"Legal context: This article discusses the differing positions in the US and Canada in relation to contributory trade mark infringement. In the US, indirect liability has blossomed from its ancient roots in tort law to reach an increasingly diverse spectrum of intermediaries and this can consistently be found at the intersection of IP law and the law of the internet. The position in Canada differs in that there is no history of "secondary" liability available.Events have moved on since this article was sent for publication. Accordingly James L. Bikoff, David K. Heasley and Phillip V. Marano have kindly sent the jiplp weblog the following post-publication advisory notice:
Key points: In the US part of the article, the authors track the historical development of indirect trade mark liability, from its bricks and mortar origins to it modern application in relation to intermediaries such internet service providers for example. In Canada where this option is not possible, the issue is how a brand owner can frame a legal challenge against an intermediary when the ability to argue "secondary" liability from a trade mark perspective does not exist.
Practical significance: The authors suggest that the evolution of indirect trade mark liability in American jurisprudence may inspire lawyers in other jurisdictions grappling with similar problems".
"Since Hauling in the Middleman went to press, two key decisions – Tiffany (NJ) Inc. v eBay, Inc. and Louis Vuitton Malletier S.A. v Akanoc Solutions, Inc. – have further solidified the jurisprudence of contributory trade mark infringement in the United States. The decisions delineate the knowledge and conduct that constitute contributory infringement by Internet Service Providers.
In Tiffany v eBay 2010 U.S. App. LEXIS 6735 at *37; No. 08-3947-CV at *29 (2nd Cir., April 1, 2010), the United States Court of Appeals for the Second Circuit affirmed the judgment of the Southern District of New York, rejecting Tiffany’s claims of direct and indirect trade mark infringement against the online auction house: “For contributory trademark liability to lie, a service provider must have more than a general knowledge or reason to know that its service is being used to sell counterfeit goods. Some contemporary knowledge of which particular listings are infringing or will infringe in the future is necessary.”
In Louis Vuitton v Akanoc Solutions No. 07-03952 JW D.E. # 281 at *18, fn. 19 (N.D. Cal., March 19, 2010), see also 2010 U.S. Dist. LEXIS 34021, the Northern District of California held that Akanoc “knew of the direct infringement occurring on websites hosted on their servers” and “w[as] in a position to directly control and monitor the instrumentality (the servers) used by third party direct infringers.” Akanoc had “numerous tools at their disposal for monitoring their servers and terminating abusive users” including “the ability to suspend a particular user, disable IP addresses used by a particular website or if necessary, unplug a server the contained the data for a particular website.” Accordingly, Akanoc could be held liable for “inaction after receiving notice of trademark infringement.”
These cases addressed opposite factual scenarios. In one case, eBay took steps to prevent counterfeiting on its online auction service, and was shielded from contributory liability; in the other case, Akanoc continued to supply webhosting services to known counterfeiters, and was held liable for contributory infringement. Both decisions followed a similar line of reasoning to reach those outcomes: specific notice of infringement cannot be ignored by Internet Service Providers, who owe a duty to take appropriate anti-counterfeiting measures or risk liability for contributory trade mark infringement.For details of the authors click here.
Both eBay and Akanoc are of particular importance to United States trade mark owners. However neither case is the final word on Internet Service Provider liability for contributory trade mark infringement. Tiffany may still petition for review by the United States Supreme Court, and Akanoc may still appeal to the United States Court of Appeals for the Ninth Circuit".