E Commerce Aff - Michigan 2024 STARTER

1ac
Notes
This is a trademark affirmative that tries to increase trademark enforcement against online platforms (like Amazon, eBay, etsy or Facebook marketplace) that don’t take action against counterfeiting. I think it’s a pretty good affirmative, but it’s complicated and will require learning a lot about trademark law to effectively debate it.
Counterfeiting is a specific form of trademark infringement regulated under the Lanham Act, where a bad actor tries to sell a product under a counterfeit trademark.
The problem with counterfeiting enforcement is that most counterfeit products sold in the United States are made in other countries, and it’s impossible to prosecute someone in China for selling a counterfeit good online in the United States. The affirmative claims that instead, the platforms that list and sell those counterfeit products should be held liable for trademark infringement and damages if they do not take proactive measures to enforce anti-counterfeiting measures.
The theory of the affirmative is that trademark owners (“brands”) can’t effectively prevent online trademark infringement. There are millions of products listed every day on each platform, and millions of individual sellers. So, while a company can report to Amazon that they saw a counterfeit listing, even if Amazon takes it down, there will be new counterfeit listings that pop up in their place (the “whack-a-mole” enforcement problem). This is reactive enforcement. It’s too expensive and time-consuming for brands to enforce trademark rights in online marketplaces, and it’s futile to try because new infringement activity will overwhelm reporting.
So instead, the affirmative has the courts impose contributory liability on platforms that fail to take proactive enforcement efforts. Proactive enforcement might include things like automated screening of counterfeit goods before they can be listed, or it might require platforms to track IP addresses of individual third-party sellers, or ban repeat infringers, or require a seller to have a US address and consent to being served in the United States before they can list items on the marketplace.
One important argument is that the affirmative claims to be “burden sharing” between platforms and brands, rather than “burden shifting” enforcement exclusively to platforms. This is the best reason courts need to do the affirmative rather than Congress – because courts can develop case law that applies the constructive knowledge standard to different factual contexts to determine what constitutes a reasonable precaution. The claim is that anti-counterfeiting enforcement only works when brands and platforms cooperate. The current system where enforcement is exclusively left to brands fails. A constructive knowledge standard puts some of the burden on platforms, but also recognizes that brands have a duty to share product information with platforms to facilitate reasonable precautions. Constructive knowledge also recognizes that not all platforms have the same capability to enforce, which means the amount of liability for each platform might vary based on the amount of sales and the nature of the platform.
Definitions
SHOP SAFE Act – a lot of cards, especially a lot of negative cards, refer to this. It’s a law that has been proposed in Congress to essentially do the plan legislatively (it won’t pass). There may be new House hearings on it over the summer, so if you’re interested in this affirmative, it’s worth your time to follow the hearings. There are a lot of things about SHOP SAFE that don’t apply to this aff – but those cards are not in the negative file. The cards that do mention SHOP SAFE do apply, because they are about strengthening contributory liability, which is the aff. The aff is slightly different from the standard in SHOP SAFE in that it will claim that ‘constructive knowledge’ is a more flexible test to apply contributory liability. But for the most part, the negative evidence is relevant.
Contributory liability – this is a form of secondary liability that holds a third party liable for counterfeiting if they knew about trademark infringement on their platform and did nothing to stop it. Contributory liability applies to trademark counterfeiting now, but it depends on the standard of knowledge that courts apply to determine whether an online platform ‘knew’ infringement was occurring.
Specific knowledge – also called “contemporary knowledge” or “actual knowledge”. This is the current standard for determining contributory trademark liability. In the 2nd Circuit case Tiffany v. eBay (2010), the court held that eBay’s liability for counterfeit Tiffany products sold on its site required eBay to remove counterfeit listings that were reported to it, but that eBay had no further obligation to police its website, because it lacked specific knowledge of other counterfeiters.
