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Edition: U.S. Article Comments (0) Save Email Print Reprints Most Popular Most Shared Special Report: iPad striptease: It's what's inside that counts 4:02am EDT iPad still awaits the rush 4:28pm EDT Reviews praise Apple iPad battery life, ease of use | Video 4:03am EDT Sharp to launch advanced 3D panels for mobile gear 4:23pm EDT China journalist club shuts website after attack 2:09pm EDT Special Report: iPad striptease: It's what's inside that counts 4:02am EDT iPad still awaits the rush 4:28pm EDT Reviews praise Apple iPad battery life, ease of use | Video 4:03am EDT Sharp to launch advanced 3D panels for mobile gear 4:23pm EDT China journalist club shuts website after attack 2:09pm EDT U.S. appeals court rules for eBay in Tiffany spat Grant McCool and Alexandria Sage NEW YORK/SAN FRANCISCO Fri Apr 2, 2010 4:04am EDT Related News U.S. court rejects Microsoft patent case appeal 4:03am EDT U.S. court rejects Microsoft patent case appeal Thu, Apr 1 2010 UPDATE 2-U.S. court rejects Microsoft patent case appeal Thu, Apr 1 2010 CORRECTED - UPDATE 2-US court rules for eBay in Tiffany trademark tiff Thu, Apr 1 2010 Kijiji begone: EBay rebranding U.S. classified site Tue, Mar 30 2010 NEW YORK/SAN FRANCISCO (Reuters) - EBay Inc did not engage in trademark infringement and dilution by selling counterfeit Tiffany & Co goods on its website, a U.S. appeals court ruled on Thursday, but it ordered further review of the jeweler's claim of false advertising. Technology | Media Tiffany and other luxury brands have long argued that counterfeit merchandise bearing their names is sold on eBay. The Web commerce company, which does not itself put the goods up for sale, says it has spent millions of dollars to track down counterfeiters and remove such listings. The case was seen as a major challenge in the United States to the freedom of Web companies from eBay to Google Inc, which claim that they are merely hosting services, and any trademark infringement lies with others, not them. Google won a major trademark victory in the European Union over similar claims last month. Tiffany said it would consider an appeal to the U.S. Supreme Court and that the decision "leaves in place a prior ruling which allows eBay to profit from counterfeit sales." The court signaled that eBay met its responsibilities in its partnership with brand holders, said Sally Abel, an attorney who chairs Fenwick & West's trademark group and was not a party in the case. "It's a win for e-commerce," said Abel, adding that the ruling helps define "the need for the online marketplace to have rules and to protect trademark rights up to a point -- but only up to that point." A panel of judges on the U.S. Court of Appeals for the 2nd Circuit in New York heard oral arguments in the dispute last year over Tiffany's claims, which dated back to 2004. "It is true that eBay did not itself sell counterfeit Tiffany goods; only the fraudulent vendors did, and that is in part why we conclude that eBay did not infringe Tiffany's mark," the appeals court opinion said. "But eBay did affirmatively advertise the goods sold through its site as Tiffany merchandise." Tiffany accused eBay of false advertising because its website touted Tiffany goods, but many of them were actually counterfeit. The appeals court disagreed with the finding of the district court that eBay's ads were not likely to confuse consumers. "The law requires us to hold eBay accountable for the words that it chose insofar as they misled or confused consumers," read the appeals court ruling. EBay said in a statement that the ruling validated its anti-counterfeiting measures and that it was confident that it would beat the false advertising claim. It criticized the use of courts to settle these issues, saying "we continue to support cooperation, rather than litigation." BATTLING FRAUD The opinion was published more than two years after a week-long bench trial before U.S. District Judge Richard Sullivan in late 2007. He ruled in July 2008 that eBay was not liable for trademark infringement by allowing fake Tiffany goods to be sold on the website by individuals. Tiffany then appealed to the higher court. The appeals court ruling noted that eBay and others have "a strong incentive to minimize the counterfeit goods sold on their websites." Tiffany argued that if eBay were not held liable except when infringing items are brought to its attention, it will have no incentive to stop the sale of counterfeits. In its arguments to the court, eBay said it spent as much as $20 million per year to battle fraud on its website, including buyer protection programs and employees who focus exclusively on anti-infringement issues. Tiffany shares closed up 1.6 percent to $48.25 on the New York Stock Exchange on Thursday afternoon. EBay fell 1.47 percent to $26.57 on Nasdaq. The case is Tiffany & Co v eBay Inc, U.S. Court of Appeals for the 2nd Circuit in New York, No. 08-3947. (Reporting by Grant McCool and Alexandria Sage; Additional reporting by Phil Wahba; Editing by Lisa Von Ahn; Gerald E. McCormick and Carol Bishopric) Technology Media Add a Comment *We welcome comments that advance the story directly or with relevant tangential information. We try to block comments that use offensive language or appear to be spam and review comments frequently to ensure they meet our standards. If you see a comment that you believe is irrelevant or inappropriate, you can flag it to our editors by using the report abuse links. Views expressed in the comments do not represent those of Reuters. More from Reuters Special Report: iPad striptease: It's what's inside that counts SAN FRANCISCO (Reuters) - The iPad will not hit stores until Saturday, but the race to unlock its mysteries started several weeks ago in San Luis Obispo, a picturesque college town roughly 200 miles south of Apple's Silicon Valley headquarters. iPad still awaits the rush Reviews praise Apple iPad battery life, ease of use | Video Sharp to launch advanced 3D panels for mobile gear China journalist club shuts website after attack Taiwan's HTC says Apple suit not affecting operations » More Top News Special Report: iPad striptease: A peek inside Apple doesn't want you to know what's inside its new gadget, but two guys armed with heat guns and suction cups have other ideas. Reuters joins the race to break open the iPad. Full Article Reviews praise battery life, ease of use Want to see the iPad? Join the club Publishers place blind bet on iPad Will you buy the iPad? Apple iPad Special Report: Foreclosing on God Churches couldn't resist the temptation of few-questions-asked loans. Now they're paying for their sins. Inside the congregations that can't pay the bills. Full Article Thrifty faithful hurts churches FaithWorld: Charities hit by recession U.S. © Copyright 2010 Thomson Reuters Editorial Editions: Africa Arabic Argentina Brazil Canada China France Germany India Italy Japan Latin America Mexico Russia Spain United Kingdom United States Reuters Contact Us Advertise With Us Help Journalism Handbook Archive Site Index Video Index Analyst Research Mobile Newsletters RSS Podcasts Widgets Your View Labs Thomson Reuters Copyright Disclaimer Privacy Professional Products Professional Products Support Financial Products About Thomson Reuters Careers Online Products Acquisitions Monthly Buyouts Venture Capital Journal International Financing Review Project Finance International PEhub.com PE Week Thomson Reuters is the world's largest international multimedia news agency, providing investing news, world news, business news, technology news, headline news, small business news, news alerts, personal finance, stock market, and mutual funds information available on Reuters.com, video, mobile, and interactive television platforms. Thomson Reuters journalists are subject to an Editorial Handbook which requires fair presentation and disclosure of relevant interests. NYSE and AMEX quotes delayed by at least 20 minutes. Nasdaq delayed by at least 15 minutes. For a complete list of exchanges and delays, please click here.

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