Who's responsible for keeping counterfeit goods out of the marketplace? It may depend on which court deals with the litigation.
Earlier this month, a federal appeals court in California upheld a ruling against a Web-hosting business for allowing its customers to sell counterfeit Louis Vuitton merchandise on rented Web space. The court awarded $10.8 million in damages.
At least 18 "notices of infringement" were sent to San Jose-based Akanoc Solutions Inc. and its manager Steven Chen between 2006 and 2007 by Louis Vuitton Malletier S.A., a luxury-goods manufacturer. But the company failed to remove the knock-off merchandise from its customers' sites. Most of the counterfeit goods came from China.
In a similar ruling, a French court ordered eBay Inc. in 2008 to pay more than $61 million to Louis Vuitton for allowing fake merchandise to be sold on its site.
By contrast, a U.S. district court in New York found eBay blameless in 2008 for sales of counterfeit Tiffany & Co. merchandise on its site. The court noted that eBay swiftly removed offending auction postings when the company was alerted to problems. The court concluded it was up to trademark and copyright holders to police their own brands.