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Euro court: eBay etc can be liable in fake tat cases

Online marts to cop it if they take 'active role'

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EBay and other online marketplaces will be liable for sellers' trademark infringements if they promote infringing sales or help sellers to "optimise" their pages, the European Court of Justice (ECJ) has ruled.

In one of many cases dealing with how online marketplaces should deal with trademark infringement, the ECJ has said that marketplaces are not responsible for infringement when all they do is allow third parties to display infringing goods for sale on their site.

But a marketplace loses the right to that exemption from liability when its involvement is greater and it "plays an active role of such a kind as to give it knowledge of, or control over, the data relating to the offers for sale, when it provides assistance which entails, in particular, optimising the presentation of the online offers for sale or promoting those offers", according to an ECJ statement.

The Court was asked a series of questions by the UK High Court in a case involving online auction site eBay and cosmetics company L'Oréal.

The Court said that EU trade mark law applies to sales that are directed at the EU even if the seller is located outside the EU.

It said that even marketplaces which do not promote infringing sales will lose their right to exemption from liability for sellers' trade mark infringements if "a diligent economic operator" should have been able to tell that sales were unlawful and it did not put an end to the sales.

The ECJ, Europe's highest court, also said that marketplaces can be forced by national courts to identify infringing sellers and that courts must have the power to issue and enforce injunctions stopping those sellers from engaging in further infringing sales.

See:

The ruling
The original High Court ruling

Copyright © 2011, OUT-LAW.com

OUT-LAW.COM is part of international law firm Pinsent Masons.

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