Shopify is an Ottawa-based ecommerce company that was founded in 2006 by snowboarders looking for a way to sell their equipment. It now has a market capital of at least $180billion and 1.75m businesses. , a Canadian company sued by five major publishers, alleging that it enabled digital piracy by its vendors.
Macmillan, Cengage and Elsevier, McGraw Hill, Pearson filed the lawsuit jointly. The suit alleges Shopify “plays host to, enabler to, and protector of a world full of digital textbook pirates.” Shopify claims it has received detailed legal notices almost every week since 2017, identifying Shopify subscribers who use the company’s services for piracy.
The lawsuit claims that Shopify routinely ignores illegal activities by identified subscribers and puts its corporate finances above its legal obligations. “Shopify is aware that it assists subscribers to infringe but doesn’t care.”
Shopify’s spokesperson declined to speak with me by telephone, but did provide a statement stating that merchants who sign up for Shopify agree to its acceptable usage policy (AUP).
The statement stated that Shopify’s AUP clearly defined the prohibited activities on its platform. We have several teams that deal with potential AUP violations (including trademark infringement) and we won’t hesitate to take stores to court if they are found guilty.
According to a Shopify spokesperson, more than 90% of all copyright and trademark reports received so far in 2021 were reviewed within a single business day.
The lawsuit claims that legal notices publishers sent to subscribers since 2017 identified the store URLs and subscribers infringing publishers’ copyright. These notices enumerate hundreds of pirate websites as well as thousands of Shopify instances of trademark and copyright infringement.
The lawsuit states that Shopify “shirks its legal obligations when Shopify learns about specific instances of trademark and copyright infringement by continuing to aid repeat infringers with their infringement.” Shopify provides repeat infringer subscribers the tools they need for running their illegal businesses. It also gives them anonymity, a false veneer to legitimacy, and a safe haven to break the law.
Shopify provides a range of services for retailers including web design, shipping and fulfillment support. It charges as low as $29 per month for small businesses, while large companies pay $2,000 for larger firms. According to the company’s website, Shopify also offers web design and digital payments. According to , Amazon founder Jeff Bezos was concerned about Shopify’s rapid rise and he quietly acquired Selz in January.
Shopify is accused of helping to sell “ebooks”, which are PDF copies from publishers’ textbooks. These books can be sold through digital stores that Shopify helps to erect. According to the lawsuit, Shopify received more than 32,000 URLs from publishers pointing out examples of infringement between 2017 and 2021. The lawsuit seeks statutory damages to the maximum amount allowed by law ($150,000 for infringed copyright, and $2 million for counterfeited trademark). A report by Digimarc, a digital watermarking company, shows that ebook piracy in 2017 cost publishers $315 millions in lost sales.
James Grimmelmann is the Tessler Family Professor in Digital and Information Law at Cornell Law School. He said that it’s significant to have so many people from a particular sector join forces to fight piracy through a coordinated industry lawsuit. He pointed out that the film and music industries have set precedents in fighting copyright violations. He pointed out, however, that textbook publishers are plagued by high prices and a large audience of internet-savvy young people who want to avoid paying.
Grimmelmann stated that publishers face more than lost revenue. Many Shopify vendors also sell solutions manuals and answer keys intended for professors. Many professors have lost their textbooks because these materials ended up on the Internet.
Grimmelmann stated that Shopify’s warnings over many years are the strongest legal argument for the publishers.
Grimmelmann stated that “they have some very damning facts regarding repeated notices involving same storefronts.” They have evidence that at most some of these storefronts receive a lot of complaints and are shut down, then shut down again with a trivial name modification still on Shopify. This is the type of fact that Shopify could use to prove that it does not effectively terminate repeat infringers.
Grimmelmann stated that despite the lawsuit’s claim that Shopify encourages piracy, he believes it is more accurate for Shopify to state that they “not devote as many resources [to flushing] out infringers out and keeping them down” than publishers would like.
Grimmelmann and the Association of American Publishers could not provide an estimate of how much the industry loses each year to piracy. Grimmelmann stated that textbook prices have risen partly to compensate for lost revenue to piracy. However, students find other ways to get books, such as sharing them with their friends.
He said that textbook prices are unsustainable and that publishers have to raise prices in order to compensate for students who don’t buy books. This causes them to lose more customers and creates a cycle of self-reinforcing.
