French court orders eBay to pay in counterfeit case

A French court on Monday ordered the online auction giant eBay to pay 38.6 million euros, or $61million, in damages to the French luxury goods company LVMH, in the latest round of a long-running legal battle over the sale of counterfeit goods on the Internet.

LVMH, a maker of high-end leather goods, perfumes and other fashion and luxury products, successfully challenged eBay for a second time in the French court, arguing that 90percent of the Louis Vuitton bags and Dior perfumes sold on eBay are fakes.

The court ruled that eBay, which earns a commission on the sales, was not doing enough to stamp out counterfeit sales.

EBay vowed to appeal the ruling in a brief statement issued immediately after the decision was announced.

“When counterfeits appear on our site we take them down swiftly, and today's ruling is not about our fight against counterfeiting,” eBay said in a statement from Paris. “It's about an attempt by LMVH to protect uncompetitive commercial practices at the expense of consumer choice and the livelihood of law-abiding sellers that eBay empowers every day. We will fight this ruling on their behalf.”

EBay has faced several legal challenges in France, where luxury goods companies are fiercely protective of their brands. In another recent case, a court ordered eBay to pay 20,000 euros to Hermes International in Paris for not properly vetting the sale of handbags.

That court concluded that eBay was not doing enough to combat counterfeit sales and should be forcing sellers to post more product information to guarantee authenticity, like series numbers.

The issue has resonated outside France. The jeweler Tiffany & Co. has sued eBay in the United States on similar grounds; a decision is pending in the case.

LVMH has pursued other Internet companies, as well, saying they help counterfeiters by providing a marketplace for the items. The luxury goods company has won several rounds against Google in France in a quest to force the search engine to remove online advertising from counterfeiters whose spots appear when the names of LVMH brands are typed in.