New type of liability established for users of auction sites

The German Federal Supreme Court has held that the owner of an eBay account can be held liable for IP infringement resulting from the misuse of the account if the account holder has failed to keep the access information safe (Case I ZR 114/06 , March 11 2009, only recently released).

 

With regard to the liability arising from the infringement of IP rights on auction platforms, the Federal Supreme Court used to base its decisions on the German legal concept of Störerhaftung or contributory liability. However, the German courts recently moved away from this concept, holding that internet access providers could be held liable if they failed to monitor and/or prevent infringements. In the present case, the Federal Supreme Court established a third type of liability: the obligation to keep access information safe.

 

French luxury company Cartier sued the owner of an eBay account for trademark infringement and unfair competition. The account of the defendant had been used to offer for sale an imitation of a Cartier collar. The offer indicated that the collar had been originally made by Cartier. As the offer had not been placed by the defendant but by his wife (without the defendant’s knowledge), the key issue was whether the defendant could be held liable for infringement.

 

The court emphasized that the safekeeping of access information is of key importance, as the public and IP rights owners must be able to identify who acts under an alias or user name. As the defendant did not comply with this obligation, the court held that he was directly liable for the infringement of Cartier's IP rights.

 

The decision demonstrates yet again that the German courts tend to favour IP rights owners in online infringement cases. Moreover, it imposes strict safekeeping requirements on internet users.

 

As a consequence, internet users are unlikely to succeed in proceedings before the German courts by arguing that someone else used their account - and rights owners are safe in the knowledge that the owner of the account may be held liable even where the latter did not place the infringing offer online.