A lawsuit filed by jeweler Tiffany & Co. opened in court earlier this week with the jeweler accusing eBay of violating its trademark rights by failing to stop the sale of counterfeit items on its site.
The case which had been filed in the Manhattan’s US District Court in 2004 will be tried before US District Judge Richard Sullivan and is scheduled to go on through November 21 2007.
Tiffany has alleged that eBay should engage in automatic screening of its listing for counterfeit products on its website. It objected to the company’s policy which required trademark holders to bring counterfeit items to its attention.
Tiffany’s lawyer, James Swire said that eBay had been on notice since 2003 against the counterfeit Tiffany jewellery sold on its website. He then charged the auction website with contributory infringement on behalf of his client.
eBay’s lawyer, Bruce Rich countered: The company is always working to improve its efforts to root out sellers of counterfeit items and has responded when Tiffany had specific complaints. He said that eBay responded at a better rate than 99.9% to specific complaints about sellers hawking counterfeit Tiffany items.
Noting that eBay had a program since 1998 called Verified Rights Owner Program which worked with trademark holders to report and take down listing for counterfeit items, Mr Rich said that the company spends more than $10 million annually to clean counterfeit merchandise from its site, which carries 6 million postings a day.
While Mr Swire said that 75% of 325 items advertised on the eBay website and purchased by Tiffany were counterfeit, Mr Rich claimed that many sellers had been suspended after reports of counterfeit sales and a large number were permanently banned.
The decision could set a precedent for trademark owners like Gucci, Prada and auctioneers like eBay to change the way they handle auctions of products with famous trademarks.
Source: ComputerWire daily updates