Well, when I heard about this lawsuit, I remembered that a high number of "Navajo" products were being sold on Etsy (3,503 items, to be exact).
So I went on to Etsy to take a closer look at them, and, I'll be danged, I found this:
So, I wrote a little letter to Etsy:
You recently featured this item: http://www.etsy.com/listing/91179565/free-ship-navajo-burnt-orange-pouch?ref=fp_treasury_11
But it is in trademark violation of the name 'Navajo': http://abcnews.go.com/US/wireStory/apnewsbreak-navajo-nation-sues-urban-outfitters-15816090#.T08Ab4cgdXE
You should not condone illegal sales activities on your site and you should not promote items that violate trademark laws and/or the federal Indian Arts and Crafts Act.
Dr. Jessica R. Metcalfe
(Turtle Mountain Chippewa)
Let's see if I get a response.
Here is the response:
If Etsy receives notice from the authorities that a member's content or activity on our site does not comply with the law, then we will remove it and/or take measures to comply with the law.
Beyond legal issues, it's up to each member to make important ethical and moral decisions about what they choose to buy and sell on Etsy.
Etsy Marketplace Integrity