What the Ebay Ruling Means to the Rest Of Us

This morning, Bloomberg news announced the following:

  • “EBay Inc., the world’s largest Internet auctioneer, was ordered to pay LVMH Moet Hennessy Louis Vuitton SA 40 million euros ($63 million) over claims it didn’t do enough to stop the sale of counterfeit goods. LVMH, the world’s largest luxury-goods maker, claimed in the Paris lawsuit that EBay has a heightened responsibility to prevent fraud. The ruling also places limits on the online sales of LVMH perfumes.”

What does this mean for the rest of us playing around in New Media?

You are responsible for what your customers do on your site.

Ebay likely contended that by the open nature of its “international garage sale”, it could not possibly contend with every buyer and seller- every transaction that happened, to guard against knock-off merchandise traded as the real thing.  As an almost perfect marketplace, Ebay definitely always comes with the “Caveat Emptor” clause- Let The Buyer Beware- the buyers definitely have to understand, in setting prices they will pay, that is it likely the goods they are getting are not authentic- that’s part of the risk involved.   But regardless, Ebay lost its case for not doing enough to limit the traffic in counterfeit goods, and lost to the tune of $40 million euros- about $63 million dollars.

Clearly, this means things like Craigslist have to begin to take a closer look at the transactions on their site.  For the likes of Facebook, MySpace, Twitter, and more, this may also mean that you could be held liable for things that happen on your site, even if you are not directly involved in the transaction.   I would be particularly concerned that the terms of service be updated with clauses waiving any and all liability for any transactions, personal or financial, facilitated through the site.  Any site connecting people to other people. goods or services is now potentially liable as a thrid party beneficiary to an illegal or immoral transaction, and I would be a bit nervous about the downstream implications of this ruling.

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1 Comment

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One response to “What the Ebay Ruling Means to the Rest Of Us

  1. Former Ebay Seller

    Ebay is going down the tubes, especially after this.

    Ebay is causing sellers to leave in droves, with the new policy changes and tens of thousands of sellers and buyers are irate. The recent changes are just plain idiotic. Sellers can no longer leave negative or neutral feedback, even if a buyer bids, wins your item, ignores your emails and doesn’t pay. What right do they have to leave any feedback, if no transaction has even taken place? We have sellers, bidding on competitors items and ruining their feedback, just to get a boost, on their own items.

    Ebay also went in and retroactively turned all neutrals, into negatives, based totally on an assumption. Neutral, means just that. How can ebay change the meaning of a word, to mean something else? They started giving new discounts to people with good ratings, but they knock them down first, with the neutral change, so that many can’t even meet the requirements, for the discount.

    This is not the worst of it. We have thousands and thousands of sellers, who have closed their stores and we KNOW that the listing count should be going down. But, we have uncovered the source of the raised listing counts and this is how ebay is throwing off the boycott, so investors don’t hear the “Noise”, as John Donahoe calls it. We can’t see it being anything, but fraud.

    The ebay seller BUY or Buy.com was taken on by ebay, right at the time ebay KNEW they were going to lose sellers. They are using buy.com, to pad the listings, to make it look like the count is up, when it really isn’t. We have found thousands upon thousands of fake listings, that have no description and you can’t even bid on them. I personally found them ending tens of thousands of listings early, saying they are no longer available for sale and then immediately relisting them. Most likely to keep the sell through rate up, which was dwindling and then relisting them again, to up the listing count 2 fold. Buy.com, doesn’t pay listing fees, so these millions of listings, are not bringing in revenue. Their sell through rate sits around 3%, last heard, so the listings themselves aren’t bringing in much either.

    If Buy.com’s millions of listings were removed from the count, it would be millions less and shareholders would be wondering what is going on, at ebay. They wouldn’t have to do much searching because their are articles, all over the place. Isn’t this making the stockholders think that listings are up, when they really aren’t? We have all the proof documented. I even have it documented of when I was talking to Ebay Live Help and asking them about all the ads, being ended early and it immediately stopped, when they found out that we knew about it.

    We just feel that shareholders, should know what’s going on and ebay is doing their best, to hide it. We can see what the funds are losing, by going to the following link: http://www.mffais.com/ebay.html
    and just think it is awful, the amounts of money people are losing. We understand a lot of funds are holding on, hoping it will go back up with the new changes, but we don’t see it getting better and just feel that you have a right, to know. Had ebay not made these changes and still had the thousands and thousands of sellers that left, Ebay WOULD be one of the best triving stocks out there, right now. But, instead they have ruined this company!

    You can go here and check out the article, from the Wall Street Journal and you will see that the page takes forever to load, because there are so many complaints about ebay and their new policies.

    http://blogs.wsj.com/biztech/2008/06/24/ebay-angers-sellers-pleases-buyers/

    You can also go to ebays own feedback message board to find thousands upon thousands of boycotters and sellers who are now getting ripped off from the changes. There are even loads and loads of sellers, who have been put out of business, overnight: http://forums.ebay.com/db2/forum.jspa?forumID=113

    Have you seen any of the videos, taken from Ebay Live 2008? Well, have a look:

    Then you have this, the interview on talk radio, where the screaming guy in the first video, calls in: http://www.blogtalkradio.com/fruity

    And you can’t forget the NEW buyers that are coming on to ebay, taking advantage of the new policies. They are all over the place. Before we had a way, when it was a fair playing field, to neg non paying bidders or bidders who do a chargeback and don’t send the item back or they send a box of rocks, instead of the item or they just plain say “I didn’t get it”. It’s really gotten out of hand. I apologize for the content in these next videos, but it is the only way to show, what is really happening:

    Thank you for reading and we hope you at least try to contact ebay, on the padding of FREE listings.

    Tracy and thousands of other ebay members

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