French Court Orders eBay to Pay $61 Million to LVMH
July 28, 2008 § Leave a comment
Internet auction site eBay has been ordered by a French court to pay $61 million in damages to luxury goods company LVMH Moët Hennessy over the sale of counterfeit LVMH goods on their website.
The ruling favors brand owners who have had a long-standing dispute with re-sale and auction sites such as eBay over who is responsible for policing counterfeit goods on the Internet.
Despite eBay’s improved anti-fraud efforts in the past two years, retailers such as Louis Vuitton say that the plethora of fakes on eBay are damaging their brands’ names and duping consumers.
Pierre Godet, an adviser to LVMH Chairman and CEO Bernard Arnault, told The Independent that the decision to fine eBay heavily was “groundbreaking” and answers “a particularly serious question, on whether the Internet is a free-for-all for the most hateful, parasitic practices.”
“If counterfeits appear on our site, we take them down swiftly,” eBay spokeswoman Sravanthi Agrawal told USA Today. The company further stated that their business model is being attacked by brand owners, who want to limit online distribution of authentic items as well as counterfeits.
LVMH represents such luxury brands as Louis Vuitton, Marc Jacobs, Fendi, and Celine.