Can A Company Ban Retailers From Selling Its Products On eBay?

from the bad-for-your-market dept

Right on the heels of the awful court decision in France saying that eBay can be barred from selling even legitimate products, it appears some companies in England are shooting for a similar ruling. Jon Pyser writes in to let us know that a bunch of baby stroller companies in the UK are pushing hard to stop retailers from selling their legitimately purchased products on eBay. Effectively, they're trying to put EULAs on baby strollers suggesting that the retailer buyers don't actually have the right to resell what they've legally purchased. Not only is this questionable from a legal standpoint, it's dumb from a business standpoint. A healthy secondary market for products increases the value of the product itself, since buyers intrinsically recognize the potential resale market in determining the value of purchasing the original. In fact, one retailer notes that in taking away eBay sales, it's made selling that brand of stroller unprofitable. You would think, after 200+ years of economists explaining how protectionism hurts your own market, that people would understand this concept by now.


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  1.  
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    Anonymous Coward, Jul 3rd, 2008 @ 6:47pm

    Oh well .....

    I do not need their product.

     

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    DS78, Jul 3rd, 2008 @ 7:05pm

    Boomer

    I can't imagine a particular brand of baby stroller being in such high demand.

     

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    Oliver Wendell Jones, Jul 3rd, 2008 @ 7:40pm

    The lawsuit is referring to retailers - not re-sellers

    If you buy a stroller, you can re-sell it on ebay.

    If you're a store owner who purchases strollers from this manufacturer, they don't want you selling them directly on ebay.

    Although I don't agree with what they want, there is distinct difference between the two. Mike leads us to believe that it's about the re-selling of the strollers when that doesn't appear to be the real case. (sorry, Mike!)

     

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    some old guy, Jul 3rd, 2008 @ 7:58pm

    Re: The lawsuit is referring to retailers - not re-sellers

    No, there is not a distinct difference there. A retailer buys goods and resells them.

     

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  5.  
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    Doug Robb, Jul 3rd, 2008 @ 8:49pm

    Distributors are the Problem I Think?

    In a nutshell how it works is someone in Australia (for example) signs up some manufacturer for the exclusive rights to distribute a product.

    Then forever and a day after that the poor consumer has to pay some (in Austrlia its usually a *big*) markup because of these middle men who basically do bugger all for their money and think they are smart business men (and women).

    Now in the new economy why would the consumer want to pay this extra when you can easily source yourself either from other markets (countries) or consumers via ebay etc.

    So there is pressure on the manufactuers by their distributors to maintain the old business model and hence call in the lawyers.

    In Australia a test case was (Montana Tyres Rims & Tubes Ltd vs Tyre Transport Sales Pty Ltd) where an Australian exclusive distributor of tyres attempted to use trade mark law to prevent a competitor importing those same tyres in competition with it ('parallel importation').

    They arranged for the foreign manufacturer's Australian trade mark registrations to be transferred to it. This was a blatant attempt to prevent parallel importation on the basis of TM infringement. Since the tyres were from the one manufacturer this seems to me to not be what trade mark law is for?

    As far as I know the attempt failed and it is not a TM infrignment to import genuine goods from a third country.
    (why wouldn't this also be the case in the various free trade agreements around the place?).

    However like all legal cases this particular dispute had a few technical reasons that won't be the case in general and you will see plenty of distribors trying to hold back the tide!

     

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    Anonymous Coward, Jul 3rd, 2008 @ 8:59pm

    Re: The lawsuit is referring to retailers - not re-sellers

    Are you dense? Are you retarded? Where is the difference between one or the other?

     

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  7.  
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    Andrew Stolworthy, Jul 3rd, 2008 @ 10:17pm

    Vacuums

    Kirby vacuums actually has a guy whose job is to search the web for any and all vacuums being sold online and buy them back so they can trace the serial number and find out where it came from and who sold it. They try and make a case in their sales pitch that if you buy one from any where other than the guy in your living room its stolen.

     

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    robert lipschitz, Jul 4th, 2008 @ 1:38am

    Actually, there are often very good economic reasons to limit who can sell your product.

    Firms have placed such limitations on resellers for hundreds of years.

    Previously, under anti-trust law (specifically, Dr Miles Ruling), these strategies were banned (e.g resale price maintenance and exclusive dealing) but it has been overwhelmingly shown that sometimes these strategies have net positive welfare effect (for consumers, resellers and manufactures).

    For example, if a product requires a lot of support at the retail outlet (technical knowledge, display space, etc) in order for customers to learn about it and buy it, then retailers need to be rewarded for putting in the extra effort. But if people can get the info from a retail store, and then by it online (where they dont have to pay staff, retail space) it might become unprofitable for the retail store to continue to hire the expert staff and dedicate the retail space). this means that these services are not provided in the economy - the manufacturer sells less and the consumer (and reseller, and online store) are all worse off. There are many other similar reasons.

    Perhaps excusable given you are probably not an economist, but your articles are always a little absolutist and from the hip. The whole notion that you need not protect IP at all, which I gather you support, is also a philosophy without ANY economic foundation. Though - when it comes to music - I actually agree that, in this case, it should not be.

