Creating a duty for platforms to police, with safe harbor provisions from liability if they comply incentivizes cooperation between trademark owners and platforms

The advent of the internet and proliferation of e-commerce platforms transformed how goods and services are exchanged. Unfortunately, this revolution allowed for counterfeits to “flood our borders and penetrate our communities.”184 Counterfeits, in addition to threatening public health and national security,185 also illegally infringe the rights of trademark owners. However, the internet made online counterfeiters who directly infringe trademark owners’ rights nearly impossible to identify. Consequently, trademark owners have been unsuccessful in trying to hold e-commerce platforms liable under the common law doctrine of secondary liability. Although courts have extended secondary liability—specifically, contributory trademark liability—to online service providers and marketing platforms, the current legal standard serves neither party optimally. A fundamental barrier in enacting any change to this standard lies in the balancing conundrum that contributory trademark liability rules must defend trademark owners’ interests in better protecting their brands from online trademark infringements while refraining from implementing restrict rules that deter legitimate and productive activities in the Internet marketplace.

While both legislative and judicial actions could remedy this problem, an especially effective solution would be for Congress to amend the Lanham Act to emulate the DMCA and create a similar safe harbor provision that clearly delineates the duties of e-commerce platforms and trademark owners. To better serve the purposes of trademark law, however, any amendment should also include a limited duty to police—something that is absent from the DMCA provisions for e-commerce platforms. In the absence of Congressional action, the Supreme Court could also solve the problem by clarifying the Inwood test’s knowledge standard. Although this Comment proposes two separate solutions that the Supreme Court could adopt, the Luxottica approach would likely be most effective. Under that approach, the Court would clarify that actual or constructive knowledge of direct infringements could arise from various sources. Additionally, the Court could impose a reasonable duty to perform at least a cursory investigation of their platforms after receiving valid allegations of direct infringements from trademark owners. Despite having both legislative and judicial options for solving the contributory trademark infringement problem as it relates to e-commerce, Congress is best equipped to formalize a uniform standard efficiently and expeditiously by amending the Lanham Act. The sooner Congress acts, the sooner that tens of millions of brand owners and e-commerce platforms could cooperate more effectively to curb online trademark infringements and stimulate healthy economic growth during the internet age.