The world’s biggest online auctioneer, eBay has been told to pay £31.5 million in damages to designer brands Louis Vuitton and Christian Dior.
The site allowed sale of Louis Vuitton, Christian Dior products
LONDON: The world’s biggest online auctioneer, eBay has been told to pay £31.5 million (40 million euros) in damages to designer brands Louis Vuitton and Christian Dior for allowing the sale of fake bags, perfumes, lipsticks and clothes.
The Paris Commercial Court said eBay had committed “serious faults” by its failure to keep counterfeit goods off its site. This is the biggest fine that the American internet auction giant has faced in Europe in a running battle that it has fought with fashion and cosmetic designer brands.
“We will fight in the name of eBay’s users and we have decided to appeal,” said a spokeswoman for eBay, insisting that LVMH, the world’s leading luxury brand, was trying to protect its “commercial practices that exclude all competition”.
French company LVMH went to the Paris commercial courts demanding 50 million euros in damages arguing that 90 per cent of 3 lakh products labelled Dior and 1.5 lakh handbags claiming to be Louis Vuitton sold on eBay in the second quarter of 2006, were fake.
Fake designer goods have flooded western markets with a Louis Vuitton handbag selling for as little as £25 — the original costs in the region of £300-500 depending on the model — and are extremely popular. EBay provides opportunities to buy these for even less than £25.
LVMH, owned by Bernard Arnault France’s riches man, also argued that eBay allowed unauthorised sales of perfume brands owned by the group — Christian Dior, Kenzo, Givenchy and Guerlain. It said even if the perfumes were genuine, their sale on eBay violated their distribution network which allowed sales only through specialist dealers.
The court ordered eBay to stop selling the perfumes and running ads for the brands, or face an additional fine of 50,000 euros per day. “The decision was crucial to the creative industry and protected brands by considering them an important part of French heritage,” said Pierre Gode, an aide to Arnault. About £30 billion of goods were sold on eBay last year and the company said that it already does a lot to weed out fake products.
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