eBay purchased keywords from online advertising services, such as Google Adwords, that included registered trademarks in order to direct potential customers seeking to purchase those goods to its website.   However, the goods being sold included both legitimate goods as well as counterfeit and unpackaged goods from non-European Economic Area (EEA) countries thereby infringing upon L’Oréal’s trademarks.  eBay implemented its own precautions against infringement by incorporating a take-down notification system and operating a Verified Rights Owner Program (VERO), however L’Oréal was not a member of the VERO program and rather turned directly to eBay for assistance with handling the infringing goods.  However, unsatisfied with eBay’s response, L’Oréal pursued its action before the High Court of England and Wales which referred several questions to the European Court.

In addition to joint liability, the Court considered the extent of injunctive relief that intellectual property owners could obtain against online intermediary websites, such as eBay, whose services are used as tools to infringe upon the IP of others.  The Court found that it could impose injunctions against online marketplaces requiring them to suspend accounts of those utilizing the site to sell fraudulently-marked goods or to employ measures which would make it easier to identify infringers.  However, the injunction would not require the website to actively monitor all activity of the website or prevent the sale of all goods bearing a particular trademark.

By finding eBay liable for joint liability, the European court differs from cases upheld in the United States.

In the Tiffany (NJ) Inc. v. eBay, Inc., cases in the federal district courts in New York, the federal courts rejected Tiffany’s argument that an intermediary website may have secondary liability thrust upon it if it has “generalized” information that its website was being used to sell infringing merchandise.  The court deduced in Tiffany that even though eBay had general knowledge of infringement by various sellers, it did not require eBay to prevent the same sellers from selling goods via their eBay accounts because general knowledge of infringement is insufficient to determine that actual infringement occurred.  eBay would have been liable, based upon Inwood Labs., Inc. v. Ives Labs., Inc. 456 U.S. 844 (1982) if it continued offering its services to sellers it knew or had reason to know were infringing on the mark’s holder’s marks.

Practical Considerations

What does this decision mean for clients who operate websites used or accessed from the European Union?

This decision suggests that, in the E.U., website owners might consider taking a more active role in addressing and preventing infringement upon learning of potential infringement from a trademark holder.  Indeed,  although an exemption from liability exists under the European E-Commerce Directive, any active role by the website owner in promoting items for sale by users may negate this exemption.

Just when he thought it was safe to go back in the water (or the boxing ring as the case may be), it appears that Mike Tyson’s legal troubles continue to fight on. The latest contender is Michael Wayne Landrum, a former boxer (turned paralegal according to his complaint) who probably wouldn’t last long in the ring with Mike Tyson but is suing the former champ for $115,000,000 for trademark infringement based on Tyson’s use of the name “Iron Mike”.

In round one of the recently filed complaint with the California Central District Court, Landrum, who is duking out his own legal representation, contends he owns trademark rights in the name “Iron Mike.” Although Landrum claims to have a federal trademark registration for the mark IRON MIKE, the court is likely to call foul as Landrum appears to have confused his California state trademark registration (which he does apparently own) with the national protection of federal registration (which he does not appear to own).

While Landrum does attach a 1996 letter from the California State Athletic Commission, which states his professional ring name was “Iron Mike Landrum,” and his California state registration (which claims a date of first use of November 1983), it remains to be seen whether such evidence will be enough to deliver TKO.

Stay tuned as the two contenders duke it out over several issues. Did Mike Tyson use the mark IRON MIKE to offer good/services or was it just a nickname bestowed upon him by his fans? Who used the mark first and in connection with what goods/services? Does Mike Tyson’s fame make confusion unlikely? Did Landrum wait to long to bring these claims? Are Landrum’s rights limited to California only?

If the author were of the betting type, the wager would certainly be placed in Tyson’s corner! Stay tuned for round two.