Constructive knowledge – also called “reason to know” – this is a standard for determining contributory liability developed in the case Inwood v. Ives (1982). Ives said that if a (brick and mortar) marketplace had reason to suspect counterfeiting was occurring, whether through multiple notices, widespread reports, or third-party assessments, and the marketplace did not take reasonable precautions, then that marketplace is contributorily liable even if did not know about a specific instance of counterfeiting. Essentially, constructive knowledge is a standard that says you “should have known” illegal activity was taking place, and the reason you didn’t know was that you were negligent.
Willful blindness – this is a judicial doctrine that says if a marketplace lacked specific knowledge solely because they refused to monitor or investigate, then they are liable.
Safe harbor – this means that if an online platform takes proactive enforcement measures, then they are no longer subject to liability. The Bernstein evidence indirectly references this in the line: “marketplace owners may discharge their duty by taking anti-counterfeiting measures.” Most safe harbor provisions require specific steps determined by legislation (the Digital Millenium Copyright Act has a copyright safe harbor provision for online platforms based on notice and takedown, for example). The 1ac evidence here says that courts will determine that “reasonable precautions” might be sufficient to discharge liability. Both Dong and Bernstein assert ‘reasonable precautions’ could be satisfied by stronger monitoring and banning repeat infringers, but what is ‘reasonable’ is fact-specific and depends upon the context of a particular online platform.
Agent considerations
This is written as a courts aff, but there are strong reasons to not specify your agent at all. Or even better, say something like ‘likely implementation would be through the courts but the plan doesn’t require an agent beyond United States federal government and an agent CP is one way the plan could be implemented.’
99% of the solvency advocates for this area of the topic recommend Congress – mainly because a safe harbor provision probably requires legislation. Campbell – the harms author – advocates almost exactly the plan, but she says it should be through legislation. Dong – the first court solvency card – does advocate the Court, but ALSO advocates Congress and thinks Congress is better (because it’s more likely to act, according to Dong). But in reality, there’s no reason the courts couldn’t do the aff – this was a problem created by the courts in the first place. Bernstein advocates the courts for both advantages – and he’s the most important solvency author by far.
The point is, once there’s a court politics DA, the Congress CP becomes a pretty strong argument because most advocates think Congress is better. Court politics DA’s are very bad arguments, but they’re a lot stronger if the CP solves the whole case. So don’t commit. There are some plausible answers to a Congress CP embedded within the 1ac, but fiat probably resolves most of them.
1ac length
The 1ac is probably too long. While many gains can be made through more efficient highlighting, you need to be careful to avoid under-highlighting the solvency evidence. The Bernstein evidence is very important to leverage against the two major disadvantages to this affirmative (inflation and the circular economy DA), but it only really helps if both you and the judge understand it.
You can cut cards in other places:
-- Lefouili and Madio serves an important role about safe harbors, but Bernstein maybe serves the same purpose. Neither uses the term ‘safe harbor’ but it’s what both are talking about.
--agriculture impacts and terrorism impacts could easily be turned into addons instead of impact scenarios
--alternatively, advantage two could be cut altogether. This is a big change, but an argument could be made to just create a solvency contention instead and try to have more impact diversity in advantage 1.
Future work
The best mechanism for this affirmative would be to adopt contributory liability based upon the standards that exist within the Digital Millennium Copyright Act. There are a lot of authors that recommend this, and some of that work has been included in this file. Most don’t think the DMCA should be adopted verbatim, but instead recommend a bunch of complicated changes to it that are trademark specific.
The reason to write this version of the 1ac is that it has the best defense of safe harbor provisions, and the safe harbor is a really important approach against disadvantages to trademark liability.
Advantage evolution – there are at least big impacts to counterfeit pharmaceuticals and counterfeit pesticides. Probably other products as well. Money laundering also has other impacts – I didn’t have time to develop these further.
1ac - plan
The United States federal government should determine that constructive knowledge of trademark infringement creates contributory trademark liability and a duty to investigate for online intermediaries.
1ac - counterfeiting
Contention 1 – counterfeiting
Online counterfeiting is skyrocketing – 70% of consumers have bought counterfeit goods through e-commerce.
