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Passage Four

eBay scored an important victory in an American court on Monday on how much checking it is required to do of its auction listings, but the decision was in contrast to recent European court rulings.

In a long-awaited decision in a four-year-old trademark lawsuit against eBay brought by the jeweler Tiffany & Company, Judge Richard J. Sullivan of the Federal District Court in Manhattan ruled that the online retailer does not have a legal responsibility to prevent its users from selling fake items on its online marketplace. The verdict reaffirms that Internet companies do not have to actively filter their sites for trademarked material. Rather, they can rely on intellectual property holders to monitor their sites, as long as they promptly remove material when rights holders complain.

“The court ruled that eBay does in fact meet its responsibilities regarding fakes,” said Rob Chesnut, senior vice president and legal counsel at eBay. “We aggressively fight fakes not only to meet our limited responsibilities, but also because fakes hurt the eBay community.” James B. Swire, counsel for Tiffany and a partner at the law firm of Arnold & Porter, said he was “shocked and disappointed” in the ruling. “The principal purpose of trademark law is first to protect consumers and then to protect brand owners,” he added. “You don’t get a real sense of that in this decision.” Mr. Swire said that Tiffany was likely to appeal the decision to the United States Court of Appeals for the Second Circuit.

The ruling is a shift in eBay’s recent courtroom fortunes. A week ago, a French judge ordered eBay to pay 40 million euros ($63.2 million) to the French luxury goods maker LVMH Moёt Hennessy Louis Vuitton over faking charges. In April, a German appeals court ruled that eBay must take preventive measures against the sale of fake Rolex watches.

If those judgments are upheld in appellate court, eBay could have a potential problem on its hands. Though it operates a single global marketplace - buyers in Europe see the same items that buyers in the United States do - eBay would be legally required to do more abroad to fight faking than it is required to do at home. American shoppers on eBay will see no change in the company’s listings, but how the various rulings will affect the listings in Europe remains to be seen.

Questions 16-20 are based on Passage Four.

Which of the following can best summarize the main idea of the passage?

  • A.Americans and Europeans see different items on eBay.
  • B.Americans care less about brands than Europeans do.
  • C.European courts are generally stricter than American courts.
  • D.Same charge against eBay has different results in the U.S. and Europe.
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