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Can eBay's "Vero"
Program Be Fixed?
By Cliff Ennico
www.creators.com
"We started selling on eBay a few months ago. We've had
spectacular success with most of our items, but recently have had two
listings removed from the site because of alleged trademark
violations. eBay told us that unless the manufacturer contacts
eBay to resolve the violation request, we are suspended from selling on
the site for one year. We have attempted to contact the
manufacturer to discuss the situation, as in both cases the items we
had for sale were 100% genuine, but there has been no response.
Is there any way a seller can get justice in a situation like this?"
Sadly, the answer is "probably not".
It is illegal to sell counterfeit or "knockoff" merchandise on eBay, or
in fact anywhere else. These products are manufactured in
violation of U.S. and international trademark and copyright laws, which
are designed to protect the manufacturers of these goods (think
Tiffany's or Louis Vuitton), their brand names and their "brand image"
in the marketplace.
Manufacturers have an absolute right to block the sale of counterfeit
or unauthorized merchandise on eBay, but they cannot legally prohibit
the sale of used or secondhand merchandise if it is in fact
genuine. So the manufacturer of Coach handbags should have no
right to object if you're selling on eBay a genuine vintage Coach
handbag you acquired in an estate sale. Since most eBay
sellers are not experts in the merchandise they sell, how can the
typical eBay seller know whether the brand name merchandise they're
selling is genuine or not?
To deal with this situation, eBay long ago developed its Verified
Rights Ownership ("VeRO") program (http://pages.ebay.com/help/tp/programs-vero-ov.html).
Here's how it's supposed to work:
- manufacturers of brand name
merchandise create an "About Me" page on eBay with information and
resources to help eBay sellers determine whether the merchandise
they're selling is genuine or not;
- if a manufacturer believes a
seller is selling counterfeit or "knockoff" merchandise, it notifies
eBay, which then shuts down the offending listing and instructs the
seller to contact the manufacturer directly to resolve the matter;
- the seller contacts the
manufacturer, and the question of genuineness is resolved one way or
the other; and
- if the manufacturer doesn't
respond to the seller, eBay contacts the manufacturer on the seller's
behalf and "facilitates" the discussion.
That's all great in
principle. But it doesn't work in practice. Manufacturers
do not like the idea of even legitimate brand name merchandise being
sold on eBay, because it circumvents their other distribution channels
and (in their view) cheapens their brand image in the
marketplace. While eBay doesn't want to frustrate its sellers, it
is absolutely petrified of being sued by large manufacturers, and so
gives in to most VeRO requests to suspend a seller's listings (or the
seller itself) with hardly any investigation.
Here's a recommendation for an improved VeRO that may level the playing
field between sellers and manufacturers without exposing eBay to
unnecessary risk:
(1)
whenever a seller includes a brand name or trademark in a listing
title, he or she should be required to fill out a separate box with
evidence demonstrating that the item is genuine – this could be a
photocopy of the original sales receipt, the story of how the seller
acquired the merchandise (what antiques dealers call "provenance"), a
certificate of authentication by a recognized independent authority, or
a listing of product details that only genuine merchandise would have;
(2) if a seller
completes this "provenance" box, the word "documented" should then
automatically appear in the listing title alongside the trademark or
brand name (for example, "documented Coach handbag");
(3) if a
manufacturer complains that a listing offers bogus merchandise for
sale, and the listing does not have the word "documented" in the title
(i.e. the provenance box wasn't filled out), eBay can terminate the
listing without explanation;
(4) if a
manufacturer complains that a listing offers bogus merchandise for
sale, and the listing has the word "documented" in the title, eBay
notifies the seller and requires them to contact the manufacturer, via
a specific e-mail address, within 24 hours of the notice;
(5) if the
seller fails to contact the manufacturer within 24 hours of eBay's
notice, the listing is automatically terminated;
(6) if the
seller contacts the manufacturer but the manufacturer doesn't respond
to the seller's inquiry within 24 hours of delivery, then the listing
continues and the manufacturer is barred from complaining;
(7) if the
manufacturer responds to the "documented" seller's inquiry and insists
the merchandise isn't genuine, giving specific reasons why (not just a
form response), then eBay suspends the listing (not the seller) and the
matter is referred to eBay's mediation system or SquareTrade for
resolution, the same as disputes between a seller and a buyer.
One more thing: since sales of trademarked merchandise on eBay
are occasional or infrequent transactions for most sellers, eBay should
never suspend a seller (as opposed to striking individual listings)
from the site for VeRO violations absent compelling evidence that the
seller is engaged in multiple, repeated sales of blatantly counterfeit
merchandise.
Cliff Ennico (cennico@legalcareer.com)
is a syndicated columnist, author and former host of the PBS television
series 'Money Hunt'. This column is no substitute for legal, tax or
financial advice, which can be furnished only by a qualified
professional licensed in your state. To find out more about Cliff
Ennico and other Creators Syndicate writers and cartoonists, visit our
Web page at www.creators.com.
COPYRIGHT 2009 CLIFFORD R. ENNICO. DISTRIBUTED BY CREATORS SYNDICATE,
INC. Permission granted for use on DrLaura.com.
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