The case of Luis Vuitton and the responsibilities of server owners to protect copyright and trademark rights
By Emma Peart
Louis Vuitton have taken action for breach of copyright and trademark rights owners of servers which it stated failed to stop users of the servers breaching copyright and trademark laws in its usage of the servers.
Louis Vuitton claimed it had knowledge of Chinese websites selling goods that it believed infringed its copyrights and trademarks. The websites did not sell merchandise directly but listed an email address that interested parties could use to initiate a transaction. Upon further investigation Louis Vuitton discovered that the websites were using IP addresses assigned to the companies MSG(Managed Solutions Group, Inc ) and Akanoc Solutions. An action was brought by Louis Vuitton against MSG, Akanoc Solutions and Steven Chen (the owner of both companies).
In 2006-2007 letters were sent to all defendants highlighting the potential infringement through official notices of infringement but no official response was given from the defendants. The websites continued to operate using servers and IP addresses owned by Defendants.
Initially, all three defendants were found liable and statutory damages were awarded. Later, the decision against MSG was then dismissed because it was viewed that MSG merely owned and leased the hardware operated by Akanoc and Steven Chen.
The appeal court raised a number of issues it felt important in the issue of liability:
• Servers could be a means of infringement as the means to which websites became available.
• proof that defendants had actual or constructive knowledge that the users of their services were engaging in infringements or knowingly failed to prevent infringing actions is sufficient to determine liability
• In relation to contributory copyright infringement, it stated that providing direct infringers with server space constitutes a material contribution to direct infringement because this “substantially assists” direct infringement.
Statutory damages were awarded against all defendants, albeit at a lower amount than the initial decision because a plaintiff can only recover one set of statutory damages where two defendants are jointly and severally liable.
The decision highlights the responsibility of server providers to regulate their usage and make sure that any usage which breaches copyright or trademark rights must be dealt with or they can be held liable for any breach of copyright or trademark law. Owners of servers must be extremely vigilant of the activities of the users of its servers.
