Grace Ordoña
Associate Editor
Loyola University Chicago School of Law, JD 2028
A designer handbag at a fraction of its retail price can be hard to resist. But knowing who is selling it does not answer the question that matters most: is it authentic? The Integrity, Notification, and Fairness in Online Retail Marketplaces for Consumers Act (INFORM Consumers Act) aims to deter counterfeit sales by making online sellers more identifiable and suspicious activity easier to report. Those protections are a useful start, but protecting shoppers and brands should also require a clear, accountable response when counterfeit complaints arise.
Seller verification and disclosure requirements
The INFORM Consumers Act, effective June 27, 2023, established transparency duties for covered online marketplaces. These marketplaces generally facilitate third-party sales of consumer goods in the United States and have an agreement governing consumers’ use of the platform. The definition can encompass smaller specialty platforms as well as major retailers’ marketplaces.
The INFORM Consumers Act requires marketplaces to collect and verify banking, contact, and tax information from qualifying high-volume, third-party sellers. Generally, a seller qualifies by completing at least 200 transactions involving new or unused consumer products and earning at least $5,000 in gross revenue on the same marketplace during any continuous twelve-month period within the preceding twenty-four months. Both thresholds must be met, and only transactions processed through the marketplace or its payment processor count.
Marketplaces must also require sellers to annually certify that their information remains accurate or has been updated. They must provide telephone and electronic reporting mechanisms on high-volume sellers’ listings and suspend sellers who fail to supply required information after notice and a ten-day opportunity to comply. For qualifying sellers with at least $20,000 in annual gross revenue on the platform, additional disclosures generally include the seller’s name, physical address, and contact information, subject to exceptions. The Federal Trade Commission (FTC) and authorized state officials enforce these obligations.
Temu and the limits of seller transparency
The Temu enforcement action illustrates why these requirements matter in practice: consumers need access to seller information and reporting tools before those protections can serve their purpose. Temu is an online marketplace through which third-party sellers offer consumer products. In September 2025, a federal settlement required its operator to pay $2 million to resolve alleged INFORM Consumers Act violations. The FTC alleged that Temu inadequately disclosed mandatory seller information and inconsistently provided required reporting tools. The settlement required Temu to put in place measures to ensure future compliance. This action addressed alleged disclosure and reporting failures, rather than determining whether particular fashion products were counterfeit. It demonstrates why transparency requirements matter, but also raises the question of how marketplaces should respond once suspected counterfeiting is reported.
Existing trademark law makes that response important. In Tiffany v. eBay, Tiffany sought to hold eBay responsible for allowing third parties to sell counterfeit Tiffany jewelry. The Second Circuit held that contributory trademark liability requires more specific knowledge of infringing activity than simply a general awareness of counterfeit sales. The court emphasized eBay’s good faith response to infringement notices, including removing reported listings and, in some circumstances, reimbursing buyers who provided evidence that their purchases were counterfeit. It also recognized that willful blindness could support liability. The decision shows why a marketplace’s response to specific evidence matters, even though awareness that counterfeits exist on its platform does not alone establish liability.
A clearer compliance standard
While seller identification helps establish who is responsible for a listing, complaint handling determines how a marketplace responds when a product’s authenticity is challenged. Clearer regulatory requirements should connect these two functions.
Congress should strengthen the INFORM Consumers Act to require marketplaces to demonstrate how they respond to credible evidence of counterfeiting. A reporting tool offers little protection if a shopper’s complaint receives no meaningful review or if a confirmed repeat offender can simply open another account. Enforceable investigation deadlines and documented decisions would make complaint handling more accountable. Preventing repeat violations should also require platforms to review whether new seller accounts are connected to confirmed offenders by using lawfully available business and payment information. However, any such review should require more than a shared address, and Congress should expressly authorize necessary data uses while preserving the INFORM Consumers Act’s privacy safeguards. These measures would connect seller verification to an ongoing responsibility to address counterfeiting.
Buyers should also have a clearer route to relief. When a product advertised as authentic is confirmed counterfeit, the proposed framework should require a refund process that does not impose return costs on the buyer. Platforms should notify purchasers potentially affected by a confirmed counterfeit listing to protect those beyond the complainant. Sellers, in turn, should receive notice of the allegations, an opportunity to provide evidence of authenticity, and a way to appeal adverse decisions. These protections would help shoppers seek recovery and allow brands to address misuse of their trademarks while protecting legitimate sellers from unsupported complaints. Effective compliance should make seller identification the starting point for an accountable response to counterfeiting, with meaningful relief for affected buyers.