Print 26 comment(s) - last by Fracture.. on Jul 16 at 2:26 PM

  (Source: LiewCF)
Ruling preserves safe harbor for online intermediaries

A federal court in New York sided with eBay in a lawsuit with upscale jeweler Tiffany & Co. Monday, mandating that eBay sellers can continue to peddle designer jewelry without the site policing listings for counterfeit items.

According to U.S. District Judge Richard Sullivan’s 66-page ruling (PDF), eBay’s current efforts at enforcement – which primarily involves responding to takedown requests from copyright and trademark holders – are more than sufficient to keep the site out of liability for inadvertently brokering counterfeit goods.

“It is the trademark owner's burden to police its mark and companies like eBay cannot be held liable for trademark infringement based solely on their generalized knowledge that trademark infringement might be occurring on their websites,” wrote Sullivan.

Filed in 2004, Tiffany’s lawsuit accused eBay of ignoring the sale of counterfeit Tiffany jewelry on its auction site. The suit also alleges trademark infringement due to the sellers’ use of the Tiffany name in product listings, and asks the New York federal court to force eBay to be more proactive in policing its listings for fake goods.

The lawsuit attracted a wide range of spectators, and legal analysts say the suit has important implications for nearly any industry affected by piracy and copyright or trademark infringement. A victory for Tiffany would have set precedent that named content and platform providers – a description that fits a wide variety of names, including eBay and video-sharing site YouTube – as primary enforcers in other companies’ trademarks.

Instead, the judge noted, eBay has a team of 200 employees dedicated to rooting out counterfeit listings, and another 70 that liaise with law enforcement. Further, noted Sullivan, eBay’s automated enforcement software is so aggressive that it’s crashed the site’s computer systems on numerous occasions. Tiffany, on the other hand, spent substantially less time developing its arguments, which include a commissioned survey of goods that Sullivan found to be “flawed” and a paralegal hired to patrol the site for two days a week.

Similar claims, made by media giant Viacom against video-sharing site YouTube, are also working their way through a New York federal court. Some analysts speculate that the Tiffany v. eBay decision could affect that case, however little appears to have happened since Google was ordered to give complete usage logs to Viacom earlier this month.

Sullivan’s decision stands in stark contrast to a similar ruling entered against eBay in France, where the Commercial Court of Paris recently sided with Louis Vitton and ordered the auction site to block sales of all Louis Vitton products – counterfeit or not – offered by unauthorized distributors.

It is expected that Tiffany will attempt to appeal the decision.

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This is actually good...
By n0b0dykn0ws on 7/15/2008 8:26:31 AM , Rating: 2
While I hate the thought of buying a defective or counterfeit item over FleaBay, this ruling is actually good for consumers.

Louis Vuitton and Tiffany want honest sellers and buyers to be punished instead of the real criminals.

This is what happens when they know they can't stop the 'bad guys', just like with piracy.

Someday the technology might be available to genuinely prevent the 'bad guys' succeeding, but it's not today, and it's time to stop screwing the honest people.


RE: This is actually good...
By AlvinCool on 7/15/2008 8:32:11 AM , Rating: 2
Someday the technology might be available to genuinely prevent the 'bad guys' succeeding, but it's not today, and it's time to stop screwing the honest people.

Then if someone wants to sell items from these vendors, like Tiffany's, why not allow them to become Tiffany certified? Then have Ebay mark them as such. Doesn't mean you won't get a Tiffany item from another vendor, but you would be assured of an authentic item from that vendor and they could get a premium. The thought of policing every sale is stupid and not realistic.

RE: This is actually good...
By nvalhalla on 7/15/2008 11:01:20 AM , Rating: 2
and how much would Tiffany charge for such an honor? They don't like people selling their products on ebay at all, that's what this is about. They want you to buy it in stores for a lot more money. They get nothing when it's resold.

RE: This is actually good...
By Nik00117 on 7/15/2008 2:00:35 PM , Rating: 2
Thats what its about, they don't like that poeple are able to sell their stuff cheaper then them. I mean I bet some of the tiffany products on there are gifts that poeple are just selling and it to them w/e they get hey the better.

Either way good job for this judge.

RE: This is actually good...
By FITCamaro on 7/15/2008 8:33:54 AM , Rating: 4
Yeah while I'm not an ebay fan, the company really has no way of 100% monitoring the posting of counterfeit items. It's not like Ebay is knowingly conspiring with counterfeiters.

RE: This is actually good...
By phxfreddy on 7/15/2008 12:53:54 PM , Rating: 1
It would be a horrible ruling for the entirety of Web 2.0 community based sites. As we all know by now that web 2.0 is where it is at. It is powering things in ways that even behemoths like Microsoft can not keep up.

I would rather see every handbag, grab-bag and apple bag be counterfeit than impinge upon this web 2.0 revolution. It is truly inspiring what has happened with it and I can see that the future hold 1000X what we have already accomplished.

