By Catherine Bosley

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BERLIN, Sept 28 (Reuters) A German court on Friday overturned the conviction of a man who was found guilty of purchasing stolen goods over eBay in a case which may have hurt the online auctioneer's business in its top market after the United States.

A state court in the southwestern city of Karlsruhe ruled in favour of the 47-year-old software engineer because he had not known that a car navigation system he bought over eBay two years ago had been stolen, a spokesman for the court said.

In the summer of 2005 the man had purchased the navigation system, which was advertised as ''brand new'', for less than a third of its usual price.

German police later determined that the device had been stolen.

In a previous ruling, a lower court in Pforzheim had fined the man 1,200 euros, arguing that the low price should have been a tip off that the device was stolen.

Web sites such as eBay thrive on offering steeply discounted prices, most of which have been legitimately acquired.

Earlier this year, a top German court ruled that eBay must do more to halt the sale of counterfeit goods on its site.

That ruling came in an appeal by plaintiffs Montres Rolex SA and affiliates in a six-year old dispute over the sale of fake Rolex watches on the auctioneer's German site.

On Sept. 4 eBay launched a revamp of its German Web site saying it needed to raise listings and the volume of goods sold.

REUTERS DKS ht1946

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