Brand-Name Merchandise, Trademarks, Copyrights, and Selling Knockoffs

Q: "What are the rules when it comes to selling trademarked or branded items, such as Gucci handbags or Tiffany jewelry, on eBay?"

A: The rules about selling trademarked items on eBay are simple to state but difficult to apply in practice. Even experienced eBay sellers make mistakes in this area. The rules are basically these:

• You cannot sell knockoff or counterfeit items on eBay—never, ever, world without end, amen.

• It's up to you to determine whether an item is genuine or not; eBay won't help you.

• If the manufacturer or owner of the brand or trademark participates in eBay's Verified Rights Owner (VeRO) program and wants your listing terminated because they think you are not selling genuine merchandise, even if you are, eBay will shut down your listing and, for repeated violations, kick you off eBay.

• If you have questions about whether an item is genuine or not, eBay wants you to talk directly to the rights owner or manufacturer about it.

• Many leading manufacturers have posted About Me pages as part of their participation in the VeRO program, but these pages offer no guidance whatsoever to eBay sellers in determining whether an item is genuine or not—most simply repeat eBay's rules about not selling counterfeit or knockoff items and warn you of the perils of doing so.

• You cannot hold yourself out as an authorized reseller of a manufacturer unless you truly are one.

Really helpful, huh?

Participants in the VeRO program are required by eBay to give you an e-mail address where you can ask questions about their merchandise, but don't hold your breath waiting for your e-mail messages to be answered. There are some very good business reasons why manufacturers and brand owners won't go out of their way to help you sell their merchandise on eBay, among them the following:

• Many luxury goods makers view eBay as a liquidation or "flea market" venue and do not want their brands sold there under any circumstances for fear of tainting their brands' marketing image.

• Many manufacturers want to protect their distribution channels from low-cost competition from eBay sellers.

• Many manufacturers, especially of luxury goods, want to discourage the sale of used (but genuine) merchandise competing with their new high-margin offerings.

• Many manufacturers want to avoid lawsuits and negative publicity from buyers who are angry about their eBay purchases (because of irresponsible or inexperienced sellers) and claim that the manufacturers have aided and abetted the eBay seller's actions by encouraging sales on eBay.

There are also some very good business reasons why eBay won't do more to help you sell branded merchandise on the site:

• It views itself as a marketplace or platform on which transactions take place; eBay is legitimately concerned about jeopardizing its neutral status by taking sides between sellers and trademark owners.

• Let's face it, eBay isn't too worried about being sued by one or two sellers who feel their listings were arbitrarily removed. However, it is petrified (and rightly so) at the prospect of being sued by powerful Fortune 500 corporations (such as the parent corporations of Gucci and Tiffany) with deep pockets and big-name law firms behind them, and will go a long way to avoid offending these companies.

To begin your education on eBay's brand-name merchandise policies, take a look at their Guidelines for Creating Legally Compliant Listings (pages.ebay.com/help/rp/compliant-listings.hrml). Then take eBay's tutorial "Intellectual Property Policies and VeRO" (there's a link to that on the above page, but you will have to sign in using your eBay user ID and password to take the tutorial). Finally, review eBay's VeRO page and read the frequently asked questions that are posted there: pages.ebay.com/help/policies/questions/ vero-ended-item.html. You now know as much as anyone does about selling brand-name merchandise on eBay.

The bottom line is that when you sell brand-name merchandise on eBay without the manufacturer's permission or authorization, you are taking a risk and have to expect that occasionally eBay will terminate one of your listings. If you plan to sell these items more than occasionally (for example, as part of estate consignments), you should make an effort to become an authorized distributor of the manufacturer's merchandise and state that clearly in each of your eBay listings.