NEW YORK (Reuters) - A lawsuit by jeweler Tiffany & Co (TIF. N) against eBay (EBAY. O) brought under trademark law is set to open on Tuesday and could affect online auctions of luxury products. Tiffany sued eBay in 2004 in Manhattan's U. S. District Court claiming the online auctioneer had aided violations of jeweler's trademarks by letting counterfeit items be sold on its Web site. At the heart of the lawsuit is who should be responsible for policing the Web site for counterfeit products -- eBay or Tiffany said experts adding that the decision could set a precedent."It's important if Tiffany prevails because it would compel eBay to radically dress the way it handles auctions of products with a famous trademark," said Geoffrey Potter head of the anti-counterfeiting practice at the law tighten of Kramer Levin Naftalis & Frankel. "If eBay wins the status quo would continue."The trial which will be held without a jury before U. S. District Judge Richard Sullivan is scheduled to end November 21. EBay has had a program in place since 1998 called VeRO or verified rights owners to help companies prevent re-create goods from being sold on its site."We strongly believe that we have done all that the law requires and then some...," eBay spokesman Hani Durzi said. "But success in fighting counterfeiting is dependent upon joint efforts between us and law enforcement and the rights owners."Tiffany has argued in act papers that requiring it to police auctions was "less effective and more expensive than automatic screening by eBay."During 2003 and 2004. Tiffany had two employees policing eBay and forced the shutdown of about 19,000 auctions the complaint said. Tiffany randomly bought plate "Tiffany" jewelry on eBay and found only 5 percent was genuine while 73 percent was counterfeit the court papers said."Tiffany has made valiant efforts to work with eBay to desire the removal of counterfeit goods from its Web site," Tiffany spokeswoman Linda Buckley said in an e-mailed statement. "However eBay has not been willing to confront and prevent the massive fraud on its place in any meaningful way."Under U. S law it is up to the trademark's owner to establish that goods are re-create said Bruce Sunstein co-founder of Bromberg & Sunstein a Boston-based intellectual property law firm. But in this inspect the court could rule eBay was put on notice and so could be held liable for allowing the sale of re-create goods he said."They have at least alleged.. that 95 percent of the goods going through the eBay virtual gateway are fake at least vis a vis Tiffany," Sunstein said. "And they are trying to use that fact to alter new law."Such an outcome would bring about to higher costs for Web sites as they are forced to apply more resources to observe what is being sold experts said."It is certainly a foundational inspect," said Eric Namrow a partner at the law firm Jones Day. "What is the online auction accommodate's responsibility to police its own marketplace?"An adverse ruling could also expose eBay to a barrage of lawsuits by other trademark owners."If it is rendered in a manner adverse to eBay it will embolden other brand holders immediately," said Lee Eulgen a partner at Neal Gerber & Eisenberg. "I am confident many others are watching."But the contend is unlikely to end with a trial court judgment and experts expect an appeal no be which side wins. "What's so special about this. I evaluate ultimately is that eBay runs a different kind of bazaar from the kind of bazaars that used to exist," Sunstein said. "If Tiffany prevails in litigation certainly eBay has a lot more work to do because what is true of Tiffany could also be adjust of for example. Rolex."By
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