EFF backs eBay in Tiffany spat
See, we don’t agree with Public Citizen all the time! Read on, via the Electronic Frontier Foundation (EFF):
[EFF] along with Public Citizen and Public Knowledge urged a U.S. court of appeals Wednesday to reject jewelry-maker Tiffany’s attempt to rewrite trademark law and create new barriers for online commerce and communication. . . .
“Millions of Americans use sites like eBay and craigslist to buy and sell goods,” said EFF Senior Intellectual Property Attorney Michael Kwun. “If Tiffany had its way, sites like eBay would be responsible for figuring out whether items its users are selling — items eBay itself never sees — are authentic or counterfeit. That’s an impossible task.”
It is? Where are the metrics for “impossible”? Can we start with nearly half a billion dollars in quarterly profits in the third quarter of this year? How do you get from that to “impossible”?
Here’s the EFF amicus brief. Lots of talk about “burdens,” and “impossible,” but no data. Yes, as a general rule the burden of proof is on the plaintiff in civil matters, but hasn’t Tiffany shifted that burden by coming forward with the undisputed claim that massive amounts of counterfeit merchandise is being sold on eBay?
Now take a look at the amicus brief of the International Anti-Counterfeiting Coalition (IACC), written by my friend David Bernstein and his partner Bruce Keller and counsel Michael Potenza. They make the point:
What the District Court failed to realize, however, was that this distinction essentially eliminates the universally accepted constructive knowledge standard and eviscerates the well-settled rule that one cannot avoid contributory infringement liability through willful blindness to prevalent third-party misconduct. That is why swap meet and flea market operators — the brick-and-mortar equivalent of eBay — are subject to contributory liability if they are generally aware of pervasive infringement on their premises, regardless of whether they know the specific identities of the counterfeiters or the particulars of the counterfeiting transactions. . . .
Those same principles are directly relevant here. The evidence of eBay’s awareness of massive infringing activity on its site is overwhelming. Where, as here, evidence of counterfeiting and infringement is so pervasive, basic common law concepts, endorsed as applicable by the Supreme Court, hold that a reasonable person is chargeable with sufficient knowledge about the conduct to be liable for its assistance. . . .
The District Court actually turned this rule on its head. It held that Tiffany’s duty to police its marks absolved eBay of responsibility for the widespread infringement and counterfeiting on its site. Tiffany’s efforts to police its marks are irrelevant to eBay’s liability for its own infringing activity; any alleged failure to prosecute unauthorized third party users may be relevant to the strength of the mark, but it is not relevant to whether eBay has done enough to prevent counterfeiting on its site.
Emphasis mine. As is so often the case in trademark litigation, it is enough merely to float a conceptual premise that “sounds right” to a judge without having to back it up with data or some kind of concrete proof — especially if that premise means, well, less work for, uh, the judge. In this case, the District Court refused to ask the question rigorously of whether eBay has indeed “done enough” to prevent counterfeiting. Along with our co-author Roberta Kraus, we tried to argue this point forcefully in drafts of our famous (to LOC readers!) and, well, groundbreaking 2003 article on this topic, but it was committeed down to milquetoasty compromise.
The Second Circuit should remand for proof on this point: What has eBay done to satisfy the burden on it to avoid “willful blindness” of the illegal activity from which it is profiting so magnificently? And in doing so, the Circuit should enunciate how that level of prevention is to be weighed when compared to eBay’s overall profitability, and not merely in a vacuous never-never land of “well, gosh, all those sales, that would be really hard, wouldn’t it”?
Well, wouldn’t it? Or would it?