Vive L’eBay! Online Retailer Wins Fake-Goods Case in France

[WSJ_law_blog]

It seems the only time we write about decisions by French courts, eBay is involved. Huh. In any event, we imagine headlines across France are screaming today, Vive L’eBay! (Or do the French spell it, eBé?)

Here’s why: A French court gave the online retailer a win on Wednesday when it ruled that eBay can’t be held legally accountable for the sale of counterfeit L’Oréal goods on its Web site in France. Click here for the WSJ story; here for the NYT story.

The French ruling is the latest turn in a longstanding feud between eBay and luxury-goods companies over whether the auctioneer is doing enough to clamp down on the sale of fake handbags, perfumes and cosmetics on the Internet. In another case, a French court ruled last year that eBay should pay damages to French luxury companies LVMH Moët Hennessy Louis Vuitton and Hermès after it judged that the online auction site hadn’t done enough to prevent the sale of high-end counterfeit products, including handbags.

But one difference in Wednesday’s ruling seemed to be that eBay had taken anticounterfeiting measures. Judge Elisabeth Belfort said that through such measures, eBay has “fulfilled its obligations of loyalty to other operators on the market.” The court also ruled that in the future, eBay and L’Oréal should cooperate more in their efforts to fight the sale of fake goods online.

EBay says it spends $10 million a year fighting counterfeiters and employs 2,000 people to scour the site for fakes. “These measures cannot be 100% effective if brands do not cooperate with us,” said Alexander von Schirmeister in an interview.

In a statement, L’Oréal said it would be “very willing” to cooperate with eBay to find a solution.

I am surprised the French did not try to give an American company the shaft!