eBay and PayPal sued for abetting sale of counterfeit products

Thomas Linton

Thomas Linton

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Irvine-based Wimo Labs Thursday filed a federal racketeering lawsuit against eBay and PayPal, claiming they knowingly abetted the sale of counterfeit products.
Wimo Labs sells phone accessories under the name Lunatik.

The suit alleges that eBay and PayPal not only facilitated but also profited from the sale of fake products that display the Lunatik trademark. PayPal was owned by eBay for 13 years before it spun off last month.

“Our client is the victim of trademark infringement and has been adversely affected by it,” said Deborah A. Klar, a lawyer representing Wimo Labs. She said Wimo had sent eBay more than 5,000 notices of trademark infringement involving more than 2,000 eBay sellers.

“Not only does eBay allow its sellers to list fake products that infringe on our clients trademark; they also elicit eBay buyers to purchase these fake products,” she said.
Wimo Labs is seeking damages of up to $2 million per counterfeit trademark, plus lost profits and attorneys’ fees. Four trademarks were identified in the complaint.
Rather than take “effective remedial action,” the lawsuit claims, eBay “protects and conceals the identity of its unauthorized sellers” and fails to use the “reasonable means it has available” to deny its services to them.

Wimo further alleges that eBay and PayPal make “enormous profits” from fake products and are therefore ignoring the plaintiff’s claims.

Spokespeople for eBay and PayPal said their companies would fight the lawsuit. “Counterfeits are not welcome on eBay and we have a number of sophisticated tools, policies and other measures in place to keep them off our site,” the company said in a statement. “We will vigorously defend our practices in court.”
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Can "Spokespeople" be sued for bald-faced lies?

Reported to ePrey several times:

HINDERER XM 18 titanium handle version Tactical folding survival knife d2 blade

$88.77
Buy It Now
Free shipping
From China
 
Darrel Ralph and I have talked at length about this. Myself and many other DDR fanboys reported the items yet nothing came of it.
 
As always, thank you Thomas for your contribution to the forum, you are all right.

Over in the Good, Bad, Ugly there is the 2015 Fake, Counterfeit, Knockoff Buck Knives & Americans Who Sell Them thread. Ebay has been notified of each American fake seller posting to ebay. The results: Many vendors voluntarily removed their ads.

Ebay appears to have little regard for legitimate manufacturers, their own rules or consumers wellbeing.
 
I don't believe reporting fakes to eBay will be as effective as reporting them to the manufacturers and having them contact eBay.
 
Not a fair comparison. They can identify balisongs and switchblades directly. Fakes aren't as easy, and without an aggrieved party brtinging civil charges, may not even be illegal.
 
Esav Benyamin said:
I don't believe reporting fakes to eBay will be as effective as reporting them to the manufacturers and having them contact eBay.
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Buck has appointed Joe Houser to be the fake czar so perhaps we will see a test of your hypothesis Esav. He can come to this forum and see the fakes and fakers in the GB & U or the Buck Forum in another sticky thread there on fakes and get the scoop. Bravo Bladeforums for breaking bulk for manufacturers regarding fakes, counterfeits and knockoffs. A big job.

From the Buck Collector's Club September 2015 Newsletter, this section by Buck CEO C.J. Buck:

"Joe Houser remains the Manager of our Warranty
department, Company Historian and Liaison with
BCCI while picking up a new vitally important role
of policing for counterfeit Buck products. Joe’s
extensive background in verifying product values will
bring amazing insights in spotting fraudulent product
and then getting that product out of the marketplace.
This will be hugely beneficial to our company and our
brand, not to mention clarification for our collectors."
 
Esav Benyamin said:
I don't believe reporting fakes to eBay will be as effective as reporting them to the manufacturers and having them contact eBay.
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I agree

My understanding is that you have to be willing to swear in an affidavit that you are the rights holder to whatever is being counterfeited/faked etc.. then eBay will use that as grounds to suspend the activity on their site. You will of course be legally liable for any damages you caused the other seller, so you better not be lying or wrong about not only being the legal rights holder, but also that you are being infringed upon or you may be very sorry indeed.

