Dear Majority Leader Schumer, Minority Leader McConnell, Speaker Pelosi, and Minority Leader McCarthy:

The 38 undersigned civil society organizations, trade associations, and companies write to share our collective opposition to the Stopping Harmful Offers on Platforms by Screening Against Fakes in E-commerce (SHOP SAFE) Act. While we support the goals of the SHOP SAFE Act— to promote consumer welfare, health, and safety—the bill as-drafted is not tailored to achieve those goals without risking substantial and negative unintended consequences. It marks a fundamental change to how individuals and businesses across the country communicate, engage, and conduct business online, and threatens to undermine free speech, innovation, and consumer choice. As Congress negotiates a final bill based upon the United States Innovation and Competition Act (USICA) and the America Creating Opportunities for Manufacturing, Pre Eminence in Technology, and Economic Strength (America COMPETES) Act, we urge you to exclude SHOP SAFE.

SHOP SAFE represents a seismic shift in law and policy around contributory trademark infringement. Yet, it has not received anything close to sufficient attention and vetting. Among other things, SHOP SAFE would effectively require digital services to monitor their users’ posts for potential trademark infringement [1] —creating barriers to entry for smaller services, making it harder for American small businesses to reach their customers, and limiting creative expression by encouraging the over-removal of non-infringing posts. [2] Due to the overbreadth of the bill, consumers could be negatively impacted because smaller services and smaller sellers may cautiously err on the side of removing legitimate listings or even shut down due to compliance burdens. [3] This runs counter to the bill’s stated goals of enhancing American competitiveness by severely limiting the opportunities for American small businesses to offer their goods and services to consumers.

The Senate has not had an opportunity to properly consider this bill and discuss how best to balance major policy changes to protect consumers while avoiding harming legitimate American small businesses. [4] Additionally, the House Judiciary Committee failed to fully consider the concerns stakeholders raised with the Committee. At the bill’s markup, numerous House Judiciary members voiced bipartisan concerns about the bill’s broad reach and negative impacts on consumers and small businesses. Unfortunately, while Committee leadership publicly agreed to continue work to address the concerns of the diverse stakeholders affected by this legislation, instead, as Rep. Lofgren notes, “we now find SHOP SAFE has been inserted without improvements[.]” [5]

Congress should not shoehorn this kind of dramatic policy change into the final compromise between USICA and America COMPETES or other “must-pass legislation.” This type of proposal should be carefully considered in the Senate with a transparent legislative process that accounts for full stakeholder participation. Since the bill’s pervasive flaws remain, they are not the sort of problems that can be resolved in conference and SHOP SAFE should be altogether excluded from the final package. Allowing SHOP SAFE to proceed, as-is and tacked-on to unrelated legislation, would set a dangerous precedent for policymaking that is fundamentally connected to our economy, innovation, competition, and free speech.

We urge Congress to remove SHOP SAFE from consideration in the final version of USICA and America COMPETES and to keep it from being added to future, unrelated legislation. In the meantime, we look forward to working with Congress as it advances competitiveness and consumer protection issues.

Sincerely,

Automattic

Center for Data Innovation

Center for Democracy & Technology Chamber of Progress

Computer & Communications Industry Association

Copia Institute

Craigslist

Creative Commons

eBay

Electronic Frontier Foundation

Electronic Transactions Association Engine

Etsy

hobbyDB

IP Justice

Mercari

National Association for the Self Employed NetChoice

OfferUp

Organization for Transformative Works

Patreon

Pinterest

Protect America’s Small Sellers (PASS) Coalition

Poshmark

Public Knowledge

R Street Institute

Re:Create

Redbubble

Reddit

Shopify

Small Business and Entrepreneurship Council

Software & Information Industry Association

Squarespace

TechFreedom

TechNet

TechNYC

Twitter

Vimeo

[1] See, e.g., Nicholas Garcia, SHOP SAFE Act: The Trademark Timebomb Masquerading as Consumer Protection, Public Knowledge (Feb. 15, 2022), https://publicknowledge.org/shop-safe-act-the-trademark-timebomb masquerading-as-consumer-protection/ (addressing the bill’s broad definitions).

[2] See, e.g., Sonia K. Katyal & Leah Chan Grinvald, Platform Law and the Brand Enterprise, 32 Berkeley Tech. L.J. 1135, 1149-50 (2017) (quoting E. Jordan Teague, Promoting Trademark’s Ends and Means through Online Contributory Liability, 14 Vand. J. Ent. & Tech. L. 461, 491 (2012) (“Requiring “mom and pop” online brokers to wage a million-dollar war against counterfeiting would likely drive these retailers out of business, undesirably narrowing consumer choice.”)).

[3] Daphne Keller, Empirical Evidence of Over-Removal by Internet Companies Under Intermediary Liability Laws: An Updated List, The Center for Internet & Society at Stanford Law School (Feb. 8, 2021), https://cyberlaw.stanford.edu/blog/2021/02/empirical-evidence-over-removal-internet-companies-under intermediary-liability-laws.

[4] A November 2, 2021 Senate Judiciary Committee hearing on “Cleaning Up Online Marketplaces: Protecting Against Stolen, Counterfeit, and Unsafe Goods” focused primarily on an alternative bill, the Integrity, Notification, and Fairness in Online Retail Marketplaces for Consumers (INFORM Consumers) Act. See Durbin Questions Witnesses in Senate Judiciary Committee Hearing on Cleaning Up Online Marketplaces (Nov. 2, 2021), https://www.judiciary.senate.gov/press/dem/releases/durbin-questions-witnesses-in-senate-judiciary-committee hearing-on-cleaning-up-online-marketplaces.

[5] See Rep. Lofgren, Extension of Remarks, H.R. 4521, the America COMPETES Act of 2022 (Feb. 2, 2022), available at https://lofgren.house.gov/sites/lofgren.house.gov/files/2.2.22%20-%20Extension%20of%20Remarks%20on%20H.R.%204521.pdf (“These concerns came up during the Judiciary Committee’s markup of the SHOP SAFE Act last fall. Members, including several who voted to advance the bill, called for further work on the bill. Based on public discussion at the markup, it was expected a committee-driven process to make changes to the SHOP SAFE Act would happen before it moved forward. Regrettably, given that the ordinary legislative process toward the Floor did not occur, we now find SHOP SAFE has been inserted without improvements into this much larger legislation.”).