Ebay have secured a win in the high court battle against luxury brand L'Oreal for trademark infringements that have appeared on their site. This win is expected to end all court action against the online auction giant.
The High court ruled that Ebay does not have a legal duty to protect other firms trademark rights and that any future problems should be consolulted with Ebay rather than resorting to the law.
The High Court case was the latest in a long list of actions by L’Oréal, Louis Vuitton, Tiffany, Christian Dior and others, who felt that their businesses were being damaged by the often high level of counterfeit goods carrying their brands that appeared for sale on eBay.
They had argued that Ebay has a duty to ensure that products of such nature do not appear on the site and that Ebay was jointly liable for those breaking the law because they were aware of these breaches and profited from them. Ebay argued that they spend $20 million dollars a year attempting to tackle such problems and removing content that has been brought to their attention.
The High Courts decision to award the case in favour of Ebay was based on the precedent case of Sir Alan Sugar's Amstrad v Record Industry in 1986. When the record industry tried to hold them responsible for selling tape recorders to people they knew would use them to record music from vinyl discs, thereby infringing copyright. Now, as then, the judge ruled that such knowledge, in itself, was not enough to make the supplier (eBay/Amstrad) jointly culpable with the infringer under the law.
The judge ended by saying that Ebay should take more responsability for the products on its site due to their highly risky business model and expressed his sympathy for L'Oreal's position.