eBay Sellers Face Federal Counterfeiting Lawsuit

eBay Sellers Also Targeted in Federal Lawsuit Naming eBay, PayPal

August 26, 2015, Los Angeles, CA – Making a quick dollar selling counterfeit products on eBay^® may have the appearance of little risk and great reward. However, a handful of eBay sellers got a surprise this week when they were also identified in the same Counterfeiting and Federal Racketeering (RICO) lawsuit facing eBay^® and PayPal^®.

Counterfeiting is a crime, and counterfeit sellers on eBay may face fines up to $2-million per infringing trademark and other damages. The financial exposure and consequence for the sellers can be substantial. Some sellers have sold tens-of-thousands of counterfeits on eBay, yet remain.

A two-year investigation by The Counterfeit Report^®, and over 1,000 counterfeit products were received from eBay sellers yet the counterfeit complaints fell on deaf ears. Many of the products and sellers remain on eBay, and sales continue to unsuspecting consumers.

Yet, there is still a perception, “what does it hurt?”

Counterfeiting is a $1.7 trillion industry, the largest criminal enterprise in the world. Counterfeits damage manufacturer’s brands and reputation, destroy hundreds-of-thousands of U.S. jobs, and dupe U.S. consumers out of billions of dollars. Poor quality or unsafe counterfeit products often prove dangerous or deadly.  For example, there are 250,000 counterfeit airbags in US automobiles that don’t work. (source: NHTSA)

One manufacturer involved in The Counterfeit Report test purchases reported over 1-million counterfeits of their $29.95 MSRP product sold on eBay. The financial impact to the manufacturer is devastating.

These counterfeit sales have been a lucrative revenue source for eBay sellers, and transaction fees are charged by e-commerce giant for each sale of fake goods.

Could you spot these counterfeit products purchased on eBay?

Shown: Chanel No. 5 EDP, SanDisk 64GB micro SDHC memory card, Lunatik Epik Apple iWatch Case and TakTik Extreme iPhone case, Monster Tron T1 headphones, and a Group-A Autosports lower automobile suspension control arm is available at view the image. (photo: The Counterfeit Report).

Sellers, as well as e-commerce giants eBay, Amazon and Alibaba should expect civil and criminal consequences when they choose to sell or facilitate the sale of counterfeit products.

A copy of the eBay/PayPal complaint, Case 8:15-cv-01330, can be downloaded here (.pdf)