eBay Vows to Fight Following Overreach by LVMH

sandiOn June 30, 2008 at 9:45 am Said:

Richard, the truth is ebay does not police its own site. The courts have once again stated as much.

This is not about brands, courts, it is about ebay not doing their job.

If you feel ebay was actually doing their job, you really do not have a handle on how ebay really works.

JohnOn June 30, 2008 at 9:47 am Said:

Quote: “The ruling stems from a lawsuit filed by LVMH back in the Fall of 2006. Since that time eBay has invested tens of millions of euros in stopping counterfeit goods appearing on the site. In 2007 eBay suspended approximately 50,000 sellers. eBay also blocked 40,000 previously suspended sellers from coming back.”

Question: Is the issue that eBay did NOT enforce counterfeit suspensions PRIOR to the case being filed? 90k after the suit is a lot, no? Why so many after the suit being filed? And even better, why don’t they talk about how many were suspended PRIOR to the suit being filed?

Randy SmytheOn June 30, 2008 at 9:47 am Said:

Richard, sorry to say eBay is not going to get much support on this from those sellers they are so vigorously protecting.

From eBay’s statement:

“… a businees model that restricts consumers choice through an anti-competitive business practice”

The pot calling the Kettle black.

implogOn June 30, 2008 at 9:48 am Said:

How odd it is that a corporation would choose to anger and alienate its customers and now entire countries.

That’s disruption on a global scale!

sandiOn June 30, 2008 at 9:59 am Said:

Louis Vuitton received the lion’s share and was awarded 19.3 million euros, or $30.5 million; Christian Dior Couture received 17.4 million euros, or $27.5 million, and Parfums Christian Dior, Parfums Kenzo, Guerlain and Parfums Givenchy, were awarded around 3 million euros, or $4.7 million.

EBay was ordered to stop selling fragrances and cosmetics from those brands immediately, or face a fine of 50,000 euros, or $79,000, a day.

It will be interesting to watch ebay’s famous “people skills” as they kill current listings.

dimesOn June 30, 2008 at 10:04 am Said:

The VERO program does absolutely nothing for customers who discover that they have received a counterfeit item.

It responds only to copyright holders, and only to take down items that are still listed.

eBay should seriously rethink the “only a venue” excuse, which implies that it rents out space to anyone who wants to place an ad.

If that were the case, eBay would charge the same fees to everyone, would not interfere in how the products are ‘displayed’, and would certainly not become involved in the payment process between the people who buy ad space and the people who purchase the advertised goods.

I checked the eBay.fr site, and there are hundreds of ads still listed for every one of the brands covered in the court case. Given that the court is imposing a fine of an additional €50,000 a day if it fails to stop advertising the sale of the perfume brands, plus another €50,000 a day if it doesn’t remove ads that feature any of the brands, somebody had better get cracking.

DeeOn June 30, 2008 at 10:25 am Said:

I’m reading ebay’s response and I’m shakin’ my head. I’m through being amazed at ebay’s doublespeak but this lil speech is award-worthy.

ebay: “…to protect uncompetitive commercial practices at the expense of consumer choice and the livelihood of law-abiding sellers that eBay empowers everyday.”

HOW can ebay utter the above with a straight face?? They are trying to do the same exact thing in Australia: they are trying to force all Australian ebay sellers to only accepyt PayPal AT THE EXPENSE OF CONSUMER CHOICE!

More ebay doublespeak: “We believe that the overreach manifests itself through an attempt to impose, in France, a business model that restricts consumer choice through an anti-competitive business practice.”

Replace “in France” with “in Australia” and you’ve discovered ebay hypocrisy at its ugliest.

Patricia1On June 30, 2008 at 10:33 am Said:

Perhaps this is the price Ebay has to pay for not taking any real precautions. If they want to be in every aspect of a sale then they can expect to pay up or else tighten things up to a point where they lose sellers and buyers. Now, its their turn to walk the tightrope after enjoying themselves for years! They were far better off being only a venue – but that wasn’t profitable enough for them…now they can pay up for it!

permacrisisOn June 30, 2008 at 11:21 am Said:

I don’t care about PayPal- they’re inept. Speaking about this case and just about this case,

The outcome IS a bit heavy handed. No provision is made for any kind of recurring fair-use payment from ebay in acknowledgement that these types of things go on. Nor does the compaint give ebay any means (or incentive) to cooperate directly with LVH either.

For a time, blank CD’s cost a dollar, part of which went to an artists fund when the RIAA feared that people would only copy CD’s and not buy them. Why not do something like that?

Like it or not LVH has got to admit, a lot of the buzz for their products come from people seeing them on ebay which is free advertising.

In addition LVH should have made a clarification between new and used product sold anywhwere online not just as it pertains to ebay.

Bsides all anybody has to do to get around the requirements (and exonerate ebay in the process) is list “purse” picturing an LVH clone with two punched holes and no label, then simply provide a screw-on nameplate shipped inside.

Best match will kill ebay, as is deserved. But this is nothing. 65 million, that’s ebays electic bill for crying out loud.

I did chuckle though, as this came on the same day as the YouTube answering machine message, which said, “eBay will begin to focus only on luxury goods”…. :-)

I’ll bet they will.

