A safe harbor alone won’t reduce counterfeiting – it requires changing the knowledge standard

Another proposal suggests importing a safe harbor scheme like the DMCA’s scheme for copyright and adding affirmative anticounterfeiting measures to qualify for the safe harbor.127 To fall under the DMCA copyright storage safe harbor, service providers must: (1) have no actual knowledge of specific instances of infringing materials; (2) not have received any financial benefit that is directly attributable to the infringing activity; and (3) promptly takedown any potentially infringing material once notified.128 If a service provider satisfies those requirements, a court will not find the provider contributorily liable for copyright-infringing actions taken by the service provider’s users.129 This proposal suggests bringing a similar scheme to trademarks, largely to increase cooperation between Online Marketplaces and trademark holders.130 However, the different type of harm coming from trademark infringement suggests that an affirmative requirement to take anticounterfeiting measures be added to the safe harbor entrance requirements.131

While this proposal is a good start and would likely have a positive effect, it does not go far enough to reduce online counterfeiting by a meaningful amount. After Tiffany, courts only find Online Marketplaces liable for contributory trademark infringement upon a showing of particular knowledge, so importing that requirement will not provide Online Marketplaces with much more protection.132 Additionally, many Online Marketplaces already take affirmative anticounterfeiting measures (including eBay and Amazon), and counterfeit goods still run rampant on those platforms.133 Therefore, while having that affirmative requirement may help on the margins, it is not enough on its own to fully solve the problem.