Authored By: Risla Shahana
School of Indian Legal Thoughts, MG University. Kottayam
ABSTRACT
The social media is developed at the 20th centuary and now it acting on the global world for speedy transportation of the commerce platform. But the liability of social media is controlled in a concise manner. In this article, mainly disscussing about the intermediaries liablity in social media for algorithm amplification by promoting the luxury brand’s trademark infringement. The paper worked on the doctrinal analysis for the issue by legal statute nationally and internationally by mainly comparing it with the European Union’s legal interpretation and statute, which is easier to compare. The intermediary liability is already mentioned in the Information Technology Act but it needs more expanding procedure. Due to misuse and misrepresentation of the intellectual property, the act should be much more regulated on intermediaries. This article mainly mentioned the intermediary liability and how they act in luxurious product with case laws. And obligation of the intermedieries to control algorithm amplification and to protect users for their frivilous act.
INTRODUCTION
This article widely discusses the emergence of social media and its multipurpose use all over the world, specifically in India, by giving a detailed account of commerce and digital trade. This article revolves around the liability and responsibility of digital platforms as intermediaries between seller and buyer. The drastically increasing and evolving nature of the digital trade and behavior of buyers raises an important legal question that has been discussed in detail in many Western jurisdictions, including the EU and America. The question is, what are the liabilities of digital platforms as intermediaries of trade, and how extensive is their liability towards buyers with regard to deceptive trademarks and intellectual property infringement on their platforms?
This article, based on the above question, explores how existing intermediary liability rules apply in cases where algorithms actively recommend or amplify infringed content. By analyzing relevant legal developments and case laws, the study seeks to evaluate whether current legal mechanisms are adequate to regulate trademark infringement of luxury products on social media platforms.
CONCEPTUAL FRAMEWORK
The social media availability came in the 20th and 21st centuries; before this period, the luxury products were done through traditional markets. By the social media intervention, the marketing structure is completely changed. For example, as per the CMP Research in December 1997, nearly two-thirds of the U.S. companies would be resorting to e-commerce by the year 1998.[1] Through these it was clear that in 1997 itself the commercial interests were mostly transferred through the internet. Before this report, a model law of e-commerce was adopted in 1996 by the United Nations Commission on International Trade and Law (UNICITRAL); further, it leads many nations to adopt their on national law regarding this.[2] For example, the Indian Information Technology Act, 2000, had the main object of ensuring trade in online platforms. When talking on social media and trade, trade preferences in social media are working on the basis of algorithm amplification but not completely.
The theme of this article made me think about whether this algorithm amplification is mentioned under any act or guidelines related to social media. When an item is searched on any social media, the same product can be visible in various media of the same user; at some instinct, these propaganda are on the preferences of the purchaser. But at some instinct it can be an already-made algorithm recommendation by social media, and it can be developed on the person’s interest, behavior, and attitude before the social media. So through this algorithm, it can lead to encouragement of trademark-infringed products and original products. While selling and marketing the product online, social media acts as the intermediary.
The intermediary is mentioned in the Information Technology Act, but it is widely explained and elaborately discussed in the guidelines published by the central government. There are a wide variety of intermediaries; those are “significant social media intermediaries” that have a number of registered users, and “social media intermediary” refers solely to enabling two or more users to create, transmit, upload, share, disseminate, modify, or access information using its services.[3] The luxury products, including cosmetics, footwear, garments, bags, etc., are being sold and purchased through these intermediaries. Social media like Instagram, Google, etc., are encouraging the sales of luxury products. Since the emergence of social media marketing, it has become accessible to all parties. From MNCs to laymen, they started trading and selling through these intermediaries, which caused an influx of a number of quality and non-quality products. Some of them passed the quality check, some of them were below quality, some of them were trademarked genuine products, while some of them were copied products with similarity to known trademarks. This situation created a chaotic situation in the online markets. After the Covid pandemic the chaotic situation became extreme due to the high unavailability of employment. Many of them find their income through this social media marketing of products.