Alex Tekip, 2023 – staff of MSU Today, “MSU survey: 7 in 10 consumers deceived into buying counterfeit products online” 10/19, https://msutoday.msu.edu/news/2023/msu-survey-7-in-10-consumers-deceived-into-buying-counterfeit-products-online //DH
Nearly seven in 10 people were deceived into buying counterfeit products online at least once in the past year, according to new research from Michigan State University.
The study was led by researchers in MSU’s College of Communication Arts and Sciences: Professor of Advertising Saleem Alhabash, Associate Professor of Advertising Anastasia Kononova, Professor of Retailing Patricia Huddleston, and graduate students Moldir Moldagaliyeva and Heijin Lee.
This research comes on the heels of two major anti-counterfeiting legislative actions:
The U.S. Congress passed the Integrity, Notification and Fairness in Online Retail Marketplaces, or INFORM Consumers Act, in June 2023. The INFORM Consumers Act is designed to increase transparency about third-party product sellers and, in turn, reduce the amount of fake and stolen goods sold online.
The Stopping Harmful Offers on Platforms by Screening Against Fakes in E-Commerce, or SHOP SAFE Act, was reintroduced to Congress in September 2023 after it did not go to a vote in 2020 and 2021. The SHOP SAFE Act incentivizes e-commerce platforms to vet sellers and proposes holding these platforms accountable for counterfeit products sold through third parties.
“Counterfeiting goes beyond a fake designer handbag,” said Alhabash. “Counterfeiters outsmart retailers, they figure out vulnerabilities in the supply chain and interrupt it. This causes retailers to lose money and, depending on the product, can pose a threat to the safety and well-being of consumers.”
Clothes and shoes — the most commonly purchased counterfeit items, according to the survey — might pose minimal threats, but even these products may contain harmful chemicals such as lead. Fake versions of items such as airbags and medication most likely do not meet government-determined safety standards, Alhabash said, and can therefore pose a health risk. That’s why he and his team believe it is important to understand shopper behavior, characteristics and motivations to devise effective strategies for educating consumers about the dangers of buying counterfeits online.
This research is the first U.S.-based global survey to provide the anti-counterfeiting and brand protection community — which includes brand owners, e-commerce platforms and law enforcement — with tools and insights to better communicate to consumers the dangers and risks of purchasing counterfeits.
Social media, e-commerce and third-party sellers
Counterfeit products were most commonly purchased via e-commerce websites (39%) and social media (39%). Of the consumers who bought counterfeits on social media, 68% did so on Facebook.
Following the COVID-19 pandemic and the exponential growth in e-commerce, online retail and social media platforms have become a hotbed for counterfeit products, especially as such platforms permit promotion of products by third-party sellers. Counterfeiters understand how the supply chain works, and they repeatedly use online platforms to promote and sell their products to consumers.
Though brand owners and consumers can report counterfeits sold on e-commerce platforms, these after-the-fact efforts, unfortunately, have not curbed the prevalence of illicit counterfeit sales online.
Kari Kammel, director of MSU’s Center for Anti-Counterfeiting and Product Protection, recently testified in the Senate’s SHOP SAFE Act hearings advocating for a balanced approach to regulating third-party sales on e-commerce platforms.
“A proactive requirement of e-commerce platforms that allows third-party sales and responsibility for ‘constructive knowledge’ of counterfeit sales will help balance the burden between intellectual property rights owners and platforms,” Kammel said.
Tiffany v. eBay created a “contemporary knowledge requirement” that shielded online platforms from trademark infringement liability if they lacked “specific knowledge” of infringement. This caused a shift from proactive enforcement by platforms to reactive, whack-a-mole enforcement by brands
Kari Kammel, 2023 - Director of the Center for Anti-Counterfeiting and Product Protection (“the A-CAPP Center) at Michigan State University. Statement to the US Senate Committee on the Judiciary, IP Subcommittee, “Back to School with the SHOP SAFE Act: Protecting Our Families from Unsafe Online Counterfeits” 10/3, https://www.judiciary.senate.gov/imo/media/doc/2023-10-03_-_testimony_-_kammel.pdf //DH
However, we do not see this theory being applied in the online marketplace space. Instead, the current case law leaves a gap by not requiring e-commerce marketplaces to take responsibility for guardianship and protection of consumers on their sites.
