Print-on-Demand Vendor Doesn’t Qualify for DMCA Safe Harbor–Feingold v. RageOn

July 24, 2020 · by Eric Goldman · in Copyright, Derivative Liability, E-Commerce, Trademark

This case involves two copyright-protected photos that users submitted to the RageOn print-on-demand service. Among other defenses, RageOn invoked the DMCA safe harbor. The Greg Young v. Zazzle case held that Zazzle qualified for the 512(c) safe harbor for displaying user-supplied photo on its site, but not for manufacturing and shipping the physical items contain the photos. This court says that RageOn disqualified for several of the DMCA safe harbor’s elements.

The court says RageOn got financial benefits from selling the items. It also had the requisite “right and ability to control” the infringements because “RageOn is an online retailer. Commonsense dictates that RageOn had the ‘right and ability’ to control what it sold.” The legal distinction between an online marketplace and a retailer is the source of substantial litigation. Calling it “commonsense” unhelpfully sidesteps the nuance.

The court also says that RageOn didn’t expeditiously remove infringing “merchandise.” It’s ambiguous if the court is referring solely to the online photos or to the actual printed merchandise (which, remember, the Zazzle court said wasn’t covered by the DMCA at all). RageOn promised 24 hour response times but admitted it took 18-23 days to remove the items. The court says the 18+ day turnaround time isn’t expeditious.

The case is moving onto damages and attorneys’ fees. Despite the bad news for the defense, there’s a tiny chance the case could lay the foundation for future defense win if other courts interpret it as saying the DMCA safe harbors apply to the physical merchandise in addition to the online photos.

Case citation: Feingold v. RageOn, Inc., 2020 WL 4003152 (SDNY July 15, 2020)

BONUS COVERAGE: YYGM SA v. Redbubble Inc., 2020 WL 3984528 (C.D. Cal. July 10, 2020). This ruling supplements the Ohio State v. RedBubble ruling. The court agrees that RedBubble doesn’t commit direct trademark infringement because it doesn’t “use” the mark. The court explains that “the service fee Redbubble imposes on transactions through its site bears no relation to the price of the goods sold….Such a fee-based business model indicates the role of a service provider rather than a seller, as a seller almost invariably adjusts its price in relation to the value of the goods in question.”

However, the Ohio State ruling didn’t address contributory trademark infringement, and this court sends that issue to the jury. Unlike Tiffany v. eBay, which involved legitimate used resales of Tiffany items, the court says “Redbubble is not burdened by the need to parse valid uses of Brandy Melville’s trademarks from invalid ones, as Brandy Melville has made clear to Redbubble that there are no legitimate sales of Brandy Melville products through its site. As such, all uses of Brandy Melville’s marks that appear on Redbubble’s website are presumptively infringing.” I doubt the court means this statement so baldly, as it disregards parodies, nominative uses, and other legitimate activities. Similarly, the plaintiff complained that RedBubble hasn’t disabled internal consumer keyword searches for its trademarks, but that doesn’t seem like a right exclusive to the trademark owner in light of MTM v. Amazon.

The court summarizes:

A company such as Redbubble could hypothetically maintain a state of “willful blindness” simply by understaffing its marketplace integrity organization relative to the amount of content on its site. This would allow such a company to simultaneously claim that its employees were doing everything in their limited power to prevent the sale of infringing products, while also enjoying the benefit of substantial revenue from the many infringing sales they were unable to catch. Whether that is the case here or not, however, is a jury question.

The court rejects the vicarious trademark infringement claims because RedBubble isn’t in an agency relationship with its vendors. However, the court also sends the counterfeiting claim to the jury.

Print-on-Demand Vendor Doesn’t Qualify for DMCA Safe Harbor–Feingold v. RageOn

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