Do E-commerce based platforms infringe upon trademarks

E-commerce has emerged as a prominent and cost effective business method to reach the global consumers with just a click of the mouse. Small , medium and even large enterprises have entered into the arena of e-commerce based business practices. E-commerce successfully propelled the online business for about more than a decade, with Amazon and eBay starting out as early in 1995 setting the early benchmarks for many follow up online businesses focusing on business to consumers (B2C) services.

While building these online transaction platforms , nobody would have ever thought that they will rise incessantly and occupy a major share in the global consumer market. Well that was history, the current scenario for e-commerce based businesses is certainly promising but extremely competitive as the number of players are rising every quarter. Such a stiff competition in occupying customers, delivering innovative , cutting edge and cost effective consumer goods can be the breeding grounds for the future Intellectual Property conflicts.

One of the recent IP conflict that came into picture is the eBay v/s European brand owners trademark violation issue. It is evident that eBay is an e-commerce giant in conducting B2C online business successfully for over a decade and transacting in diverse range of consumer goods but at the same time the Brand owners in the European territories are unhappy with the way by which counterfeiting goods pave their way to the eBay platform and thereby highly affecting their overall brand sales. While eBay claimed to have developed a stringent anti-fraud policies for suppressing such conflicts in future but the luxury brand owners like L’Oreal, who filed a case against eBay at the European Court in May 2009, seems satisfied with the recent decision of the court holding eBay liable for trademark infringement committed by its users. The court's judgment could be accessed here.

This decision will certainly have a great impact on the European brand owners and will somehow lag the parallel importation or the grey market goods entering the European consumer markets. The court's decision in this favor also indicated that the national courts within EU will enforce suitable punishments if such online market platforms violate trademark rules and regulations. Looking at the rising numbers of online trademark infringements ,this decision of the court is certainly welcomed by the European brand owners who were battling for the online protection of their brands for quite some time. Hence, the e-commerce based platforms will certainly look closely into the aspects of Intellectual Property infringements and will ensure to develop stringent measures to curb such IP related infringement issues in the future and foster a great consumer – business relationship. 

(Image by Svilen Milev)

Start - ups and the role of Intellectual Property

Acknowledging the fact that there are several factors and ingredients involved in setting up a start-up venture , one prominent fact is that the key element in any start-up is the entrepreneur's Intellectual Property(IP). The IP is the key initiator for entrepreneur's access to financing and technology acknowledgment , which are instrumental in providing adequate thrust to start the venture. On the contrary some business strategists hold an opinion that start ups should make an early entry into the markets focusing upon addressing new market segments rather than entangling themselves into the patent filings and procedures. Well, from my point of view, I certainly don't buy that argument. All technology based start ups have one thing in common that is “ The new technology” itself. What's the idea behind spending huge bucks in creating ,distributing brands and targeting new customer bases when your technology itself stands unsecured from IP point of view.

How would a start up entrepreneur deal with the consequences of infringements and technology thefts by the ever growing competitive global market. The only way to ensure protection of your technology is by securing a “Patent right” on that. As early as an entrepreneur comes up with an idea to design a start up around a new technology , the next immediate step should be to file a provisional patent application followed by the complete specification later. Understand the utmost need of filing a patent application and securing an early priority date nationally or internationally because it might be possible that many other start- ups might be working on the similar technology and will be in the race of filing the patents themselves. Looking at the stiff global competition, entrepreneurs and inventors should aim for an early patent priority date to be in a profitable situation.

From business point of view, an early stage entrepreneur with an established patent portfolio will undoubtedly draw prominent attention for financing from the investors. Looking at the vast number opportunities which an entrepreneur enjoys after attaining IP rights on their respective technologies or inventions, I wouldn't mind spending an extra time to patent my technology. Start -up entrepreneurs can monetize heavily through their IP in the following forms : 1) Licensing their technologies with established companies , 2) Creating licensing Partnerships, 3) Selling their IP , 4) Reaping the benefits from royalties, 5) Damages awarded by infringements , 6)Using the IP itself . Thus, the right amount of money starts flowing in the start-up, just by the value of your intangible assets like IP. Therefore, the next time you think of launching your start -up , give a comprehensive thought on the benefits of Intellectual Property which could boost your start- up.

 (Image by Emil Bacik)