And The Winner Is? Digital Platform Liability For Trademark Infringement

Much has been made of the question of liability for the operation or furnishing of digital platforms in the copyright context. Since the U.S. Supreme Court ruling that the provider of the Betamax recorder did not itself infringe copyright in the movies some users illegally copied on it (because the Betamax was capable of substantial non-infringing uses), courts have struggled with the extent to which developers of new technologies, services, or business models that may facilitate copyright infringement cross or don't cross the direct infringement, contributory infringement, or vicarious liability line. It was against this background, and, of course, in the new digital age, that Congress enacted the Digital Millennium Copyright Act (DMCA), providing digital platform providers a safe harbor against most remedies so long as they comply with delineated takedown procedures for challenged content on their sites and meet other conditions.

Trademark law has lagged behind copyright in this context, and there is no equivalent to the safe harbor and notice and takedown process of the DMCA. But, as is typical of jurisprudential development involving the birth and evolution of disruptive new industries, case law develops over time - though not as quickly as some litigants and enterprises might like - ultimately proving guideposts for what is permissible behavior and what crosses the line. Not surprisingly, this organic progression is now evident in connection with trademarks and digital platform liability.

At this writing, the court has just heard closing argument in Academy of Motion Picture Arts and Sciences (AMPAS) v. GoDaddy, a five year old case challenging domain registrar GoDaddy's practice of essentially turning a blind eye to registration of arguably infringing domains, which were then "parked" by the registrants who benefited financially from advertisements displayed on the sites (GoDaddy receiving a small fraction of the purportedly misdirected advertising revenue). At issue is whether GoDaddy's behavior violates the Anticybersquatting Consumer Protection Act (ACPA), federal law intended to prevent cyberpiracy of domain names (15 U.S. C. §1125(d)).

In facilitating the registration and parking of over 200 domain names, each in some way playing off of the Academy Awards (i.e., 2011oscars.com, each in some way playing off of the Academy Awards (i.e., 2011oscars.com, betacademyawards.com), did GoDaddy demonstrate the requisite "bad faith intent...