RE: This is actually good...
By tmouse on 7/15/2008 8:57:13 AM , Rating: 2
I have very mixed feelings, I fully support the ability of owners to re sell old items they have and in this light it is good for consumers. I strongly disagree with the notion that people should be able to buy fraudulent merchandise, just because they cannot afford the real thing. That hurts everyone who makes anything for a living. It is also dubious if allowing the internet to become a safe haven for this type of activity is good, currently it maybe the minority but rulings like this will increase the scam artists. I do not know how EBay can avoid being damaged in the long run if people start getting ripped off in large numbers. For expensive ticket items I suppose there could eventually be registration numbers recorded automatically at the time of purchase (from the vendors like Tiffany) then when items come up for public sale the agent (EBay) could offer to hold the sale for 24 hours and the trademark holder would have the burden to contact the owner to verify the sale. Cumbersome to be sure but it could work. Now for all of those expensive “gifts” bought on the sly for mistresses then the registration itself would be a disincentive ;)

RE: This is actually good...
By Denigrate on 7/15/2008 9:52:33 AM , Rating: 2
People who can afford to buy the real thing, don't buy it from Ebay. If they are looking for vintage items, they'll likely head to an auction or reputable shop and buy it there. People head to Ebay to do one of two things. Buy something cheaper than they can elsewhere, or try to find hard to find items.

RE: This is actually good...
By johnbuk on 7/15/2008 10:49:51 AM , Rating: 2
And it's those hard to find items that makes this a concern.

I've read too many stories of people buying rare high $ items on ebay only to be sent a counterfeit and then have paypal/ebay deny their claim of fraud because they can't find an expert who will attest that the item is a counterfeit.

I agree that I personally wouldn't buy a high $ vintage item on ebay for that very concern, but it doesn't stop a lot of other people from doing it.

RE: This is actually good...
By Spivonious on 7/15/2008 11:11:18 AM , Rating: 3
There's a sucker born every minute.

Laissez faire.

A fool and his money are soon parted.

There's a reason these phrases exist. Ebay is not responsible for the intelligence of their buyers.

RE: This is actually good...
By Denigrate on 7/15/2008 12:32:30 PM , Rating: 2
Exactly right.

RE: This is actually good...
By Muirgheasa on 7/15/2008 3:09:51 PM , Rating: 2
You forgot

caveat emptor

But yeah, same sentiment.

RE: This is actually good...
By tmouse on 7/16/2008 8:14:21 AM , Rating: 2
People who can afford to buy the real thing, don't buy it from EBay

Well if you’re talking about new items I agree but some want the real thing but cannot afford new so getting a used item at a discount is desirable.

I would also never buy a high ticket item sight unseen from an unknown source. I do believe EBay should have limited itself to handling used items or have a MUCH higher requirement for sellers of new merchandise, to ensure they are not facilitating counterfeiting (this is easy to do with high profile brands as they simply do not bulk distribute so there is simply no way for someone to sell large quantities of new items for less without them being stolen or counterfeit). EBay and others will have to come up with some solution sooner than later because the scam artists will only be increasing and the courts can easily reverse themselves when the harm becomes more evident. Then they will be forced to do things they may not be prepared to do.

RE: This is actually good...
By Some1ne on 7/15/2008 3:15:43 PM , Rating: 2
While I hate the thought of buying a defective or counterfeit item over FleaBay

Why? Because you prefer the idea of paying a 1000% markup for something just because it happens to have some fashion designer's stamp of approval?

Louis Vuitton and Tiffany want honest sellers and buyers to be punished instead of the real criminals.

Louis Vuitton and Tiffany *are* the real criminals. They charge people huge markups simply because of the image associated with their products. They're no better than Apple, really.

RE: This is actually good...
By straycat74 on 7/15/2008 6:51:05 PM , Rating: 3
Louis Vuitton and Tiffany *are* the real criminals.

You forgot the part when they force people to buy them.

RE: This is actually good...
By jhb116 on 7/15/2008 11:56:12 PM , Rating: 2
And that not the worst of it. Have you ever heard that a diamond is "an investment?" Ever try to exchange that ring?

If they can prevent you from selling your ring on Ebay - they effectively have you (all of us) bent over a barrel.

RE: This is actually good...
By Fracture on 7/16/2008 2:26:46 PM , Rating: 2
I was thinking of the same article you linked.
Just want to throw this question out there:

What do you think will happen now that the US ruling contradicts the French ruling?

Understandably, the French restricted their ruling to perfumes and other designer things, but the contradiction is clear.

My attitude is the similar to that of n0b0dykn0ws, that
Louis Vuitton and Tiffany want honest sellers and buyers to be punished instead of the real criminals.

Yes, the French are willing to protect their "industry" by removing these items from the market, but they're going about it the wrong way. Some designers actually price affordably and find normal retail outlets like JC Penney, etc instead of charging the arm and leg that gives rise to counterfeiting in the first place, behavior that the French government should not support.

What about the buyers?
By Suomynona on 7/15/2008 9:42:29 AM , Rating: 2
When they place the burden on the copyright holders to notify eBay of counterfeit goods, it makes eBay even less likely to be proactive in trying to stop auctions of knockoffs. This way, the customer gets the shaft. I've notified eBay of counterfeit goods that I've bought and that I've seen for sale, and they've done absolutely nothing about it. They honestly don't seem to care, as long as they aren't being sued.

