EBay, British luxury goods group to talk counterfeit sales

Meeting comes on heels of differing rulings on who bears responsibility for preventing sales of bogus goods

Intellectual property lawyers from eBay and Walpole British Luxury, a group that represents the British luxury goods industry, are meeting Monday in London to discuss ways they can work together to prevent the sale of counterfeit goods online.

The meeting comes after courts in the US and France gave contrasting rulings on the issue of who is responsible for averting the sale of counterfeit goods on Web sites.

"Basically these are exploratory talks because we have two different rulings in two different jurisdictions," said Gavin Davis, a Walpole spokesman in London. "And Walpole just wants to speak to eBay to see what both groups can do going forward."

Davis said the meeting was a first step to discuss ideas that could lead to an agreement between the two parties in collaborating to prevent the sale of counterfeit goods on eBay.

"As part of eBay's ongoing commitment to fighting the global issue of counterfeits and protecting our users when they shop online, we constantly collaborate with brands and rights owners as well as local and global organizations, governmental associations and law enforcement," said eBay spokeswoman Nichola Sharpe in an e-mail. "We feel that collaboration is key and this meeting is just an example of the ongoing relationship building we do."

Last week, federal Judge Richard Sullivan for the Southern District of New York, ruled in favor of eBay in concluding that Tiffany & Co. was responsible for monitoring the eBay Web site for counterfeit Tiffany goods and for bringing those counterfeit goods to eBay's attention.

In 2004, Tiffany sued eBay, claiming that the online auction site didn't do enough to keep counterfeit goods off its Web site. EBay disagreed, saying it already took steps to stop the sale of counterfeit goods through its Verified Rights Owners (VeRO) Program, which provides tools to help companies look for phony goods. Under the program, if a company determines that a user is selling counterfeit merchandise, it notifies eBay, which immediately takes down the auction.

However, in June, the Tribunal de Commerce in Paris fined eBay US$61 million for allowing the sale of Louis Vuitton Malletier and Christian Dior Couture counterfeit goods on its Web site. That decision came on the heels of a similar ruling by a separate French court that ordered eBay to pay US$31,000 to Hermes International for selling fake Hermes handbags.

"The court decisions on both sides of the Atlantic seek to place the full burden of policing online fakes on either the online auctioneers or the trademark owners," said Frederick Mostert, chairman of the Walpole IP & Brand Protection Working Group, in an op-ed piece in the Financial Times last week.

"Policing the World Wide Web for an exponentially growing giant wave of counterfeits is a Herculean burden. Tiffany, Louis Vuitton and other luxury good manufacturers chafe at having to commit unlimited time and resources to police auction sites and their growing number of counterfeit listings."

Mostert said more needs to be done and both sides need to work together to prevent the sale of counterfeit goods online.

"The answer for assessing responsibility lies in the middle - both sides should, in equal measure, diligently confront the online counterfeit problem together," he said.

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