SW Legal studies in Business

ISP May Be Liable for Knowingly Hosting Trademark Infringing Website
Description Court refused to dismiss a suit against an ISP that hosted a website accused of infringing a valid trademark. Since the ISP had been notified that the website was infringing a mark, and it did nothing to prevent the website from continuing, the ISP may have contributed to the infringement and is not protected by the First Amendment or by the Communications Decency Act.
Topic Cyberlaw
Key Words Trademark; Infringement; Website; ISP
C A S E   S U M M A R Y
Facts Gucci America, owner of the trademark Gucci, sued Hall, who maintained www.goldhaus.com, a website, and Hall's ISP, Mindspring, asserting trademark infringement. Gucci notified Mindspring that Hall was engaged in trademark infringement by using the Gucci name on its website in the sale of jewelry, but Mindspring did not stop the infringement. Gucci sued Hall for infringement and Mindspring for contributory infringement. Mindspring moved to have the suit dismissed, contending that it was immunized from liability for information posted on websites by the Communications Decency Act (CDA) and by the First Amendment.
Decision Motion denied. The CDA does not immunize an ISP from a claim that its hosting of a trademark-infringing website, despite notice from the mark owner, was itself infringement of the owner's mark. The CDA does not limit existing intellectual property laws, under which a manufacturer or distributor who continues to supply its product to one whom it knows or has reason to know is engaging in trademark infringement may itself be liable for infringement. An alleged infringer is innocent unless it acted with knowledge of infringement or with reckless disregard as to whether the mark owner's rights were being infringed. That will be determined at trial. The First Amendment also does not bar a claim against the ISP for hosting a trademark-infringing website, despite notice from the mark owner. Deceptive speech is not protected by the Constitution.
Citation Gucci America, Inc. v. Hall & Associates, - F.Supp.2d - (2001 WL 253255, S.D. N.Y., 2001)

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