The impact of intellectual property law which includes intellectual property rights, intellectual property transfer or licensing is a huge concern for the large discount retail industry. Of course, large discount retailers want the cheapest price for the product so that they can make a phenomenal profit but because of that fact, they are subject to counterfeit merchandise being sold to them. Sure, once the merchandise is found to be counterfeit, it can be pulled but that might mean hundreds of thousands of dollars down the toilet. Large discount retailers must also be on the lookout for intellectual property infringement for their own companies. Wal-mart was just recently in a battle over the “smiley-face” logo which it had patented in the U.S but not abroad. Someone in another country claimed that Wal-mart had infringed on intellectual property rights. Therefore, a legal battle ensued. As the business world becomes more global, intellectual property laws should be more global instead of left to individual countries to enforce.
One of the most remarkable characteristics of e-commerce is that it occurs globally. Intellectual property may be used and licensed in many countries simultaneously. The global characteristic of e-commerce businesses affects intellectual property in a number of ways. It makes it difficult to find the infringer and enforce intellectual property rights that are violated on the Internet. It is unclear what courts will have jurisdiction over disputes relating to e-commerce and intellectual property. Also, laws affecting intellectual property vary from country to country so levels of protection may be different.
Lawsuits can be brought against a large discount retailer or, conversely, a large discount retailer may seek redress in national courts, but various legal procedural issues will affect such cases. If the parties are in different countries, it will be difficult to determine which court can or should be used. The court may or may not take legal control over the case, depending on many factors, but especially the connection between the parties and the country. As a practical matter, in order for a lawsuit to succeed, the defendant has to reside in the country in which the lawsuit is brought. Another difficult issue is what law to apply, especially if the laws of the countries of the parties involved are different. Finally, even if the lawsuit succeeds, it could be difficult to enforce a judgment in another country. International arbitration is one way to deal with international e-commerce disputes, though generally participation is voluntary and cannot be forced.
In 2006, a Frenchman claimed to have invented the yellow smiley face that Wal-mart uses back in 1968. For some, the image is a reminder of 1970s counter-culture, for others, a useful shorthand when sending e-mails. But since 1996, Wal-Mart has used the image in the US on uniforms and promotional signs, and it wants sole rights to it in the US retail sector. Franklin Loufrani - just one of a number of people who profess to have invented the image - has marketed the sign since the early 1970s. He and his London-based company SmileyWorld today own the rights to the logo in more than 80 countries around the world. The US is not included in this list (“Wal-mart”, 2006).
In 2007, a federal district court judge issued two landmark decisions in a nationwide class action suit against Target charging that the retail giant has "failed and refused" to make its Web site accessible to the blind. Brought by the National Federation of the Blind, the suit charges that by failing to make its site accessible to blind users via vocalization software or other tools, Target has violated the Americans with Disabilities Act as well as two California civil rights statutes: the California Unruh Civil Rights Act and the California Disabled Persons Act. In the ruling, Judge Marilyn Hall Patel not only certified the case as a class action on behalf of blind Internet users nationwide under the ADA, she also held that web sites such as Target.com are required by California law to be accessible (“IP”, n.d.).
Intellectual property laws are complex and vary from country to country. Preparation must be taken to insure that a company's intellectual property rights are not violated and that the company does not violate any laws themselves.
(2006, May 8). Wal-Mart seeks smiley face rights . Retrieved January 22, 2009, from BBC: http://news.bbc.co.uk/2/hi/business/4984138.stm
(n.d.). Industry Overview: Discount Stores. Retrieved January 22, 2009, from Hoovers: http://www.hoovers.com/discount-stores-/--ID__300--/free-ind-fr-profile-basic.xhtml
(n.d.). IP Concerns About International Transactions in E-Commerce. Retrieved February 1, 2009, from World Intellectual Property Organization: http://www.wipo.int/sme/en/e_commerce/transactions.htm
Noyes, K. (2007, October 3). Commerce Times . Retrieved February 1, 2009, from Target.com Lawsuit Shines Light on Net Access for Blind: http://www.ecommercetimes.com/story/59634.html