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L’Oréal and eBay settle dispute over online fakes

Seven years after L’Oréal sued eBay for not doing enough to counter the sale of fakes on its website, the two companies have settled their litigation, declaring that “cooperation, rather than litigation”, is the way forward in the fight against fakes

The terms of the deal are confidential but in a joint statement L’Oréal said it acknowledges eBay’s commitment in the fight against intellectual property infringement.

L’Oréal filed lawsuits against eBay in France, Belgium, the UK and Spain in 2007. In 2008 the Belgian first instance court dismissed L’Oréal’s claims. One year later, the Paris Tribunal de Grande Instance ruled that eBay had fulfilled its obligation “in good faith” to help prevent fake L’Oréal products from being sold on its website but the judge told the two parties to discuss their dispute with a mediator.

The case filed in the UK was ultimately referred to Europe’s highest court, which in 2011 addressed the liability of internet service providers for counterfeit goods sold online; the legality of sales of goods from outside the EU; and the legitimacy of keyword advertising.

The Court’s ruling said that the operator of an online marketplace cannot be exempted from liability for infringement when it “plays an active role” giving it knowledge of or control over data relating to offers for sale.

At the time, Stefan Krawczyk, senior director and counsel government relations, eBay Europe, told Managing IP that it is still up to the national courts to decide facts. “That still probably leaves 27 or more different interpretations,” he added. “The national court will again come into play: is it proportionate? Does it affect legitimate trade? Judgments will be made in national contexts.”

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