Supreme Court Takes One, Leaves One

Though there are no opinions from the Supreme Court today, there have been some notable acceptances and rejections of cases to the docket.  The first of these is Tiffany & Co v. eBay Inc, No. 10-300.  Tiffany brought an action for trademark violation against eBay because counterfeit Tiffany items were available on eBay.  Tiffany acknowledged that it was the individual sellers who were listing the fraudulent items but argued that eBay had notice of the fraudulent items and should have investigated.  The trial court (576 F.Supp.2d 463 (2008)) said no, that it was up to Tiffany to protect its trademark.  It also noted that eBay promptly removed the infringing listings when specific frauds were brought to eBay's attention. 

The main issue on appeal at the Second Circuit was whether generalized notice of fake articles caused eBay to beliabile for contributory infringement.  After discussing the relevant case law, the Circuit Court of Appeals concluded that something more than general knowledge was necessary (600 F.3d 93 (2010)), and affirmed the opinion of the District Court.  The Supreme Court today declined to take up the case.

Though trademark and copyright law are derived from separate statutory regimes, this sounds pretty similar to the case Viacom brought against Google for copyright infringement through its YouTube subsidiary.  In fact, the District Court cited the Second Circuit's Tiffany opinion for the proposition that generalized knowledge without more does not create liability.  The Court in Viacom noted that the DMCA applied the same principles through its safe harbor provisions.  The Court granted summary judgment to Google.  Viacom at the time said that the District Court got it all wrong and angrily vowed to appeal.  A denial of certiorari is not precedential, though here it means the Second Circuit's interpretation of generalized knowledge and infringement stands for the time being.  Those handicapping the coming appeal, take note.

A second case that the Supreme Court did accept is Microsoft's appeal in the i4i litigation where Microsoft was found to infringe on a patent covering XML technology held by the Toronto company.  Microsoft lost on appeal (598 F.3d 831 (2010)) and had to remove the offending technology from Word and Office.  The appeal concerns the standard for invalidating a patent through court action.  The standard courts use is clear and convincing evidence.  Microsoft argues that the evidence it presented wasn't considered by the Patent Office when it granted the patent, thus a different standard should apply.  A decision in this case could have far reaching effects in a lot of industries that rely on method patents.  [MG]