     

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    Jason (profile), Jul 4th, 2008 @ 1:49am

    Re: Re: The lawsuit is referring to retailers - not re-sellers

    The first term is being used to refer to contractually obligated members of a distribution chain - stores that unload extra product or squeeze out extra profit by ebaying in a way that undermines (or at least seems to) the brand value of their vendors.

    The second term is referring to joe schmoe who buys from an outlet or store within that same chain, and then, under no contractual obligation, resells the product as he sees fit according to the first sale doctrine.

    It's late and I haven't checked the facts of the story, ans so I don't know just exactly what's happening in UK on this, and it's a holiday here in the US, so I may not do that, but that's pretty much what I read from the context here.

    As to whether it's right or not, there is JUST ONE POINT where I have a very strong tendency to agree with even the most freedom-restrictive of laws, and that's when a sucker, reasonably informed and uncoerced, signs on the dotted line. Generally, if you agree to it, then you've generally bargained away your rights(obviously exceptions apply).

     

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    Bravest343, Jul 4th, 2008 @ 4:39am

    eBAY

    WILL EVERY ONE JUST STOP WHINNING! IT"S A BUSINESS, THINGS HAPPEN.

     

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    Monarch, Jul 4th, 2008 @ 5:14am

    Re: by robert lipschitz on Jul 4th, 2008 @ 1:38am

    "Perhaps excusable given you are probably not an economist, but your articles are always a little absolutist and from the hip. The whole notion that you need not protect IP at all, which I gather you support, is also a philosophy without ANY economic foundation. Though - when it comes to music - I actually agree that, in this case, it should not be." Mike does have a degree in Economics, and if I remember right, he has a post graduate degree in Economics. Either way, that would make him an economist of sorts.

     

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    Anonymous Coward, Jul 4th, 2008 @ 5:21am

    Re: Re: The lawsuit is referring to retailers - not re-sellers

    Are you dense? Are you retarded? Where is the difference between one or the other?

    If the retailer has a contract with their supplier that prohibits selling on e-Bay there is a big difference.

    Do the retailers have a contract?

     

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    Ross, Jul 4th, 2008 @ 5:24am

    Rolex

    Rolex has had an agreement with their retail outlets like this for a LONG time. Official Rolex Dealers are not allowed to sell new Rolex Watches on eBay (and I think they are not allowed to sell online at all)

     

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    Haywood, Jul 4th, 2008 @ 5:37am

    I can see where they might be upset

    The traditional supply chain is dependent on hostage customers. The internet is changing all that.
    My eyes were truly opened when I tried to buy a Bosch dishwasher locally. I hit road block after road block, with very few retailers in my area, the price and model selection was very limited. I did some on line research and found the new model, top of the line could be had for half the price the local cartel wanted for the dated, middle of the road one, including delivery from 1500 miles away.
    Saving a few bucks on a dodad on the internet was always a hobby of mine, now everything is fair game. I saved 1/2 on a pair of tires yesterday.
    I'd like to support the brick and mortar stores, I would hate to see them go away completely, but they need to have a more reasonable expectation of profit. Keep in mind the E-tailer is still making money or they wouldn't do it at all. Any business that expects to triple key its merchandise is doomed in today's world.

     

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    Bill G, Jul 4th, 2008 @ 5:49am

    Yet another business model change....

    Those that do not change with it, will go the way of the dinasour

     

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    Relonar, Jul 4th, 2008 @ 7:20am

    anyone found that lawersbane root yet?

    Do you really need a legal team to fight these people who are harming your ability to sell your own product? No, you are free to stop selling to those who have put your product where it is easily accessible to you customers. You are free to sell to only a very select few resellers who will only place you product in obscure corners of their stores. Your customers are free to flip you the bird when they find someone else who can get an equivalent product to them with more convenience.

     

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    ehrichweiss, Jul 4th, 2008 @ 8:16am

    Dishnetwork will ban the sale of their receivers

    I've had them twice cancel the sale of one of their receivers because they claimed that I was infringing on their trademark and they wanted me to jump through a bunch of hoops to keep them happy; I refused and am trying to find others who had this problem as well so we can cause them a bit of a legal nightmare. So I sold it on craigslist instead for twice what I would have on ebay.

     

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    mobiGeek, Jul 4th, 2008 @ 9:02am

    Re:

    I simply don't buy your example. It is micro-thinking at best and has a smattering of the same type of arguments that the pro-"IP laws" people claim.

    Let's walk through your example and remove the protectionist (exclusive) pricing. People go to a store, get all the details, walk out and buy at a discounter with no service. The store loses money, stops selling article. Only discounters left, they don't have expertise, product stops selling.

    If that's the way it plays out, then I would argue that the product deserves to die off...it has not net benefit to society.

    If, however, the product does have benefit, then the entire system would automatically adjust to keep the product alive. This could happen a number of different ways:

    • Discounters see sales dropping, raise prices in order to offer training/services. Main retailers come back online and start selling, taking a (competitive bite) out of their previous excessive profit (that exclusive pricing gave them).
    • Manufacturer sees dropping sales, offers its own training/services, raising prices equally to all distributors. Main retailers come back online selling at a competitive price with "discounters".
    • Consumer groups form to offer training/services. Discounters and retailers can offer the product at similar prices
    • ...

