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…

Communication and social networks play a vital role in the modern world. The role and importance of social networks has been heightened by the advent of the Internet and the new “information age” in which modern society operates. The Internet has had a profound impact upon nearly every society, and it has increasingly assumed indispensable functions. Not only has the Internet changed the way that people communicate and network, but it is also one of the most powerful and far-reaching technological developments known to the world with respect to information exchange, education, business, and entertainment. Continued…

The United States retail payments industry is in the middle of a transition in regard to information security. A substantial number of data breaches have occurred over the last five years, despite substantial compliance with the industry standard, the Payment Card Industry Data Security Standard. There will need to be a move to a higher level of security, and the major challenge is institutional. How can the industry organize itself to move collectively toward this goal? Without recommending any particular technical solution, this paper proposes one way to meet this institutional challenge. Drawing on the experience of Europe and the United Kingdom in moving to a chip and PIN environment, I recommend a public-private partnership where industry, government and civil society jointly work through the technical, economic and public policy issues that need to be solved if we are to have improved information security in the industry. Continued…

In the past decade, a number of studies have scrutinized the Federal Circuit’s rate of reversal of district court claim construction rulings. To date, however, there has been little empirical research focusing on district court claim construction decisions themselves. Although district court statistics represent only a “slice in time” before appeal, they are nevertheless important to litigants and trial counsel, who must make various tactical decisions and cost-benefit analyses at the district court level long before considerations of appellate reversal rates come into play. Continued…

Not long after Google announced in December 2004 that it would include in its search database the full text of books from a number of leading research libraries, two lawsuits—structured as class actions—were filed by a group representing mostly trade authors and a major publisher. One of the key issues was whether Google’s project was defensible as fair use.

After several years of discussion, a proposed settlement was reached. It would have allowed Google to continue scanning copyrighted books into its search index and displaying the text to its users in exchange for the payment of license fees to copyright holders. The proposed display rules were contingent on whether a book was still in print. Additionally, rightsholders could opt out of the settlement either entirely, by requesting the removal of protected books, or partially, by modifying the default display rules. Continued…