European Court Rules eBay May be Liable for Trademark Infringements

A European court ruled Tuesday that internet auction website eBay EBAY may be liable for trademark infringement committed by its users. eBay and French cosmetics manufacturer L'Oreal have been locked in legal proceedings for years. The cosmetics company previously sought $4.8 million in damages in 2009, accusing eBay of allowing counterfeit goods to be traded on its site. This year's ruling may translate to further legal action by L'Oreal, especially if eBay is determined to have an 'active role' in the criminal act. "When the operator has played an 'active role'..., it cannot rely on the exemption from liability which EU law confers, under certain conditions, on online service providers such as operators of Internet marketplaces," the court said in a statement. According to a Reuters report, "The court found that under EU law, member states had to ensure that national courts could order market operators to take measures that help to end trade mark infringements by users of a marketplace such as eBay, as well as preventing further infringements of that kind." The court noted: "Those injunctions must be effective, proportionate, and dissuasive and must not create barriers to legitimate trade." eBay is one of the world's most popular marketplaces for exchanging goods. The company holds a market capitalization of over $42 billion.