eBay Fined 38.6 Million Euros for Allowing Fake Vuitton Sales

In The Guardian: A French court has ordered online auction site eBay to pay luxury goods giant LVMH (Louis Vuitton Moët Hennessy) a whopping €38.6 million euros in damages for negligence. eBay is charged with allowing independent retailers to use its site to sell fake products.

eBay is to pay €19.28 million to Louis Vuitton Malletier and €17.3 million to Christian Dior Couture for “damage to their brand images and causing moral harm.” Another €3.25 million goes to four LVMH perfume brands for “sales in violation of its authorized network.”

Can someone explain how sales of fake goods cause “moral harm”? Another bout of corporate ridiculousness.

eBay has appealed the ruling, arguing that LVMH is using the specific issue of counterfeits to attack the general trend towards e-commerce and to maintain (declining) control over the brands’ primary sales channels.

Other brands are hovering like vultures: Hermes, Tiffany & Co., and L’Oreal are all suing eBay for similar damages.

Luxury brands that cater to privileged elites (or the wanna-be-privileged elites) don’t mix very well with e-commerce or web platforms, which are largely driven by the mass populace. While the former relies on exclusivity, uniqueness, and tradition, the latter thrives on access, ubiquity, and change. The former would like to keep the latter out — unless of course the commoners are buying directly.

This seems to be what eBay is being punished for: providing an open marketplace for the populace to transact their own goods and services, on their own terms. I’d say it’s the best real-time representation yet of market supply/demand, property valuation, as well as socio-cultural trends.

Policing eBay in favor of corporate property is unfair. Fining eBay for what individuals own and are willing to buy and sell on the site is ludicrous (particularly since we are talking about handbags — not handguns or drugs or porno). How about policing corporate activities to protect individual rights for a change?

Keep our common markets free. Will we ever evolve from the Dark Ages of Extreme Luxury and Corporate Greed?

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