Applying a constructive knowledge standard to contributory trademark liability for online commerce would force online marketplaces to take a proactive approach in addressing counterfeiting
Hayley Dunn, 2021 - Maryland licensed attorney who holds a J.D., cum laude, from the Catholic University of America, Columbus School of Law. At time of writing, served as a judicial law clerk to the Honorable Laura S. Ripken of the Court of Special Appeals of Maryland. “What's in Your Box? Removing the Tiffany Standard of Knowledge in Online Marketplaces,” 29 Cath. U. J. L. & Tech 91 (2021). Available at: https://scholarship.law.edu/jlt/vol29/iss2/6 //DH
An alternative to such a broad approach would be to create a statute to overturn Tiffany, requiring the high standard of specific knowledge of particular online infringements.279 In particular, the knowledge standard for contributory liability must be modified so brand owners can recover. Rather than saying there must be more than “general knowledge” of infringement for a company to be liable, Congress could draft a statute to establish clear factors for willful blindness. It could clarify that once an online marketplace has been notified of a certain amount of infringements for a particular brand, they have been put on notice to address subsequent listings from the same brand. Willful blindness has been established as constructive knowledge in contributory trademark infringement cases for brick-and-mortar stores, but courts have yet to apply the same standard through online marketplace infringements.280 A statute to create such a cause of action may read:
An online retailer may be held contributorily liable for trademark infringement if: the online retailer suspects wrongdoing, and fails to investigate and rectify such wrongdoing, or fails to actively police for particular infringements after suspecting such wrongdoing. In order to evaluate whether the online retailer ‘suspects wrongdoing,’ courts shall evaluate the following factors, including but not limited to: (1) whether a party outside of the online retailer notified the online retailer of the particular alleged infringements of particular products; (2) whether a party outside of the online retailer notified the online retailer of general alleged infringements of particular products; (3) the amount of infringements; and (4) whether there is information publicly available indicating alleged infringement.281
This approach is feasible because it parallels Alibaba’s current methodology of actively policing a mark once there is a specific amount of infringement claims.282 Additionally, broadening of the knowledge standard would incentivize online marketplaces to increase their efforts to combat counterfeits. It also does not entirely shift the burden away from brand owners—they would still have to put the website on notice prior to suing.