B. The Elements of Contributory Liability under Inwood: 3. The Requirement of Actual or Constructive Knowledge: (c) Willful Blindness
The knowledge requirement under the Inwood standard can be met by demonstrating a defendant’s “willful blindness” to ongoing trademark violations. See Hard Rock Café Licensing Corp. v. Concession Services, Inc. 955 F.2d 1143, 1149 (7th Cir. 1992)(“willful blindness is equivalent to actual knowledge for purposes of the Lanham Act.”), citing Louis Vuitton S.A. v. Lee, 875 F.2d 584, 590 (7th Cir. 1989). Accord, Fonovisa, Inc. v. Cherry Auction, Inc., 76 F.3d 259 (9th Cir. 1996) (“a swap meet owner can not disregard its vendors’ blatant trademark violations with impunity”); Gucci America, Inc. v. Frontline Processing Corp., 2010 WL 2541367 at *13 (S.D.N.Y.) (a showing of willful blindness satisfies the knowledge requirement);Tiffany v. eBay, 576 F.Supp.2d 463, 513 (S.D.N.Y. 2008)(“the reason to know” standard can be satisfied by a showing that the defendant was willfully blind to the infringing activity), affirmed in part and remanded in part, Tiffany v. eBay, 600 F.3d 93, 109-110 (2d Cir. 2010), cert denied, 131 S.Ct. 647 (2010); Cartier Int’l v. Ben-Menachem, 2008 WL 64005 (S.D.N.Y. 2008)(finding contributory liability on part of parents who were willfully blind to the counterfeiting business operated by two of their sons)(unpublished opinion); Perfect 10, Inc. v. Cybernet Ventures, Inc., 213 F.Supp. 1146, 1188-1189 (C.D. Cal. 2002)(rejecting contributory liability claim due to lack of evidence but noting that test for such a claim “can be met where one knows or has reason to know of the infringing activity, and it specifically covers those who are “willfully blind” to such activity.” ) And see Louis Vuitton Malletier, S.A. v. Akanoc Solutions, 591 F.Supp.2d 1098, 1112 (N.D.Cal. 2008) (applying the willful blindness test to ISPs), defendants’ motion for JMOL denied, 2010 WL 5598337 *10 (N.D. Cal.).
To be willfully blind, “a person must suspect wrongdoing and deliberately fail to investigate.” Hard Rock Café, supra. Accord, Monsanto Co. v. Campuzano, 206 F.Supp.2d 1271, 1275 (S.D. Fla. 2002); Medic Alert Found. v. Corel Corp., 43 F.Supp.2d 933, 940 (N.D. Ill. 1999). And see Tiffany v. eBay, 576 F.Supp.2d 463, 513 (S.D.N.Y. 2008), affirmed in part and remanded in part, Tiffany v. eBay, 600 F.3d 93, 109-110 (2d Cir. 2010), cert denied, 131 S.Ct. 647 (2010); Fare Deals, Ltd. v. World Choice Travel.com, Inc., 180 F.Supp.2d 678, 690-691 (D. Md. 2001), citing Hard Rock Café, supra at 1149.
The willful blindness test has been applied in contributory liability cases in both the “product” and “non-product” contexts, as discussed below. The doctrine is not applied without limitation, however, as courts have recognized that the “reason to know” part of the Inwood standard requires a defendant to “understand what a reasonably prudent person would understand” and does not impose any duty to seek out and prevent violations. Hard Rock Café, supra at 1149, citing Restatement (Second) of Torts. Sec 12(1) & cmt. A. This subsection will discuss how various actions taken by (or taken upon) defendants can affect the outcome of the court’s findings on willful blindness. It will further explore the limitations on the concept of willful blindness, as set forth by the courts.
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