the Company filed an amended complaint adding two
plaintiff shareholders, naming Lehman Brothers Holdings Inc. as a
defendant, eliminating the previous claim of intentional interference with
prospective economic advantage and clarifying various points of other claims in
the original complaint. The suit alleged that the defendants, who control over
80% of the prime brokerage market, participated in an illegal stock market
manipulation scheme and that the defendants had no intention of covering short
sell orders with borrowed stock, as they are required to do, causing what are
referred to as “fails to deliver” and that the defendants’ actions caused and
continue to cause dramatic distortions within the nature and amount of trading
in the Company’s

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stock
as well as dramatic declines in the share price of the Company’s stock. The
suit asserts that a persistent large number of “fails to deliver” creates
significant downward pressure on the price of a company’s stock and that the
amount of “fails to deliver” has exceeded the Company’s entire supply of
outstanding shares. The suit accused the defendants of violations of California
securities laws and common law, specifically, conversion, trespass to chattels,
intentional interference with prospective economic advantage, and violations of
California’s Unfair Business Practices Act. In April 2007, defendants
filed a demurrer and motion to strike the Company’s complaint. The Company
opposed the demurrer and motion to strike. In July 2007 the court
substantially denied defendants’ demurrer and motion to strike. In November 2007,
the defendants filed additional motions to strike. In February 2008, the
court denied defendants’ motion to strike the Company’s claims under California’s
Securities Anti-Fraud statute and defendants’ motion to strike the Company’s
common law punitive damages claims, but granted in part the defendants’ motion
to strike Overstock’s claims under California’s Unfair Business Practices Act,
while allowing the Company’s claims for injunctive relief under California’s
Unfair Business Practices Act. Lehman Brothers Holdings filed for bankruptcy on
September 15, 2008 and Barclays Bank has purchased its investment banking
and trading business. The Company elected not to pursue its claims against
Lehman Brothers Holdings in the bankruptcy proceedings. Dislocations in the
financial markets and economy could result in additional bankruptcies or
consolidations that may impact the litigation or the ability to collect a
judgment. On January 12, 2009, Goldman Sachs Group, Inc., Goldman
Sachs &Co., Goldman Sachs Execution & Clearing L.P.,
Citigroup, Inc, Citigroup Global markets, Inc., Credit Suisse
(USA) Inc., and Credit Suisse Securities (USA) LLC filed a motion to
strike portions of the Second Amended Complaint regarding certain allegations
of conspiracy among defendants and the request for punitive damages. Also, on
January 12, 2009, Goldman Sachs Group, Inc., Goldman
Sachs &Co., Goldman Sachs Execution & Clearing L.P.,
Citigroup, Inc, Citigroup Global markets, Inc., Credit Suisse
(USA) Inc., and Credit Suisse Securities (USA) LLC filed a demurrer
to the first and second causes of action for conversion and trespass to
chattels and a motion to strike various other allegations of the Second Amended
Complaint. On March 19, 2009, the Court sustained the demurrer to first
and second causes of action but granted leave to amend the complaint. The
motion to strike was denied. On April 20, 2009, the Company amended its
complaint against all the defendants, re-pleading conversion and trespass to
chattels causes of action. Defendants again filed demurrer to the amended
complaint and, on July 23, 2009, the court sustained the demurrer.
Discovery in this case continues. A trial date has been set for
September 12, 2011. The Company intends to continue to vigorously prosecute
this action.

On
April 15, 2008, the Company received a letter from the Office of the
District Attorney of Marin County, California, stating that the District
Attorneys of Marin and four other counties in Northern California have begun an
investigation into

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the way
the Company advertises products for sale, together with an administrative
subpoena seeking related information and documents. The subpoena requests a
range of documents, including documents relating to pricing methodologies,
definitions of core and partner product, as well as other site-defined terms,
and the methods of internal and external pricing of products, as well as
documents related to the pricing of a list of product items identified in the subpoena.
The Company has responded to the subpoena and has engaged in resolution
discussions with these authorities. In January 2010, attorneys for the
Company received correspondence from the Office of the District Attorney of
County of Santa Clara in which the same offices of the various district
attorneys made a collective proposal to resolve the dispute by the Company’s
payment of $8.5 million. In March 2010, the Company received
correspondence from the Office of the District Attorney of the County of Monterey
in which the respective offices of the various district attorneys have made a
collective proposal to resolve the dispute by the Company’s payment of $7.5
million in penalties and reimbursement. The Company disagrees with the proposal
and continues to discuss this matter with the authorities involved. The nature
of the loss contingencies relating to claims that have been asserted against
the Company are described above. The Company has accrued a liability for
this loss contingency. However, no estimate of a possible loss or range of loss
can be made. It is reasonably possible that the potential loss may exceed our
accrued liability. The Company believes that it follows industry
advertising practices and intends to continue to cooperate with the investigation.

