Safe Harbor? or Shady Harbor?

Disney sells. Even copyright-infringing Disney. And on Etsy, especially copyright-infringing Disney. And for the many shop owners selling Disney items on Etsy without proper licensing, they are breaking the law. But what about Etsy? Is it breaking the law by allowing the sale of illegal goods on its site?

Etsy claims safe harbor status under the DMCA,  which status relieves the company from liability for copyright infringement by its’ users. There are several requirements that must be met in order for Etsy to qualify and maintain this status. You can find those requirements here.

According to the linked FAQ (in part, emphasis added):

Question: What does a service provider have to do in order to qualify for safe harbor protection?

Answer (in part) …Finally, the service provider must not have knowledge that the material or activity is infringing or of the fact that the infringing material exists on its network. [512(c)(1)(A)], [512(d)(1)(A)]. If it does discover such material before being contacted by the copyright owners, it is instructed to remove, or disable access to, the material itself. [512(c)(1)(A)(iii)], [512(d)(1)(C)]. The service provider must not gain any financial benefit that is attributable to the infringing material. [512(c)(1)(B)], [512(d)(2)].

According to one attorney (emphasis added):

In addition, if the service provider has the right and ability to control the infringing activity and if the service provider receives a financial benefit directly attributable to the infringing activity, the service provider will not be protected by Section 512 of the Digital Millennium Copyright Act.

So, I don’t know. Is Etsy protected by Safe Harbor or not?  I suppose we will only find out when the company is challenged in court and claims Safe Harbor as a defense.

In any event, since copyright infringement is illegal, it seems ethical business practices would dictate that Etsy at least discourage the unlawful sale of copyright-infringing items on its site. Does it do that?

Nowhere does Etsy policy state copyright-infringing items are prohibited; the only copyright-infringing items prohibited are those for which Etsy has received a takedown notice. Etsy seller policy states: “…. items that violate our intellectual property policies are not allowed on Etsy.”  The link goes to a notice of Etsy’s take down policy, which notice is one of the requirements for Etsy to qualify for safe harbor status.

Rusetsy has found nothing on the site stating that one cannot sell copyright-infringing items, and nowhere does Etsy make any attempt to dissuade sellers from doing so. In fact, Etsy even goes so far as to shut down forum threads where sellers point out copyright infringement. But then. Why would Etsy discourage the sale of something it profits from? Listing fees, transaction fees, direct checkout fees, and…. don’t forget search ads

Look at this list of search ad keywords. Every time a buyer searches for one of these items, Etsy profits from the paid ads using these tags. Isn’t the word “Disney” a trademark, and does Etsy have a license to profit from the “Disney” brand?? I don’t know the answer to these questions, but that harbor where Etsy is anchored seems more shady than safe.

disney  $0.000502       $0.50
disneyland      $0.001191       $1.19
disney applique $0.002312       $2.31
disney apron    $0.003786       $3.79
disney bow      $0.001697       $1.70
disney brave    $0.001263       $1.26
disney car      $0.000908       $0.91
disney christmas        $0.002084       $2.08
disney clothing $0.001489       $1.49
disney countdown        $0.005000       $5.00
disney couple   $0.005000       $5.00
disney cruise   $0.001061       $1.06
disney dress    $0.000973       $0.97
disney earrings $0.001629       $1.63
disney fabric   $0.002181       $2.18
disney font     $0.005000       $5.00
disney frozen   $0.001249       $1.25
disney halloween        $0.004411       $4.41
disney jewelry  $0.001217       $1.22
disney lanyard  $0.001238       $1.24
disney magnet   $0.002638       $2.64
disney ornament $0.001249       $1.25
disney plane    $0.001507       $1.51
disney poster   $0.003131       $3.13
disney princess $0.000733       $0.73
disney ring     $0.001889       $1.89
disney shirt    $0.001210       $1.21
disney stitch   $0.001329       $1.33
disney sweater  $0.001570       $1.57
disney sweatshirt       $0.002396       $2.40
disney tom      $0.003401       $3.40
disney up       $0.001175       $1.17
disney villain  $0.001293       $1.29
disney wedding  $0.001436       $1.44
disney world    $0.004525       $4.53


A Matter of Time

Wonder what Coach would think about the use of its logo on this lovely little watch, and the use of its’ name to sell it?  Or the use of its signature fabric replicated on this phone case? You can keep a watch (pun intended) on these two items that are sure to soon disappear from Etsy.

But what about those shops that have profited from stolen artwork from other Etsy sellers? Will they be shut down? I have followed with interest the happenings of one such shop as several sellers have expressed frustration and disgust at Etsy allowing it to remain open after stealing Etsians artwork for printing on pillow covers. Although the infringing listings were taken down, the shop remains open where it continues to sell what may be infringing items.

Why the double standard? M.O.N.E.Y.

Most Etsy artists don’t have the financial means to go after copyright and trademark infringers. But the big boys like Coach do. And will.

It’s only a matter of time.