There are a number of risks associated with being a commercial landlord, such as the time commitment needed for maintenance and claims arising out of injuries on the property, car damage in the parking lot, dangerous structural conditions, and environmental hazards. One of the more remarkable occurrences is the growing tendency by the courts to find commercial landowners and lessors responsible for trademark infringements by their lessees. This article will discuss this development and will highlight some of the more important decisions on the topic.
THE PROBLEM WITH COUNTERFEIT GOODS
Counterfeiting is one of the biggest underground businesses in the world and it continues to expand. It is also becoming more arduous to detect a bogus item because of 3D printing and other new technologies. The problem is almost impossible to eradicate because of cheap overhead, high profits, and a “cloak-and-dagger” business style. It once seemed that the sale of counterfeit goods was restricted to dubious individuals prowling the streets, but these counterfeit products are now regularly discovered at flea markets, on the internet, outside arenas at sporting events and concerts, and even in brick-and-mortar stores.
Many Americans seem unaware of the deleterious repercussions of counterfeiting. There seems to be a prevailing attitude that knockoffs are restricted to fake handbags, sunglasses, and watches, as well as a failure to appreciate the effects that counterfeit goods have on American enterprises. Consumers who consciously purchase counterfeit items are unlikely to procure genuine equivalents and often make these acquisitions because the copy is much cheaper. This allows the counterfeiters to appropriate an owner’s intellectual property (IP) without paying taxes or following the rules and quality standards mandated for the real item.
HOLDING LANDOWNERS AND LESSORS RESPONSIBLE FOR CONTERFEIT GOODS
A consensus has developed, as the result of court decisions, that the owner or lessor of a flea market, super-max center, shopping complex, or commercial establishment may be responsible for a trademark infringement committed on its property, and that willful unawareness of those illegal pursuits may establish constructive knowledge of the selling of counterfeit items.
The Practical Real Estate Lawyer
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