This week a french court ruled eBay had to pay $63 million to Louis Vuitton for not doing enough to prevent counterfeit goods on its website.  eBay is even liable for users selling legit products because Vuitton claims no one can resell its products.

This ruling makes eBay responsible for the actions of its users.  One of the only good parts of the United States’ DMCA are the Safe Harbors which means service providers, like eBay, cannot be held responsible for what its users do.  This allows websites and ISPs to focus on providing services and goods for users without worrying about legal responsibility if things are taken out of hand.  France doesn’t have the same protection.

The problem is somehow eBay is expected to know what’s counterfeit and what’s real.  A similar argument is being made against YouTube over copyright, claiming its too much work for copyright holders to police the site so YouTube should do it itself.  How is eBay supposed to know what’s allowed to be sold and what isn’t?