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Tiffany v. eBay 2: The Appeal

If Dad says no, ask Mom.  And if the Federal District Court for the Southern District of New York says no, ask the 2nd Circuit. 

As expected, Tiffany has filed a notice of appeal of its loss last month to eBay in a lawsuit alleging, among other things, that eBay should bear more responsibility for shutting down hundreds of thousands of listings for counterfeit Tiffany silver jewelry.  The auction site's response, with which Judge Sullivan agreed, was essentially, "Hey, we're a marketplace.  And we never even see the stuff.  How do we know what's fake and what's not?  If Tiffany tells us that a specific item is counterfeit, we'll stop that auction, but that's all we can do."  In legal terms, eBay cannot be held liable for contributory infringement of Tiffany's trademark without having specific knowledge that particular items are counterfeit -- as opposed to general knowledge that a large percentage of the listings are for fakes -- and then refusing to shut down those counterfeit auctions. 

Tiffany obviously didn't buy eBay's argument.  After all, eBay takes a cut of every sale, whether or not it's the real deal.  Talk about an ambiguous incentive.  Tiffany added in essence that eBay should look for red flags (like listings of multiples of the same item) and use the same common sense that buyers do when trying to figure out whether an item is genuine. 

From my perspective, eBay may have won a bit of a Pyrrhic victory.  Yes, it has avoided the legal responsibility and cost of policing Tiffany's (and others') trademarks, at least for now, but at the expense of being identified as a site where counterfeits may outnumber the real thing and the official policy is "caveat emptor."  Its wise publicity machine immediately leapt into action with noises about cooperating with brand owners in the fight against fakes -- but a Google search for "eBay" and "counterfeit" just turned up 1.8 million hits.  And half of us can't even spell "counterfeit."  (Remind me of that the next time I'm naming a website....)

In other words, eBay may be selling fake Tiffany silver, but the auction site is the one with the tarnished name.


So what's a fashionista looking for genuine goods at less than full retail to do?  (Hint:  The answer is not to email me.  I love you guys, I'm flattered, and I'm happy to share tips when I can -- but I don't authenticate auction listings.)  Instead, you can hope for a clearance sale, rent rather than buy, or visit an auction site that does guarantee authenticity.  Sure, eBay is great for unloading that tacky trinket your ex won for you at a street fair.  I've bought and sold there a couple of times myself.  But when it comes to luxury labels, why settle for uncertainty when you could score a certified preowned handbag instead? 

Related posts:  Euros and Scents: More on LVMH v. eBay, Strike 2: eBay loses to LVMH, Party TimeDefendant du Jour