Mike posted an article about a case that I read yesterday regarding Louis Vuitton being awarded $32 million in damages from two hosting companies that were found guilty of Contributory Trademark Infringement. The companies had apparently been informed that there were counterfeit goods being sold on websites it hosted, but it did nothing:
“In awarding the damages, the jury agreed with Paris-based Louis Vuitton Malletier S.A.’s claims that the defendants knowingly allowed several Web sites they hosted to sell products that infringed Louis Vuitton’s copyrights and trademarks.”
When I first read the Computerworld article, my thought was that there are probably some domain parking companies that are nervous about this. At least two large parking companies have their operations in California, and they would presumably be held to the rulings of the U.S. District Court in the state of California. Further, one could believe that any company doing business with California residents could potentially be held liable for Contributory Trademark Infringement if they are doing anything to help monetize a trademark infringing domain name.
A parking company that provides PPC landing pages for hundreds of thousands of domain names could be in a similar position as the hosting companies in this situation. There’s no way to monitor every single potential trademark violation on all of the domain names it helps monetize. It will be even more important for them to look into every trademark infringement email notification they receive.
I don’ think hosting companies are going to investigate every claim they get, I think they are just going to pull the sites down.
Too much risk for a hosting company.
Attorney fees, risk of millions of dollars in damages, personally imposed against the owners of the hosting companies.
What is the downside of keeping the site up? Losing the customer.
Lots of downside, very little upside, easy call
Agreed – in fact, I’ve filed a couple of DMCA notices and the hosting cos have been very responsive.
How about in the case of a parking company monetizing potential TM names?
If none of these have been filed yet, which I’m not sure they haven”t, its coming
Selling blatantly counterfeit merchandise is a much stronger and clear cut enforcement and criminal situation. I don’t see Domain TM issues as being in that same realm from law enforcement’s perspective.
You can only take “contributory” so far. What’s next, suing the power company because they provided the electricity to make the servers run?
This case was about hosting images and product names of products that LVH has worldwide trademarks on. LVH has a long and successful history of protecting their trademarks.
If the hosting company took down the images and product names which LVH has clear trademarks on, then they’d not be in the mess that they’re in now.
This case isn’t much different than a hosting company allowing clients to host copies of movies of CD’s on their servers.
True, but I think it could be argued that hosting images/product names would be similar to typos/TMs where the parking company displays links to competitors and/or the company itself.
I know that all corporate lawyers wouldn’t sue companies unless it was cut and dry, but… 🙂
It seems to me Elliot that you are also leaving out one piece of the puzzle, and that was that they were notified and made aware of specific domains/sites that were infringing.
I think if a company complained about a domain to a parking co. and they took the site down, then they would be okay. Of course that is an assumption.