Randy SmytheOn June 30, 2008 at 11:27 am Said:

Richard,

eBay is a public company that for years has forced its will on competitors, vendors and sellers because they could, to complain now that somebody else is doing the same thing is just plain silly.

All of that previous behavior has come back to bite the corp. in the a$$.

sandiOn June 30, 2008 at 11:30 am Said:

The company argues the move to PayPal will improve the user experience by reducing payment fraud.

Do the ebay executives keeo straight faces when they make bold face lies?

As a buyer, I go pay using Paypal, initially Paypal shows who I am making a payment to, for what and how it is being paid for.

My bank account is ALWAYS first choice. Truth of the matter is I have a savings account opened just for Paypal purposes, it has a sum total of 50 bucks in it. Sorry Paypal is not the company I trust to keep my actual bank information – I am willing to accept the loss of 50 bucks, but no more.

I want to use my credit card. I have to use IE whenver I need to use paypal because the basic html is poorly done and they have loose table tags so if I am not using IE I do not even see the link to select a different payment method.

Ok, there is the first two “negative buying experiences”, 3 if you count paypal thinks I am incapable of protecting myself.

Now I click other payment options, select my credit card, click ok which brings me to a page explaining how I should use my bank account because Paypal will protect me. I click the button saying I REALLY want to use my credit card. Now 5-7 minutes later depending on how Paypal is working that day I finally get to the point where I can pay.

There is absolutely nothing “fun” about using paypal as a buyer.

Now if the buyer accepts Google, the expect me to use my credit card, they do not ask me stupid questions, they do not question my rationale for using a credit cvard.

And all the bull**** Paypal makes me go through has nothing to do with my safety, my buying experience, it deals specifically with Paypal making more money PERIOD.

Sorry, but Paypal has nothing to do with y buying expiernce, Paypal could care less about keeping me safe – my credit card companies does a much better job at that.

TonyOn June 30, 2008 at 12:05 pm Said:

No matter how you dress it up, the move to paypal only in Australia is anti competitive and it’s not surprising that people are going to point that out. There are plenty of places to buy Louis Vutton merchandise, it’s not like ebay is the only venue.

However two wrongs don’t make a right, this ruling is more about restrictive practices than counterfeit goods, sure the counterfeit issue is the stick being used to beat ebay with, but the underlying issue is restricting sales to stop competition, there are some fundamental principles at stake here and ebay are right to appeal, even if their double standards on issues like this will leave users and observers shaking their heads.

RobOn June 30, 2008 at 12:23 pm Said:

At least eBay apparently has an impartial and independent legal venue to hear and fight their case.

Anyone who has ever sold on eBay knows that eBay presumes a Seller to be guilty of any allegation. Further, since eBay is the police, prosecutor, judge, jury and executioner, there isn’t any way to really appeal.

eBay: this is another stepping stone on the way to oblivion.

Chris @ TameBayOn June 30, 2008 at 12:56 pm Said:

I think people may be missing the most important point here. The court cases aren’t just about counterfeit goods and eBay getting an expensive rap accross the knuckles.

It’s about giving manufacturers the right (or not) to decide which channels their products can be sold in and banning seller from reselling legitmate goods, obtained legally, in secondary (or gray) markets.

Imagine if a company like for instance 20th Century Fox suddenly decided they didn’t want their DVDs resold on eBay and a couple of other film companies followed suit. Suddenly most of the media sellers on eBay would be out of business just because a couple of companies objected to the channel being used for their goods.

Think about what you sell and what would happen if the manufacturers whose products you sell took a dislike to eBay as a channel – that’s the major import of the French courts decision. :-(

dimesOn June 30, 2008 at 1:04 pm Said:

@Chris -

I’m not familiar with French law, but in the US, the “first sale doctrine” would prevent Fox from prohibiting owners of its products from reselling them on eBay.

There was a court ruling in CA a couple of weeks ago over this very issue – Universal Music sued an eBay seller for selling promotional CD’s on eBay, and lost.

From the news report:
“The “first sale” doctrine says that once the copyright owner sells or gives away a copy of a CD, DVD, or book, the recipient is entitled to resell that copy without further permission from the copyright owner.

“This is a very important ruling for consumers, and not just those who buy or sell used CDs,” said Corynne McSherry, staff attorney at the Electronic Frontier Foundation, which represented defendant Troy Augusto.

“The right of first sale also protects libraries, used bookstores, and businesses that rent movies and videogames. This ruling affirms and protects the traditional balance between the rights of copyright owners and the rights of the public.”

http://tinyurl.com/5eurez

Does France have a similar law protecting resellers?

Randy SmytheOn June 30, 2008 at 1:12 pm Said:

@Chris@tamebay,

Many of us realize this, there will certainly be “dolphins caught up in the nets” Luxury items may be completely blocked on eBay even from legitimate sellers.

Is it not the right of a manufacturuer to do everything in their power to protect their brand?

Nobody needs to worry about commodities like DVD’s or stuff that Buy.com sells.

eBay is not fighting this for the small number of dolphins, no matter what they say publicly. eBay is fighting this for eBay.

