According to The New York Times, Tiffany & Company is sueing eBay "for facilitating the trade of counterfeit Tiffany items on [its] site." It says:
If Tiffany wins its case, not only would other lawsuits follow, but eBay's very business model would be threatened because it would be nearly impossible for the company to police a site that now has 180 million members and 60 million items for sale at any one time.
eBay buyers are supposed to be protected by the reputation system, but they aren't. The story says that people trading in fakes trade with each other to boost their seller status and "regularly dole out positive feedback to each other to fool potential buyers". Meanwhile, "Buyers and sellers are often reluctant to leave bad reviews, lest their own reputations suffer. "
