The European Court of Justice (ECJ) says that online market places, such as eBay, should not be exempt from liability if it is proved that they have assisted – meaning they have knowledge of or control over – companies advertising counterfeit goods on their sites.
The ruling reads that sites could be held responsible if they are found to be “optimising the presentation of the offers for sale in question or promoting those offers”.
It adds that auction sites will not be exempt if they are found to have played an “active role of such a kind as to give it knowledge of, or control over, the data relating to those offers for sale”.
It will now be up to national courts in European Union member states to interpret the ECJ’s ruling in similar cases brought by either brand owners, or online auction platforms.
The ruling was on a case brought by L’Oreal. The cosmetics company originally voiced concerns about trademark infringements in 2007, accusing eBay of damaging its brand by using L’Oreal trademarks as sponsored links to lead users to perfumes and other cosmetics that infringe trademarks. EBay denied this.
A case was brought in the High Court in London before being referred to the ECJ last year.
Tania Clark, partner and trade mark attorney at law firm Withers & Rogers, says brand owners will welcome the ruling
“Brand owners will be breathing a sigh of relief – the outcome of this case was far from certain. They have won the right of recourse against online auction sites, which may now be held responsible for the legality of the products they sell.”
A L’Oreal statement says it is “satisfied” with the ruling, which is a “step towards effectively combating the sale of counterfeiting brands and products via the internet”.
EBay, says it provides “provides some clarity on certain issues”.
A spokesman adds: “As a marketplace, eBay provides a level playing field for all online sellers and will continue building constructive partnerships to expand the range of brands being sold on eBay.”