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Fab Flash: LVMH Wins Over eBay in Counterfeit Goods Trial


Don't mess with fashion giant LVMH Moet Hennessy Louis Vuitton.

After a two-year trial, a French court ordered eBay to pay up for selling counterfeit items on its online auction site and for selling genuine goods outside LVMH's retail channels. The penalty was a whopping 40 million euros, or $63.2 million at the current exchange rate.

This all came about when prestigious brands including Louis Vuitton, Givenchy, Fendi, Emilio Pucci, and Marc Jacobs had complained about 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.'' In rebuttal, eBay said 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.

Sounds like both parties are still heated, but for now, the courtroom has cooled.

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