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Oh look, a bandwagon

7 July 2008

When the news broke that the parent company of Louis Vuitton had been awarded some US$61m by a French court in an action against eBay, I knew it was only a matter of time before others saw the chance to bring similar actions.

And indeed, wouldn't you know it, it's already happened here in NZ.

The importers of the Ab King Pro have announced they're suing local auction site TradeMe, claiming that just as in the eBay case, the company had failed to take adequate action to avoid counterfeit products being traded on the website.

And, given the rather stunning success that was had against eBay, I have to say that unless TM can really show that it did everything reasonably possible to stop the sale of fakes through its site, they may well face a stingy penalty.

But this won't be the last such action and it does place auction sites in a very tricky position.

Just how do you stop people from flogging fake goods through your auction or trading site?

Well one simple, but seemingly effective method, is to simply ban the whole category of goods involved.

That's what TM has done with VCDs. According to their website, TM has placed VCDs on their "prohibited" list because, it claims, most were pirated copies of copyrighted works.

Okay, but that's not going to work if we're talking about handbags, watches, perfumes or other products.

So that just leaves the Community Watch link that appears on each auction - is that really enough?

Can an online auction site hide behind the excuse "but nobody told us" if fake goods are sold on their site without being reported by other users?

I guess NZ courts will now decide if that's an acceptable level of care on the part of TM.

So that's one bandwagon that seems to have already attracted a new rider, but there's another which I'm sure will also be about to become overloaded with "me-too's"

I'm talking about the Viacom suit against Google which has resulted in the search-engine giant being ordered to hand over 12TB of activity logs from their YouTube website.

If Google does not successfully appeal against this judgement, you can bet your bottom dollar that there will be some very clever people working very hard to try and leverage this precedent to their own advantage.

When you look at the value such a log represents to any marketer or market-researcher, it would be very much worth trying to convince the courts that some of your own copyrighted material has been illegally posted to YT and that you've suffered losses as a result.

Keep you eyes open for a long list of copycat law-suits against auction sites and Google in the coming year or two.

I'm sure the corporate sharks will be kept very busy but in the end, we'll all pay.

Does TM do enough to protect against the sale of fake goods and scams?

Do the courts really understand how the Net works and why giving all of YT's activity logs to Viacom was a very, very bad thing?

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