I used to sell on eBay under a name I came up with on my own (not a particularly catchy name even) until someone from Canada with a very similar business name swore to eBay I was violating their copyright. Maybe I could have fought them, I don't know, but eBay didn't care either way. They had the sworn affidavit (they sent me a copy) and the onus was on me to fight the other party. I just changed my name and was done with it.

If you contact eBay as a third party claiming something is wrong it will likely be falling on deaf ears, and rightfully so.
 
I hope ebay takes a hit on this one. I don't expect them to be perfect but they have been a part of the problem. They know full well that it is HIGHLY unlikely that a seller in China has 1000's of an uncommon custom to sell.

I think Sears and a babyfood maker took them to court years ago for knowingly selling stolen goods. Forget how that case turned out but it was the same deal. They knew that people were committing a crime and just turned away (while making $$ off of it).
 
Anyone remember a women head of eBay (Meg Whitman?) 10 years ago or so said something like- if the buyer can't tell it's fake they don't deserve the real thing?
 
Honestly, this is lawyers looking to make a buck. I by no means support any counterfeits. Let me say it again.....Chinese fakers and counterfeiters should be castrated. Now, eBay is just a consumer based free market. If they know ...yes Know ie: proof that the item is bad they will pull it. Like them or not, there is no way that eBay can possibly police every item people put up for sale. It's literally billions per day/hour. The site relies on buyer FB to police things as well. Again, they just become the only target for lawyers to get $$$$. The root of the problem is Chinese mfgrs and counterfeit makers.
Our government has done nothing to protect USA companies from this. eBay is just an easy target, easy blame, and easy money. They are not pure as the driven snow, but they are not THE main problem either. Just my opinion. And yes, I sometimes hate eBay too.
 
RevDevil said:
Idiot CEO mentality, not always the case, but it's getting worse.
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Like VW's CEO, resigned over the emissions cheating. This afternoon's followup is that other top managers are heading for a permanent vacation also.

Life is too sweet in the executive suite! At least on Bladeforums, we don't lose our edge. :)
 
Esav Benyamin said:
Like VW's CEO, resigned over the emissions cheating. This afternoon's followup is that other top managers are heading for a permanent vacation also.

Life is too sweet in the executive suite! At least on Bladeforums, we don't lose our edge. :)
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Yes, all the discussion about fine blades keeps us all sharp!
 
The plaintiff claims:
"Though eBay's policy is not to return counterfeit products, upon information and belief, this is exactly what eBay requires for a consumer to receive a refund. Fake Products are evidence of a crime. See 18 U.S.C.A. 2320. Contrary to law, upon reporting a purchased item as counterfeit, the eBay customer is refunded and instructed to return the product. Instead of taking any action against the Unauthorized Seller, eBay facilitates the Seller's receipt back of the Fake Products, which are likely then resold to another unsuspecting eBay customer."
 
Gastonknife said:
Our government has done nothing to protect USA companies from this.
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Dude, do you have any idea the amount of money that would be needed to inspect, detain, and destroy the amount of counterfeit merchandise coming into the country? The amount of judges, prosecutors, and jurors needed? The amount is literally staggering. And if you think they'll stop trade with China and the cheap manufacturing happening there in the name of stopping or curbing the illegitimate products produced there you're crazy. It'd literally shut down many countries, including this one. It's just a fact. It's like saying they're going to stop drug use in the ghetto. There's no stopping it no matter what and you can't legitimize it, either. It's just the way the world works. The government isn't to blame any more than the original designers for not creating some kind of ironclad method of identifying which product is genuinely theirs. Why do you think secret recipes are so closely guarded? This stuff has been happening forever and it's no one's fault but the cheats doing it and they can't be stopped, they can only be rooted out where possible. That's it.
 
Respectfully, "cheap" is not the topic.

And I know how "well" the "War on drugs" has worked.

Nor do I know if anything substantial can be done about counterfeit goods, but we are not really trying.

