Court decisions create uncertainty over the level of knowledge required to establish contributory liability – because every decision is contingent on the facts of each case
Irene Calboli, 2016 - Professor of Law at Texas A&M University School of Law, Academic Fellow at the University of Geneva, and Visiting Professor at Nanyang Technological University “Contributory Trademark Infringement on the Internet: Shouldn't Intermediaries Finally Know What They Need to "Know" and "Control?", in RESEARCH HANDBOOK ON ELECTRONIC COMMERCE LAW, Elgar Online. Accessed via University of Michigan //DH
As I noted in the Introduction, even though the courts have adopted the test that the Supreme Court elaborated in Inwood in a variety of contexts, the analysis of judicial decisions on contributory trademark infringement indicates that the outcome of each case remains essentially driven by the facts at issue.127 In particular, the analysis of judicial precedents illustrates that the presumed legitimacy of the intermediaries, their responsiveness to trademark owners’ complaints, and the type of activities that potential direct infringers engage in play a very relevant role in the final decision of the courts. Still, uncertainty dominates with respect to the definition of the element of “knowledge” and that of “control” under the Inwood test and its variations. As a result, intermediaries are left without bright-line rules to follow, which could lead to a finding of contributory trademark infringement.
In contrast, the only certainty that one can derive from judicial decisions with respect to the element of “knowledge” under the second prong of the Inwood test is that the courts have converged toward a narrow interpretation of “specific knowledge” rather than “generalized knowledge.” As I elaborated in Part II, the Ninth Circuit initially ruled, in Fonovisa, that liability attached to the defendant’s action because it had a “generalized” knowledge of the sale of counterfeit products on its premises.128 In the following years, the courts reduced the breadth of this interpretation of “knowledge.” The most recent leading case in this respect is Tiffany v. eBay, in which the Second Circuit rejected the idea that “generalized” knowledge could satisfy the Inwood test,129 and stated that a finding of liability required “specific knowledge” of the direct infringement.130 Post-Tiffany v. eBay, the courts have continued to hold that knowledge of “specific instances of infringement” is required for a finding of contributory infringement.131 Still, how specific this “specific knowledge” should be, and how many specific instances of infringement intermediaries should be aware of, remain unclear. What is clear is that the courts will assess this knowledge on a case-by-case basis.