Threatening legal action against Ebay it does not crack down on counterfeits

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Posted By: bruce Dorskind

PPR threatens to sue Ebay over fake goods

By Adam Jones in Paris-Financial Times August 31, 2007

PPR, the French conglomerate that owns Gucci, Bottega Veneta and several other luxury goods brands, is threatening legal action against Ebay if the online auction site does not crack down further on counterfeits sold on its website.

In an interview with the Financial Times, François-Henri Pinault, PPR’s chairman and chief executive, said that his company had been in talks with Ebay for several months in an attempt to improve the policing of fakes sold by the site’s members.

“We have signalled to Ebay that if their practices related to our products continues, we envisage taking legal action. We are in the process of talking to them about what they should do to avoid this.” He said it was up to Ebay to verify whether branded products sold by its members were authentic. “They can’t let people trick others by selling counterfeits on Ebay.”

Ebay declined to comment Friday. If it did take the matter to court, PPR would be following in the footsteps of LVMH, its great rival in luxury goods, which sued Ebay in France over the circulation of fake Louis Vuitton products last year. Tiffany, the jeweller, has also sued Ebay.

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Posted By: leon

Do we know if anyone (businesses included) has won a judgement due to this kind of action? I always thought the ebay lawyers had their contractual obligations pretty tight as only making ebay a venue? I would think that if someone proved they were negligent then maybe something could happen...but I am far from a lawyer and my guess is ebay has a ton of good ones....

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Posted By: jay behrens

My problem with eBay always claiming that they are only a venue is that if this really is the case, then they cannot be setting up rules to dictate what can or cannot be sold. Once you start doing that, you are more than a venue, you are controlling what can or cannot be sold there and at that point it makes sense that they then need to be held responsible for what is being sold there. Also, if they truly believe in cavet emptor, then why do they bother to make an attempt to remove counterfits and fakes? To me, if they are making an effort to do this, then they need to be held responsible for not doing an effective job.

eBay basically want to have their cake and eat it too. They want to let people sell just about anything they want to while giving the illusion it is a safe place to buy and sell, when it is not.

Jay

The richest person is not the one who has the most, but the one who needs the least.

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Posted By: Paul

Similar lawsuits have succeeded against the owners of swap meets / flea markets. I think there is a pretty close analogy between those cases and the ebay situation, so the lawsuit may stand a chance of success.

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Posted By: Larry

eBay's recent decision to ban the sale of gun parts and accessories is another example refuting their "venue only" claim

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Posted By: barrysloate

On any given day ebay may have 10 million objects up for auction. How do they police all of them?

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Posted By: Jim Dale

The problem is they don't appear to be policing any. Look at autographs - they put up a warning page - and that is it. The ignore complaints against power sellers (perception = reality) and routinely let suspended sellers back into the frey.

Assuming you are right and they have 10 million auctions up at any given time it also means they've collected $3.5 million in listing fees at any given time....they need to hire some cops.

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Posted By: barrysloate

Look at the complete list of categories and the number of items in parenthesis. If you made costume jewelry and needed to buy beads, there are over 100,000 items listed under "loose beads" on a typical day. Then multiply that by the hundreds of categories. It's mind boggling.

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Posted By: jay behrens

Barry, but they do make attempts to police them. Look what Leon is doing with them. This proves beyond a shadow of a doubt to me that they are more than just a venue. They could do a much better job of enforcing rules and removing fake items, but that would mean cutting into their bottom line and hurting their stock price.

Jay

The richest person is not the one who has the most, but the one who needs the least.

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Posted By: barrysloate

I know they are making an attempt, but there are too many items to watch. Best they could do is spot check. I suppose some areas are more rife with counterfeiting than others; I'm sure autographs are more dangerous than listings for tube socks.

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Posted By: TONY

I have a simple answer that would eliminate any expensive phony cards being Listed on ebay

what if any card worth say $5k or u pick a figure can only be listed if graded or authenticated by one of the Big 4 grading services?

that would eliminate most of all phonies & blantant overgraded cards

good for us collectors

good for the grading services &

BAD for scam artists &

Ebay would get a ton of less listing so it won't happen as it would hurt their bottom line

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Posted By: David Smith

Earlier this year, I listed a wrist watch that used the word "tank" in the description. After a couple of days, I received an E mail stating that the auction was ened and my fees refunded because of a violation of eBay rules.

I E mailed (twice) but received no answer why. I then called eBay and was just given a name and telephone number of the company that made the watch. After three or four calls, I finally reached the person eBay refered me to. That person said the word "tank" was a trade mark of another company and I could not use that word in describing my watch I had for sale.

I removed "tank" from the listing and the auction went to completion and ended with a sale (about $15 dollars).

So, if eBay can take their time to remove a listing for a $15 dollar sale, then they can do the same for higher dollar items.

David

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Posted By: Rich Klein

http://www.msnbc.msn.com/id/6030048/

http://www.law.com/jsp/article.jsp?id=1090180362167

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Posted By: Frank Wakefield

I think an eBay rule that would require cards of a certain threshold value to be graded is bad. It would put eBay in cahoots with the grading companies... If you don't want to bid on a card worth 1k or 5k unless it is graded by a big 4 company, then don't bid. But don't make the sellers have to get stuff graded.

If folks would learn about what they're buying, buy from folks with return policies, and from sellers who have a solid track record, then there would be fewer problems. (The problems arise when someone buys a 2k card for $20, and expects the card to be authentic.) I myself see enough mistakes by the big 4 graders, so many mistakes that I value my opinion as to authenticity more than I value theirs.