I dolphins are getting caught in the nets with eBay current policies what are a few more dolphins?

Patricia1On June 30, 2008 at 1:25 pm Said:

I’m not disturbed by this. As the sole manufacturer of everything I sell I can actually see the manufacturers’ point – plus it was long overdue for somebody to put the big bully in its place…though I’m sure they’ll figure out some way to beat this out of their sellers :-(

MechelleOn June 30, 2008 at 1:31 pm Said:

@Richard

I read this article too, and here is my response

[i][b]“EBay is an Internet company that has found a way to make money by offering a product — its online auction platform — that hadn’t existed before. So quick, someone fetch the antitrust regulators.”[/b][/i]

What are you talking about??? There is nothing new in eBay’s online auction platform availability – it has existed for 12 years- what exactly are you arguing? What does this have to do with eBay’s Tying arrangement with PayPal??

So, this is where you at least mention the relevant information to your headline

[i][b]“The Australian Competition and Consumer Commission thinks the move is anticompetitive because eBay’s position as Australia’s “leading online marketplace” means that shutting out other payment methods would hobble them unfairly. So on June 12, the Commission issued a draft ruling that would bar eBay from going ahead with its plan.”
[/b][/i]

Yes, and it is a good thing that the Australian CCC is intelligent enough to see the wolf in sheep clothing that eBay is. Only a fool who has not taken even one full minute to research the issue and understand all of the variables involved with PayPal only and the consumer protections commanded by the Australian Government.

It is not an issue with eBay being the leading online marketplace- nor is it about the PayPal only within that leading online marketplace. There are 2 problems with eBay’s PayPal only scheme-

1) eBay members- sellers will be forced to use eBay’s PayPal product if they want to use eBay’s online auction platform product- clear cut tying arrangement, which is anti-competitive business practices.

A) The absurdity of this if you don’t like it get out of the pool attitude is mind boggling. If the issue were only whether or not you choose to buy a shirt from a department store and they were the only store who had the item we could make the choice to not shop at that store and it will not negatively impact the state of the market- because no consumer of that department store will lose their income if they decide not to buy from that department store. Choosing not to buy from a department store is in no way a parallel to choosing not to sell on eBay.

eBay’s bragging
-
[b]“In an interview, Whitman, 51, said the 1.3 million figure includes 750,000 people in the U.S. who (“make most, if not, all of their living selling on EBay.””.) McCain’s EBay Model for Jobs Finds Few Buyers Among Economists: By Hans Nichols, June 24 (Bloomberg)[/b]

Are you so base that you believe 1.3 million eBay users can decide today right now to quit eBay altogether? Are you so ignorant that you actually believe that these 1.3 million people who rely on their eBay business as their primary or secondary source of income have the luxury of hopping into an unstable up and coming (maybe) online auction venue? EBay has a monopoly with its online auction platform as it is – they suck out insane fees for their sub-par service as it is. That just isn’t enough so they are intent on abusing their customer base that they know damn well 1.3 million of them are reliant on their eBay income.

B)They are exploiting their power in the online auction market, and the only reason they have yet to make an attempt to pursue a legal license for the enforcement of PayPal only here in the US is because they do not have to- we (US consumers) have already essentially conformed to a PayPal only system. eBay’s ban on Google checkout the only other online payment method that could severely damage PayPal’s market potential and the other payment method that was convenient for consumers, but essentially just for looks was BidPay , which abruptly shut down January 2008. Money orders or cashier’s checks are to much of a hassle to make any significant contribution to the seller so are virtually moot in the argument. We don’t do direct bank deposits. We are bound to PayPal due to eBay’s ban of Google and the American culture.

C)eBay’s brain wash of buyers convincing them that eBay sellers are all crooks and cons and to protect themselves from these “bad people/sellers” they should use PayPal the only safe payment method, with the back end threat of if you do get screwed don’t come whining to us message they effectively terrorize the buying members into using PayPal and as consequence sellers are essentially locked into a tying arrangement driven by eBay’s psychological terror of eBay members ultimately leaving these 1.3 million individuals who rely on their eBay income to use PayPal as a payment method if they actually want to sell anything. The new policy forcing anyone with less than 100 feedback only use PayPal as an accepted payment method is only to continue this and increase the use of PayPal above the only other options of payment (money orders, cashier’s checks, and personal merchant accounts). By the time the new seller rack up enough feedback to offer other methods they will be so entrenched in the system it will not be an issue for eBay.

2)So, why does eBay need to attempt a legal immunity from their admitted anti-competitive actions? People ignore or haven’t picked up on the fact that eBay requested immunity from Australia’s anti-trust laws. eBay makes no effort to try to hide the fact that they know what they want is illegal, but they are hoping that Australia will treat them as some sort of utility like the power company- it is outrageous. Australians are not as entrenched in the PayPal system as US members are. They have a more competitive (Cheaper & safer) method as an option. I think only 30% of Australians use PayPal that is a lot of fees eBay/PayPal is missing out on.

