Tiffany alleged multiple established and novel causes of action in this lawsuit, including (1) direct trademark infringement under federal and common law; (2) contributory trademark infringement under federal and common law; (3) unfair competition under federal and common law; (4) false advertising under Section 43(a)(1)(B) of the Lanham Act; (5) trademark dilution under federal and New York law; and (6) contributory dilution.

The Court recognized that the rapid development of the Internet and web sites like eBay has created new ways for sellers and buyers to connect to each other and to expand their businesses beyond geographical limits. Likewise, the Court recognized that such new markets have also fostered new opportunities for counterfeiting and infringement.

While admittedly sympathetic to Tiffany and other rights owners who have invested enormous resources in developing their brands, only to see them illicitly and efficiently exploited by others on the Internet, the Court found the various preemptive and deterrent measures taken by eBay to identify and address infringement timely, cooperative and adequate under the circumstances. The Court held that companies like eBay cannot be held liable for trademark infringement based solely on their generalized knowledge that trademark infringement might be occurring on their web sites. 

The Court ultimately adhered to the longstanding principle that corporate owners of trademarks have a duty to protect and preserve the corporation's trademark assets though vigilant policing and appropriate acts of enforcement.

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