    So I don't buy the "hundreds of years" argument. I also don't buy the wishy-washy statement "it has been overwhelmingly shown that sometimes ..." (overwhelming somtimes??)

     

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  19.  
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    Gary, Jul 4th, 2008 @ 10:48am

    Limiting who can re-sell your product is a way to sell your product if your product is overpriced or there's really no market for your product.

    Herbal Life is good example. Same with Arbonne. If there were internet competition in selling their products, they would be commoditized.

     

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  20.  
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    Willi de Smet, Jul 4th, 2008 @ 11:48am

    Protectionism hurts your own market

    > protectionism hurts your own market

    Of which Apple and French high-class restaurants are excellent proof.

     

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  21.  
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    Daddio on the Paddio, Jul 4th, 2008 @ 12:33pm

    EBAY Resale

    Leave it to the Brits to ruin free enterprise at the individual level. Maybe if the queen were selling her jewels on eBay it would be ok.

     

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  22.  
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    Carl Lipservice, Jul 4th, 2008 @ 1:43pm

    Why buy locally when your treated like meat?

    Who wants to support a local retailer when your treated like cattle? Personally, I love it! Please sign me up, kind sir.

    But the void will be filled by manufacturers selling direct to customers on eBay without the brand name silk-screened on the product. Might as well save some money.

    Moo. Moo!

     

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    dkp, Jul 4th, 2008 @ 1:45pm

    Right of First sale

    Right of First sale

     

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    Crackpot, Jul 4th, 2008 @ 1:51pm

    Re: Right of First sale

    Why the hell should there only be a right to sell a product once? I imagine this ideology will only decrease the overall value of the item.

    As an example, let's say suddenly overnight, some industry decided to remove the ability to resell an expensive asset, let's say a car, I think the car market would tank literally overnight and cheap $4,000 cars, such as those from TaTa Motors would be shipped stateside immediately.

    This is a dumb, dumb idea.

     

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  25.  
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    Eric Schmidt, Jul 4th, 2008 @ 2:21pm

    Contracts

    Contracts are good. EULAs are contracts. It's great that this baby stroller company has the right to attempt to engage in whatever contract they want with me as a buyer of their product. You say they're unprofitable after attempting to sell w/ some new contract? Okay, great, so then they will discontinue attempting to sell w/ that contract. But what's the big deal about them attempting to engage in some contract with you or me? Why would you deny them that right? Consider all the business that could not operate without contracts. Countless dollars would be lost. Imagine if media companies were denied the right to sell us, say, a DVD along with a contract that says we can't make copies and redistribute it? They wouldn't be able to operate. These million-dollar movies that hollywood pumps out and that we all love would be unfeasible. These business would fail and thousands of jobs would be lost. Thank goodness firms' have the right to engage in contracts with people to whom they sell their products. More thoughts in the comments here: http://www.techdirt.com/articles/20050906/0230233.shtml

     

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  26.  
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    Mike (profile), Jul 4th, 2008 @ 3:20pm

    Re: The lawsuit is referring to retailers - not re-sellers

    Mike leads us to believe that it's about the re-selling of the strollers when that doesn't appear to be the real case.

    Huh? Throughout the post (and in the title) I clearly say it's about retailers...

     

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    Mike (profile), Jul 4th, 2008 @ 3:35pm

    Re:

    it has been overwhelmingly shown that sometimes these strategies have net positive welfare effect (for consumers, resellers and manufactures).

    Can you cite a study?

    For example, if a product requires a lot of support at the retail outlet (technical knowledge, display space, etc) in order for customers to learn about it and buy it, then retailers need to be rewarded for putting in the extra effort. But if people can get the info from a retail store, and then by it online (where they dont have to pay staff, retail space) it might become unprofitable for the retail store to continue to hire the expert staff and dedicate the retail space).

    And the market can't deal with that by forcing suppliers to make products that don't require support? Or, if it's true that the product really needs so much support then people will get upset when they buy it without that support and retailers will stop selling it.

    The whole notion that you need not protect IP at all, which I gather you support, is also a philosophy without ANY economic foundation.

    Other than the dozens of economic studies we've pointed to (some written by Nobel Prize winning economists)?

    You can disagree with the foundation, but to say it has none is simply incorrect.

     

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  28.  
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    Anonymous Coward, Jul 4th, 2008 @ 5:07pm

    Re: Contracts

    Assignable property rights have been a part of America and what have made America great, starting from when early settlers bought Manhattan Island for a few dollars, and the Louisiana Purchase.

    In your commentary, you attempt to draw some sort of correlation of DVD contracts to stroller ownership. This is flawed logic. When a person buys a DVD, they don't own the actual media, but enter into a contract to own limited, private exhibition playback rights. What's flawed is that if DVD sales was truly focused on licensing, and allowing a customer playback it's product, I would imagine content owners would want to be featured in every type of distribution possible- TV, Satellite, Online, Hulu, NetFlix, iTunes, YouTube, eBay, etc to drive licensing revenue. But as discussed multiple times here, this seems to run opposite of what is actually happening with some companies.

