A recent decision in the United Kingdom considered eBay Europe's liability for trade mark infringement that occurred on its website.
L’Oréal S.A. sued eBay Europe and others in the High Court of Justice in the United Kingdom concerning infringement of L’Oréal’s well known trade marks, including LANCOME, for use in association with perfume, cosmetics and hair care products. It was alleged that a number of individual infringers sold infringing products on the internet auction and sales site operated by eBay Europe. It was also alleged that eBay was jointly liable for the trade mark infringement committed by the individual defendants, among other things.
In a lengthy judgment, the Trial Judge reviewed the common law concerning joint liability. The Judge referred to the previous decisions of the House of Lords involving the sale of an audio cassette deck with twin tapes that could be conveniently used to make copies of copyright musical works. In that case, it was found that the tape deck was lawful although it was also capable of being used for unlawful purposes. Once the manufacturer had sold the product, it had no control over it or interest in its use. In these circumstances, it was found that the allegation that the manufacturer was a joint infringer was untenable.
The Judge also considered other activities which could constitute inducement and incitement or persuasion to infringe. However, it was observed that such actions must be directed to an individual infringer and must identifiably procure a particular infringement in order to make the defendant liable as a joint infringer. In general terms, in order to establish liability for joint infringement, there must be a common design and the defendants acted in furtherance of the design.
Even knowing assistance does not suffice to make the “secondary” party liable as a joint tortfeasor with the primary party. In order to show liability the secondary party must be shown to have gone further and have conspired with the primary party to procure or induce its commission of the tort or must have joined in the common design pursuant to which the tort was committed.
eBay submitted that it was under no duty or obligation to prevent third parties from infringing L’Oréal’s registered trade mark. eBay submitted that it operates its site in a neutral and impartial manner, irrespective of whether it is being used by sellers to sell infringing goods or non-infringing goods and that it attempts to prevent, or at least minimize, infringements through its programs. Finally, it was submitted that eBay was at worst responsible for facilitating infringements but this was not enough to establish joint liability.
The Judge accepted these submissions although it was indicated that the issue was a difficult one to decide. The Judge also said that he had considerable sympathy with the suggestion that eBay could and should have dealt with the problem of infringement in a more positive manner.
The principles referred to above have been applied in a similar fashion in Canada and it is likely that a Canadian court would decide this case in the same manner. It is difficult to establish joint liability by common design