WWD reports that LVMH Moet Hennessy Louis Vuitton has won a huge jury verdict against two internet service providers who continued to host counterfeit handbag sites after being repeatedly warned by LVMH's attorneys that websites on their servers were breaking the law.
A federal jury in San Jose awarded a whopping $32.4 million verdict against Akanoc Solutions Inc. and Managed Solutions Group Inc., and Steven Chen, manager of the two firms. The jury said that the two companies were liable for contributory trademark and copyright infringement.
LVMH filed its suit in 2007. In an amended complaint filed in July 2008, the firm alleged Akanoc and Managed Solutions hosted more than 75 commercial Web sites with names like LVBagz.com and Louivuittonbagz.com that offered counterfeit LVMH wares to Internet shoppers.
The luxury brand said it had repeatedly warned the Fremont, Calif.-based Web hosts that sites on their servers sold counterfeit merchandise, but that the two firms continued to allow the sites to function.
"Louis Vuitton had given the defendants very specific notice of the infringing activity and it hadn't changed," said attorney Andy Coombs, who argued the case for the luxury house in the two-week trial.
A lawyer for Akanoc, Managed Solutions and Chen did not return a call seeking comment.
The judge has not yet ruled on LVMH's request for an injunction which would stop the defendants from further contributing to counterfeit sales. In other words, LVMH wants the court to order that the company stop hosting websites that sell fake handbags. This is a huge win for LVMH, which will almost certainly be appealed immediately. Luxury goods firms are really cracking down on the huge network of websites that sell fake handbags.