The intermediaries are protected from liability by the Indian legislature under Section 79 of the IT Act. While the European Union and the USA divided the intermediary liability into direct liability (primary) and indirect liability (secondary) as a broad concept. When the Safe Harbor principle[4] mainly focuses on how to protect the intermediary from liability from third-party content. This led to a thought: this act is neither helping the commercial platform nor the community platform to develop, nor the public space from malevolent forces.
A registered trademark is infringed by a person who, not being a registered proprietor or a person using it by way of permitted use, uses in the course of trade a mark that is identical with, or deceptively similar to, the trademark in relation to goods or services.[5]So the trademark-infringed products can also be viewed online as social media propaganda. In the Satyam info ltd. case[6] , the trademark infringement was by carrying the same domain name. The use of a similar domain name may lead to diversion for the users. Through this case it was concluded that the consumers are easily misrepresented by the product. For an illustration, we can consider the luxury brands of H&M, Gucci, etc. The same product with a cheap price and low quality can be seen, which makes the people deceptive. These trademark-infringed products are easily attracted to the people by algorithm amplification. This led to a legal gap regarding whether the social media company that already designed the representative algorithm is liable for their conduct.
Through the safe harbor principle, the intermediary is not liable for the conduct done by the third party. This led to a question related to my research, as the algorithm amplification is done by the intermediary, and these led to trademark-infringed products being sold very quickly by misrepresenting the consumers. But in the legislative statute there is no particular provision that deals with the intermediary liability done by the algorithm amplification. As already discussed, the intermediary guidelines were made for consumer safety and procedures to be applied by intermediaries. In the guidelines, Rule 3(b)(iv) states that the intermediary shall inform the rules and regulations, privacy policy, and user agreement and remove any patent, trademark, or other proprietary rights that cause infringement. The guidelines provide for removal of the infringed content, but it is not mentioned about the algorithm amplification legal issue and their interest in social media. Through this paper, the main aim is to avoid infringement in the present and also future infringement.
The algorithm amplification is formed by social media for human needs and for easy mode to get information and interest. So these cannot be categorized under the online platforms that cause risk, illegal content, and social harms as mentioned under the Digital Service Act in the European Union. This is not a social harm; sometimes it can be considered as private interest rather than public interest. The online platforms are not providing illegal content, but they are only showing the trademark-infringed products as the same as that of other genuine products. A serious issue will rise while moving forward. That is, the infringed product is sold by the originator[7] and through social media propaganda, the consumer becomes misinformed or deceived about the product. The sole responsible party for the act is the originator, but to some extent the service provider is liable for algorithm amplification. Then the issue comes under the caveat emptor (buyer beware) of the Consumer Protection Act.
This question is one of the concerns; when solving these, it will lead to another path. Now focusing on the intermediary liability, the Indian legislative system does not think about such a problem. They mainly focused on the intermediary liability only. When looking into these, a similar example came to mind: when a theft is done and the stolen property is found in another’s possession, it will lead to a criminal offense. While at the same time the trademark-infringed product was in the possession of social media, and this led to the sale. It also causes brands’ reputations to suffer, and it will lead to the destruction of the sale of that product. While moving into question that is intermediary liability promoting the trademark-infringed product by algorithm amplification. This led to a various path rather than a solution.
COURT INTERPRETATION
In L’Oreal SA & Ors. v. eBay International AG & Ors[8], the question arises in this: how is the intermediary liable? The liability of the service provider may be limited on the basis of the role played being neutral. If the online platforms did not play an active role and he only provided the service, then he was not liable. But if the online platforms became aware of the facts and deliberately avoided the facts, then he should be liable.[9] For preventing the infringement in the future, it should be interpreting the EU law and avoiding barriers for legitimate trade. Through this case analysis the liability is based on the participation, and for a legitimate trade it should be necessary to control the intermediary for a legitimate trade.
