Dismissal of trademark lawsuit against print on demand website, reversed. OSU v. REDBUBBLE

Trademark law in the United States grants the owner of a trademark the right to exclude others from using a trademark in a way that is likely to cause consumer confusion. Trademark infringement is the unauthorized use of a trademark in a manner that is likely to cause confusion, deception, or mistake about the source of the products which bear the trademark.

When people think about trademark infringement they typically think of direct infringement, where the person who is accused of trademark infringement is the person selling the infringing products. Other legal theories exist that impose liability even when the trademark infringement defendant is not the person directly infringing on a trademark. Contributory infringement is not expressly imposed by the Lanham Act, however the United States Supreme Court has recognized that “liability for trademark infringement can extend beyond those who actually mislabel goods with the mark of another.” See INWOOD LABORATORIES, Inc. v. Ives Laboratories, Inc., 456 U.S. 844 (1982).

In INWOOD LABORATORIES, manufacturers had supplied pharmacists with a generic version of a drug whose brand name was trademarked. Some of those pharmacists mislabeled bottles of generic pills as trademarked pills. The plaintiff sued the generic manufacturers instead of the pharmacists on the theory that the generic manufacturers contributed to the trademark infringement. The Supreme Court held that “if a manufacturer or distributor intentionally induces another to infringe a trademark, or if it continues to supply its product to one whom it knows or has reason to know is engaging in trademark infringement, the manufacturer or distributor is contributorially responsible for any harm done as a result of the deceit.”

The internet has made it much easier for the flow of commerce, this raises new questions on how to apply old laws. Some websites offer on-demand services which allow a consumer to get custom manufactured products. The website connects a customer with a manufacturer and handles the communication from order placement to invoicing. The question then becomes, if the customer orders a product, and wants a trademark placed on the product, is the website now liable for trademark infringement?

THE OHIO STATE UNIVERSITY, v. REDBUBBLE, INC., 19-3388 (6th Cir. 2021) is a case which deals with the question of whether an on-demand website is liable for trademark infringement.

Redbubble is a company based in Australia that operates an online marketplace. Products for sale on Redbubble’s website include apparel, wall art, and other accessories emblazoned with an image selected by a consumer. Independent artists, not employed by Redbubble, upload images onto Redbubble’s interface. Consumers then scroll through those uploaded images and place an order for a customized item. Around 600,000 artists use the website, and over $100 million in sales has flowed through Redbubble’s platform.

Ohio State University is a well respected institute of higher learning in the United States. OSU has very popular and successful sports teams. Sports apparel and other merchandise which bear the OSU logo are popular products with OSU fans. OSU has trademarked many of its logos and has licensed its trademarks to various different manufacturers.

In 2017 OSU discovered that merchandise bearing its trademark was being offered for sale on Redbubble. OSU then sued for trademark infringement. The district court found that Redbubble did not “use” OSU’s trademarked images in operating its business model under the Lanham Act because it only acted as a “transactional intermediary” between buyers, sellers, manufacturers, and shippers. OSU then appealed to the Court of Appeals for the Sixth Circuit.

On appeal OSU that Redbubble directly infringed OSU’s trademarks under the Act because Redbubble’s role in operating its online marketplace meets the statutory definition of using a trademark in commerce without owner approval. OSU argues that Redbubble’s marketplace model differs from those used by Amazon, eBay, and other passive e-commerce facilitators.

Redbubble responded that it was not liable for trademark infringement because it was a neutral intermediary between consumers and third-party vendors. Courts have typically not found online vendors liable for trademark-infringing goods sold on their platforms.

The Sixth Circuit reversed the district court grant of summary judgement. The Sixth circuit found that the goods being sold by Redbubble would not have existed without Redbubble’s participation, therefore it was not a transactional intermediary. The Sixth Circuit held that the district court construed the definition of “use” in the Lanham Act too narrowly and remanded the case for further proceedings.

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