On
May 30, 2008 the Company filed a complaint in New York state court against
the New York State Department of Taxation and Finance, its Commissioner, the
State of New York and its governor, alleging that a recently enacted New York
state tax law is unconstitutional. The effect of the New York law is to require
Internet sellers to collect and remit New York sales taxes on their New York
sales even if the seller has no New York tax “nexus” other than with New York
based independent contractors who are Internet advertising affiliates. The
complaint asks for the court to declare the law unconstitutional and enjoin its
application to the Company. New York filed a motion to dismiss. The Company
responded to the motion and filed a motion for summary judgment, and both
motions were heard simultaneously. On January 12, 2009, the court granted
New York’s motion to dismiss and denied the Company’s motion for summary
judgment. On February 12, 2009, the Company filed notice of appeal, and
argued the appeal on October 29, 2009. The appeal is still pending before
the New York Supreme Court, Appellate Division.

On
August 12, 2008, the Company along with seven other defendants, was sued
in the United States District Court for the Northern District of California, by
Sean Lane, and seventeen other individuals, on their own behalf and for others
similarly in a class action suit, alleging violations of the Electronic
Communications Privacy Act, Computer Fraud and Abuse Act, Video Privacy

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Protection
Act, and California’s Consumer Legal Remedies Act and Computer Crime Law. The
complaint relates to the Company’s use of a product known as Facebook Beacon,
created and provided to the Company by Facebook, Inc. Facebook Beacon
provided the means for Facebook users to share purchasing data among their
Facebook friends. The parties extended by agreement the time for defendants’
answer, including the Company’s answer, and thereafter, the Plaintiff and
Facebook proposed a stipulated settlement to the court for approval, which
would resolve the case without requirement of financial contribution from the
Company. On March 17, 2010, over objections lodged by some parties, the
court accepted the proposed settlement. Various parties objecting to the
settlement have appealed and their appeal is now pending. The nature of the
loss contingencies relating to claims that have been asserted against the
Company are described above. However no estimate of the loss or range of loss
can be made.

On
November 14, 2008, the Company filed suit in Ohio state court against the
Ohio Tax Commissioner, the Ohio Attorney General and the Governor of Ohio,
alleging the Ohio Commercial Activity Tax is unconstitutional. Enacted in 2005,
Ohio’s Commercial Activity Tax is based on activities in Ohio that contribute
to production or gross income for a company whether or not the company has a
physical presence in or nexus within the state. The Company’s complaint asked
for a judgment declaring the tax unconstitutional and for an injunction
preventing any enforcement of the tax. The defendants moved to dismiss the
case. On July 28, 2009, the trial court ruled that there was no
justiciable controversy in the case, as the Company had not yet been assessed a
tax, and it granted the defendants’ motions to dismiss. In September 2009,
the Company received a letter of determination from the Ohio Department of
Taxation noting the Department’s determination that the Company is required to
register for remitting of the Commercial Activity Tax, and owes $612,784 in
taxes, interest, and penalties as of June 30, 2009. The nature of the loss
contingencies relating to claims that have been asserted against the Company
are described above. The Company has accrued a liability for this loss
contingency. However, no estimate of a possible loss or range of loss can be
made. It is reasonably possible that the potential loss may exceed our accrued
liability. The Company believes the determinations to be unlawful,
erroneous and is vigorously contesting the determination.

On
March 10, 2009, the Company was sued in a class action filed in the United
States District Court, Eastern District of New York. Cynthia Hines, the
nominative plaintiff on behalf of herself and others similarly situated, seeks
damages under claims for breach of contract, common law fraud and New York
consumer fraud laws. The Plaintiff alleges the Company failed to properly
disclose its returns policy to her and that it improperly imposed a “restocking”
charge on her return of a vacuum cleaner. The Company filed a motion to dismiss
based upon assertions that the Company’s agreement with its customers requires
all such actions to be arbitrated in Salt Lake City, Utah. Alternatively, the
Company asked that the case be transferred to the United States District Court

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for the
District of Utah, so that arbitration may be compelled in that district. On
September 8, 2009 the motion to dismiss or transfer was denied, the court
stating that the Company’s browsewrap agreement was insufficient under New York
law to establish an agreement with the customer to arbitrate disputes in Utah.
On October 8, 2009, the Company filed a Notice of Appeal of the court’s
ruling. The appeal was denied. The nature of the loss contingencies relating to
claims that have been asserted against the Company are described above. However
no estimate of the loss or range of loss can be made. The suit is in its early
stages, and the Company intends to vigorously defend this action.

On
September 23, 2009 the Company along with 27 other defendants was sued by
SpeedTrack, Inc. in the United States District Court in the Northern
District of California. The Company is alleged to have infringed a patent
covering search and categorization software. The Company believes that certain
third party vendors of products and services sold to the Company are
contractually obligated to indemnify the Company in this action. On
November 11, 2009, the parties stipulated to stay all proceedings in the
case until resolution of a the United States Patent and Trademark Office had
concluded and resolved a reexamination of the patent in question, and also
until a previously filed infringement action against Wal-Mart Stores, Inc.
and other retailers resulted either in judgment or dismissal. Subsequently, the
parties agreed to extend the time for defendants’ complaint answer until
21 days following a court order to lift the stay to which the parties
stipulated. The nature of the loss contingencies relating to claims that have
been asserted against the Company are described above. However no estimate of
the loss or range of loss can be made. The Company intends to vigorously defend
this action and pursue its indemn