LVMH wins French case against Ebay over fakes
Ebay for failing to prevent the sale of fake goods and for selling
genuine perfumes without authorization.
The commercial court in Paris ordered Ebay to pay LVMH almost €40m in a court case that will be welcomed by many major brands but put the commercial viability of internet auctions in danger. The court ruled that Ebay had not done enough to stop the sale of counterfeits on its website and for that negligence it was ordered to pay €19.28m to Louis Vuitton and €16.4m to Christian Dior Couture. Ebay was also fined €3.19m for breaching distribution agreements by selling genuine Christian Dior, Guerlain, Givenchy and Kenzo perfumes. The court ruled that products can only be sold through distributors chosen by manufacturers. Protection from "parastic practices" LVMH welcomed the verdict saying that it is an important step in the protection of brands and designs against "parasitic practices". The news will be welcomed by other luxury brands and cosmetics manufacturers. L'Oreal, for example, is currently challenging Ebay in five countries over the sale of fake cosmetics and perfumes. The world's largest cosmetics company said it took the legal action because it had noticed a considerable rise in the number of fakes being sold online. Ebay vows to fight verdict Meanwhile, Ebay fought back against the LVMH decision accusing the luxury goods firm of restricting consumer choice through anti-competitive behavior. The company said it would appeal against the ruling. It also said more and more resources were being invested to prevent the sale of counterfeits on its online auctions with 2,000 people employed to carry out the daily fight against fakes.