Another Misuse Of Trademark Law To Prevent Competition

from the just-what-we-needed dept

Gregory A. Beck of Public Citizen writes in to let us know “Public Citizen Litigation Group filed suit yesterday against Dymo Corporation, a company that makes label printers. Our client is a small eBay seller named Rip Mohl, who sells printer labels that are compatible with Dymo printers. After failing to talk him into becoming an authorized distributor of brand-name Dymo labels, the company began invoking eBay’s Verified Rights Owner (“VeRO”) program to terminate his auctions of compatible labels. VeRO is an implementation of the Digital Millennium Copyright Act, but although the DMCA applies only to claims of copyright infringement, eBay also extends the same takedown procedures to trademark claims. In this case, the company claimed that by truthfully stating that the labels were compatible with Dymo printers, Mohl was infringing the company’s “Dymo” trademark. After several VeRO terminations, Mohl had to remove the Dymo name from his listings in order to avoid the risk of losing his eBay account. As a result, his sales have declined to a fraction of what they used to be. Printer companies are especially active in terminating the eBay sales of compatible products like labels and ink cartridges. This is, we think, another example of abuse of intellectual property laws to squelch legitimate competition. This kind of abuse ultimately hurts everyone by raising prices and reducing choices available to consumers. The Dymo-brand labels on eBay, for example, cost an extra couple dollars per roll. Small eBay sellers, however, typically do not have the resources to defend themselves from the intellectual property claims of big corporations. These claims therefore almost always go unchallenged.” This is another bad use of trademark law — having nothing to do with the intended purpose of trademarks.

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Comments on “Another Misuse Of Trademark Law To Prevent Competition”

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Anonymous Coward says:

brand-name Dymo labels

“who sells printer labels that are compatible with Dymo printers. After failing to talk him into becoming an authorized distributor of brand-name Dymo labels”

if Dymo is so “in the right” about their claims, than eBay should also remove all items that are compatible with other such items – such as car parts that are compatible with major manufacture cars (ever heard of AFTERMARKET SUPPORT PRODUCTS?)

…and what about other products that are compatible with someone who owns a Sony VCR and a JVC Television with Adelphia provided Cable hooked up through wires purchased through Radio Shack…

But with Dymo’s analogy, the customer would have to have 100% of the product purchased from Best Buy, being manufactured by Best Buy and being 100% ONLY supported by Best Buy… as an example.

Anonymous Coward says:

And then what happens if Dymo should go out of business – does this mean that everyone with a Dymo product should throw out that product and replace it with that of a product made by another company?

I mean, if Dymo doesn’t allow aftermarket support for their products, they are essentially shooting themselves in their feet if they should ever run into financial problems.

Dymo products will be obsolete since the only place to get support Dymo will be from Dymo.

Greg Beck says:

No laws were broken, that is true. The problem, however, is with the DMCA and eBay’s VeRO program you are guilty until proven innocent. Even if a claim is meritless, it will still get your sale taken down. There is no counternotice procedure or other appeals process for trademark claims, so the only recourse is to sue. Biig companies count on the fact that small eBay sellers aren’t going to subject themselves to that kind of trouble and expense.

Anonymous Coward says:

This is bizarre. As a paralegal I took a course in Copyright, Patent and Trademark law…one of the things that is very specifically as a kind of fair use is to mention a trademarked item if you have something compatible with it. This certainly seems to me to fall within that permissibility.

Ebay can have whatever policies it wishes, of course, But they should make it clear it’s just an ebay restriction and not something to do with legal restrictions on trademark usage.

Chris says:

I think he was wrong

After reading the actual facts of the case, I’d have to say that I’m with Dymo on this one. If trademark laws are to prevent confusion in the market place then this is a legit violation.

There’s nothing in his item description to say that these labels are not made by Dymo.

Reading it I would not at first glance think that these were a third party label.

I do think that trademark and copyright are over used, but this is a legit case.

Kim says:

Re: I think he was wrong

He states it’s a ‘compatible’ and in no way did he state that the labels were made by Dymo.

There are plenty of ‘compatible’ items on the market. Why is Dymo picking on him?

Dymo is just a plain bully, and using eBay’s LOUSY VERO program (which has lots of loopholes) to enforce their bullying! A total disgrace imho!

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