Users of online auctions could see their costs rise should a ruling of the Court of Justice of the European Union (CJEU) rule against Ebay tomorrow (Tuesday 12 July), a legal firm has warned.
The long running case, which has seen cosmetic giant L’Orealtake legal action against eBay, will end with the CJEU returning a decision as to whether online marketplaces such as Amazon and eBay should identify and block the sellers of counterfeit goods or items which infringe brand owners’ rights.
According to legal consultancy Osborne Clarke, a verdict in favour of L’Oreal will place great responsibility on such sites to prevent illegal use. This is likely to mean a rise in usage prices by the sites to compensate for the loss in volume of sellers.
Emily Devlin, senior associate in law firm Osborne Clarke's Intellectual Property Group, said:"Given the sheer volume of auctions taking place online, marketplaces have always argued that it is more realistic for them to be reactive, as it impossible for them to know about and prevent the sale of infringing goods through their sites. In reality, it's almost certain that counterfeit and infringing goods are being offered for sale at any given time.
"The CJEU is considering whether the probability that counterfeit goods are for sale on these sites amounts to 'actual knowledge' of illegal activity by the sites and, if so, whether companies like eBay should actively prevent their sale.
"If the court decides in L'Oreal's favour it could result in higher fees for people selling goods online, in order to cover the extra costs of policing illegal activity."
The judgement will be announced tomorrow morning.