Posted by Frank Reed

EBay has the “honor” of being in the Wall Street Journal headlines twice today. So what do you want to read about regarding eBay today; trademark infringement or merchants leaving eBay for other smaller niche auction sites ? Looks like eBay may want a little ORM in place to handle this current flood of “news”.

For this post’s purposes we will look at the trademark story. On the heels of a July victory stemming from a 2004 suit brought against them by Tiffany & Co. regarding the sales of fake goods on the auction site, eBay will have to suffer through the appeals process before victory is theirs. Apparently Tiffany’s doesn’t agree with the ruling handed down by US District Court Judge Richard Sullivan. It was Tiffany’s contention that eBay was not doing enough to prevent counterfeit goods from being sold on their site. The ruling stated that trademark holders like Tiffany’s, not eBay, “bore the main responsibility for monitoring eBay’s auction site for fake goods.” Tiffany’s response was “that the court’s ruling failed to apply established principles of trademark law.”

Well, eBay seems to be just fine with the ruling regarding its responsibility in the sale of fake goods via their site auctions. In fact, eBay has taken a few legal shots regarding this in European courts so a victory was a nice change of pace. eBay’s response was:

“Tiffany’s decision to carry this litigation on after the District Court’s decision doesn’t do anything to combat counterfeiting. The best way to stop counterfeiting is ongoing collaboration between companies, government agencies and law enforcement.”

Nice way to eliminate themselves from that process, huh? I gotta believe that eBay should have SOME responsibility in policing this stuff. It’s like saying that iTunes shouldn’t be responsibility for any licensing of songs they sell. Just let them collect the cash and then the record companies should be the trademark cops. Seems to me that both parties should have some stake in making sure that the customer is not getting ripped off if indeed they actually believe they are getting Tiffany’s jewelry. Chances are anyone who is able to afford that kind of thing isn’t fishing on eBay for a bargain anyway.

So where should the line be drawn? When selling and reselling goods online who should be legally responsible for the policing of trademark issues? Should internet marketers be able to simply wash their hands of the obligation? Is there an ethical or moral aspect to this as well? Lots to consider and it should be interesting how this ruling does or does not hold up under the appeals process.

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This entry was posted on Wednesday, August 13th, 2008 at 1:23 pm and is filed under News. You can leave a response, or trackback from your own site.

About the Author: Frank Reed's blog Frank Thinking About Internet Marketing provides practical advice and insight for Internet marketers from local SMB's to Fortune 500's. Frank provides Internet marketing services through FT Internet Marketing, Inc. In addition, Frank is a regular contributor to Andy Beal's Marketing Pilgrim and Mike Moran's Biznology blogs.