Jonathan Band, an attorney for copyrights in Washington, D.C., stated that Shopify might be assisted by the Digital Millennium Copyright Act, which reduces the damages that can come against service providers such as Shopify if they follow certain conditions. This law, he said, has allowed YouTube to avoid any liability for its platform, as long as it strictly follows the DMCA requirements.
He stated that Shopify will need to be proven inadmissible for the limitations of the “safe harbour” part of the DMCA by publishers calling their legal notices asking Shopify not to remove infringers, only to have them appear again like a “game-of-whack-amole”.
Band stated that they keep sending notices and then the rights holder and then service provider take it down, then it gets put back up.” The DMCA is not popular with publishers because they believe it isn’t effective for them. They continue to send these notices and nothing stops…. The publishers want to make an argument why the DMCA doesn’t apply.
DMCA takedowns on Shopify
Shopify allows brands to showcase and sell their products online and connect with customers. Shopify is not without risks for brands. An estimated 1 of every 5 Shopify sellers are fraudulent. This issue is rapidly growing on Shopify. Your brand should be ready to take down Shopify’s fraudulent sellers as soon as they appear.
Continue reading:
- Shopify counterfeit sellers: Be aware of the danger and be prepared
- Find out what a DMCA request is on Shopify, how it works and how you can make it happen.
Shopify protects what type of intellectual property infringement?
It is important to understand the protections offered by every platform and ecommerce website you use for your brand. The site helps brands to protect their intellectual property by assisting them with Shopify infringement . Shopify has outlined the prohibited items on its platform. It also offers assistance to stop infringements.
- Shopify: Copyright infringement
Copyright infringement is when your brand’s “tangible work” has been stolen or misused by an unauthorised party ( Shopify). Copyright infringement can be committed on Shopify as well as elsewhere by using product photos, web copy, and graphic designs. This is prohibited on the site. You could be eligible for a Shopify DMCA removal of the offending website by using your copyright content.
- Shopify: Trademark infringement
Trademarks are unique identifiers that help shoppers identify the brand from which a product comes. Your trademark can be used by Shopify websites to copy your logo, brand phrase or packaging. This is a tactic to trick and confuse consumers and is subject to DMCA removal on Shopify.
What is a Shopify DMCA Notice and Takedown Procedure?
Shopify sends DMCA notices to owners of websites that infringe on trademarked and copyright material. Shopify will automatically take down the infringing sites after they approve a DMCA request. Although Shopify does everything it can to identify fake websites they sometimes can’t find the majority of infringers without a report.
It is vital that your brand monitors Shopify scams for infringing on you brand. You may not catch scammers ripping off you brand if they don’t submit a DMCA to Shopify. If you find a Shopify fake site that is stealing protected content from your brand, please file a Shopify legal DMCA right away.
How can I file a DMCA for Shopify?
The Shopify DMCA notice is simple and should take only a few moments. Shopify offers an online form that allows you to report trademark and copyright violations. The form will require proof of proof, so make sure you have links to the fake website that show where they infringe on your IP.
After your Shopify DMCA request has been submitted, Shopify will review it. They should respond within a few hours to confirm that they have accepted your DMCA. If they have accepted, a Shopify notice with DMCA will be sent to the website. It will then be taken down.
You can continue the Shopify DMCA process if your request is rejected. You can collect more evidence of the site’s infringement and file another report. Your request will likely be approved if you have the right proof. Make sure your trademarks and copyrights are current and easy to defend.
Shopify: Why should businesses protect their IP?
Shopify stores are often fake and steal content from genuine brands. These sites are easily created by scammers using stolen product photos and content to sell counterfeit goods and get shoppers’ personal information. These sites pose a risk to not only your customers, but also to your brand.
These scam sites can steal your intellectual property and reduce your revenue. They lure customers with amazing deals they cannot duplicate. This can not only reduce sales but also harm your brand’s reputation. Protecting your customers and brand from Shopify scammers is crucial.
Protecting yourself is best done by monitoring suspicious Shopify stores. You can cause irreparable damage to the brand if you wait for customers to report a scammer to use your content. It is vital that you obtain the appropriate licenses for your IP and actively monitor for fraudsters to identify and take down fake sites.
Conclusion
Shopify fake sites are becoming a problem. They pose a threat for your brand’s reputation, brand revenue and customers. To properly protect your brand against Shopify infringement, it is important to monitor for fraudsters and submit DMCA takedowns.
