When are online marketplaces responsible for the goods sold on their sites? For eBay, this is more than a theoretical question as it finds itself in European courtrooms facing designer brands over the issue of counterfeit items for sale on its site.

On Friday, LVMH issued a press release to say the Paris Tribunal de Grande Instance found eBay responsible for brand counterfeiting. Pierre Gode, Director of LVMH Group, said, "The Tribunal has ruled that eBay, in using in its advertisements the keywords of some of LVMH's brands, has committed acts of counterfeiting through reproduction or imitation." The Tribunal ordered eBay to pay LVMH 80,000 euros. The Tribunal has also forbidden eBay from continuing any such activities and will enforce a fine of 1,000 euros per future infringement.

eBay issued a press release to say that in the Dior case relating to the use of trademarks and buying keywords for search engines, eBay was satisfied that the court rebuked Parfums Christian Dior request for EUR4 million in damages. "However, the decision flies in the face of the recent legal victory by eBay on appeal in Belgium in February in a similar action opposing eBay to Ralph Lauren. We await with anticipation the European Court of Justice to rule on adwords-related issues in the two Google cases referred to it in the near future."