February 16, 2021
As reported by the National Law Review, Louis Vuitton was recently successful in its unrelenting battle to defend against unauthorized use of its famous brand.
In 2006, the company discovered knock-off Louis Vuitton goods being sold online using copyrighted images, designs, and trademarks. The company used the website IP addresses to identify two web hosting businesses - Managed Solutions Group Inc. (“MSG”) and Akanoc Solutions Inc. (“Akanoc”). MSG leased servers, bandwidth, and IP addresses to Akanoc. Akanoc then leased packages to their customers who were mostly located in China. Both companies were owned by Stephen Chen.
Louis Vuitton sent numerous infringement notices and letters advising MSG, Akanoc, and Stephen Chen to take down the infringing materials. The companies, their web hosting clients, and Chen all failed to respond or remove the content.
Louis Vuitton then took further action, suing all three for contributory trademark and copyright infringement. Louis Vuitton alleged actual knowledge of their website client’s activities and highlighted their repeated attempts to contact the companies and Chen, advising of the infringing activities of their customers.
At trial, the jury awarded $10.5 million in statutory damages for contributory trademark infringement and $300,000 for willful contributory damages for each defendant.
The defendants moved for judgment requesting the court set aside the jury verdict as unsupported by the evidence. The Northern District of California granted the motion for MSG, but denied it for Akanoc and Chen.
On appeal, the Ninth Circuit affirmed the decision with respect to MSG, and upheld the other contributory copyright infringement verdicts. The Court found the defendants' actions to be an essential step in the infringement process. The Court also found there was no legal basis for multiplying the damage awards by the number of defendants and that Akanoc and Chen were jointly and severally liable for the $10.5 million in statutory damages and $300,000 in contributory damages.
Authors: Mark Leonard and Emma Baumann