EBay Told to Pay $61 Million to Fashion Company Over Sales of Fake Goods
I'm not sure how I feel about this. While I agree with eBay that "cutting out the middleman" can make products more appealing to users, in the long run if fraud is left unchecked it may also drive away buyers.
A French court ordered eBay Inc. to pay more than $61 million to a high-end fashion company Monday because counterfeit goods were sold on the auction site.
The fashion company, LVMH Moet Hennessy Louis Vuitton SA, is home to such prestigious brands as Louis Vuitton, Givenchy, Fendi, Emilio Pucci and Marc Jacobs, and had complained that it was hurt by the sale of knockoff bags and clothes on eBay.
Pierre Godet, an adviser to LVMH Chairman and CEO Bernard Arnault, said the Paris court's decision was "an answer to a particularly serious question, on whether the Internet is a free-for-all for the most hateful, parasitic practices."
EBay countered that LVMH is trying to crack down on Internet auctions merely because it is uncomfortable with the business model, which tends to cut out the middleman.