L'Oréal Sues eBay Over Counterfeit Sales

The L'Oréal Group, a global cosmetics and beauty company headquartered in Clichy, France, has recently taken legal action against eBay Inc., a popular online auction website, in several countries including France, Germany, Britain, Spain and Belgium. The lawsuits allege that eBay does not effectively combat the sale of counterfeit L'Oréal products on its website and that such failure has resulted in several million euros worth of damage, including harm to L'Oréal’s selective distribution network and the reputation of its trade-marks. Meanwhile, as L'Oréal observes, eBay receives a percentage of each transaction and advertisement on its website regardless of whether it is derived from legitimate or counterfeit items.

L'Oréal claims that it has generally been facing an increase in illicit trade in counterfeit fragrances and cosmetic products on various online auction websites, reflecting similar problems faced by companies like Christian Dior and Tiffany & Co., which have launched similar lawsuits against eBay.

This entry first appeared in the September 13, 2007 edition of lawsof.com. For additional information, click here.