San Francisco — If a French court has its way, online auction giant eBay Inc. will soon have to pay dearly around $2.6 million for marketing a French Perfume. The fine stems from a ban on the sale (or purchase) of LVMH goods, by the Commercial Court in Paris for failing to meet the terms of an earlier ruling, which prevented sales of certain perfume brands to French consumers on its website. The company said the ruling “hurts consumers” and effectively enforces restrictive distribution contracts “which are anti-competitive”.
The ruling is corresponding to one of three lawsuits brought by LVMH, which is the brand owner of luxury products such as: Louis Vuitton, Christian Dior, Tag Heuer, Givenchy, and De Beers, won a major case against eBay in June of last year. The suits accused eBay with illegal marketing of perfume brands that included Christian Dior, Kenzo and Givenchy as well as the sale of counterfeit items on eBay.
Christian Dior Poison by Dior Credit: Christian Dior Fragrances.
The Commercial Court of Paris discovered that eBay, in June 2008 violated a court order to halt sales of Moet Hennessy Louis Vuitton perfumes. The Commercial Court of Paris ordered eBay to pay damages of €35.5 million related to the cases about counterfeit sales and €3.05 million for illegally selling items in breach of selective distribution network agreements. LVMH uses such agreements to limit the sales of its products to selected outlets.
Mary Huser, eBay’s deputy general counsel, said the company poured millions of dollars into filtering software to check millions of daily listings to ensure that it acted in accordance with the injunction.
“It is extraordinarily difficult, if not impossible, for the French consumer to purchase these products because of the money and technology that eBay put into place,” Huser said. “We did not agree with the decision to implement the injunction. But we did everything to meet the terms.”
Now, Alex von Schirmeister, the general manager of eBay in France, has said in a statement, “We believe that the higher courts will overturn this ruling and ensure that eCommerce companies such as eBay will continue to provide a platform for buyers and sellers to trade authentic goods”.
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