A federal district court judge in Manhattan has dismissed the sole remaining charge of false advertising in Tiffany & Co.’s lawsuit against eBay Inc., potentially closing out the six-year-old case.
In a decision Friday that was available in court records Monday, U.S. District Judge Richard Sullivan concluded, “Tiffany failed to establish that eBay ‘intentionally set out to deceive the public,’ much less that eBay’s conduct was of an ‘egregious nature’ sufficient to create a presumption that customers were being deceived.”
Tiffany filed its lawsuit in 2004, seeking relief on claims for direct and contributory trademark infringement, unfair competition, false advertising and direct and contributory trademark dilution. In July 2008, the district court ruled in favor of eBay on all claims.
The federal appeals court in April 2010 affirmed the lower court’s ruling, with the exception of the claim of false advertising, which was remanded back to the district court for further review. Tiffany said at the time that it was considering an appeal to the Supreme Court.
A spokesman for Tiffany declined comment on the latest ruling on false advertising. He noted the company last month filed a “petition for [a writ of] certiorari with the U.S. Supreme Court on the trademark issues decided [in April] by the Second Circuit” Court of Appeals.
In Friday’s decision, the district court noted that a false advertising claim may arise from one of two reasons: either that the challenged advertisement is literally false or that, while not literally false, is likely to mislead or confuse customers. As for the first premise, Sullivan pointed out that both courts have determined that advertisements made about Tiffany merchandise “are not literally false.”
Considering the second theory, Sullivan said the “record is clear that [Tiffany] failed to prove at trial that eBay ‘intentionally set out to deceive or mislead consumers.’” WhileTiffany argued that eBay’s intent to deceive was proven by the auction site’s “continued advertising [of] the availability of Tiffany’s products on its Web site after it had been notified that a sizable portion of the products were counterfeit,” the court pointed out that the contention was first raised in a June 2010 letter to the court. Since it was raised neither before, during nor after the first trial, or on appeal, that argument was deemed “waived” by the court.