Collins statement on counterfeits hearing

"Marketplaces must aggressively protect U.S. consumers and IP rights holders from sellers who seek to trick consumers into buying counterfeits. Marketplaces must have effective policies and practices to detect and block the sale of counterfeits automatically, immediately respond to complaints by consumers and brands, quickly remove counterfeiters from their sites and detect and prohibit confirmed counterfeiters from returning under another name."

WASHINGTON — Rep. Doug Collins (R-Ga.), Ranking Member of the House Judiciary Committee, gave the following opening statement for the subcommittee hearing on counterfeits. Below are the remarks as prepared. Ranking Member Collins: Thank you, Mr. Chairman, and thank you all for testifying before the committee today. You do not have to be an avid soccer fan to have enjoyed the recent success of our Women’s National Soccer Team. Within a day or two of winning the Women’s World Cup final, counterfeit versions of Nike brand official Alex Morgan jerseys were being sold on Amazon, and, over the last few years, dozens of articles have told the story of the pervasive problem of counterfeits being sold online. Most of these stories describe the plight of small and large businesses who are helpless to stop the theft of their intellectual property, and who have received little or no help from the platforms who profited from the sale of these counterfeits. The rampant sale of counterfeits online is not just a threat to U.S. jobs and innovation, it also poses a threat to consumers. Through their third-party marketplaces, platforms are selling contact lenses contaminated with bacteria, batteries that catch fire, cheaply made toys that allow children to swallow magnets and force them to undergo surgery and even an airbag that killed a driver. The list of counterfeit products being sold online is endless, so just imagine how often we expose ourselves and our loved ones to harm when we are tricked into buying counterfeits online. Online marketplaces have the choice to aggressively protect consumers from counterfeits and show respect for others’ property rights, but brand owners argue some are making a merely cosmetic effort. Certainly, marketplaces could be doing more to stop their sites from being used to sell counterfeits. We recently held a roundtable to hear from brand owners and platforms on the issue. Which platform has demonstrated it is truly committed to stopping the sale of counterfeits and protecting consumers? By most accounts, it is Alibaba. At the roundtable, we learned Alibaba’s anticounterfeiting policies and programs are significantly more effective than any of their U.S. counterparts. They are working very closely with all complaining brand owners and are using cutting-edge technology to scan for and detect counterfeits. I find it shocking U.S. platforms are so far behind. Marketplaces must aggressively protect U.S. consumers and IP rights holders from sellers who seek to trick consumers into buying counterfeits. Marketplaces must have effective policies and practices to detect and block the sale of counterfeits automatically, immediately respond to complaints by consumers and brands, quickly remove counterfeiters from their sites and detect and prohibit confirmed counterfeiters from returning under another name. The marketplace must apply these anti-counterfeiting policies and practices with equal rigor to protect all brands, particularly our small businesses, and not reserve their best protections for a few companies that bring huge profits to the marketplace. Platforms must do a better job of vetting sellers and sharing information with brands, consumers and law enforcement so these thieves can be brought before U.S. courts. Marketplaces should not allow sellers to trick consumers into buying a counterfeit by using a product’s image without the brand owner’s consent. Marketplaces should not promote counterfeit sellers’ products by highlighting the product of sellers offering the same item at a counterfeit price. These solutions are well within the grasp of our large online marketplaces and are practices they should have already implemented on their own. I hope the witnesses will share their views on which practices and policies must be adopted by online retailers and tell us whether Congress needs to act to ensure consumers and businesses are protected from counterfeits. Until recently, courts had consistently held that, upon a showing of likelihood of confusion, harm to the trademark owner’s reputation was to be presumed. As a result, trademark owners were able to get the form of relief they needed most, an injunction preventing further infringement. Ignoring the fact money damages rarely make a trademark owner whole, however, many circuit courts have abolished the rebuttable presumption of harm in trademark cases. Where damages cannot be proven, a successful trademark plaintiff will be awarded no relief. That cannot be right. I want to hear from our witnesses on whether we need to fix this misapplication of the law. During the Patent and Trademark Office’s oversight hearing, we learned the PTO had been tricked into registering a number of fraudulently secured trademarks. I look forward to hearing from the PTO representative and our other witnesses on how to prevent registration of such fraudulent trademarks in the future, and how best to quickly remove trademark registrations that should not have been granted. I look forward to delving into these very important issues.