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Posted By: barrysloate

While I agree with Frank that it would be difficult to force a seller to have a card graded before he puts it on ebay, it would go a long way towards cleaning up one problem area. It's nice for everybody to become his own expert, but there are always beginners coming into the hobby and they could use the assistance of a third party. And if a beginner gets burned a few times he's going to leave the hobby as quickly as he came in.

Fact is, selling graded cards on ebay is actually a pretty sound idea.

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Posted By: dennis

"Fact is, selling graded cards on ebay is actually a pretty sound idea."
it works unless the scammer is the grading company (ie: libertyforall)

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Posted By: DJ

Ebay is simply too big to be controlled on the levels that a lot of people want. You can't babysit a 2.2 million people and watch their every move.

The problem with eBay is that it allows everything and while we speak on a level of what we know, every other area on the site is being manipulated with fraud on some level as well that we simply don't recognize.

As far as autographs go, eBay is doing something and people are being plucked from the site on a daily basis. The only problem here is that there are so many creative ways that these sellers go about to continue living large by pretending to be someone else.

As far as cards go, there a small fraction of fraud in comparison to the autograph world (which I think is the worst problem on eBay), but there is a far greater issue in other avenues like illegal handbags (it is a huge issue) and clothing, copyright infringed photos, bootleg media, plucked scans, people not getting the products, pirated accounts...etc.

The staff that handles complaints (from what I understand) is rather small. It relies on inputs from what many deem "the experts" and if they have to further police categories because of massive complaints, it will have to hire more people and it will rival every situation that closely mimics every public hall in the country about that time every year when taxes are raised. In this instance, perhaps another nickel on insertion fees so we can all complain about that.

What has to happen, card-wise, is be happy that you have people out there reporting stuff and that while some things slip through the cracks, steps are being made. That if Scam Artist A puts up a fresh Ed Plank that has been run over twice by a Chevelle to give it that authentic look, that was recently discovered in a cigar box (cigar box shown) in your late relatives attic, that it will probably removed shortly after it's debut on the site if the right people see it. This wasn't the case many years ago.

That's my take. Have a good Labor Day!

DJ

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Posted By: JimB

Maybe a good samaritan could start a website dedicated to baseball card frauds on ebay and whenever somebody sees one they can post it there. Then there would be a place where people could go to check.
JimB

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Posted By: davidcycleback

Buying your Louis Vuitton handbag on eBay defeats the purpose.

A magazine hired a diamond expert to examine the diamonds as some place like Target, and he said that for what was advertised the diamonds he examined were good quality. In fact he said he was surprised at the quality.

Similar diamonds at Tiffany's would cost substantially more, but people of a certain means would prefer to buy their diamonds at Tiffany's. In part because they feel you don't go to Target to buy diamonds, but also they know when they go to Tiffany's you know how you are going to be treated and you know what you are going to get.

What's the average purpose of buying a Luis Vuitton handbag on eBay? People on eBay are looking for cheap bargains on brand names they couldn't afford retail. They're too cheap to even buy them at Target.

There are some luxury good stores I pass downtown, including a Luis Vuitton store, where I wonder if they'd let me in, much less buy something. "We don't doubt that your credit card is valid, but we'd prefer that you not buy anything here. The alley door is this way."

/////

In case anyone wondering, my things are carried in a Jansport backpack with a broken zipper that I used in college.

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Posted By: jay behrens

eBay is a very profitable business. It wouldn't kill them to spend some of that money on better enforcement rather than lining their pockets and those of the share holders. Sadly, that is what big business is all about, the shareholders, not the customer.

Jay

The richest person is not the one who has the most, but the one who needs the least.

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Posted By: Marc S.

<<eBay is a very profitable business. It wouldn't kill them to spend some of that money on better enforcement rather than lining their pockets and those of the share holders. Sadly, that is what big business is all about, the shareholders, not the customer.>>

Jay -- one of Ebay's classic defenses is that it is simply an conduit, and it is not the direct owner/seller of anything that passes through an Ebay auction. If they start taking too much ownership on the fraud front, they possibly put themselves in harm's way of a lawsuit in the case that something does slip through (e.g. a fraudulent/counterfeit item sold as authentic) and they don't catch it.

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Posted By: barrysloate

I'm running an auction right now and I could say the same thing- I'm just a conduit between buyer and seller. But I have to take full responsibility for whatever transpires, both good and bad (mostly good, hopefully).

Then again, I don't have 12 million lots to oversee. I think the enormous size of ebay makes policing it very difficult.

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Posted By: Marc S.

the card are physically in your possession right now. Ebay hides behind the fact that it is simply a software interface and destination. It never takes ownership of any goods, and simply provides a conduit for sellers to choose which selling features they prefer and buyer to perform their due diligence with their purchasing/bidding habits.

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Posted By: barrysloate

Marc- that's a valid distinction as I am in possession of all my material. But I still can't hide behind the fact that since I don't own most of the lots (although I will admit some of the lots I do) that I won't take any responsibility for them. If someone consigns a bogus item I am obligated to withdraw it. Ebay has the same obligation but they would need a thousand experts in all different fields to do so.

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Posted By: jay behrens

Mark, please read the whole thread so I don't have to repeat myself.

Jay

The richest person is not the one who has the most, but the one who needs the least.