Louis Vuitton wins important counterfeiting case

Luxury Goods

LVMH-owned Louis Vuitton Malletier has been awarded US$32.4 million in damages following a lawsuit filed in 2007 against the web host of sites that sold Louis Vuitton counterfeit merchandise.

California-based Internet hosting business Akanoc Solutions, Managed Solutions Group and Steven Chen (‘the Akanoc defendants’) were found liable for contributory trademark and copyright infringement by the US District Court, Northern District of California (San Jose) on 28 August.

The court is expected shortly to issue a permanent injunction banning the Akanoc defendants from hosting websites that sell counterfeit or infringing Louis Vuitton goods.

Louis Vuitton Intellectual Property Director Nathalie Moullé-Berteaux said: “We are very pleased that the jury recognised the Akanoc defendants’ contributory liability. This decision is another important step towards reducing the illegal activity of websites selling counterfeit merchandise and enforcing the rule of law on the Internet.

The case sets a precedent for contributory liability with regard to the internet. The defendants’ case that they simply provide unmanaged server capacity to web hosting resellers did not exempt them from taking steps to prevent infringing activity upon notification from an intellectual property rights owner, the court found. This means that those who know or should have known that the business operations for which they provide venues, are conducting illegal activities, have an obligation to ensure those business operations are legal.

Moullé-Berteaux added: “The size of this award should make it clear to all Internet Service Providers (ISPs) that they cannot act, or fail to act, with impunity when a trademark owner provides notice that websites hosted by the ISP are selling counterfeit goods. We believe the size of the damages awarded should serve as a deterrent to other ISPs who may consider ignoring counterfeit trade on the websites they host.

This is a landmark case and hats off to Louis Vuitton for their relentless chasing of counterfeit operators – it is a scourge on the industry and a ‘silent killer’ of desire and demand.