When a Federal judge ruled eBay (EBAY) couldn’t be held liable for auctions on its site that violated chichi jeweler Tiffany’s (TIF) trademarks in July, the appeal was inevitable.
But a decision in favour of Tiffany’s could have ripples thoughout e-commerce, and this week Amazon (AMZN) and Google (GOOG) filed friend of the (appellate) court briefs arguing e-Commerce outlets can’t possibly be expected to distinguish authentic goods from counterfeits.
Tiffany itself concedes that it cannot in good faith attest that a particular listing contains counterfeit goods absent manual inspection of the listing by a Tiffany employee—a task that Tiffany characterises as overwhelming notwithstanding its specialised knowledge of Tiffany’s brand, products, and typical knockoff products. That burden would be crushing for eBay and similarly situated service providers, which would, under Tiffany’s proposed regime, have a similar duty with respect to not only Tiffany’s marks, but also thousands of other marks around the globe.
Faced with the infeasibility of screening out even a small proportion of counterfeit goods and the consequent risk of liability for infringement and substantial litigation costs, service providers would have little choice but to severely limit or even delete listings for all trademarked goods whenever they had any general reason to think some portion of the listings for such goods were counterfeit.
It’s not hard to see where the interest is coming from: A ruling against eBay could have ramifications for Amazon Marketplace or Google Checkout as well.
Handicapping the appellate court’s thinking is above our pay grade, but given the intensity of interest and the money involved, it wouldn’t surprise us to see this case appealed yet again no matter who wins.