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- Businesses regularly lose revenue due to poor online brand enforcement. At the same time, consumers regularly buy counterfeit products on online marketplaces without ever knowing that they have bought a counterfeit.
- Online resellers, including Etsy, have attempted to address the issue of counterfeits and “grey market” goods by setting up reporting mechanisms on their site. Etsy’s new reporting portal allows intellectual property (IP) owners to report items they suspect infringe their trademark or other IP rights.
- As a first step, owners must register their brands with Etsy and create a profile for future reference by filling out the required information. The Etsy portal contains a menu of enforceable assets: trademarks, patents, copyrights and also an “Other” option.
Businesses regularly lose revenue due to poor online brand enforcement. At the same time, consumers regularly buy counterfeit products on online marketplaces without ever knowing that they have bought a counterfeit. Sales on online marketplaces have skyrocketed in the last decade and companies see such marketplaces as a great opportunity to attract new customers and expand into new marketplaces around the world. As a downside, it is not uncommon to come across products that are counterfeit and/or subject to piracy on these online platforms.
Online resellers from Amazon to Facebook have attempted to address the issue of counterfeits and “grey market goods” by setting up on-site reporting mechanisms. Because of its business model, the issue of fake goods on Etsy is of particular concern.
Etsy’s new reporting portal allows intellectual property (IP) owners to report items they suspect infringe their trademark or other IP rights. As a first step, owners must register their brands with Etsy and create a profile for future reference by filling out the required information on the portal. The Etsy portal contains a menu of enforceable assets: trademarks, patents, copyrights and also an “Other” option. The information required includes a statement as to whether the selected IP is registered or not. If it is registered, the owner must provide the registration number and place of registration. Once all information has been provided, brand owners can report items, and Etsy will consider such a report to determine if an objectionable item meets its policies. Etsy may also notify the alleged infringer of the report, along with the name and email address of the reporting party. In accordance with the Digital Millennium Copyright Act (DMCA), Etsy accepts counter-notifications where the reporting party alleges copyright infringement.
As with other online retailers, Etsy hopes to simultaneously incentivize and encourage loyalty among consumers and businesses to use its online marketplace platform. Businesses and entrepreneurs need these IP protections to leverage the value of their IP assets on the platform, and consumers will definitely have an enhanced shopping experience. Potential infringers might be more cautious about their illegal sales plans. However, companies will still need to monitor their response to these measures.
Development of an online brand protection strategy
A trademark protection action plan is more than just reporting rights on online platforms; The outcome of such actions may not have the results that brand owners expect. Intellectual property protection on online marketplace platforms becomes more effective when such activities are combined with other trademark enforcement activities that provide advantages, including advantages of evidence in court proceedings. These include patent protection; Registration of trademarks, logos and slogans with the US Patent and Trademark Office; Registering Content and Artwork with the US Copyright Office; proper investigation of other actors in the distribution chain contributing to the distribution of counterfeits; and well drafted cease and desist letters.
Businesses, entrepreneurs and small businesses should take a proactive – not reactive – approach to protecting their intellectual property rights on online platforms. In that sense, it should be an ongoing, long-term plan of action by the company and not just a consequence of ongoing litigation. If registration of rights is effective and timely, anticipated or pending civil and/or criminal intellectual property enforcement proceedings are likely to be more effective.
The rise of new virtual worlds, cryptocurrencies, innovative technologies and non-fungible tokens (NFTs) opens up new opportunities for companies to advertise and sell products and services online. Etsy and other similar online marketplace giants like Rakuten (Japan), Mercado Libre (Latin America), and Amazon are constantly trying to improve their IP enforcement policies to address current issues and anticipate unforeseen new realities in e-commerce to prepare. Due to virtual reality, users are likely to have a “live” experience in their buying and selling interactions.
Conclusion and takeaways
For all these reasons, the only constant is change. The good news is that product innovation is encouraged when online platforms have a proper IP enforcement protection plan in place that protects the products they offer. As the business models of these online marketplaces change due to new e-commerce realities, content creators and brand owners must take advantage of the tools provided and push for additional protection as the counterfeiters and criminals are almost as quick to adopt new methods.
The content of this article is intended to provide a general guide to the topic. Professional advice should be sought in relation to your specific circumstances.
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