There shouldn't be a precedent that extends to content-hosting sites, because in this case there are two victims: the IP owner, and the sap who gets stuck with a knockoff. I'm not that concerned about the IP owner, but the person who buys a fake item (whether it's a Louis Vuitton bag or a memory card) actually loses money.

RE: What about the buyers?
By Seemonkeyscanfly on 7/15/2008 10:57:35 AM , Rating: 2
Way to much stuff for sale to watch over everything. The article says e-bay goes after counterfeit, but I'm sure they miss more then they get.
I think the counterfeiter should just sell as knock-offs and tell people straight up. Call them selves Siffany's or something. If they can take a $10,000 Tiffany's item and make something that looks the same for $300.00 - there will be a market for it. Just do not claim to be the real thing.

RE: What about the buyers?
By Spivonious on 7/15/2008 11:12:33 AM , Rating: 2
It would still be a copyright violation though, as the counterfeiters are copying Tiffanys' design.

RE: What about the buyers?
By Seemonkeyscanfly on 7/15/2008 11:24:14 AM , Rating: 2
It's been done all the time. Example back in the 80's a Mazda use to copy Porches body design (very minor changes). Ford probe and Mazda I think it was the rx7... And of course clothing lines copy each other like crazy. They just need to be a little different, hence knock-off. Yep, sucks for the original but chances are the knock-offs are selling to someone who would never buy the original or could never afford the original. The original line will always maintain their core customers.

RE: What about the buyers?
By Suomynona on 7/15/2008 1:26:59 PM , Rating: 2
I don't expect them to trawl through every listing, but they don't even take action when you report something as a counterfeit. I've seen memory cards for sale that were supposedly from SanDisk that were in capacities that they don't even make, and eBay did nothing when I reported them. They only seem to care when a copyright holder reports something, because then they can actually face legal action.

I'd like it if sellers would just tell people that they were selling knockoffs, too, but of course the IP owners wouldn't. I wouldn't really care if people sold counterfeit goods if they didn't lie and say that they're genuine.

Ebay then and now
By 325hhee on 7/15/2008 10:35:08 AM , Rating: 2
I used to use Ebay, when they were just an auction site, but now they've become commercial and a retail site. I have mixed feelings on the ruling. For the seller who got duped unknowingly, it sucks for them, for the buyer, well, when you see a $10k item for $200, well, they should know better.

Now on the other hand, anyone that wants a genuine LV, Tiffany, etc. Why would they go to Ebay? It makes no sense whatsoever, and they'd have their own personal shopper go to those stores for them. Or if they want a truly vintage item, they'd go to something like Sotheby's and Christie's. People with money would know better than to trust Ebay, plus sellers with a real item, and wants to make the most money off it, would have it appraised by companies like Sotheby's and Christie's and auction it off there. Where they are insured they won't get scammed by a fake bank check, or delinquent payment.

Ebay is a dumping ground, for crap, junk, low end items. Then they also have the certified stuff like cars, boats, etc. You're either buying from one end, or the other. Anyone out there buying some kind of high end named brand stuff, knows they're buying knock offs. No one is that naive to believe otherwise.

I liked the old Ebay where people just wanted to get rid of stuff, at a discount. I collect some trinkets here and there, but now, everybody thinks they have gold, and are asking way too much for stuff. Even Craig's List has gotten out of hand. Sellers are getting too stupid and greedy, and sorry, an album cover with out the vinyl album itself is not worth more than $10, with exceptions to autographs. It's sick when people ask $100 for an album cover with no record or autograph. I hope Ebay dies, because of their commercialism BS.

RE: Ebay then and now
By maven81 on 7/15/2008 2:43:13 PM , Rating: 2
Ebay is a dumping ground, for crap, junk, low end items.

Sadly that's not true. I agree with pretty much everything else you said, but there are plenty of high end items on ebay. To name just two that I have bought and sold: musical instruments and telescopes/camera gear. This wouldn't be so bad if the greediness of both sellers and ebay themselves had some bounds. I've seen countless things that the seller even admits were bought at an estate sale (probably for almost nothing) with a starting bid that's absolutely laughable...

From what I can tell
By dflynchimp on 7/15/2008 8:43:53 AM , Rating: 2
The judge basically told Tiffannys to stop whining about potential counterfeiting when they effort they spent on trying to prove their case is significantly less than what Ebay routinely spends on removing bad listings.

Now if only the judge that presided over the Viacom case were the same...*sigh*

It's not EBay's fault.
By Spivonious on 7/15/2008 11:09:07 AM , Rating: 2
Why doesn't Tiffanys go after the actual EBay sellers? I'm sure EBay would be glad to provide their mailing addresses if Tiffanys had good reason to believe the items were spoofs.

The phrase "don't shoot the messenger" comes to mind.

"We’re Apple. We don’t wear suits. We don’t even own suits." -- Apple CEO Steve Jobs

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