$63 Million Hits eBay Really Hard…What’s Next?
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EBay Inc. was ordered by a French court to pay nearly $63 million to luxury-goods maker LVMH, which produces Louis Vuitton and Dior products.
As a result, shares of eBay were trading down 1.3% at $27.24 by early Monday afternoon. As if it weren’t tough enough in these days hard economy!
So what’s this fuss all about? It’s simple enough – and at the same time for many it doesn’t make sense at all. eBay has been found guilty at allowing counterfeit products to be listed in listings and being sold.Similar cases are brought against eBay by fashion giants L’Oreal in Europe and Tiffany & Co. in the States.
The reasoning behind the accusations is that all these companies are losing millions every year because of the counterfeit and even second-hand products sold on the biggest auction website. But eBay themselves are eagerly disputing this saying that there’s actually very little they can do to make sure the merchandise doesn’t come from some Asian fakes’ factory.
In fact, we have to agree with this. Since the eBay policy already stipulates penalties for selling counterfeit products and the sellers confirm that they accept these regulations, the actions should be brought against sellers – not eBay as the marketplace.Could we imagine whole shopping malls being fined when few individual resale merchants are caught with having fake merchandise on the shelves? We at SAT don’t think so – and millions of voices on the Internet agree with it this time. Actually, if we draw parallels between eBay and off-line world, it would be the same if, let’s say, LVMH sued China for allowing such exports at all.
What consequences it’s going to have on you – regular eBay sellers? We don’t know it for sure, but when $63 million is being cut off from eBay just like that, you should prepare for even tougher security measures in the future.Now it concerns only fashion industry selling handbags, perfumes and other items but who knows if other industries don’t follow LVMH example and don’t demand another piece of the huge eBay pie!