While in U.S jurisdiction Tiffny vs. Ebay[10], the allegation was that the eBay platform constitutes direct infringement on counterfeiting the product. The court held that eBay acted in good faith and took sufficient steps to remove the infringed content from the website. In this decision the court described that if a mark is used to signify the genuine product of the trademark owner, then it cannot be considered under infringed products. The liability is considered if there is already knowledge about the infringed mark and the service provider neglects to take necessary steps. So through these cases it was clear that different jurisdictions have different ideas on intermediaries. In the first scenario, the intermediary liability is controlled for the user’s interest. But in another scenario, the intermediary’s liability is more extended rather than controlling.
In Christian Labatioun case[11] The court considers the e-commerce platforms as intermediaries under section 2(w) of the IT Act. Then it considered the position of social media, whether it is an active participant or not. In this case, Darveys.com is a platform for selling luxury products. The plaintiff company is a luxury brand that is exclusively enabled only in offline trade and is not interested in doing trade in the online market. But the defendant enabled the trade of the plaintiff’s product and trademark in the online market without his consent. The real question is whether he acts as an intermediary; to some extent he is an intermediary but not a passive participant. In this online platform, whoever is a member of the media will be able to be a customer. While becoming a member, they are easily giving consent for the liability. In this case, the judiciary talks about the e-commerce effect on trademark-infringed products.
Through these cases the effect of algorithm amplification is continuously avoided. Through these they are protecting the current situation of the company. The later effect is not completely mentioned. But in the above case, the court held to remove the product of the plaintiff from the website, but it did not give the loss caused to the company by these sales of infringed products.
FINDINGS
The intermediaries, as mentioned above, are not liable for the act of the originator who infringed the product. But the social media that already have an algorithm are acting on the basis of that; sometimes it will cause severe harm to the identity of a luxurious product. In the above-mentioned case,[12] it was clear that a huge loss has been caused to the fashion company due to the effect. In these circumstances, algorithm amplification, which is managed by social media, should be aware of the product identity, whether it is an infringed or diluted product. In the intermediary guidelines, it mentioned the privacy policy concerns to avoid trademark and copyright infringement. Then when such an infringement is known by the intermediary, it should be removed from all the sources.
In the European statute, the Digital Service Act provides fairness, trust, and safety in the digital environment and provides targeted responsibilities for online intermediary services, including network infrastructure services, online platform services, and services provided by very large online platforms, which cause risks in the dissemination of illegal content and societal harms.[13] The Digital Services Act (DSA) applies a cautious regulation of ASRS, or the algorithm search and recommender system. The DSA establishes the most stringent requirements, as they may pose particular risks for the distribution of illegal content and, thus, may cause societal harms under Article 33 of the DSA. The providers of online services must make available a functionality that allows users to select and modify at any time their preferred option. And annual assessments of systematic risk should be done by the online platforms.[14] Through these acts, the European Union is attracting user-friendly online platforms and avoiding harm to the public.
So in India the intermediary liability is not well explained, but at some time it causes a huge loss to the fashion industry by not protecting their own product in their premises. To some extent the infringed products will get more popularity than the original product, which will cause a huge loss to the company. Sometimes their company’s reputation can also be affected badly. So a strict regulation, as of the European Union, should be given to the Indian legislative for the originator and consumers to have a better experience from social media. A strict regulation on the intermediary helps the people to purchase online. So it will make a more protective method rather than a traditional method.
CONCLUSION
In this paper, mainly focused on the algoritham amplification by the intermediary or the social service provider liability promoting the the trademark infringed product. The Indian legislation has not protected the consumers and company who working solely for the fashion. There is legal gap regarding the social media’s obligation to save the trade. In the international law such as UNICITRAL mainly mentioned about the trade enforment but not for protecting the traders. The luxuries product were misused by the trademark infringment. And such an act was promoted by the social media. So it is neccessary to be controlled. A specific legislative rules and regulations are neccessary to protect the luxurious product from misuse and interpretation of the social media of their own choices such as above mentioned EU Digital Service Act.
