March 24, 2021 | less than a minute read

New Bill Would Add Pressure on Online Marketplaces

Taylor English

INFORM Consumers Act would impose responsibility of online sellers to verify and disclose third-party seller information, requiring companies such as Amazon to authenticate the identity of “high-volume third-party sellers.”

As I recently reported, The Ohio State University recently received a favorable opinion from the Sixth Circuit, in a case against online marketplace seller Redbubble, which arranges the manufacturing and shipping of the product, which is often infringing, adding fuel to efforts by brand owners to hold e-commerce companies liable for trademark infringement arising from products they sell in the online marketplace.

Brand owners are increasingly frustrated at relying solely on cumbersome and inefficient "take-down" approaches to combat infringement, and are looking to acquiring additional tools for their arsenal.

The bill – which has received support from 3M, the American Apparel & Footwear Association, CVS, Levi Strauss & Co., the Retail Industry Leaders Association, the Fashion Jewelry & Accessories Trade Association, and Ulta Beauty, among others – is one of several marketplace-focused efforts aimed at achieving this. In terms of the names that are presumably not on the list of INFORM Consumers Act backers: the e-commerce marketplaces, themselves, which have long argued – from the Tiffany v. eBay case to more recent challenges waged against Amazon – that they should not be held liable for offerings of third-party sellers that are counterfeit or otherwise infringing. With that in mind, the increasing push to hold marketplace operators accountable for the products sold by third-parties via these often-sweeping marketplace sites will almost certainly be an unwelcome one.