A)The issue goes beyond the use of PayPal within eBay. The reality is once all eBay members in Australia (estimated 5Billion) are forced open a PayPal account their likelihood of using PayPal for other online transactions increase substantially- this proliferation of PayPal users outside of eBay will continue to grow and may lead to merchants offering PayPal more frequently as a preferred payment method there by reducing the viability of other payment options both within and outside of eBay. This PayPal proliferation has been taking hold in the US ecommerce market with fierce intensity over the past year. I imagine by the end of the year every online US merchant will offer PayPal and because of its convenience the user base will dramatically increasing entrenching the entire ecommerce market in the use of PayPal.

B) In essence eBay is intent on entrenching the Australian consumers into PayPal at the level of use it is in the US- the clear ultimate goal is to entrench the global ecommerce market into the use of PayPal. The role of eBay’s user base is essential for the success of this PayPal dominance model.

[i][b]“ As of December 2007, approximately 1,319,872,109 people worldwide use the Internet, according to Internet World Stats.” (http://en.wikipedia.org/wiki/Global_internet_usage)/b/i

[b]1,319,872,109 eBay users worldwide there is no better tool to get the job done![/b]

[i]This is anti-competitive behavior and the global market needs to pay attention before we are all overcome by the eBay/PayPal and they drive the global ecommerce market into the ground. Next could be the tangible market- would it shock you to see PayPal as a payment option on the Atm/CC terminals at your grocery store, local department stores? What about as auto payment for your household bills? We need to take this situation seriously, because it is profoundly important to stamp this activity now before they start gaining ground in this goal of global payment domination!
[/i]

Tired and upset so hopefully this makes sense

MechelleOn June 30, 2008 at 1:33 pm Said:

that is stupid- you need to put some additional tools into the comment area- bold and italics would be appreciated

MechelleOn June 30, 2008 at 1:54 pm Said:

@Richard

This is a copy of my response to the idiot who wrote that opinion piece in the WSJ not directed at you

MechelleOn June 30, 2008 at 2:10 pm Said:

@Chris @ TameBay

The issue I have is their hypocrisy not the sentiment. The reality is they appear ridiculous with their argument concerning this judgment in light of their actions in Australia.

TonyOn June 30, 2008 at 2:21 pm Said:

I’m in agreement with Chris, people are letting their anger at ebay’s policies get in the way of seeing the bigger picture here, this is a very important issue.

I did read earlier that it was unlikely such a case would be won in the UK, I’m not exactly sure why that’s the case, but it suggests it’s French law more than European law at the heart of this issue.

Forget ebay’s hypcocritical statements, this is about sellers having the right to sell products they own, it’s an important principle and I support ebay in their stance in launching an appeal. This doesn’t mean I support ebay’s restrictive practices, but people need to look at each case on its own merits.

sandiOn June 30, 2008 at 2:35 pm Said:

It’s about giving manufacturers the right (or not) to decide which channels their products can be sold in and banning seller from reselling legitimate goods, obtained legally, in secondary (or gray) markets.

Sorry but I think they have that right. It’s their product, it’s their marketing plan, and it’s their name. If they want to limit who can sell their product they have the right to do so, they are allowed to set their own prices. It would only fall into a problem if all the purse manufacturers got together and set prices together.. I doubt seriously if any of these companies wanted to put barriers up against those who purchased their items legitimately, but they were forced into this corner by ebay.

The companies in question have spent large amounts of monies creating the prestige of their brands, how could they let ebay devalue that image? No business person in their right mind would do anything different.

The alternative was to have 24/7/365 employees monitoring every single listing. Why is it their job?? Ebay is the one who makes money, it is their responsibility to police itself, I would think ensuring fakes not being allowed would be a critical part of that great ”buyer experience”. They have left the job to sellers, who they have been kicking around as if they were nothing and the Vero members who have to spend resources to hire staff. As an owner for some of these brands, I don’t want my purse, watch or sunglasses devalued by ebay.

I own a company, twice in 20 years I “fired” a client, my right. I happen to wear Dior perfume, I understand the cost, and to me it is worth that cost. I want to walk into a store and know I am getting what I pay handsomely.

If one does not like the policy of Rolex, LVMH, they can buy alternate brands.

Reality, had ebay done its job to begin with, would any of these companies have felt threatened their brand was being devalued? Yes, you can point to the suitcase Rolexes on NYC street corners, etc. But NONE of them had the massive/global effect ebay did.

Ebay created the brand of “the place to get counterfeits”. I can relate to not wanting one’s product attached to such a description. EBay apparently thought they were above the law. Today’s ruling is a reminder ebay must adhere to the same laws as everyone else/

sandiOn June 30, 2008 at 2:40 pm Said:

but it suggests it’s French law more than European law at the heart of this issue.

European countries share many laws, this happens to be one of them. This ruling does not impact just France.

MechelleOn June 30, 2008 at 3:11 pm Said:

I think the message of the judgment is to inform eBay they are in fact responsible for what takes place on its “venue”. That the “venue” argument is insufficient relative to their neglecting to protect consumers and respect the integrity of the Brand. I doubt – matter of fact I know that eBay has issues with other sites using what they believe can easily be assumed by the public as being associated with the eBay/PayPal brand. Granted their objection seems to be aligned with hiding truths of the experience members have had with either or both eBay/PayPal.

