This article highlights two seemingly inconsistent trends.
- Trend #1 is that plaintiffs (private actors or government agencies) are taking very expansive positions on affiliate liability.
- Trend #2 is that when tested, expansive affiliate liability theories are failing in the courts. These two trends seem to be in conflict with each other.
My hope is that trend #2 becomes so strong that it overrides trend #1; i.e., plaintiffs and government actors get the message that they have gone too far.
Unfortunately, in the interim, many defendants will capitulate and settle an expansive affiliate liability claim — even if it's lawless — because it's the cheapest path to resolution or because the precedent isn't strong enough to ensure victory.
Perhaps some defendants will realize that the trend is in their favor and will fight back accordingly. More judicial clarity about the line between permissible and impermissible behavior would benefit everyone.
It is also possible that the legal ambiguities of affiliate liability will be resolved by statute. However, despite the defendants' string of court victories, I see the chances of legislative intervention to curtail expansive affiliate liability doctrines as nil. If anything, it's more likely that future legislation will codify liability expansion.
For a rare in-depth analysis of affiliate liability, see Jean Noonan and Michael Goodman, Third-party liability for federal law violations in direct-to-consumer marketing: telemarketing, fax, and e-mail 63 Bus. Law. 585-596 (2008) [ABA subscription required to download].