eBay sued by LVMH

Shoppers hoping to find a luxury bargain on eBay may find themselves hard-pressed. This week the online auctioneer eBay has been ordered by a French court to pay approximately GBP30m to the Louis Vuitton-owned fashion house LVMH for selling counterfeit goods on its site. LVMH, short for Louis Vuitton Moet Hennessey is home to prestigious brands such Givenchy, Fendi, Emilio Pucci, and Marc Jacobs.

Allegedly, eBay sold Louis Vuitton fakes; LVMH questioned whether the Internet is a free-for-all for the 'most hateful, parasitic practices'. eBay countered saying that LVMH's actions had more to do with protecting uncompetitive commercial practices at the costs of consumer choice and the livelihood of law-abiding sellers empowered by eBay than protesting against counterfeits. A spokesperson for eBay said the auctioneer plans to appeal the ruling.

All said, this isn't the first such instance of eBay having been sued by a luxury brand; past plaintiffs against the online auctioneer include the likes of Tiffany and Company (USA), Montres Rolex SA (Germany), and L'Oreal SA (Europe).

eBay is like a magnet for counterfeiters mainly because of the sheer volume of products sold through its auction system as also the difficulty in patrolling fast-moving transactions. And like Google, eBay too relies on intellectual-property (IP) owners to alert the company about suspicious postings/products on its site. Nevertheless, the auctioneer maintains it spends millions of dollars every year trying to clean up fakes from its site.