Though I do find eBay’s argument over this issue and the other situation with the commerce laws in Europe absurd considering their current behavior. However, I do believe that if I purchase something it is at my discretion to do what I choose to do with it regardless of whether or not the manufacturer wants. Sell it on eBay, Yard sale, flea market, or throw it away it is my right (in the US) and these manufacturers are just going to have to deal with it.

Again, eBay looks ridiculous and they should be actively pursuing counterfeit dealers, but I think they are right concerning an individuals right to sell their own property regardless of the manufacturers feeling concerning the consumers choice right to use their property anyway they choose to.

I really think this message is more about eBay’s negligence and essential assistance in the distribution of counterfeit products and is not so much related to the individuals right to sell. The court said eBay cannot allow these products to be sold on the eBay “venue” they didn’t say individuals don’t have the right to sell their property any where- just by extension not on eBay.

Chris @ TameBayOn June 30, 2008 at 3:47 pm Said:

@Dimes “in the US, the “first sale doctrine” would prevent Fox from prohibiting owners of its products from reselling them on eBay”

And therein lies the problem – If I can buy LVMH products why should they be allowed to prevent me from re-selling them on eBay which is effectively what the court has decreed?

We’re not talking dodgy knocked off products here. We’re talking about the right for you and me to have purchased and want to dispose (or perhaps for pro-sellers purchased specifically to resell) a product.

I fail to see why any manufacturer who’s received the full asking price for their product should then expect to control the resale in the future. It’s absurd!

petewheatOn June 30, 2008 at 4:05 pm Said:

As a person who unknowingly waded into this designer cesspool a while back I have a hard time feeling anything for all parties involved. First off maybe some have tried to sell LV etc. on eBay I can attest to the fact that the high end designer accessories are swarming with people who are obsessed with status as it pertains to authenticity. Most of these people are women who swamp their boards regarding every aspect of every detail to determine if something is fake or real. At the other side (as usual) everyone is trying to steal a great deal way below market price. SO you have greed meeting style and of course with no substance. O.K. I don’t need a lecture on the history of couture in French history. Bottom line anyone who sells or wants to sell in that shark infested water better have some ammunition because corruption is rampant and the manufacturers snobbish over priced strata seeking caste system is to blame. eBay should just bail out here as you don’t see unlicensed LV new/used etal. being sold on Amazon do you?

sandiOn June 30, 2008 at 4:10 pm Said:

I fail to see why any manufacturer who’s received the full asking price for their product should then expect to control the resale in the future. It’s absurd!

A buyer wants does not trump a manufacturer’s rights.

I think you are missing the bigger picture. The law has been there, probably not enforced until the last few years. I doubt seriously Vuitton doesn’t want resale of their product – afterall the resell creates a new market segment, the person who can’t yet afford brand new, but will become brand loyal and someday be able to afford new.

But you have an ebay that has thousands of listings using your product name/brand. You repeatedly aske ebay to stop the counterfeits. No success, you have staff monitor the site ebay is less than speedy. Many auctions of fakes last one day, so now you have to have staff who monitor 7 days. What about time zones, now you have staff 24/7/365.

You can’t even really hire high school interns because some of the sellers are so good they know what makes it look real, you now have to have your bst experts monitoring ebay.

ebay is costing companies money. ebay caused manufacturers to go to court to enforce a law they would not have wanted enforced previously.

The cpounterfeits have grown to the point they now outnumber the real items. I am not sure ebay will be able to fix it because they ignored it for so long.

But if a manufacturer wants to enforce this law, I as a buyer have free will. I can not buy a product I can not resell afterall. No court has really taken away my right. I personally would never buy a name product on ebay, their reputation is not great.

Which brings the second reason why a Vuitton would not want their name in the same sentence as ebay.

I think the bigger question is, would any of these companies gone to court had ebay done what it was suppose to do to begin with?

Matthew WintersOn June 30, 2008 at 4:47 pm Said:

Richard, it does seem like you tend to be as forthright as possible, but even you probably don’t have freedom to be completely upfront. The reality concerning this decision in France and eBay’s statement is that both LVMH and eBay have good points. And their points are not mutually exclusive.

It is very possible that LVMH is overreaching. It is very possible this is more about business than intellectual property. It is also possible that it is not. I have know way of knowing.

If the former is true, then eBay’s position is justified.

But I think the real point being missed is that none of this is really the point. If eBay had done due diligence to combat trademark fraud in the beginning instead of scrambling late in the game, LVMH wouldn’t even be able to use counterfeit products as an argument. So while both parties make good points that makes for an intellectually stimulating debate, eBay really brought this decision upon themselves. I think eBay take the issue seriously enough now, but this is a case of “too little, too late”.

Chris @ TameBayOn June 30, 2008 at 5:07 pm Said:

@Sandi

I think you’re missing the point. If every manufacturer decided to be pig headed, follow LVMH, and limit the resale market of their goods it would pretty much wipe out most eBay sellers and a lot of off-eBay sellers as well.