REFERENCE(S):
Article:
- A Lakshmana Moorthy & CR Karisiddappa, CYBER COMMERCE FOR LIBRARIES, 4, (Mar, 07.2026, 9:20 PM) https://www.researchgate.net/profile/Dr-Karisiddappa-C-R/publication/337732279_Cyber_commerce_for_libraries/links/5de781dd4585159aa45fadd2/Cyber-commerce-for-libraries.pdf
- Antitrust Chronicle January 2019, 5, https://www.competitionpolicyinternational.com/wp-content/uploads/2022/12/6-ALGORITHMIC-SEARCH-AND-RECOMMENDER-SYSTEMS-IN-THE-DIGITAL-SERVICES-ACT-By-Oliver-Budzinski-Madlen-Karg.pdf (last visited Mar. 9, 2026).
Books:
- JYOTI RATTAN, Cyber Laws & Information Technology 77, (VIJAY RATTAN, 6th ed. 2017).
Case laws:
- Satyam Infoway Ltd vs Siffynet Solutions Pvt. Ltd. AIR 2004 S.C 3540 , https://indiankanoon.org/doc/1630167/ (last visited Mar. 8, 2026).
- L’Oréal SA and Others v eBay International AG and Others (ECJ 2011).
- Tiffany Inc v eBay Inc, :, https://www.unodc.org/cld/en/case-law-doc/fraudcrimetype/usa/2010/tiffany_inc_v_ebay_inc.html (last visited Mar. 9, 2026).
- Christian Louboutin Sas vs Nakul Bajaj & Ors on 2 November, 2018, https://indiankanoon.org/doc/99622088/ (last visited Mar. 9, 2026).
Indian Statute :
- Information Technology ACT, 2000
- TRADEMARKS ACT, 1999
- The Information Technology (Intermediary Guidelines and Digital Media Ethics Code) Rules, 2021
International statute:
- ERNOULD & peirre, Digital Services Act
[1] A Lakshmana Moorthy & CR Karisiddappa, CYBER COMMERCE FOR LIBRARIES, . 4, (Mar, 07.2026, 9:20 PM) https://www.researchgate.net/profile/Dr-Karisiddappa-C-R/publication/337732279_Cyber_commerce_for_libraries/links/5de781dd4585159aa45fadd2/Cyber-commerce-for-libraries.pdf
[2] JYOTI RATTAN, Cyber Laws & Information Technology 77, (VIJAY RATTAN, 6th ed. 2017).
[3] The Information Technology (Intermediary Guidelines and Digital Media Ethics Code) Rules, 2021, sec. 2(v) & (w).
[4] IT Act,2000 sec. 2(za).
[5] The_trade_marks_act,_1999.Pdf, 29, https://www.indiacode.nic.in/bitstream/123456789/15427/1/the_trade_marks_act%2C_1999.pdf (last visited Mar. 8, 2026).
[6] Satyam Infoway Ltd vs Siffynet Solutions Pvt. Ltd. AIR 2004 S.C 3540 , https://indiankanoon.org/doc/1630167/ (last visited Mar. 8, 2026).
[7] IT ACT, 2000 sec. 2(za).
[8] L’Oréal SA and Others v eBay International AG and Others (ECJ 2011).
[9] In the Section 79 of IT Act it specifies about the “actual knowledge” of the intermediary as same as in the above scenario.
[10] Tiffany Inc v eBay Inc, :, https://www.unodc.org/cld/en/case-law-doc/fraudcrimetype/usa/2010/tiffany_inc_v_ebay_inc.html (last visited Mar. 9, 2026).
[11] Christian Louboutin Sas vs Nakul Bajaj & Ors on 2 November, 2018, https://indiankanoon.org/doc/99622088/ (last visited Mar. 9, 2026).
[12] Id.
[13] ERNOULD & peirre, Digital Services Act, 1. an overview
[14] Antitrust Chronicle January 2019, 5, https://www.competitionpolicyinternational.com/wp-content/uploads/2022/12/6-ALGORITHMIC-SEARCH-AND-RECOMMENDER-SYSTEMS-IN-THE-DIGITAL-SERVICES-ACT-By-Oliver-Budzinski-Madlen-Karg.pdf (last visited Mar. 9, 2026).