i. The Tiffany v. eBay Case
In 2010, the Second Circuit in the Tiffany v. eBay case26 noted the extension of the Inwood test to service providers, such as the flea market owners in Hard Rock,27 and then also noted that they were the first to apply this test to an online marketplace.28 The standard set here for secondary liability for an online marketplace was that if the service provider: “‘[c]ontinues to supply its [service] to one whom it knows or has reason to know is engaging in trademark infringement’” —and “[s]ome contemporary knowledge of which particular listings are infringing or will infringe in the future is necessary—”29 otherwise known as the contemporary knowledge requirement.30 The e-commerce platform eBay was found not liable for secondary trademark infringement because they had responded to specific suspected counterfeit postings reported by Tiffany and they had no onus to search proactively for counterfeit postings.31
ii. Practical Impact of Tiffany
From a liability perspective under the current state of the law, there is no obligation on any party to proactively address online counterfeit postings. Some online marketplaces understand that there is a massive problem with counterfeit postings and remove some counterfeit postings that are reported to them (notice and take down) or found through internal self-investigation by technology or otherwise (before the intellectual property rights holder reports the posting)—what I would refer to as a reactive response.
A few may proactively vet sellers or postings, but these are not the majority. Under the recently passed INFORM Consumer act, e-commerce platforms must collect basic information from high-volume third-party sellers,32 but platforms are not required to vet sellers’ postings, nor to proactively monitor their own platform for counterfeit goods. Further, this is not required by the law. Under the Tiffany standard, they must only remove them reactively, or when they have “specific knowledge.”
A intellectual property rights owner, however, does not want injury to its reputation, or injury to its consumers;33 so, practically that owner tries to monitor and notify the online marketplace or social media platform to remove a suspicious listing, counterfeit listing, or a seller that is selling an illicit, counterfeit, or unauthorized product, even though the counterfeit product does not belong to the intellectual property rights owner. For every listing that a brand owner successfully petitions to have removed from an online marketplace, many more illicit listings will likely take its place34—leading to what is called in the industry the “whack-a-mole” problem.
The “specific knowledge” standard gives platforms incentives to allow counterfeiting to continue.
Brian J. Winterfeldt, 2021 - Counsel to the Global Brand Owner and Consumer Protection Coalition. Comment submitted to the US Patent and Trademark Office, “RE: Secondary Trademark Infringement Liability in the E-Commerce Setting” 1/25, https://www.regulations.gov/comment/PTO-T-2020-0035-0022 //DH
E-commerce platforms today are integrally involved in the commercial process – rather than mere conduits for buyers to connect with sellers, many e-commerce platforms actively facilitate sales by categorizing, optimizing, and promoting products and sellers, handling inventory and logistics, shipping, and processing financial transactions. These platforms facilitate access to the US marketplace and US consumers at a level that would otherwise generally be unavailable to international merchants, and which allows sellers within the US and abroad a level of anonymity that brick and mortar retailers in the US are simply not afforded. As a result, the current US legal regime applied to e-commerce platforms has enabled the circumvention of certain aspects of the usual commercial regulatory scheme, which has been unable to keep pace with rapid technological developments.
Currently under US law, online intermediaries are generally not liable for the products sold on their platforms by third parties unless they fail to act upon specific knowledge of particular infringements. Because e-commerce platforms have no affirmative duty to prevent or remedy infringement, there is a strong disincentive for those intermediaries to proactively stop the sale of counterfeits and other harmful products. On the contrary, e-commerce platforms have a strong financial incentive to allow these sales to proliferate, as they make their profit regardless of whether the articles sold are genuine or infringing. Furthermore, many direct infringers using e-commerce platforms are located outside the US, putting them beyond the jurisdiction of US courts and therefore leaving limited recourse to brand owners or consumers impacted by sales of counterfeit or other infringing products by such foreign sellers. Remedies at the border against the import of infringing goods, such as through 

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