And you can also forget the second hand market because none of the sellers of second hand goods (online or offline) wouldn’t be approved either

MechelleOn June 30, 2008 at 6:16 pm Said:

@Sandy

“I personally would never buy a name product on ebay, their reputation is not great.”

eBay’s reputation isn’t great? or are you saying that the sellers on eBay reputations are not great?

“The cpounterfeits have grown to the point they now outnumber the real items. I am not sure ebay will be able to fix it because they ignored it for so long”

are you speaking of the whole of eBay or particular categories?

Randy SmytheOn June 30, 2008 at 6:25 pm Said:

@Chris,

I know this judgement creates a slippery slope, and eBay will now have to restrict legitimate sellers of these items, but they’ve already been restricting sellers. The “New eBay” is all about control of the marketplace.

eBay could have “protected sellers” years ago before this lawsuit was even brought against them. The cost was just not worth it to them. They should have figured a $61 million judgement into their ROI calculation.

sandiOn June 30, 2008 at 6:37 pm Said:

on eBay I can attest to the fact that the high end designer accessories are swarming with people who are obsessed with status as it pertains to authenticity

Please didn’t lump us all togeher. I own the products you posted about, not one was purchased on ebay. Just a different perspective. I own one pait of sunglasses I paid 500.00 for 10 years ago. I own 2 purses I paid over 1000.00 bucks for a while back as well (one works for fall/winter, the other spring/summer).

Now perfume is my one personal vice so to speak, I know it is something I spend too much money on, but I think everyone probably has one thing they love and spend too much money on. If the lessor expensive brands smelled the same ALL day long, I would buy those instead, but they don’t. But I don’t run around with the label on my shirt, I select/wear perfume for me. I do sneek into stores an hour before closing time because its when they are least busy, spray and leave until I find the right new perfume:-) (for men, you can not really tell how any perfume smells with one spray)

I purchases designer names for 2 reasons, they tend to have a classic style that stays in style – and they last years. I hate to shop in stores, sunglasses specifically need to be bought in person. I will spend more on quality because it lasts longer – which means fewer shopping trips.

I have never posted on any designer board, have no intention.

That all said, I think it is appalling that persons who might not who might not really be able to afford a designer purse gets ripped off because ebay has allowed fakes to overtake genuine items.

sandiOn June 30, 2008 at 6:53 pm Said:

Mecehelle,

Unforunately I am speaking about alot of ebay. As someone who really does purchased 98% of everything online, I don’t find ebay a safe venue. I would buy from you, I would buy from Patricia, and several other regulars here because I have read your posts, and know you are an ethical and moral person.

I use to buy 30 books a month on ebay, printers, inks, art supplies, etc – all from the same sellers over and over. Those sellers did not lose me as a buyer, I just do not buy from them via ebay anymore.

Designer brands I would not buy on ebay because I simply don’t know enough to tell fakes from real – but I own real and know how long they will last so I prefer designer. I buy direct, actually that’s not quite true, I am 1/2 french, family send me “gifts”.

As someone who has seen clear policy violations and reported them and seen nothing done – sorry but that makes me afraid. How do rational, semi-intellect management think there would be no effect to their lack of actions?

I now look elsewhere before ebay and if I have to come to ebay, to be very honest I am always scared and I expect the worst if it is a new seller.

Don’t get me wrong, it is not sellers who caused this, it is ebay that caused this. How lomg did they think they could ignore reported problems and think normal everyday people would begin to visualize problems everywhere – real or imagined?

petewheatOn June 30, 2008 at 7:01 pm Said:

@ Sandi
I respect your right to spend your money any way you deem appropriate and I comprehend the quality aspect of longevity. I have heard these type of arguments from my well heeled and wanna-be affluent friends in the past. This general category is not what I consider a current eBay asset as the China syndrome of cheap imitated objects increase exponentially. That is why I think eBay should abandon this type of higher end cache item or create a separate site. The fact that people who cannot afford this type of “luxury” can be ripped off because of their desire to obtain “class and quality” is indeed sad. ref: Michael Jordan Nike shoes

sandiOn June 30, 2008 at 7:17 pm Said:

Randy Smythe, I just think trademark holders, manufacturers have rights greater than ebay wants to acknowledge. The reaity is, it is ebay who caused this.

If they opt to not allow them in the second market, one would think it would not be to their financial advantage down the road.

That said, I can fully understand why they took this step, I don’t think ebay left them any other option.

I realize my college age daughter would love to be able to buy a second hand designer bag (she knows I wear mine out to the pointshe would not want it and I am not buying her one, now her great grandmama might break down this year, who knows). But if she has to “suffer” to ensure someone’s brand is protected, so be it. Everybody doesn’t always get what they want afterall.

sandiOn June 30, 2008 at 7:29 pm Said:

I have heard these type of arguments from my well heeled and wanna-be affluent friends in the past.

Pretty please, don’t lump me in this group? I know people like that. If I came off as pretentious, not my intent. And I apologize. I am just one lucky person who worked hard, was in the right place at the right time and had a lot of luck.

I mean I literally have a total of 2 purses, one pair of sunglasses :-). The sunglasses were a fluke, I use to lose 10 pair of sunglasses a week, and I bought them at the dollar tree for a dollar a pair. One day my daughters & I were shopping and they talked me into sunglasses that cost way too much in my opinion.

