Rightsholders Want Platform Counterfeit Liability That Tech Opposes, PTO Told

Trade groups representing intellectual property rightsholders told the Patent and Trademark Office that secondary trademark infringement liability hasn't been effective in getting e-commerce platforms to police themselves. Some want Congress to define the parameters of this doctrine by passing a law. Comments were due Monday. The Computer and Communications Industry Association said shifting responsibility to platforms would reduce voluntary cooperation and wouldn't decrease the number of counterfeits for sale. The American Apparel and Footwear Association said the test of platform liability, that a company should “know or have reason to know” of trademark infringement, seems straightforward, but courts have applied it differently. “The court in Tiffany v. eBay believed that market-based forces would provide a strong incentive for platforms to combat counterfeits. Empirically, it is irrefutable that this assumption is false," said AAFA. The Shop Safe Act (HR-6058) from the last session of Congress would have created a new form of secondary liability for counterfeits, and AAFA said it needs a clearer definition and its coverage should be expanded. The National Association of Manufacturers said legislation is needed to set “judicial review standards that encourage courts to develop critical fact-specific case law.” NAM said some courts say Communications Decency Act Section 230 protections for platforms give them a safe harbor to host sellers of bogus goods, and that wasn't what Congress intended. Amazon noted that in 2019 it invested more than a half-billion dollars to fight counterfeits and other fraud and abuse on its site. “Amazon’s primary focus is on preventative, technology-driven tools built on machine learning and data science to proactively scan the more than 5 billion changes submitted to Amazon’s worldwide catalog" daily, it commented. “For every one of the self-service takedowns by brands, Amazon’s automated protections proactively stop more than 100 listings.” It said it launched a Counterfeit Crimes Unit in June 2020: "Amazon needs the help of rights holders, the company said, and information sharing, from both [Customs and Border Protection] on seizures and from other platforms, would help the company stop counterfeiters."