Liability balanced now - provides incentives for trademark protections and enforcement

[28/12/2020, Patent and Trademark Office, “Engine Advocacy”, https://downloads.regulations.gov/PTO-T-2020-0035-0008/attachment_1.pdf, accessed 7/9/2024, LR]

I. Doctrine of contributory liability, as applied by courts, and how e-commerce platforms routinely address alleged trademark infringement online

Under prevailing case law, e-commerce platforms can be held liable for contributory infringement if they continue to supply services to users when they know or have reason to know that those users are engaging in trademark infringement.3 In practice, there is a “substantial convergence” in how liability is analyzed for trademark and copyright claims in this context. 4 Analogously, e-commerce platforms routinely implement systems for removing alleged trademark infringement they know of—e.g., upon receipt of a notice—just as they do for claims of copyright infringement.5

That said, as e-commerce platforms scale, and depending on several factors (including the type of content hosted and the volume of potential trademark infringement), many will develop and adopt technology or hire teams of content moderators to help flag potential trademark infringement.6 This is similar to the so-called “DMCA-plus” efforts certain platforms use to attempt to detect possible copyright infringement.7 Indeed, “the presence of infringing activity on their sites is contrary to the business interests of” ecommerce platforms. “Instilling consumer confidence in the integrity of their marketplaces is critical. Consumers who cannot trust the authenticity of the merchandise listed on a site will not long remain customers.”8

Developing technology and/or hiring moderators comes at substantial cost. For example, eBay invests as much as $20 million per year in trust and safety efforts—including running searches, deploying filters, and implementing buyer protection programs—with over 200 employees focused on combatting potential infringement.9 Alibaba has likewise developed technology to try and identify potential infringement, after significant investment, and takes further steps to monitor posts, look for anomalous transactions, assist law enforcement, etc.10 While these and numerous other e-commerce platforms do more than notice-andtakedown, the costs of doing so are far more than what a startup could afford.11

Overall, as the case law illustrates, “in most cases the courts are getting it right” and the current doctrine of contributory liability is resulting “in decisions that reward good behavior and punish bad behavior by platforms.”12