SEO firm pays huge penalty in counterfeit goods case

Post by Steven Cox on 16th March 2011
 in SEO, E-commerce, General news

An American federal court has decided that a search engine optimisation company had contributed to offences of trademark infringement and unfair trading committed by one of its clients.

A website-building, hosting and SEO company had built and hosted an e-commerce website operating under the CopyCatClubs.com domain. Golf club manufacturer Cleveland Golf filed a complaint in 2009 that material on the website breached 11 of its trademarks.

Now, after a South Carolina federal judge ruled in favour of Cleveland Golf, a colleague has ordered that web company to pay $770,750 (more than £481,000) in damages. The amount is far greater than the $28,250 penalty – just over £17,600 - which the site’s owner was ordered to pay.

Cleveland Golf had initially pursued its claim against CopyCatClubs.com alone, but added the site's developers to the action when it decided that they should have known the goods being advertised on its site were counterfeit.

““For internet intermediaries like SEOs and web hosts, this should be a cautionary warning," says Christopher Finnerty, one of Cleveland Golf’s lawyers.

“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."

The Copycatclubs.com site has now been taken down. But Stephen Gingrich, vice-president of global legal enforcement and human resources for Cleveland Golf/Srixon, told the website Internetretailer.com: “Counterfeiting has existed for thousands of years but has been a localised issue.

“The internet, ease of global shipping and payments, combined with SEOs and web hosts injecting steroids into the situation has brought the issue into every consumer's living room."