    I think Mike is trying to show that the problem comes to light when people purchase a product to accomplish a utilitarian goal (Such as transportation of a baby) and now baby stroller manufacturers are attempting to change "Ownership of the stroller" to "Utilization of transportation of one baby" or essentially a lease or renting of a stroller. What's next? Raids on Goodwill for selling used strollers? Come on. There are much bigger problems affecting our world that these crazed geniuses need to be focused on. I think you'll find that the overhead involved in running a renting/leasing business is much, much higher than that where the manufacturer just sells the product. Plus it pisses customers off.

     

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  29.  
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    Anonymous Coward, Jul 4th, 2008 @ 5:38pm

    Re: Re:

    "Can you cite a study?"

    Some references to such studies can be found in the Leegin opinion cited below:

    Leegin Creative Leather Prods. v. PSKS, Inc., 127 S. Ct. 2705 (2007)

    The amicus briefs are no longer available at the Supreme Court website, but did include numerous briefs from economists and the results of their work.

    "Other than the dozens of economic studies we've pointed to (some written by Nobel Prize winning economists)?"

    I have read, to the extent they were available (some in total, some not because only excerpts were available), the studies you consistently reference and in all candor must say that their contents are nowhere as unequivocal as you repeatedly state. Some parts of each seem to align with your views, but other parts seem to align otherwise.

     

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    Brent C, Jul 4th, 2008 @ 6:02pm

    Re: The lawsuit is referring to retailers - not re-sellers

    Give it 5 years. They'll start with EULA controls on retailers. If that's successful, then they will move to the re-sellers. Here's the HurrDurr Profit Chart

     

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    John Duncan Yoyo, Jul 4th, 2008 @ 8:05pm

    Re: Vacuums

    Hmmm, If this guy is really motivated to buy back each and every Kirby Vacuum one could probably get a fair markup on ebay if one had one to sell.

     

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    anonymous coward, Jul 4th, 2008 @ 9:51pm

    Re: Re: Vacuums

    I was thinking the very same thing

     

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    The Masked Porkchop, Jul 4th, 2008 @ 11:25pm

    Re: Re: The lawsuit is referring to retailers - not re-sellers

    What the fuck are you talking about? I wont even ask you like the other guy does(In this thread, you know the one calling people a retard). You are a retard! I don't even want too elaborate, it would probably cause your head to explode!

    Better hurry and catch that short bus. EULA, what a dummy.

     

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  34.  
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    The Mustached Carrot, Jul 4th, 2008 @ 11:40pm

    I have looked and.

    Have you ever really looked for a authentic LV purse on eBay. They are barely cheaper than retail, while the rest cost what you would pay at any of the manufacture retail locations. You probably would get raped in the shipping fee usually inures a profit.

    But!
    I am willing to bet that a reseller on ebay, of authentic goods, make about the same as a retail store on the item.

    Now, its the bootleggers that cash in big. I still have a folex that I bought in TJ. Its actually pretty nice.

     

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    ThePeopleGeek, Jul 5th, 2008 @ 1:06am

    This is so simple.

    They should just make the strollers really flammable so they can't be sent through the mail.

    Why can't people see the simple solutions.

     

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  36.  
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    Cassius Seeley, Jul 5th, 2008 @ 5:59am

    This is all very simple

    Prevent us from re-selling anything we buy = throw it out (when we are finished with it) and someone else having to purchase a new one instead which means that the manufacturer has to make and sell 2 vs. 1 Of course unless they want to send the police out to prevent yard sales (and I bet they would), they will still loose. It is our own fault for letting them get away with it. you know I am sure that you could structure the "sale" in such a way as to get round this wort of thing. Perhaps you "donate" money to some organization, and the organization then "gives" money to the person with the object you want. In return the person with the thing you want generously "gives" the object to you. there we are :) No laws broken, all contracts in order. Say it would not work? It does every day in the real estate industry :) for down payments. Cheers

     

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  37.  
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    Brick, Jul 5th, 2008 @ 9:02am

    business 101

    The concept that selling at a flea market or eBay is the same as running a brick and mortar business with employees, taxes, inventory, lease, more taxes and a group of foolish consumers who think cheaper is better and the retailer is just sticking it to them will get in the end what they deserve.

    Of course it makes sense to keep new retail products off the auction sites (flea markets). How do those products gain the populatrity to sell on the flea market site? advertising? promotion? Who pays for that? Oh yes we have Viral marketing. LOL Brilliant plan.

    Overpriced? Because some idiot poaches sales in a parasitic manner the business that others have invested capital in? If I ship out of my house and have no overhead this is better business? You better hope I'm still in business in 6 months. I certainly will not be paying much for the labor I need because I charge too little for the actual cost of the item. Ever call Amazon? Ebay?

    Changing business model? I compare it to the new math used during the Internet bubble. Consumers still can not add up the cost of the Walmarts and Every Day cheap prices! Who pays for that? The workers who lose their jobs as the factory is outsourced to the newest third world nation with cheap labor. China labor is getting expensive. Who will we exploit next? Don't worry it is coming back on us: Unemployed people can't afford dish washers or strollers. Soon you will not have to worry about the brick and mortar and all the products you buy (hey let's try food next!) will be at the flea market. Makes sense. Gee with all the money we save we will not have to worry about being unemployed because of all the money we are saving.

    I know it's going to be like the music industry and we are going to force the washing machine (or baby stroller) to go on tour. Because no one is going to pay for it to be promoted. Sing for your supper!

