SEO Firm Responsible for Client’s Counterfeit Products?

As an SEO, hosting service, or a web content specialist, are you responsible for your client? Absolutely; you are responsible for producing the best content that will help increase online visibility and, hopefully, everyone’s bottom line. Are you responsible if they violate the law, and you do not stop them? A recent ruling by a US federal court found exactly that when it ruled an SEO company was liable for the sale of its client’s counterfeit products.

Bright Builders, a US company that offers web and graphic design, programming, marketing, and hosting services, was ordered by a judge to pay an incredible $770,750 in damages because they assisted their client, CopyCatClubs.com, in committing “contributory trademark infringement and unfair trade practices.” They constructed and hosted the golf club e-tailer’s website. CopyCatClubs was being sued by Cleveland Golf for infringing on 11 trademarks, and the suit was extended to the web hosting service because the firm should have known that their client was illegally selling counterfeit products.

Cleveland Golf lawyer, Christopher Finnerty, says of the ruling, “The jury found that web hosts and SEO's cannot rely solely on third parties to police their web sites and provide actual notice of counterfeit sales from the brand owners. Even prior to notification from a third party, Internet intermediaries must be proactive to stop infringing sales when they knew or should have known that these illegal sales were occurring through one of the web sites they host."

Finnerty and his team were able to establish that Bright Builders knew of their client’s violations and failed to do anything about it. According to Web Host Industry Review, “The ruling, if it is understood to be a precedent in future cases of this kind, doesn’t require service providers to outright police their users’ content, but it would seem to require them to act on illegal activity, should they become aware of it.”

Finnerty likened Bright Builders to a landlord. That landlord isn’t required to investigate, but if he does know about illegal activity, he must report it.

CopyCatClubs was also found liable and ordered to pay $28,250 in damages. Why the enormous discrepancy? Attorney Christopher Lizzie, representing Prince Distribution, who ran the counterfeit golf site, says, “The defendant Bright Builders basically had a heightened duty and they didn’t comply with it. The jury came back knowing my client acknowledged his fault in this in the beginning and was trying to be lenient on him.”