An online company provides products to individuals and small businesses. Like most online companies, it collects various types of information from its customers such as email addresses for notifications, mailing addresses for product shipment, and credit and debit card numbers for payment. Continued…

This essay views secondary trademark liability in light of tort law’s treatment of parties whose actions expose a plaintiff to third-party wrongdoing.  Broadly speaking, tort law imposes liability on a party for contributing to the tortious activity of another in two different ways. In vicarious and accomplice liability cases, courts impose on defendants the same liability to which the direct tortfeasors would have been subject, had they been defendants. If, for example, the third-party wrongdoer was a batterer, then the defendant is liable for battery. Another line of cases imposes liability for unreasonably putting a defendant at risk of third-party wrongdoing, and these cases are often based on knowledge of probabilistic harm. But crucially, these are negligence cases: even if the third-party wrongdoer is a batterer, the defendant’s liability in these cases is for negligence and not for battery. Continued…

Trafficking in counterfeit and trademark-infringing goods is a widespread and serious problem, particularly in online marketplaces that provide a forum where third parties, with relative anonymity and at limited cost, can ply their trade.  Fortunately, the law has long provided a fair, balanced standard for determining when a party can be held liable for contributing to the infringing actions of another.  In Inwood Laboratories, Inc. v. Ives Laboratories, Inc., the Supreme Court held that a party can be contributorily liable if it induced the infringement or continued to support conduct that it knew or had reason to know was infringing. Continued…

The extent to which online service providers can be held liable for copyright infringement committed by users of their services is one of the more complicated and contentious copyright issues of our day. Courts have struggled with how to apply common-law doctrines of secondary liability to online activity. Congress has enacted limitations on the liability of service providers, but conditioned those limitations on a fairly complicated set of conditions. And technology continues to evolve and to raise new questions. This Essay examines one relatively new issue concerning the interaction between Congressional and judicial developments: how do the statutory liability limitations apply to the developing cause of action for inducing copyright infringement? Part I briefly introduces both the statutory regime and inducement liability, and then examines one court’s suggestion that the statute’s limits simply do not apply to claims for inducement. Part II argues that it is too early in the evolution of the law of inducement to categorically deny the possibility that the statute might limit liability for at least some claims of inducement.

The recent history of intermediary liability decisions in copyright and trademark law reflects a notable resistance to rules that might constrain judicial discretion to ferret out bad guys. The Supreme Court in Grokster suggested such resistance, by limiting the Sony safe harbor to defendants with squeaky-clean intentions. In the trademark context, recent decisions have shown great solicitude toward good-faith actors, while reserving the option to condemn those who act with the apparent design to sow confusion. Indeed, a dichotomy appears to be emerging between two types of defendants: those who want infringement to happen and those who do not. The former group faces almost certain liability, while the latter receives broad immunity, even when its services facilitate widespread infringement. The Sony safe harbor and its trademark analog, in other words, are available only to intermediaries that appear to be acting in good faith and with ultimately non-infringing objectives. Continued…

We have reached a telling intersection in the law of secondary copyright liability. Cases in which defendants seek to broaden the safe harbors of Section 512 of the Digital Millennium Copyright Act (“DMCA”) are running up against precedent generated by Metro-Goldwyn-Mayer Studios, Inc. v. Grokster, Ltd., in which courts have held service providers liable for promoting infringement by their users. In some instances, the behavior for which the defendants are seeking shelter under Section 512 bears more resemblance to the sort of purposeful conduct condemned by the Supreme Court in its 2005 Grokster decision than that of the prototypical “innocent” service provider Congress sought to shield under the DMCA. Continued…

A patent challenger who defeats a patent wins spoils that it must share with the world, including all its competitors. This forced sharing undercuts an alleged infringer’s incentive to stay in the fight to the finish—especially if the patent owner offers an attractive settlement. Too many settlements, and too few definitive patent challenges, are the result. I have argued previously that a litigation-stage bounty would help correct this tilt against patent challenges, for it would provide cash prizes to successful patent challengers that they alone would enjoy. Even the best-designed bounty, however, would likely fail to encourage patent validity challenges in all the cases where such encouragement would be salutary. Others have urged that, going forward, post-grant administrative review is a more promising approach to weeding out weak patents. A new post-grant review procedure, however, will do nothing to encourage worthy challenges to thousands of extant weak, overasserted patents. Continued…