On July 14, 2008, a federal judge ruled that eBay Inc. is not legally responsible for its users selling counterfeit items. The ruling comes four years after the trademark suit was filed by Tiffany and Co., who alleged most of the Tiffany items sold on eBay were counterfeits. Tiffany argued eBay aided trademark infringement by allowing the sale of counterfeit items.

The ruling reaffirms that online companies are not legally obligated to monitor their websites for trademarked violations, that ultimately trademark owners must protect their marks. eBay’s procedure for removing allegedly infringing material upon notice by trademark owner was deemed adequate.

eBay recently was ordered by a French court to pay $60 million to LVMH, which makes Louis Vuitton handbags, in a similar trademark lawsuit. In April 2008, a German appeals court ruled eBay must be active in preventing the sale of counterfeit Rolex watches.