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Website liable for ‘user generated content’?

Opinion by Maarten Haak in the national Dutch financial newspaper Het Financieele Dagblad of 26 June 2008. Websites containing ‘user generated content’ could be (co) liable for trademark or copyright infringements in that content. Good news for the right owners! A French trader used ‘fake Louis Vuitton’ as Google Adwords – a clear infringement of the world famous trademark. Fashion company LVMH did not go after the trader, but after Google itself, because it was Google that allowed this infringement and that even made suggestions for such infringing Adwords. Was Google to blame? Yes, the French court so far decided in favour of LVMH. In other cases, eBay had to pay damages in France and Germany to Hermès and Rolex because of sales of counterfeit products via eBay. The sites were held (co) liable for their users’ content. Apart from trademark owners also copyright owners have acted against websites containing infringing materials placed by third parties. Television company Viacom submitted a billion dollar claim in the USA against YouTube, because its film material had been made available via YouTube without its prior consent. In the Netherlands, the structurally facilitating of infringements via websites has been considered unlawful more than once. The website owners always point at the advertiser or uploader (‘they take the initiative’). They are only passing on information and do not want to be involved with the content of it. No prior check, but a ‘notice & take down procedure’. After a complaint an infringing add or film is removed. Some sites are actively warning the trademark owners (as far as they have registered with them) in case of new adds containing the trademark. The trademark owner could then allow or dismiss these adds. Abuse by the trademark owner leads to a stop of these warnings. eBay and Google are already working this way, but Google has recently changed this system in the UK. Google Adwords containing a competitive trademark as a keyword are simply appearing again. It wrings that the right owners are not receiving one cent of the extra profit that these sites are making through third party infringements. The right owners are forced to maintain an expensive control system in order to timely act when necessary. An advance control system seems suitable here. In the Louis Vuitton case the French court recently asked the European Court of Justice what the relation is between the Community Trademark Regulation and the Trademark Directive on the one hand, and the E-commerce Directive on the other hand. Is Google jointly responsible for infringing Adwords placed by its customers? Must Google pay its additional profits to the right owners? Or is Google just functioning as a mere conducting party passing on third party content, without taking a position on its own? The outcome will also be important for possible claims of copyright owners against film websites like YouTube and the Dutch 123 Video.nl. It seems justified that right holders are acting to stop the unlimited exploitation of their rights. Also in the Netherlands claims are prepared. Sites containing user generated content should keep a close eye on the Louis Vuitton case. Maarten Haak

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