Photo/Shetuwang

Mar. 19 (NBD) -- Estee Lauder, one of the world's leading cosmetics firms, has sued e-commerce platform NetEase Kaola for infringement, claiming 1.2 million yuan (178,899 U.S. dollars) for compensation.

As per requirements of the French company, NetEase Kaola shall stop infringing on and selling M.A.C. products and disclose the sources of goods, and the e-commerce firm and other defendants shall destroy infringing products and publish an apology for 30 consecutive days.

Estee Lauder took NetEase Kaola to court at the time when the lawsuit the e-commerce site filed against the skincare giant is still pending.

The feud began from early last year when the China Consumer Association, using authentication results from Estee Lauder's Shanghai unit Estee Lauder Trading, called the 15-ml eye cream of Estee Lauder sold on NetEase Kaola counterfeits in a report regarding the country's Double 11 shopping festival.

NetEase quickly responded, saying that its sourcing chain is clean and reliable and the company sells authentic products purchased from abroad.

In order to clear its name, the e-commerce company sued the CCA, Estee Lauder Trading and its parent Estee Lauder as well as the website which published an article about the CCA's report and circulated the information.

While exchanging bills of complaints with Estee Lauder, NetEase Kaola has been entangling with Canadian Goose over the authenticity of a long down jacket a lady bought on the shopping site.

NetEase Kaola argued on its official website that it directly sources goods from the brand owners or certified dealers.

Behind the drama lies the incompatible contradiction between brands' direct sales and dealers, in essence, conflict of benefit.

For instance, Canadian Goose has opened a flagship in Beijing, the very first in Mainland China, and started emphasizing expansion of direct-sale channels, with surging popularity and recognition of its brand. And, for the parka manufacturer, it's important to get a hold of interests via its direct-sale channels in order to better tap the Chinese market with great consumption potential.

It's safe to say NetEase Kaola is standing on the opposite side of direct-to-consumer brands.

Cao Lei, head of China e-Business Research Center, once noted that online trans-border platforms source merchandises from many countries, regions and places of origin and via a number of channels. Such complicated sourcing chain, plus customs clearance, warehouse storage, delivery and other links involved in cross-border purchases, increases risks in guaranteeing product authenticity.

NetEase Kaola is being questioned constantly over the authenticity of its commodities, while the company has long started dealing with the problem.

This February, the e-business platform was reported to be looking to merge with the Chinese business of U.S. e-commerce giant Amazon. NetEase Kaola may get access to Amazon's global supplier source through the tie-up.

But this is not a done deal yet. NetEase Kaola hasn't found the exact cure for the Rashomon effect clouding its commodities.

Cao advised that related government department can set up a registration system where shopping sites and vendors report the imported goods and ensure follow-up tracking.

Email: gaohan@nbd.com.cn