     

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  38.  
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    RTS, Jul 5th, 2008 @ 9:30am

    Re:

    Now this is amusing; this joker is trying to say that your position has no economic basis, while the position that consumers benefit from being locked into high-markup distribution channels has "overwhelming" support. It's damn nice of him to excuse your ignorance because you are not an economist.

    The ONLY economic literature, some of which the court relied upon in throwing out Miles, that supports Mr. Lipschitz's position is BOUGHT and PAID FOR "research" by folks who should be ashamed to call themselves economists - of course since these days no one is ashamed to make money by prostituting themselves, this should be no surprise.

    The great problem with trusting any but a very small core of economists is that, unlike hard science researchers who must at least produce verifiable, repeatable data to back up outragous claims, economists can use completely unique and uncontrolled market examples to back up any opinion that they have an incentive to produce. When you have a world where research scientists can claim with a straight face that tobacco is not addictive, you can imagine what this does to the quality of economic research.

    The fact is, in the 95 years since Miles, the NAM it's predecessors and fellow travelers have been funneling money into university economics departments with many goals, one of them being to produce a body of research to back up the absurd claim that reduced choice and higher prices benefits the consumer (keep in mind, not a single consumer, but the body of consumers as a whole - sure a single consumer might benefit from the contrived example above.)

    Clearly Robert Lipschitz is one of these sucklers and as such should be subject to the same treatment we used to reserve for snake oil salesmen (who I'm sure deserve their own protection in his book) and other charlatans.

     

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    Joe, Jul 5th, 2008 @ 12:42pm

    It is the manufacturers fault for not controlling their product through contractual agreements with the retailer.

    Take for example the Gibson Company that controls where and how it's guitars are sold. This is done in order to keep the market price inflated and not to cheapen it's line. They have their own sales channels and it has nothing to do with a EULA. The end users can sell their guitars for whatever they want and the resale value remains relatively high for a Gibson guitar.

    Fender guitars went the complete opposite direction with their brand name and you see their guitars for sale new in pawn shops. They flooded the market with cheap guitars under the Fender name and it also brought the values down as in terms of these newer guitars holding their value.

    I do not think Eula is the correct term to use here as it legally relates mostly to digital goods.

    So....retailers have the right to sell wherever they want unless their is a specific contract in place stating retailers are only allowed to sell in certain retail channels. This is nothing ne and again it was the stroller company's fault for not putting stipulations in their contract if that is the case.

    So yes, if they had stipulations already in place regarding what channel the retailer can sell through, then the manufacturer should rightfully take the matter to court.

     

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    Steve, Jul 5th, 2008 @ 12:59pm

    Re: Vacuums

    Well, stolen = cheaper. If it "fell off the back of a truck" I'll take it.

     

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  41.  
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    Overcast, Jul 5th, 2008 @ 1:19pm

    After *you* buy it, it's no longer the company's possession, since *you* bought it - if you want to resell it, it's your item, not the companies and should be up to the purchaser.

     

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    another anon, Jul 5th, 2008 @ 1:23pm

    Re:

    Joe -> "Fender guitars went the complete opposite direction with their brand name and you see their guitars for sale new in pawn shops"

    I doubt that the success or failure of a guitar manufacturer is based solely upon whether they tightly control the retail market.

    Could it possibly have anything to do with the quality of the product ?

     

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  43.  
    identicon
    Anonymous Coward, Jul 5th, 2008 @ 3:24pm

    Re: Re:

    I take it you are not happy with the shift from the "per se" standard in Miles to the "rule of reason" standard in Leegin.

     

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  44.  
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    BRADLEY STEWART, Jul 5th, 2008 @ 7:06pm

    WOOOO! SPOOKY PEOPLE UNDER YOUR BED AND

    IN YOUR CLOSET. A friend of mine who buys and sells antiques went to an estate sale one day. When he deceided on what he wanted he called the seller over and said Ill take this and this and I don't want this or this but I will take this. At this point the seller said I don't think that you understand? My friend inquired what do you mean? Well the seller said this is a box sale. You have to take the good with the bad. This is the good and this is the bad.The Internet is no different.

     

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  45.  
    identicon
    BRADLEY STEWART, Jul 5th, 2008 @ 7:12pm

    Preditors on Internet gaming

    I believe my comment fell dropped under the wrong question

     

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  46.  
    identicon
    Big Eagle, Jul 5th, 2008 @ 9:00pm

    I can understand the heartache. I have companies that I deal with who also forbid me from selling their items on ebay. If I wanted to do business with them, I had to agree to that stipulation, so I just sell items that I purchase from other wholesalers that don't have that "no sale on e-Bay" clause on e-Bay. It is up to them to prove that I purchased that item from them and not someone else.

     

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  47.  
    identicon
    McCrea, Jul 5th, 2008 @ 11:55pm

    Re: Yet another business model change....

    No. They "should". However, US govt is often very interested in keeping them around.

     

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  48.  
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    chris, Jul 6th, 2008 @ 9:22am

    I can see their point somewhat. I am sure Louis Vuitton hates the cheapening of their brand from knock offs and even ebay. Ebay is fine and all for mass market items but its not exactly Christies or Sothebys. On the other hand, If a regular consumer, not a commercial seller who has agreements with the company regarding selling, legally purchases from either their company stores or department stores you should the right to sell any which way you want.

