A French court has ordered online auction site eBay to pay Louis Vuitton owner, LVMH, £1.5m for failing to prevent the sale of LVMH products on its website.
The ruling follows an injunction issued by the French courts in July last year barring the sale or purchase of any LVMH products on eBay, irrespective of their authenticity.
The injunction came on top of a £37m fine imposed on eBay for not doing enough to prevent counterfeit goods being sold on its site.
The court heard that more than 1,000 LVMH products have been advertised on eBay's site since the injunction was imposed.
eBay said it had complied with last year's ruling by deploying specialist software to try and prevent French internet users from accessing LVMH products.
Pam Withers, a partner at intellectual property firm Marks & Clerk, said the ruling, and attempts by eBay to comply with the injunction, prove just how difficult it is to police brands online.
But French courts have tended to look more favourably on brand owners than other jurisdictions, which means the ruling will not necessarily lead to similar decisions elsewhere in Europe, she said.
According to Withers, the main concern of brand owners is about counterfeiting and whether or not online marketplaces should be compelled to take greater steps to stop brand abuse.
The second issue is about whether the rights of those brand owners should extend to things like selective distribution rights and whether comparative advertising in a search engine constitutes trade mark infringement, she said.
"The internet is an international channel that requires a much more co-ordinated response, which is ultimately in the interest of brand owners, consumers and online forums alike," said Withers.
This kind of approach would increase confidence of brand owners and online consumer sites and should curtail abuse by more effectively and consistently punishing the real offenders, she said.