What has a trade mark dispute between eBay and beauty products manufacturer L’Oréal to do with inventors? And why ‘eBay gum’? Give me a minute and I’ll get there.
First, some background. The dispute started in 2009 and is summarised with exemplary brevity in this extract from the excellent Ipkat blog.
The facts in brief: Paris-based L’Oréal, which had brought similar proceedings in several European countries, objected that online auction site eBay did not do enough to prevent the sale of counterfeit goods such as perfumes and cosmetics. Broadly speaking L’Oréal’s position was that eBay should be liable for counterfeit and parallel imported goods sold via its website, and that eBay should do more to prevent the sale of such trade mark infringing goods.
The court’s judgment, written in sentences designed to make your head explode, comes down on the side of L’Oréal. An open and shut case, you might think. Any physical outlet selling fake branded goods would very quickly be persuaded to mend its ways. Even scrapyards are required to establish the legitimacy of their supplies. Why should an online market-place be any different?
It’s different because, like Google and other internet giants, eBay is so rich and powerful it thinks it can stick two fingers up to any critic and do whatever it wants. An appeal in this judgment appears likely, so eBay could still prevail and carry on merrily making money from other people’s trade in fake or unauthorised goods.
That L’Oréal had to take eBay to court at all – that eBay can’t play fair with other businesses and still make tons of money for itself – says a lot about the debased moral state we’re in, courtesy of the internet. It’s an example of the culture of disregard I ramble on about in Patenting Your Invention: the Ugly Truth.
This is one of the internet’s darker achievements – putting the shoplifters in charge. The prevailing sentiment seems to be: if the technology and the platform enable me to cheat or steal, that’s exactly what I’ll do. L’Oréal v eBay shows that it’s happening at both the supplier and consumer ends of the rainbow. And if the enabler in the middle – eBay in this case – couldn’t care less, it’s very difficult to get anything done about it except by protracted legal action.
And it isn’t just a problem for well-known brands. Smaller companies are taking a hit too. Where’s the motivation to invent and innovate when the chances are high that you’ll be ripped off by unscrupulous manufacturers (let’s say it: mainly in China) helped by trading platforms that turn a blind eye to it all?
Rupert Murdoch is currently under the cosh thanks to the phone hacking scandal, so worms can turn. The judgment in L’Oréal v eBay may be more evidence of it. There’s no doubt that the playing field needs some serious levelling to stop product innovation becoming a fool’s game, and that impacts on all of us.
A postscript – and an explanation of the headline to this post. A good friend of mine, also based in Yorkshire, registered the domain name ‘ebaygum’. Not for any particular reason; he just fancied owning it. Within days he got a snotty email from eBay’s legal department, making it clear that they’d come down on him like a ton of bricks if he didn’t immediately relinquish ownership.
Which suggests that while eBay appears happy to let L’Oréal and others suffer from counterfeiting and passing off, it doesn’t brook any of that nonsense when eBay itself is the potential loser.