Over the past decade, courts have developed two distinct approaches in evaluating trademark claims against online intermediaries. The first and most common method frames the issue as one of secondary liability: should the intermediary face liability for wrongdoing committed by its advertisers, subscribers, or other users of its services? In this approach, courts struggle with the tension between preserving legitimate, non-infringing uses of technologies on the one hand, and minimizing infringement on the other. While no clear doctrinal consensus has formed, courts are converging on a framework centered on specific knowledge, reasonable response and inducement—principles derived from trademark law but mirroring their counterparts in copyright.
At the same time, some opinions have suggested a different form of trademark liability focused on the intermediary’s choices in designing services that use—or allow others to use—trademarks in various ways. Though branded as direct trademark infringement, the doctrine bears little resemblance to historical direct infringement law. Instead, it resembles a roving unfair competition law, leaving discretion with the fact finder to assess the intermediary’s culpability in enabling confusion. Because the likelihood-of-confusion factors map poorly onto such an inquiry,4 this form of direct infringement has no clear doctrinal framework. Nor have courts articulated a coherent normative vision to guide lower courts in shaping and applying the law. Most troubling, the scant case law has paid little attention to issues at the core of secondary liability analysis—namely, the need to strike a balance between infringing and non-infringing uses, and the worry that liability might threaten legitimate uses of trademarks that enhance competition and increase consumer choice.