Shopify is on the receiving end of a lawsuit alleging it has failed to weed out pirated content on its website.
Shopify found itself in hot water earlier this week when five publishers filed a lawsuit in the US District Court for Eastern Virginia “over pirated learning materials like PDFs of ebooks and test materials, saying the e-commerce platform fails to remove listings and stores that violate the publishers’ trademarks and copyrights.” The suit is seeking more than $500 million in statutory damages.
The plaintiffs include Pearson Education, Inc., Macmillan Learning, Cengage Learning, Inc., Elsevier Inc., and McGraw Hill. According to the suit, Spopify “assists and profits from the online sale of infringing copies of the textbooks and other products.” Additionally, the publishers claim that Shopify “received detailed notices virtually every week for years that identify listings selling pirated content and related store URLs, but failed to block sellers from using the platform.”
The publishers also argue that Shopify “continues to offer services like storefront building, web hosting, and payment processing to sellers who are known to list pirated content.” The suit states, “Shopify furthers its business model — and bottom line — by enabling known repeat infringers in their continued infringement.”
In the past, Harley Finkelstein, the president of Shopify, said that when the company “sees storefronts that are infringing on a copyright or trademark, it’s removed.” However, the plaintiffs claim that “anyone looking at the storefronts, including Shopify, can see that they are dedicated to selling pirated textbooks.” On top of that, the publishers allege that “Shopify’s failure to control textbook pirates hurts their bottom line.” Why? For starters, “illegal digital copies of textbooks are sold at a fraction of the price of the legitimate digital textbooks, thus diminishing their perceived value and resulting in lost sales.”
Is textbook piracy that common, though? Well, it’s becoming more common as the price of learning materials and textbooks continues to soar. According to a study by the Bureau of Labor Statistics, “textbook costs rose 88% between 2006 and 2016.” To combat this rise in prices, some publishers have pointed to digital textbooks as a more affordable option. However, “ebooks don’t fix the affordability issue because access sometimes expires after a certain date, or they can’t resell them to recoup costs.”
When commenting on the lawsuit and its allegations, a representative with Shopify said the company works hard to “remove copyright violations.” They added:
“We have multiple teams that handle potential Acceptable Use Policy violations, including copyright and trademark infringement, and we don’t hesitate to action stores when found in violation…To date in 2021, over 90% of copyright and trademark reports were reviewed within 1 business day.”
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