eBay 2015 Annual Report Download - page 29

addition, we have received significant media attention relating to the listing or sale of illegal or counterfeit goods,
which could damage our reputation, diminish the value of our brand names, and make users reluctant to use our
products and services.
We are subject to risks associated with information disseminated through our services.
Online services companies may be subject to claims relating to information disseminated through their
services, including claims alleging defamation, libel, breach of contract, invasion of privacy, negligence,
copyright or trademark infringement, among other things. The laws relating to the liability of online services
companies for information disseminated through their services are subject to frequent challenges both in the
United States and foreign jurisdictions. Any liabilities incurred as a result of these matters could require us to
incur additional costs and harm our reputation and our business.
Our potential liability to third parties for the user-provided content on our sites, particularly in jurisdictions
outside the United States where laws governing Internet transactions are unsettled, may increase. If we become
liable for information provided by our users and carried on our service in any jurisdiction in which we operate,
we could be directly harmed and we may be forced to implement new measures to reduce our exposure to this
liability, including expending substantial resources or discontinuing certain service offerings, which could harm
our business.
Changes to our programs to protect buyers and sellers could increase our costs and loss rate.
Our eBay Money Back Guarantee program represents the means by which we compensate users who
believe that they have been defrauded, have not received the item that they purchased or have received an item
different from what was described. We expect to continue to receive communications from users requesting
reimbursement or threatening or commencing legal action against us if no reimbursement is made. Our liability
for these sort of claims is slowly beginning to be clarified in some jurisdictions and may be higher in some non-
U.S. jurisdictions than it is in the United States. Litigation involving liability for any such third-party actions
could be costly and time consuming for us, divert management attention, result in increased costs of doing
business, lead to adverse judgments or settlements or otherwise harm our business. In addition, affected users
will likely complain to regulatory agencies that could take action against us, including imposing fines or seeking
injunctions.
We may be unable to adequately protect or enforce our intellectual property rights, or third parties may
allege that we are infringing their intellectual property rights.
We believe the protection of our intellectual property, including our trademarks, patents, copyrights, domain
names, trade dress, and trade secrets, is critical to our success. We seek to protect our intellectual property rights
by relying on applicable laws and regulations in the United States and internationally, as well as a variety of
administrative procedures. We also rely on contractual restrictions to protect our proprietary rights when offering
or procuring products and services, including confidentiality and invention assignment agreements entered into
with our employees and contractors and confidentiality agreements with parties with whom we conduct business.
However, effective intellectual property protection may not be available in every country in which our
products and services are made available, and contractual arrangements and other steps we have taken to protect
our intellectual property may not prevent third parties from infringing or misappropriating our intellectual
property or deter independent development of equivalent or superior intellectual property rights by others.
Trademark, copyright, patent, domain name, trade dress and trade secret protection is very expensive to maintain
and may require litigation. We must protect our intellectual property rights and other proprietary rights in an
increasing number of jurisdictions, a process that is expensive and time consuming and may not be successful in
every jurisdiction. Also, we may not be able to discover or determine the extent of any unauthorized use of our
proprietary rights. We have licensed in the past, and expect to license in the future, certain of our proprietary
rights, such as trademarks or copyrighted material, to others. These licensees may take actions that diminish the
17