L'Oreal loses test case against eBay
Published 22/05/2009 | 14:26
Online "marketplace" eBay claimed victory today in a High Court test case brought by cosmetics giant L'Oreal.
A judge in London ruled that eBay was not jointly liable for trade mark infringements committed by its users.
Mr Justice Arnold announced his decision in the latest of a number of cases brought by L'Oreal in courts around Europe.
The judge said one of the main questions raised by the claim by L'Oreal was 'is eBay Europe liable for trade mark infringements committed by its users?'
In a lengthy written ruling he held that it was "not jointly liable" for such infringements.
L'Oreal had argued eBay was liable for counterfeit goods and parallel imports sold on its website which breach the Paris-based cosmetics giant's trademark.
Ebay's case was that it simply provided a trading platform for consumers to buy and sell products.
L'Oreal lost a case against eBay in Belgium last year, but other retailers have won cases against the site.
A commercial court in Brussels said eBay does not have to police its site to prevent counterfeit products from being sold.
After today's ruling, Richard Ambrose, eBay's head of Trust & Safety, said: "This is an important judgment because it ensures that consumers can continue to buy genuine products at competitive prices on eBay.
"As such, it is a victory for consumers and the thousands of entrepreneurs who sell legitimate goods on eBay every day."
In a statement issued after the ruling, eBay said that last year it hosted 2.7 billion listings globally and "only 0.15% of them were identified as potentially counterfeit".
It said today's ruling, along with similar judgments in France, the US, Germany and Belgium "reinforces that eBay is a safe and trusted place to shop".
Mr Justice Arnold said it was "common ground that over the last few years counterfeiters have become increasingly sophisticated in their attempts to replicate the appearance of genuine cosmetics and fragrances".
He said: "As a result it is increasingly difficult even for experts to identify counterfeit products by visual inspection. Often it may only be possible to identify a counterfeit product by chemical analysis."
L'Oreal had contended that eBay Europe could do more to prevent, or at least minimise, sales of counterfeit and other infringing products on the site.
The judge said he was in no doubt that it would be possible for eBay Europe to do more than it currently does, but that did not necessarily mean it was legally obliged to do so.
He suggested a number of possible steps, including filtering listings before they are posted on the site and using additional filters, including filters to detect listings of testers and other not-for-sale products and unboxed products.
Mr Justice Arnold pointed out: "There is nothing in eBay's systems and policies which favours or encourages the listing or sale of counterfeit goods.
"On the contrary, eBay Europe takes active steps to prevent or at least minimise such activities. The fact that eBay could take further steps does not affect this."
After the ruling, L'Oreal issued a statement welcoming the judge's "guiding comments on measures to prevent trade mark infringement on eBay's UK platform".
The company said the court "agreed with the view held from the outset by L'Oreal, that eBay could do more to prevent trade mark infringement" and had suggested 10 measures.
Commenting on the fact that the judge had referred other issues of law raised by the case to the European Court of Justice for further guidance, L'Oreal said it "remains confident of a positive outcome".