Are you sure the Craftsman Professional is 3. 5 tons and not 4 tons? Because the black and yellow was 4 tons. Anyway, THEORINGSTORE.COM sells some repair kits for Craftsman jacks. If you know the model number, them you may be able to buy one for your jack. These jacks are repairable but Sears say these are not because they are not in the business of repairing old jacks, they are in the business of selling you a new one.
http://www.theoringstore.com/index.php?main_page=index&cPath=799
Check below a partial list of the CRAFTSMAN kits available on THEORINGSTORE.COM
BY the way, Craftsman is now selling a new 4 ton model made by TORIN, and a "new" 3.5 ton model made by SHINN FU, which uses the same pump as the previous 4 ton made by SHINN FU.
Sometimes, people mess with the overload bypasses and other times these become loose over time. An ram overload bypass that is not adjusted correctly might do what you describe. Check below the parts breakdown for the Shinn Fu pump that is used on the 4 ton Craftsman jack as well as other jacks made by Shinn Fu. Does it looks like yours? If it does, you can try by tightening the threaded plug under the sealing cap, shown in the parts breakdown and identified as "ram overload bypass", until it bottoms out and then back it out 1.5 to 2 turns. If it does not change the situation, then you might have a bad u-cup seal, since it is 10 years old, and although some better quality u-cups can last longer, yours might be broken or simply just worn enough that it does not seals properly.
You may also have a case of a worn pump piston o-ring. The size of this o-ring is 3.0 mm x 16.5 mm. You might get away with a 3.0 x 16 mm. The 3 x 16.5 is available from THEORINGSTORE.
You really don't have to buy a kit, you can replace the seals with aftermarket u-cups and O-rings and save some money in most cases.
The jack shown below in the parts breakdown link, is basically the same 4 ton Craftsman jack and these both use the same pump.
http://www.shinnfuamerica.com/Owners Manual/G-737 Professional3-12TonSpeedyLiftGarageJack/2763