Court Finds Web Hosts Liable For Counterfeit Sales By Web Sites

from the bad-precedents dept

Wed, Feb 4th 2009 7:37pm — Mike Masnick

While a US court last year (correctly) found that eBay is not liable for counterfeit goods sold by users, a recent court case won by Louis Vuitton surprisingly found that a web hosting company could be found liable, if a site hosted by the company sells counterfeit goods. The court finds the site guilty of both contributory copyright infringement and contributory trademark infringement, claiming that the host knows about the infringement due to notices from Louis Vuitton, without explaining how the hosting firm could possibly know if the complaints were legit or not (or whether the goods being sold were counterfeit or not). In a bit of a scary connecting of the dots, the court suggests that because the web host was notified, and because it could then disable the accounts, it's now liable as well. That creates a huge chilling effect for web hosts -- as it encourages them to basically shut off any website based on any accusation of selling counterfeit goods. If web hosts don't do that, they may face significant liability. There's nothing wrong with companies going after the actual sellers of counterfeit goods -- but going after the web host (and winning!) sets a dangerous precedent.

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Filed Under: counterfeit, liability, web hosts
Companies: louis vuitton

17 Comments

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ChurchHatesTucker (profile), 4 Feb 2009 @ 7:55pm

Sweet!
Next step: sue New York City for the cheap knockoffs you can buy on the streets!
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Anonymous Coward, 4 Feb 2009 @ 8:14pm

Cool
So who hosts www.louisvuitton.com ?
hmmm - looks like it registered with networksolutions
and hosted with RWT RagingWire Telecommunications
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Anonymous Coward, 4 Feb 2009 @ 8:17pm

Don't worry about the chilling effects. Global warming will take care of that.
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Anonymous Coward, 4 Feb 2009 @ 9:30pm

Re:
Not soon enough, it's been below zero Fahrenheit each day for weeks where I live! We're in the start of a freaking ice age! Where's my global warming?!?!?

Oh, and I hope the courts go further and put liability on anyone that is informed the next time, including any local municipalities where the web host, company and owners are located. Maybe then they will see how ludicrous it all is. But it's France I'm sure, and we all know they are more backwards that the U.S. Congress!
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David, 4 Feb 2009 @ 9:35pm

Re:
I wish I had something valid (or even semi-valid) I could claim Louis Vitton infringed my copyright on.
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Killer_Tofu (profile), 5 Feb 2009 @ 5:32am

In the US?
So this actually took place in the US?
This needs to get appealed.
Stupid stupid judge. Complete failure to have any forward thinking ability at all.
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Me, 5 Feb 2009 @ 7:30am

Why stop there?
They could sue the post office, UPS, Fedex, etc for shipping the fake goods. And how about the digital camera makers for allowing pictures of the fake good to be taken with their equipment (how dare they!), and computer manufacturers for allowing such reprehensible actions to be committed using their hardware, and MS and Apple for providing software that OBVIOUSLY should only be allowed to perform legal activities.......
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Anonymous Coward, 5 Feb 2009 @ 7:48am

So to take it a step further, if a brick and mortar establishment sells fake goods, the owner of the property is now liable for copryright infringement? (this is assuming, of course, that the establishmnet doesn't own the building)
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Anonymous Coward, 5 Feb 2009 @ 2:05pm

Re: In the US?
Yes, Northern District of California. Seems pretty poorly reasoned by the Court, as it ignores several precedents. That doesn't mean it will be overturned, though. But a more reasonable court would likely find this conclusion quite a stretch.
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Anonymous Coward, 10 Mar 2009 @ 5:15pm

Re: In the US?
No. This happened in France.
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Travis, 20 Oct 2011 @ 4:26pm

Re: In the US?
Think of it like this... Someone owns an apartment building. One of the tenants is operating a meth lab out of one of the apartments. The owner has been told several times about it by a neighborhood watch group. The owner goes to the apartment and sees the meth lab, and does nothing. You don't think that the Apartment building owner has any liability for enabling the meth lab to operate?

The web hosts are allowing illegal activities to be conducted through there servers. They are completely liable.
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