A Court has ordered that a company selling wicker furniture cease sending false DMCA notices to eBay orders company and desist from sending bogus DMCA notices to eBay to have their competitors’ auction listings shut down.
eBayers should find the Court’s preparedness to condemn abusive DMCA take down notices refreshing. The Defendant in the case had sent sixty three notices to eBay notifying eBay that the plaintiff’s auctions infringed on their copyright in their furniture. The defendant, as a competitor of the plaintiff selling wicker furniture took the case to court seeking a temporary restraining order preventing the plaintiff from sending more DMCA notices to eBay.
The Court recognised that the defendant had violated s512(f) DMCA by knowingly and materially misrepresenting that plaintiff’s eBay auctions contained infringing material. The court held that the plaintiff’s claim would probably be upheld as there was a strong case to support the fact the defendant knew they didn’t have a valid copyright on their furniture. Copyright protection doesn’t extend to industrial designs, excluding ‘useful articles’ from it’s scope.
Due to the risk of harm to the Plaintiff arising from the suspension of their activities and the loss of goodwill and customers, the court found that on balance, the injunction should be granted. In an interesting remark, the court held that making the order would be in the public interest.
The Court found it intriguing how permissive eBay’s policies were in taking down content based merely on an allegation of infringement, thus reversing the normal burden of proof which rests upon a plaintiff to discharge who alleges intellectual property infringement.
The case serves as a reminder that EULA and TOS don’t always comply with law and that one should always look beyond the terms of service when evaluating whether or not a website is in compliance with the law.
EBAY routinely suspends users’ accounts and auction listings down at the request of a VERO member. The VeRo Program established the Verified Rights Owners Program to enable rights owners to easily report and request removal of listings offering items or containing materials that they allege infringe their intellectual property rights. The VeRo program is found here.
This is an easy method for rights owners to request auctions be removed from ebay without having to prove that the auction holder is infringing intellectual property rights of the owner, either in trademark or copyright. Ebay treats the notification of the alleged infringement as tantamount to proof. VERO is a means for rights holders to take a shortcut to shut any trader down.
There is no due process around an alleged violation of the trademark or copyright rights of VERO members. A court order is not required for an ebay program participant to inform ebay to shut down a vendor.
eBay has framed guidelines and policies describing items that cannot be listed on eBay and might expose you to risk. These includes items prohibited by law, those prohibited by ebay policy, and reported by a VeRO program participant.
Any item which violates eBay policies or infringes on the copyrights of others may be removed and some listings are removed as the language or photos used in the item title or description violate ebay policy. This means that some items you may have purchased in a store, or even possibly on eBay, may not be allowed or could be removed due to listing policies.
The rights holder does not need to prove any of the accusations made in a court of law.
This requires users and auction sellers to prove their innocence which is automatically granted to them until the point at which the intellectual property owner obtains a court order proving otherwise.
Online video services like Youtube have developed a notification mechanism to be eligible for the Safe Harbor protection from secondary copyright infringement charges. eBay has been using a similar procedure since 1997, a year before the DMCA was enacted. However the amount of power given to VeRO member leaves the system very open to misuse.
Rights holders have been using VeRO to suppress a vibrant secondary market for their goods and to restrict competition. There is a counter-notification procedure, as re quired by the DMCA, members wanting to object to the takedown are required to undergo a process by which they have to go to great lengths to get ebay involved in the counternotice process. If the rights holder claims the right being violated is a trademark right, not a copyright, being infringed, eBay will not send a counternotice to the user at all.
Notifying eBay of an infringing item is very easy, and a company only needs to file a form by fax, at which time they will be given an email address to expedite the process. Many interests who aren’t copyright holders at all misuse the VeRO process to have competitor’s auctions taken down. eBay states it has no tolerance for anti-competitive use of VeRO fraudulent notification of infringement is very easy.
Only three notifications by a VeRO member could lead to the suspension or termination of an eBay’s users account and infringement claims, and even if there is a successful counter-notice the infringement claims remain on the account holder’s record.
s512(f) DMCA Act provides for punishment for a false accusation through the VeRO program yet there hasn’t been an instance despite studies showing 30% of notices demanding taken down for claims present a question for a court to consider. Thirty percent of notices demanded takedown for claims that presented an obvious relating to whether certain material copyrightable, or whether there is a fair use defence.