Blog: Leonie BarrieBattle of the fakes

Leonie Barrie | 30 June 2008

When LVMH first embarked on legal action against online auction site eBay for selling fake copies of its products, one of the key issues was who, exactly, is ultimately responsible for the fakes that are listed on the internet. Should eBay police the site itself and make sure counterfeit goods aren’t traded, or are the brands responsible for chasing down the people selling the fake items?
 
Well the answer, according to today’s ruling by a Paris court, is that companies like eBay do seem to have some responsibility for the products they sell.

And perhaps that’s not surprising. eBay’s business model is based on earning a commission on the sales, and until now it has done little to supervise buyers and sellers. While eBay claims it removes counterfeits quickly, anyone who has ever thought about making a bid will agree it’s almost impossible to verify whether a so-called ‘designer’ label is genuine or not.

In fact, LVMH believes around 90% of items sold under its labels on the site are fake.

eBay argues that LMVH is simply trying to stifle consumer choice and keep its own prices high, but the ruling may in fact force eBay to rethink its business model.

Unless it is seen to be doing more to combat counterfeit sales – like requiring sellers to post information like series numbers to guarantee authenticity – then it could well be that other companies also take matters into their own hands and pursue Internet companies as well.

FRANCE: Court fines eBay EUR40m for selling fakes


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