Who is responsible for policing the Website for counterfeit products –Tiffany, eBay, or the customers themselves. Is it even possible to catch everything? What the courts decide will surely set a precedent.

Is the end in sight for eBay's unique business model? Is the lawsuit actually a strategy to force people to buy from Tiffany and Tiffany only? Will flea markets and credit card companies now be liable for involvement in the purchase of counterfeit goods?

What Tiffany said: The famous New York-based jewelry retailer claims that the San Jose, California-based eBay does not ascertain the genuineness of goods sold in its Website, facilitates the sale of fraudulent Tiffany items, and makes millions of dollars in profits from these counterfeit sales. (Tiffany had randomly purchased a few hundred "Tiffany" items on eBay and discovered that three quarters of these items were counterfeit.)

What eBay said: The online auction house claims that it has cooperated, and will continue to cooperate, with Tiffany's brand protection and monitoring efforts and has given the jewelry company the tools to report problem listings – which eBay immediately removes. Furthermore, it will fight the lawsuit because "its claims are without merit."

The lawsuit, started by Tiffany in 2004 and recently opened before US District Judge Richard Sullivan, has already inspired a flurry of opinions from lawyers to bloggers…and everyone in between.

Those who want Tiffany to prevail claim that it naturally does not want its brand diminished by allowing fake products to be sold under its name, that the lawsuit sends a message to illegal resellers that their activities will not be tolerated, and that eBay must make much-needed changes to verify the provenance of products with a famous brand.

Those who think eBay should win point out that Tiffany may have brought on the lawsuit to restrict the second-hand sale of its products and force people to buy exclusively from their stores. eBay defenders also claim that even with computers sifting through eBay items in search of counterfeits, it's just not possible to catch each and every fake product. Furthermore, should Tiffany wins the case, not only will eBay be open to similar lawsuits from other brand owners, but every two-bit flea market and other venues which happen to sell fake items should be sued as well.

But what about the heart of the case: whose responsibility is it to police items when products are being resold?

According to Tiffany, it has worked with eBay for years to remove fake items from the auction site but that this has done nothing to stop the counterfeit sales. The company claims, moreover, that automatic screening by eBay would be more effective and less expensive. The online auctioneer counters that eBay is a marketplace and service provider, not a retailer. And that with its VeRO (verified rights owners) program to help brand owners prevent fake goods from being sold on its site, it's already doing more than the law requires.

Speaking of the law, the US law does say that it is the trademark owner's job to determine whether goods are counterfeit. Others say the responsibility rightfully belongs to the buyer. This landmark case, however, could reverse the rules: If the court finds in favor of Tiffany, then eBay and other auction houses may now have to spend even more money for increased monitoring of their sites. Also, the fact that eBay was informed of the fake products on its Website could shift the policing responsibility to them.

Today, it's Tiffany. Tomorrow, could it be Gucci? Prada? Chanel? The folks at eBay are holding their breath.