LONDON — L’Oréal’s bid to clamp down on trademark infringement and the sale of counterfeit products on eBay was dealt another blow Friday when the U.K. High Court ruled the online auctioneer is not jointly liable for trademark infringements committed by sellers using its site.
This story first appeared in the May 26, 2009 issue of WWD. Subscribe Today.
The case is one of a series of proceedings initiated in 2007 by L’Oréal against eBay in several countries.
“This is an important judgment because it ensures that consumers can continue to buy genuine products at competitive prices on eBay,” stated Richard Ambrose, head of Trust and Safety at eBay. “As such, it is a victory for consumers and the thousands of entrepreneurs who sell legitimate goods on eBay every day. When companies try to prevent genuine items being sold through the Internet, they demonstrate that they are out of step with consumers, how they use the Internet to shop and, at this time when every penny counts, the importance of shopping around to get the best price.”
In his ruling, the U.K. judge referred a number of issues to the European Court of Justice for guidance and listed 10 measures eBay could take to counteract the sale of counterfeit goods. Those suggestions include filtering listings before they’re posted on eBay and stepping up the detection of listings for unboxed products, testers and not-for-sale items.
“The court agreed with the view held from the outset by L’Oréal, that eBay could do more to prevent trademark infringement,” L’Oréal stated. “The U.K. High Court of Justice considered that the relevant European trademark law and the eCommerce Directive were unclear and referred nearly all the issues to the European Court of Justice for further guidance.
“Since L’Oréal has maintained that eBay cannot benefit from the regime of liability for hosting providers under the eCommerce Directive, it is satisfied to note that the U.K. court preferred its view before referring the matter to the [European Court of Justice].”
On May 13, the Paris High Court ruled eBay is not accountable for the sale of counterfeit L’Oréal products on its French Web site. The court found eBay had implemented means to fight the sale of counterfeit products on its online platform, thereby fulfilling its obligation of fair dealing. A court in Belgium also found in favor of eBay in a similar case in 2008. L’Oréal has since appealed the Belgian court’s decision and the case will be heard before the Court of Appeals in Brussels in 2010.
L’Oréal is not alone in taking eBay to task regarding the sale of counterfeit goods. In 2008, the Internet giant was ordered by French courts to pay compensation to LVMH Moët Hennessy Louis Vuitton and Hermès International, whereas a U.S. court found in its favor in a case involving Tiffany & Co. the same year.