eBay Faces a Credibility Problem

Consumers unknowingly purchase risky counterfeits.

February 14, 2017, Los Angeles, CA – Consumers should have confidence and expect authentic, safe products when they shop on eBay, but that’s not what happens.

At issue is eBay’s illusory claim; "You can't list replicas, fakes, counterfeits, or other illegal copies on eBay." The fact is that counterfeit and replicas can be, and are, easily listed on eBay. The same sellers often repeatedly re-list counterfeits which may be dangerous or even deadly despite repeated notifications to eBay.

Counterfeit products are replicas of real products, designed to take advantage of the superior value and reputation of the real product. eBay is proving to be an ideal platform to distribute counterfeit goods -- an activity that is profitable, difficult to track and widely unpunished. The move is drawing an avalanche of counterfeits from both U.S. and global sellers, and criticism from manufacturers.

eBay is migrating from the auction house of garage sale items and concentrating on global Marketplace sales of new items (80%) at a fixed price (86%) from un-vetted global sellers. The counterfeit products are visually deceptive, may be dangerous, and consumers are best advised to avoid trademarked items and buy directly from the manufacturer or authorized retailers.

For example, The Counterfeit Report identified over 2.8 million counterfeit items on eBay and reported over 1.9 million to eBay for listing removal on behalf of trademark holders. The counterfeits included electronics, over-the-counter (OTC) drugs, sporting goods, children's toys and fragrances. All were represented to be covered under eBay's Money Back Guarantee, while eBay reported over 560,000  counterfeit items had already sold to eBay consumers. The Counterfeit Report also purchased and received over 2,300 products from eBay sellers. All were counterfeit.

What’s the credibility problem?

• Deceived eBay buyers are never told by eBay they received a fake or dangerous item and may be entitled to a refund.
• There may be no indication in eBay seller profiles of a counterfeit sales history, despite some sellers having over 100 counterfeit listings removed by The Counterfeit Report.
• After being reported to eBay, the sellers usually remain and often relist items that are again removed.
• eBay has publicly admitted to allegations of deleting negative feedback, and removing counterfeit comments and warnings protecting consumers from dangerous products.
• Weary of the The Counterfeit Report's test purchases, eBay blocked The Counterfeit Report's test purchase accounts and by extension, protections afforded eBay consumers, yet allowed the counterfeit sellers to remain.

Could you identify these counterfeits listed or purchased on eBay?.

(Photo: The Counterfeit Report® - left to right)

1. Tiny microSD® computer memory cards are used in cell phones, cameras and laptops.  Authentic microSD cards bear the microSD trademark which owned by SD-3C, LLC, who licenses its use to authentic, conforming products. Memory on counterfeit cards is usually not the capacity of what is published on the card and the fake items may fail. When that happens, you are likely to lose your data, images, and damage your equipment. None of the items shown above from eBay are authentic. The Counterfeit Report reported 1,328,397 infringing items to eBay in 2016, with eBay reporting that 70,233 counterfeits had already been sold to eBay consumers. There is no such product as a 64GB microSDHC® card -- an obvious fake. Many infringing variations of the fake products remain listed.
2. The materials used in these counterfeit Lego® products is unknown, may be toxic, break and present a choking hazard to small children.
3. Composite Resources has supplied their Combat Application Tourniquet® (C-A-T®) to the U.S. Military, police departments, first responders, and the public worldwide for the past decade. Counterfeit versions of the C-A-T tourniquet have catastrophically failed during actual life-saving applications. The Counterfeit Report reported 43,623 infringing items to eBay, with eBay reporting that 14,559 or more counterfeits had already been sold to eBay consumers. The counterfeit items remain listed, often by the same sellers.
4. Dr. Numb® is a topical 5% Lidocaine anesthetic numbing cream. Counterfeit Dr. Numb products are being sold on eBay at attractive prices, but the ingredients are unknown. The Counterfeit Report reported 4,609 infringing items to eBay. eBay reported that 1,545 counterfeits had already been sold to eBay consumers. The counterfeit items remain listed.
5. Federal, state and local laws regulate the sale, purchase, possession and display of fake badges, as of course does common sense. eBay policy also specifically prohibits most police badges and items. However, replica current issue LAPD, FBI and other law enforcement badges are listed on eBay and available to terrorists, child predators and other criminals. Repeated notices to eBay CEO, Devin Wenig, senior management and general counsel about the alarming practice have been acknowledged, but ignored.
6. Counterfeit Apple USB Adapters have caused one death, fires, injuries and equipment damage but are common on eBay.
7. DrewTech's MongoosePro interface cable is used by repair technicians and auto dealers to program vehicle computers including braking, emission. performance and safety features. Counterfeit Mongoose® products may severely damage your vehicle, and install malware on your computer. The Counterfeit Report reported 382 infringing items to eBay. eBay reported that 206 counterfeits had already been sold to eBay buyers. The authentic product is not made in purple - an obvious fake.
8. Skunk2's Rear Lower Suspension Control Arms are direct replacements for a vehicles original suspension parts  You are risking your life, and the lives of others, using untested and unproven counterfeit suspension parts. Counterfeit parts may fail at a critical time causing injury or death. The authentic Skunk2 model is not made in green - an obvious fake. The counterfeit items remain listed.
9. Counterfeit EO Tech holographic weapon sights can jeopardize the safety and lives of American soldiers and law enforcement officers as many of these counterfeits were sold as genuine L-3 EO Tech products.

e-Commerce giant eBay is no stranger to allegations of selling counterfeit goods, not adhering to its own policies or cracking down on counterfeit goods listed on its website. eBay allows the sale of millions of dollars of counterfeit goods to unsuspecting consumers, while collecting transaction fees on each sale.

However, eBay claims it's "just a venue" and has immunity for counterfeit sales under eBay's often cited 2008 Tiffany (NJ) Inc. v. eBay Inc.2 lawsuit. However, conscious avoidance of knowledge can be enough says the Hon. Michael Mukasey, United States Attorney General (2007-09) and U.S. District Judge (1988-2006).

Companies that facilitate criminal activity and benefit from the proceeds of dishonest actions that impact jobs, consumer safety and public trust create a public perception of deception and impunity. However, reputation damage is only a small part of the problem: counterfeiting costs U.S. manufacturers over $250 billion, U.S. workers over 750,000 jobs, and supports criminals and terrorists while manufacturer's brand integrity is tarnished or destroyed.

Some issues are debated – and decided – in the court of public opinion where consumers will decide if eBay must provide honest services and present information in a clear, truthful and professional manner. Other issues will be decided in a court of law.

eBay can adopt real and effective solutions to end the counterfeiting problem that it enables. Will it?