I haven’t lost them yet. So in essence they saved me money in a dumb, stupid way. I live in constant fear of losing them now.

I fly coach unless I can get bumped to first class for free (company policy and my employees hate it – but I do it too). I even reuse tea bags :-)

permacrisisOn June 30, 2008 at 7:53 pm Said:

Suppose a compromise were reached (settlement notwithstanding). What form would it take? What concessions or admissions would each side possibly have to offer?

These two parties have a once-in-a-lifetime chance to do some creative negotiation, and possibly even set a legal precedent.

If ebay were going to turn over a ‘new’ new leaf, now might be the time to do it. They love to apply formulas to everything lately– this situation practically screams “formula.”

Sadly instead what’ll happen is, LVMH will get free listings and no FVF and get invited on board as the next ‘Buy’ and all other purse sellers get the boot maybe?

That’s a precedent nobody wants to see.

dimesOn June 30, 2008 at 7:58 pm Said:

@ Chris –
Your point: “We’re not talking dodgy knocked off products here. We’re talking about the right for you and me to have purchased and want to dispose (or perhaps for pro-sellers purchased specifically to resell) a product.” is well taken.

I agree that once purchased, people should be able to re-sell a product and am a little surprised that the EU hasn’t addressed this adequately yet (according to an earlier post by Richard about a ‘Call to Action’).

On the other hand, I can see where manufacturers are coming from in their efforts to limit the arbitrage that goes on with ‘parallel imports’ (the legalese for ‘grey market’), in which a volume of legit products are purchased cheaply in a market in which the price is low, and imported for sale to a more expensive territory, undercutting their own price in the more expensive market.

eBay’s limitation on the number of designer items that can be put up for sale by a single seller could take care of that issue on eBay if it used at least some form of ID verification beyond the IP level.

AmberOn June 30, 2008 at 9:12 pm Said:

Is it not the right of a manufacturuer to do everything in their power to protect their brand?

Nope. It isn’t. The First Sale Doctrine here in the US is quite clear. It started with books, but the interpretation has been expanded to include nearly all consumer items.

France and other countries do not have the same laws. The solution to me would be easy. Restrict the sales to those countries. Block them from appearing outside the home domain.

The problem is that there is a fine line between removing counterfeit items for sale (absolutely legal and needed) and restricting the trade of genuine used goods.

I doubt seriously Vuitton doesn’t want resale of their product

Sandi, for once I am on eBay’s side here (sort of)….I know you should probably circle the day in red, ’cause it will never happen again.

It is against the law in the US to restrict the flow of merchandise after the initial sale. Clearly, the EU has no such laws in place to protect resellers.

The high end manufacturers have been abusing the VeRO program for years. They’ve initiated unwarranted take downs of legitimate listings while doing nothing whatsoever to help fight the fakes. eBay should have done more–absolutely.

But this isn’t about fake handbags and other luxury items. This is about preventing the resale of their items because it cuts into their potential customer base. If you can’t buy it used, perhaps you’ll break down and buy it new from an authorized dealer. Used, the manufacturers get NONE of the secondary profits.

Authors and publishers here in the US have been trying to do the same thing with ebooks and software. I’m quite sure there will be a showdown about it sooner or later. I’ve personally read about more than one author accusing the used book market of taking sales (and thus contracts) away from authors. Violating their “intellectual property rights” and not compensating them for subsequent sales.

Sound familiar?

I’m sure counterfeits are harmful to a brand image. Ebay’s poor reputation makes it understandable that luxury brands would want distance from eBay. But I think the real issue comes down to money. They want a cut of the secondary market OR they want that market to just go away.

MechelleOn June 30, 2008 at 9:42 pm Said:

@Sandy

I understand exactly where you are coming from. This is an issue with many eBay members. The distrust of the site encompasses more than the counterfeits. New members most frequently, but more experienced as well are suspicious of the seller, the reliability of the description, and of course the authenticity of the product.

I have had an overall positive experience purchasing on eBay- after I had been burned a few times. I learned who to trust and who not to, but I had had a lot of transactions prior to the thieves so it didn’t scare me off from eBay. The unfortunate reality is many people are victims in their first few purchases and are likely not to return and if they do are very timid on making the purchase.

I have been asked if my product is real, if it is full size, does in come with the applicators, does it come with its box, can you please tell me sku and or product number…. All of these (other than the sku) are in the listing and the picture, but they need to be certain, and I don’t blame them, so they ask. It is clear that the overwhelming emotion of eBay members is of fear. The item could be fake, real but misrepresented, manipulative titles, hidden details and the list goes on. It is very sad and depressing that people are so uneasy shopping on eBay and that they suspect me for no other reason than where I have set up shop.

I am just at a loss in understanding why eBay has made shipping the culprit rather than fix the biggest and most insidious problem in the marketplace. I’ve never had a question about shipping other than if I combine for discount. No one has ever questioned me on my shipping fee, service, or anything else negatively. Shipping may be annoying but it is also the easiest thing for a buyer to control- if it is to much you shop some where else- easy. Is it real? who the hell knows, is it new? who the hell knows, is it broken? who knows !! You won’t know the answers to the questions until you have the product in your hand. Is the shipping $9.80- yep- ok I’ll go some where else. Unbelievable, where this company puts its money and effort.

