👠 Amazon's selling fakes

In today's email, we've got:

  • Amazon getting in trouble for third-party sellers selling fakes

  • a mega-US law firm merger

  • a free alternative to a gift basket

If you take just one thing from this email...

Amazon lists both Amazon and non-Amazon products on its website. While it tries to make sure the non-Amazon stuff aren't fake designer goods, the latest decision from the Court of Justice of the European Union suggested it's not doing enough. 

If the judgment goes against it, Amazon could be breaching intellectual property rights of the fashion designers and treated as if it's selling counterfeit goods itself.

EDITOR'S RAMBLE 🗣

It's coming to the end of the year.

While there's a lot of talk of New Year's resolutions around this time of the year, I think it's equally a useful time to look back and reflect on the year that's coming to an end.

The end of a year is a chance to look at your work, health, finances, relationships and other areas of your life over the previous 12 months.

The best way I've found to do this is by doing something called an 'annual review'. 

Here's a thorough and helpful guide for anyone hoping to go through an ‘annual review’ process who's not done it before.

The process lets you celebrate your successes, learn from your failures, and most importantly, assess whether you’re spending your time in life in the areas you actually want to be spending your time in life.

Hopefully this can help you live a more intentional 2023. 

Happy New Year!

- Idin

FEATURED REPORT 📰

👠 Amazon's selling fakes

Credit: Giphy

What's going on here?

The Court of Justice of the European Union (CJEU) has ruled that Amazon may be held responsible for trademark infringements resulting from fake goods sold on its platform. This would include the sale of ‘fake’ red-soled shoes that look like those of high-end shoe designer Christian Louboutin.

What does this mean?

The preliminary ruling comes after designer Christian Louboutin brought two cases against the online retailer in 2019, alleging that Amazon regularly displayed adverts for red-soled shoes on its marketplace without Louboutin's consent.

Louboutin believes that Amazon is to blame for the sale of the fake shoes and is breaching the designer’s intellectual property in doing so.

Why is Amazon to blame?

In this case, Amazon is selling the products of third-party sellers. It isn’t actually putting up fake Louboutin for sale itself, but is allowing listings for them to be published. 

But Louboutin says Amazon is "misleading the public" as it’s advertising fake goods on its site. It’s not always clear from Amazon’s website which of the goods are Amazon goods (and more reliable) and which are third-party goods (which might be less reliable).

The CJEU agreed that Amazon could potentially be responsible for intellectual property breaches found in the advertisements of counterfeit shoes featuring Louboutin’s famous red sole, as Amazon users may believe it’s actually Amazon marketing the product (and not the third-party seller).

While Amazon’s not the seller, it still makes money from third-party sellers on its site - so it is profiting from those sales. Amazon also offers benefits like storage and shipping of third party products, helping out in that way too.

What are the lawyers saying?

Fabian Klein, an intellectual property lawyer from law firm Pinsent Masons says that Amazon should “review the layout of their site to ensure that it was clearly identifiable to the public where the offers originated from” (i.e. whether it’s an Amazon product or a third-party product). 

A platform that only ever shows third party products (like eBay, Vinted or Depop) is okay. But the issue here is that Amazon mixes its own stuff with other people’s stuff. Klein says “they should consider - from a trade mark perspective - whether they want to create a different look and feel, or other clear differentiations" for non-Amazon items.

As Amazon sometimes helps with warehousing and shipping third-party goods, it can cause even more confusion for the buyer as the Amazon packaging and returns labels might (understandably) make you think you’d bought a product from Amazon when you didn’t.

What’s the impact for Amazon?

Amazon has always argued that it’s only a middleman in transactions and shouldn’t be liable for things like this. It also has policies and an internal team dedicated to taking action against counterfeiters. So, they may think that they’ve done enough.

But it seems that the CJEU didn’t think so. 

Following the ruling, it’s possible that Amazon will have to redesign its website to differentiate between Amazon goods and non-Amazon goods. This could hurt sales as many buyers buy from Amazon relying on its good name but would be more sceptical of buying from an unknown third-party.

Thierry Van Innis, Louboutin's lawyer, says that “Amazon can be held accountable for the breaches as if the platform was itself the seller.” While this isn’t the language of the CJEU, it shows the level of accountability that brands want from Amazon. If this is where the courts also end up drawing the line, then Amazon’s going to have to get much tougher on fake sellers to avoid risking itself getting into trouble.

It’ll probably mean additional costs for Amazon in hiring more investigators to check out the goods being listed. And, in the cases where they get it wrong, there will be massive risk of liability that opens up for them as they’d be treated as selling the fake goods themselves.

Following this ruling, Amazon’s not said much yet but did say that it “will study the Court’s decision.”

So, what will happen next?

The CJEU said it was now up to two national courts, in Belgium and Luxembourg, to ultimately decide the case. The decision could have a massive cost and risk impact on Amazon and any other ecommerce businesses running a similar ‘mixed’ model to Amazon.

If it goes against Amazon, it will make things much tougher for them and as their risk exposure for intellectual property breaches could skyrocket.

 A BIT OF FUN 😄

Guess the price shifts

This year's been a rollercoaster year for markets as central banks have raised interest rates to try to manage inflation.

Can you match the four assets in the first section to their price change since this time last year in the second section?

Assets

  • A. British Petroleum

  • B. Amazon

  • C. Ince Group PLC

  • D. Bitcoin

Price Change

  • 1. -67%

  • 2. -86%

  • 3. -49%

  • 4. +41%

Scroll down to the bottom to see the answers. 👀

IN OTHER NEWS 🗞

  • 🤝 Law firms Shearman & Sterling and Hogan Lovells could be merging: Rumours have spread that the two law firms could merge to create a US mega firm. Shearman held meetings with senior people at the firm to discuss the merger and since rumours were raised, neither firm has denied it.

  • ❌ Law firm group ‘Ince’ has suspended trading of its shares: The Ince Group, a law firm group that trades on the London Stock Exchange, has been suspended because of concerns raised by auditors. The issues relate to delays in publishing their accounts, which are meant to be published in December 2022 but probably won’t come out until January 2023.

  • 💻 Meta has settled the Cambridge Analytica scandal case for $725m: The scandal saw Meta accused of letting the British firm to access Facebook users' personal data. Meta’s not accepted that it did anything wrong but has said it’s ‘revamped’ its approach to data security since this issue arose. The sum is the largest of any US data privacy class action.

AROUND THE WEB 🌐

  • 🎁 Gifts: Next time you have to get someone a present, forget the gift basket - you can get them an (equally amazing) GIF basket.

  • 👀 Reading: This cool browser extension allows you to speed-read by showing one word at a time.

  • 🤖 Crypto: It's been a bad year for crypto... I know that, but I don't really know why. If you're the same as me, this handy website translates all the crypto updates to plain English in daily updates.*

* This is an affiliate link. Although it is free to join, if you sign up through us, we will receive a small commission. 

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Quiz Answer: 

Amazon: -49%Ince Group PLC: -86%British Petroleum: +41%Bitcoin: -67%