     

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  49.  
    identicon
    Anonymous Coward, Jul 6th, 2008 @ 12:44pm

    i still have my stroller and i love it. who would hock their stroller. they last forever. oh i get it. the world only needs a certain amount of strollers at any given time. god bless that ebay for realizing this.

     

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  50.  
    icon
    Mike (profile), Jul 6th, 2008 @ 2:09pm

    Re: Re: Re:

    The amicus briefs are no longer available at the Supreme Court website, but did include numerous briefs from economists and the results of their work.

    I'll ask again if you can cite any actual research. You did not. You cited a legal case, not academic research.

    I have read, to the extent they were available (some in total, some not because only excerpts were available), the studies you consistently reference and in all candor must say that their contents are nowhere as unequivocal as you repeatedly state. Some parts of each seem to align with your views, but other parts seem to align otherwise.

    Wait a second. You claimed that there was NO economic basis for my position, and yet now you're admitting that there is some. Funny how that works.

    And, no, of course the research I point to doesn't all unequivocally state the same thing, but when taken together, they all point in the same direction -- and when taken as a whole it's rather hard to debate the findings.

    Of course, you curiously chose not to debate the findings at all, but instead chose to insist they don't exist at all.

    Funny.

     

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  51.  
    identicon
    Anonymous Coward, Jul 6th, 2008 @ 6:05pm

    Re: Re: Re: Re:

    The briefs embodied such research. That is why I was disappointed to see they were no longer online on the SCOTUS website. By the way, do you seriously believe that judicial decisions are rendered in the abstract without an evidentiary base?

     

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  52.  
    identicon
    Anonymous Coward, Jul 6th, 2008 @ 9:58pm

    Re: Re: Re: Re:

    "Wait a second. You claimed that there was NO economic basis for my position, and yet now you're admitting that there is some. Funny how that works."

    You must have confused me with another person posting to this thread.

    "And, no, of course the research I point to doesn't all unequivocally state the same thing, but when taken together, they all point in the same direction -- and when taken as a whole it's rather hard to debate the findings."

    But my comment was merely to note that you consistently proffer unequivocal statements about patents and copyrights being "bad things" that impede the free market, reduce innovation, etc., etc. Some broad data gathered by noted economists lend some credence to your position, but in the papers by such economists the conclusions you draw are couched in terms like "might", "may", "maybe", etc. I noted with some interest Ms. Moser's observation that in countries without a patent system the breadth of technology was less than countries with such a system. Of course, this does not in any way establish a causal relationship between the existence of a patent system and technological diversity, but at least is does give some pause to reflect on the negativity some associate with such systems.

    By the way, I will at any time be glad to entertain a debate of sorts, but quite frankly meaningful discourse is not in my view possible unless based on a comprehensive examination of a specific factual circumstance. For example, is KSR a good thing for what some perceive as making the obviousness standard a bit more difficult to satisfy? While many say "of course", persuasive arguments can be put forth that this may actually have a negative effect on the conduct of business in our multi-faceted and highly dynamic economic system where the predictability of "property" boundaries is seen as a good thing by the likes of Bessen and Meurer. I, for one, have concerns that it may lead to less predictability...precisely the opposite of what Bessen and Meurer suggest will happen.

     

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  53.  
    icon
    Mike (profile), Jul 7th, 2008 @ 1:29am

    Re: Re: Re: Re: Re:

    The briefs embodied such research. That is why I was disappointed to see they were no longer online on the SCOTUS website. By the way, do you seriously believe that judicial decisions are rendered in the abstract without an evidentiary base?

    I asked for cited evidence. You didn't provide any.

    If there is economic evidence then it should be findable, no?

     

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  54.  
    icon
    Mike (profile), Jul 7th, 2008 @ 1:35am

    Re: Re: Re: Re: Re:

    You must have confused me with another person posting to this thread.

    Perhaps if you posted with your name, that wouldn't happen.

    Are you afraid to identify yourself?

    But my comment was merely to note that you consistently proffer unequivocal statements about patents and copyrights being "bad things" that impede the free market, reduce innovation,

    Again, when you combine all of the evidence, it's rather hard to refute those conclusions.

    Some broad data gathered by noted economists lend some credence to your position, but in the papers by such economists the conclusions you draw are couched in terms like "might", "may", "maybe", etc. I noted with some interest Ms. Moser's observation that in countries without a patent system the breadth of technology was less than countries with such a system.

    Moser's papers are used to simply prove it false that there is no innovation without patents. That is all. People insist that none will occur without patents, and that's easily proven false by her research. And I'd challenge the concept that the "breadth of tech" was less in countries without a patent system. That seems to be a slanted reading of her fidnings.

    By the way, I will at any time be glad to entertain a debate of sorts

    It's hard to debate you when you refuse to identify yourself.

    but quite frankly meaningful discourse is not in my view possible unless based on a comprehensive examination of a specific factual circumstance.

    And what factual circumstance have not been examined?