With all the time effort and money into litigation – why not just solve the problem rather than try to defend it in court??

bonniOn July 1, 2008 at 1:19 am Said:

I love this bit: “… a businees model that restricts consumers choice through an anti-competitive business practice”

eBay doesn’t like that? So why are they trying to circumvent Australian trade laws by forcing everyone to use PayPal, a practice that the ACCC has found to be anti-competitive? I thought eBay believed that consumers weren’t smart enough to know what was good for them and letting them make choices was a bad thing? Or is it just Australian consumers who aren’t smart enough to know we should use PayPal?

Pot. Kettle. Black. eBay. Clueless.

sandiOn July 1, 2008 at 7:13 am Said:

Amber, my primary point is any manufacturer has the right to protect the value of it’s product and name. These companies have spent billion to create a brand, to create the illusion of superior products. ebay has smeared their names. That is what this is about more than anything. These companies what to protect their brand. ebay failed to work with them, assist them, heck they invited the chinese bootleggers to come through the front door for goodness sakes.

Let’s keep in mind they did not take ebay to court year one, they tried to work with ebay, when the site had more fakes than real, only then did they go to court. ebay got what it deserved.

ebay has a proven track record of simply not caring about fakes/counterfeits.

I seriously doubt Tiffany, Rolex, Dior, Vitton, etc want to stop the resale of their items in legitimate methods.

ebay dropped the ball. And as usual they are blaming the other guy. ebay is simply doing the smoke and mirror trick using designer brands as tje bad guy, when ion fact ebay is the bad guy in all of this.

Mechelle, it is time ebay walked the talk. As long as I can find clear policy violations on listings and take the time to report them and discover ebay does nothing – they have zero credibility about anything.

Randy SmytheOn July 1, 2008 at 8:06 am Said:

@Amber,
Regardless of the First Sale doctrine, it is still the right of a manufacturer to protect their brand, LVMH is just doing what eBay and other corporations do on a daily basis. Sure the French Court should have limited this to counterfeit items only, but had eBay taken care of these issues way back when or even negotiated with LVMH on a solution we wouldn’t be where we are.

This will certainly require eBay to be more restrictive, but they were heading that way anyway. This judgment won’t kill the secondary market in the US because of First Sale, but it may take a hit in those countries that do not have a similar doctrine.

eBay is only “protecting sellers” in this instance because it suits their corporate interest.

Here’s the problem with huge corporations who take advantage of their size and power, eventually regulators and courts start ruling against them and once there is blood in the water, all the sharks come calling.

Had eBay just added the concept of “should” to their ROI calculations the regulators and courts would still be at bay.

The concept of “should” comes from the well known philosopher Jeff Goldblum in the movie Jurassic Park; “Yeah, but your scientists were so preoccupied with whether or not they could, they didn’t stop to think if they should”

There are natural laws that regulate the “should” in life – Karma!

Just my 12%

Patricia1On July 1, 2008 at 9:19 am Said:

Ebay hardly ever thinks of “should” where there are fees involved ;-)

DeeOn July 1, 2008 at 9:21 am Said:

@Randy Smythe,

Love your post. Especially the line:

“eBay is only “protecting sellers” in this instance because it suits their corporate interest.”

That’s the bottom line and ebay can spin, spin, spin all they want too. Karma is here to bite them in the…

Bring on the sharks!

dimesOn July 1, 2008 at 9:32 am Said:

Interesting article today on Forbes about a former eBay seller who has moved on to create his own auction site for luxury item resale. The authentication process it uses sounds pretty intense, but at an average selling price of $2000 it better be.

http://tinyurl.com/3en4pt

AmberOn July 1, 2008 at 9:46 am Said:

Oh I never claimed that eBay was motivated by anything but self interest.

Ebay never does anything for altruistic reasons. Ever.

I’m well aware of that.

BUT I honestly do see this as anti-competitive (again, not I’m blind to the hypocrisy on eBay’s part)

From what I’ve gleaned, secondary markets would be limited to “authorized resellers” only. Meaning that those brands will get a cut of the secondary or tertiary sales.

Sure, some of this is about image, but bottom line–it is about the $.

Companies have legal rights to protect their brands. This includes making sure that all references to their products in print include the appropriate designations. TM for trademark, © for copyright, ® etc
It means making sure that their brand does not get turned into a catch-all generic term for those types of products. Coke, Band Aid, Kleenex etc have all fought those battles…largely without success.

What companies DO NOT have the right to do is to dictate what happens to their purchases after they’ve been paid for them. At least not here in the US. The EU should protect consumers instead of big business on this one. In a free market, luxury brands will flourish by making a superior product, not trying to limit the legit sale of preowned items.

petewheatOn July 1, 2008 at 9:47 am Said:

@Sandi
O.K. you’re off the hook. :) Actually, I can relate to the guilt about all this. I think I am most appalled not by having a few of these things, but the sheer quantity some people require.