How about:

1. Expand the "Private Attorney General" law to cover counterfeit goods. Presto! 300,000,000 inspectors with a financial motive to find, document, and report counterfeit goods.
2. Expand forfeiture laws to take everything available from convicted criminals to pay massive fines, court costs, and costs of imprisonment on prison farms.
3. Punitive tariffs on countries which are documented to encourage manufacture of counterfeit goods.

We don't know what is "possible" if we don't try.
 
Thomas Linton said:
Respectfully, "cheap" is not the topic.

And I know how "well" the "War on drugs" has worked.

Nor do I know if anything substantial can be done about counterfeit goods, but we are not really trying.

How about:

1. Expand the "Private Attorney General" law to cover counterfeit goods. Presto! 300,000,000 inspectors with a financial motive to find, document, and report counterfeit goods.
2. Expand forfeiture laws to take everything available from convicted criminals to pay massive fines, court costs, and costs of imprisonment on prison farms.
3. Punitive tariffs on countries which are documented to encourage manufacture of counterfeit goods.

We don't know what is "possible" if we don't try.
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There's a difference between theory and practice. There's a lot that comes with what you're proposing. 300,000,000 private attorney generals? What about all the countersuits and litigation from libelous claims? How are you going to extradite some random chinese people? For the people who import the stuff you have to prove without a doubt that they KNEW the stuff was fake. Can you do that each and every time? How many cases would you as a private attorney general be willing to prosecute yourself with your own funds before you got ONE case to stick? How many lawsuits would you be willing to defend for bringing in people who weren't convicted?

What about the docket time necessary to prosecute the offenders and law suits that'd come.

Forfeiture laws are a beast. I don't know if you know what it takes to seize something from someone under federal law, but I do. Sure, you can seize and destroy something fake upon importation. Ok. How many shipments come in from foreign countres? How many people does it take to search ONE container in a timely manner? What about the paperwork generation for each container searched? How many people need to work behind the scenes to stop ONE container? Do you know any of this? It's enormous.

And punitive tariffs? How can you prove without a doubt that China itself knew beyond a doubt that they knew and facilitated the manufacture of the fake knife you're holding? Sure, it's fine to suspect but when the burden of proof is on you to and your goal is to slow down or stop some heavy global trade youd better have more than some fake purses and knives made by some fly by night factories.
 
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Theory is distinct from actually doing something.

Shortly after the Apple Watch was formally announced, fake "Apple" watches were selling for between $40 and $80 – a fraction of Apple's asking price of at least $349 – on Taobao, a Chinese e-commerce website owned by online retail giant Alibaba.

400 South El Camino Real, Suite 400
San Mateo, CA 94402
United States

Tel: (+1) 1-408-785-5580
Fax: (+1) 1-408-748-1218

In 2012, the International Chamber of Commerce estimated the global value of all counterfeit goods reached $1.7 trillion, and China alone accounted for 70% of all counterfeits seized globally.

For those who believe something might be done: http://www.jurisdiction.com/lovells.pdf
 
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bodog said:
Dude, do you have any idea the amount of money that would be needed to inspect, detain, and destroy the amount of counterfeit merchandise coming into the country? The amount of judges, prosecutors, and jurors needed? The amount is literally staggering. And if you think they'll stop trade with China and the cheap manufacturing happening there in the name of stopping or curbing the illegitimate products produced there you're crazy. It'd literally shut down many countries, including this one. It's just a fact. It's like saying they're going to stop drug use in the ghetto. There's no stopping it no matter what and you can't legitimize it, either. It's just the way the world works. The government isn't to blame any more than the original designers for not creating some kind of ironclad method of identifying which product is genuinely theirs. Why do you think secret recipes are so closely guarded? This stuff has been happening forever and it's no one's fault but the cheats doing it and they can't be stopped, they can only be rooted out where possible. That's it.
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Thank you for helping make my point. This post was about prosecuting and fining Ebay; not about policing the world. Hard to blame them -as you said it's been going on forever.
My point was that the Gov has done nothing, it is difficult to actually get to the counterfeiters, and well Ebay becomes a nice target for a lawyer to make some money............as most other avenues are dead ends money wise. you can close down Ebay tomorrow and they'll still be selling fake rolexs in Chinatown.
Nothing more nothing less.
 
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