H.R. 5384 – the Stopping Harmful Offers on Platforms by Screening Against Fakes in E-commerce Act (SHOP SAFE)
Judiciary Subcommittee on Courts, Intellectual Property and the Internet Chairman Rep. Hank Johnson (GA) issued the following opening statement during a full Judiciary Committee markup on September 29, 2021.
I move to strike the last word.
Combatting counterfeits online is of critical importance. My colleague, the Ranking Member of the Courts and IP Subcommittee, Mr. Issa, said during our hearing on this bill earlier this year, that there is no more bipartisan and cooperative issue than keeping unsafe counterfeit products out of consumers’ homes. I could not agree more.
The SHOP SAFE Act has been a true collective effort with Chairman Nadler, Ranking Member Issa, and Representative Cline. I want to thank Chairman Nadler for his leadership on the bill, and Mr. Issa and his staff for their dedicated work to get this bill to markup.
We are no longer in the era of fake watches and handbags being sold out of car trunks. As consumers have moved online, counterfeiters have embraced the internet too. But shopping on an online marketplace should come with the same customer trust and confidence as a brick-and-mortar store – today it does not.
Last Congress, I held a hearing in the IP Subcommittee where we heard testimony about the hazards of counterfeits being sold online, often in listings that make it virtually impossible for a consumer to even know they are buying a fake. I still vividly recall the video one witness showed about what happens if you have your car fixed with a fake car part—suffice it to say that the impact is truly life or death. The same is unfortunately true for fake electronics or even toys if they are substandard and break or fail at exactly the wrong moment.
Brands have been doing their best under the current legal system to keep fakes off these online platforms. While no one wants to see consumers get hurt, brands also suffer the consequence to their reputation if a counterfeit bearing their trademark is associated with harm or tragedy. They cannot do it alone.
They need online platforms to share in some of the legal responsibility. And that is exactly what the SHOP SAFE Act does. In my Subcommittee this Congress, we held a hearing specifically on this bill, with testimony about how it would incentivize platforms to take steps that only they are able to take, like more rigorously and consistently vetting sellers and monitoring and removing those who are found to repeatedly sell counterfeits, in addition to other best practices.
In exchange for undertaking these best practices, platforms would be immunized from liability for counterfeit products sold by third-party sellers—a much fairer bargain than the minimal steps platforms currently need to take to avoid the same responsibility. The bill is expressly directed at those products that affect health and safety, the products where the need for this legislation is the greatest. And the bill is drafted to acknowledge that brand owners would continue to play a role in the process.
It was important that we get this right. This bill does that, in a balanced and considered way. I strongly support the bill and urge my colleagues to do the same.