    For example, is KSR a good thing for what some perceive as making the obviousness standard a bit more difficult to satisfy? While many say "of course", persuasive arguments can be put forth that this may actually have a negative effect on the conduct of business in our multi-faceted and highly dynamic economic system where the predictability of "property" boundaries is seen as a good thing by the likes of Bessen and Meurer. I, for one, have concerns that it may lead to less predictability...precisely the opposite of what Bessen and Meurer suggest will happen.

    Can you explain on what evidence you base this on?

    You prefer a low and totally amorphous "obviousness" bar to one that is more clearly stated?

     

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  55.  
    identicon
    Anonymous Coward, Jul 7th, 2008 @ 8:27am

    Re: Re: Re: Re: Re: Re:

    Unlike you, I do not keep track of such things. That is why I made reference to the amicus briefs, which did contain citations. As I noted, one brief was submitted by about 24 economists in support of the Petitioner's position concerning vertical price restraints.

     

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  56.  
    identicon
    Anonymous Coward, Jul 7th, 2008 @ 9:16am

    Re: Re: Re: Re: Re: Re:

    "Moser's papers are used to simply prove it false that there is no innovation without patents. That is all. People insist that none will occur without patents, and that's easily proven false by her research. And I'd challenge the concept that the "breadth of tech" was less in countries without a patent system. That seems to be a slanted reading of her fidnings."

    Obviously we are in agreement that innovation transpires independent of what legal system may be in place. Those who state that we are an innovative economy precisely because of our IP laws are suggesting a causal relationship that has never been established. BTW, take a look again at her paper and note her observation that in countries without a patent system their industries gravitated into technical areas not easily susceptible of reverse engineering. In contrast, those with such systems tended to include a broader range of technologies, such as, for example, manufacturing equipment.

    "Can you explain on what evidence you base this on?

    You prefer a low and totally amorphous "obviousness" bar to one that is more clearly stated?"

    I came across what I thought was a very intriguing paper co-authored by an attorney and an economist that took a look at the issue from a slightly different perspective in considering not only KSR, but also other proposed patent reforms currently on Congress' "plate". What they did in their article was attempt to ascertain if KSR, the reforms, and other current proposals would tend towards making patent claims more "property like", i.e., would they move in the direction of making patent claims more definite as to their metes and bounds in the manner associated with real property. This is one of the concerns expressed by Bessen and Meurer in their recent book, and one of their proposed reforms was to tighten up the award of patents, relax the presumption of validity, etc. As I read through their article (several times in fact) they raised questions that did place this issue in a new light and gave me much pause to reflect on what seems to be the conventional wisdom. Like an idiot I deleted my IE7 history (as I regularly do), and now do not have the site in which the article is contained. I am still looking, but have not as yet hit on the right search terms in Google, which is not unexpected since I came across the paper in the first place by a series of links. If I find it I will provide a cite, not because it will change any minds, but because it is always appropriate to reflect upon fresh approaches to issues.

    Re "amorphous", despite its limitations, the prior emphasis (note: not exclusive, but quite strong) had the benefit of objective evidence being made a part of the record. While I rather doubt KSR will ever take over as the sole test, it does raise a concern that some evidence being proferred by a patent examiner may be more subjective than objective, a result that may unwittingly drive claims in a direction where they may not result in the greater boundary demarcation that Besser and Meurer deem as an important part of any property-based system.

    Please not I did not say I prefer a low standard, but only that this paper, coupled with my experience as a lawyer, raised a host of questions that gave me some pause for concern about conventional wisdom.

    BTW, I do not use my name only because it is tedious to type it and my email address each time I respond, and not to try and hide my identity. For whatever assurance it may provide my name is Michael L. Slonecker, an attorney licensed in California who has practiced all aspects of IP law in both private and corporate settings for almost 30 years. You will not find me to be a prolific publisher of journal articles simply because much of my research is tactically oriented, and my views are consequently not the type I would ordinarily share in open forums. I see nothing to be gained by sharing with the world my take on issues that are best left to situations where an issue is squarely presented in business negotiations and/or litigation. Why give competing interests a peek at my "legal hand"? It seems to me that would be self defeating, especially when the other party stands on very shaky legal grounds.

     

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  57.  
    icon
    Mike (profile), Jul 7th, 2008 @ 5:08pm

    Re: Re: Re: Re: Re: Re: Re:

    Don't have time to respond to the rest of this right now, but:

    For whatever assurance it may provide my name is Michael L. Slonecker, an attorney licensed in California who has practiced all aspects of IP law in both private and corporate settings for almost 30 years.

    If you fill it in once and then click the check box next to "save me a cookie" you won't ever need to fill it in again.

     

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  58.  
    identicon
    Anonymous Coward, Jul 7th, 2008 @ 5:43pm

    Re: Re: Re: Re: Re: Re: Re: Re:

    OK...cookie box checked.

    Now, how to go about reproducing text in italics?

     

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  59.  
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    Robert Lipschitz, Jul 18th, 2008 @ 5:17am

    Re: Re:

     

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  60.  
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    Robert Lipschitz, Jul 18th, 2008 @ 6:48am

    Re: by RTS on July 5th -

    Mr RTS,

    Firstly, I'd like to apologize to Mike for saying he was "probably not an economist". The reason I said so was because he did not seem to be showing us the other side of the argument, the "on the other hand" most economists do by training. Nevertheless, the comment was not needed either way - all I needed to do was point out that I was disappointed that Mike was not showing us arguments for the other side.

