Items and pets are sold at Auction to the highest MP bidder. Some auction lots will only allow bids from their Friends or members of their Club. You can auction any of your items from your Inventory and you can auction standard pets from the profile of your Pets.
The Halloween Alien puts a new item up for auction every 10 minutes. He randomly selects new Halloween Prizes and lists the item for 1MP. If you are really lucky, you may catch a very rare or retired Halloween item.