    Secondly, on your "this joker is trying to say that your position has no economic basis." I was not. For example, I currently tentatively support the position against IP rights when it comes to music, but I need more arguments/ evidence before I could conclusively come to view. I currently believe that the efficiency benefit of zero-priced reproduction of music MAY outweigh the loss we would face if musicians thereby make less money and produce less music. So, I was not saying that Mike's (general) position has no economic basis.

    However, the claim that IP rights are never beneficial does not have any economic basis, in my opinion. Its just absurd. Are their really papers that argue so categorically? From some of the other posts, I understand that such categorical/ absolutist positions are rarely to be found in the literature, it at all (but please forward them, if they exist). In my opinion, there is good evidence - and really, simple common sense - that there are often important economic payoffs in allowing inventors to benefit from their invention through IP.

    It is only, however, the ABSOLUTIST position of Techdirt, that upsets me. Its always the same one sided view. Dont get me wrong, I think Techdirt does a good job sometimes and that is why I read them. However, if we don't engage in the arguments of the other side, we wont succeed in knocking IP where it counts.

    Finally, on the comment that I should be treated like a "snake oil salesman" trying to protect the big powers. That's just blatantly nasty. I don't appreciate it. I may have been a little nasty in saying Mike was probably not an economist. And for that, perhaps I have received due retribution.

    However, as to your implication! As to any implication that my views are biased, or ever would be, well...sorry, I'm going to have to take you on.

    Not only are my views based on serious research, I was also careful to state them in non-absolute terms. For example:

    E.g 1: "Actually, there are OFTEN very good economic reasons to limit who can sell your product." OFTEN, but not always are not even most times. Just OFTEN.

    E.G 2: "Previously, under anti-trust law (specifically, Dr Miles Ruling), these strategies were banned (e.g resale price maintenance and exclusive dealing) but it has been overwhelmingly shown that SOMETIMES these strategies have net positive welfare effect (for consumers, resellers and manufactures)." SOMETIMES, but not always. And not even most times.

    Hence, the idea that I am trying to back the "powers that be" who are trying to maintain rents in distribution is just utter rubbish. Your admit that there is plenty of economic research arguing that RPM can sometimes be a good thing. Yet you think the work of all these economists in all these universities are biased. OK. Thanks for your conspiracy theory.

    Who cares. Academic research is powerful precisely because we subject the research to scrutiny. The economic arguments which suggests there are efficiencies inherent in price maintenance (RPM) have been published in peer reviewed economic journals. Not only that, but they have been accepted as SO CONVINCING by the Supreme Court of Appeals (in Leegin) that they were in part relied upon to overturn nearly a century of per se prohibition on RPM.

    Perhaps you will consider the core logic of the argument of men you insult so quickly. The fact is that manufacturers have no obvious incentive to give retailers/ resellers/ distributors additional profit (by implementing RPM). They can get all the profit they need by simply charging the retailer/reseller/distributor a higher price. If they try maintain the price that these resellers charge, it will usually only hurt them BECAUSE it will cause the final retail price to go up, the demand for the goods to drop, with no benefit of the higher price (which goes to the reseller, not the manufacturer). HENCE - we would in general expect that - just like consumers - manufacturers want to keep the profits and prices of resellers as low as possible.

    OK, so when they nevertheless DO CHOOSE to implement RPM, there may be a very good reason for it. For example, they may be doing it because they believe that ultimately that is the best way to sell their product. The examples I gave are just one of the many instances as to how this may be the case (i.e. maintain service levels). There are many others, including maintaining a wide distribution service.

    So, in my mind, the onus is you to show that the manufacturer has got it wrong OR, as is the core danger in RPM, they have been "bought out" by the distributors/resellers/retailers who are using them to maintain a price cartel. But absent evidence like this, we should be very careful to go about telling manufacturers how they should sell their products. That is why Leegin REMOVED the PER SE condemnation of RPM. Its not that RPM is always good. Its just that it may not always be bad. And the onus is on us, case-by-case, to find out whether the particular instance under discussion harms or benefits the economy. Idealistic positions are dangerous in economic arguments. And they are not needed.

    Techdirt should realise this and engage more with the other side - in that way, their good arguments would carry more weight, especially when IP should go, and we want to do more than preach to the already converted.

    Otherwise, you look like you are trying to support a new brand of resellers: the Internet companies that stand to benefit if IP is scrapped. And then you want to apply it to all sorts of other things - RPM, etc, etc. And that seems like a dangerous slope to slide down and makes me wonder who is selling the oil.

    Property rights are hard won institutions of peace, liberty and justice. We could make manufacturers give up their factories because we know they are charging us above variable cost for the cars they produce but we don't do that because, well, thats communism. And communism sucks. Non tangible property is no different (other than that the variable cost will sometimes be zero). We don't usurp IP because to do so might stifle innovation and investment. However, we do decide how much to protect them, as with other property rights. Sometimes a little, sometimes a lot. In some cases, we may protect too much. Music, for example. But I'd like to read something that probably engages in the argument.


    R. Lipschitz.

     

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