Trademarks

Hosting Counterfeit: Louis Vuitton v. Akanoc and the Liability of the Server Beneath the Storefront

The Ninth Circuit held that a web host that ignores notices and keeps serving counterfeit-selling sites can be liable for contributory trademark infringement—but capped statutory damages at one award per mark, jointly and severally.

June 23, 2025
Rows of servers in a data center with status lights
The court treated the hosting servers themselves as the instrumentality of infringement. Shutterstock
Educational content, not legal advice. This article explains general legal concepts. It does not create an attorney–client relationship. For your specific situation, consult a licensed attorney.

Counterfeiting cases usually name the seller. Sometimes they name the marketplace. Louis Vuitton Malletier, S.A. v. Akanoc Solutions, Inc., Nos. 10-15909 & 10-16015 (9th Cir.), decided September 9, 2011, went one layer deeper—to the company that owned the servers on which counterfeit-selling websites lived. The U.S. Court of Appeals for the Ninth Circuit (Chief Judge Kozinski, Circuit Judges Hawkins and Gould) affirmed that a web host and its principal could be contributorily liable for the trademark counterfeiting carried out on the sites it hosted, after a jury in the Northern District of California (Judge James Ware, No. C 07-03952 JW) found them liable. The court’s second move was just as important as its first: it reined in the statutory-damages award, holding that the jury could not multiply a single statutory award across multiple jointly liable defendants.

At a glance

  • Case: Louis Vuitton Malletier, S.A. v. Akanoc Solutions, Inc., Nos. 10-15909 & 10-16015 (9th Cir.).
  • Decided: September 9, 2011 (panel: Kozinski, C.J.; Hawkins and Gould, JJ.).
  • Court below: N.D. Cal., Judge James Ware, No. C 07-03952 JW. The jury found contributory infringement of thirteen Louis Vuitton trademarks and two copyrights and awarded $10.5 million in statutory damages for willful contributory trademark infringement against each of three defendants.
  • Liability holding: A web host with “direct control and monitoring of the instrumentality used … to infringe” that continues to provide services after notice can be contributorily liable under Inwood.
  • Damages holding: Under 15 U.S.C. § 1117(c), statutory damages are awarded per counterfeit mark, not per defendant; the award was vacated and remanded so that liable defendants would be jointly and severally responsible for a single award rather than parallel awards.

The instrumentality problem

The doctrinal puzzle in Akanoc was whether contributory trademark liability—built for the supplier of a mislabeled product in Inwood Laboratories, Inc. v. Ives Laboratories, Inc., 456 U.S. 844 (1982)—reaches a defendant whose only contribution is server space and bandwidth. The Ninth Circuit had earlier confronted the question in Lockheed Martin Corp. v. Network Solutions, Inc., 194 F.3d 980 (9th Cir. 1999), and Perfect 10, Inc. v. Visa International Service Ass’n, 494 F.3d 788 (9th Cir. 2007), framing the inquiry as whether the defendant exercised “direct control and monitoring of the instrumentality used by a third party to infringe.”

Akanoc supplied the answer that hosting is not abstract. The court treated the physical servers—and the connectivity Akanoc provided—as the instrumentality of infringement, because the counterfeit-selling websites could not function without them. Unlike the domain-name registrar in Lockheed, which merely translated addresses, or the payment networks in Perfect 10, which were several steps removed from the infringing display, Akanoc directly hosted the offending content and could pull it down. That degree of control over the means of infringement satisfied the Inwood threshold for a service provider.

Knowledge and the duty to act on notice

Control alone does not create liability; the defendant must also know or have reason to know of the infringement and nonetheless continue to supply its service. Here the record was unfavorable to Akanoc. Louis Vuitton sent at least eighteen notices identifying specific infringing websites hosted on Akanoc’s servers and demanding their removal. Akanoc, the jury found, largely failed to respond or to disable the offending sites.

That pattern distinguishes Akanoc sharply from Tiffany (NJ) Inc. v. eBay Inc., 600 F.3d 93 (2d Cir. 2010), where the platform promptly removed listings whenever it received specific notice and was therefore not liable. The two cases are consistent: contributory liability turns on what the intermediary does once it acquires specific knowledge. eBay acted and escaped; Akanoc was told, repeatedly and specifically, and did not act—so the willfulness finding and the contributory-liability verdict stood. Akanoc is, in effect, the mirror image of Tiffany: it shows what happens when an intermediary fails the specific-knowledge test rather than passing it.

The statutory-damages cap: one award per mark, not per defendant

The most enduring contribution of Akanoc may be its damages holding. The Lanham Act authorizes a plaintiff who proves use of a counterfeit mark to elect statutory damages “per counterfeit mark per type of goods or services sold,” within a range that rises sharply for willful counterfeiting. 15 U.S.C. § 1117(c). The jury had awarded $10.5 million against each of the three defendants—an aggregate approaching $31.5 million—as though each defendant generated an independent pool of statutory damages.

The Ninth Circuit held that this misread the statute. Statutory damages under § 1117(c) are keyed to the number of marks infringed and the types of goods, not to the number of liable defendants. Where multiple defendants are jointly and severally liable for the same acts of infringement, the plaintiff recovers a single statutory award for each qualifying mark, and the defendants share responsibility for it. The court therefore vacated the multiplied award and remanded, with instructions that the recovery for contributory trademark infringement be a single $10.5 million sum for which the liable defendants (the host and its principal) were jointly and severally liable, alongside a separate $300,000 for the copyright claim. The lesson is that statutory damages are a function of the marks counterfeited, not a per-defendant bounty.

Open questions

  • How far down the stack does control reach? Akanoc directly hosted the sites. The opinion does not resolve whether an upstream provider—a backbone carrier, a CDN, or a registrar—exercises the “direct control” Inwood requires.
  • What counts as adequate response to notice? Akanoc essentially did nothing. Between total inaction and eBay’s hours-long takedowns lies a wide middle ground the court did not chart.
  • Does joint-and-several treatment dull deterrence? If many defendants share one statutory award, does the cap under-deter well-capitalized intermediaries who profit from hosting counterfeiters?
  • How should courts value “willfulness” within the § 1117(c) range? The statute multiplies the ceiling for willful counterfeiting, but provides little guidance on calibrating an award within that expanded band.

Implications

  • Hosts are not automatically safe harbors. A web host that exercises control over its servers and ignores specific infringement notices can face Lanham Act contributory liability; trademark claims do not enjoy the DMCA-style safe harbor that shelters some copyright claims.
  • Notice-and-response discipline is decisive. The difference between Tiffany (no liability) and Akanoc (liability) is the intermediary’s conduct after receiving specific notice. Prompt, documented takedowns are the best defense.
  • Statutory damages scale with marks, not defendants. Plaintiffs should plead per-mark, per-goods-type theories; defendants should resist arithmetic that multiplies a single award across co-defendants.
  • Principals can be personally exposed. The host’s individual principal was held jointly and severally liable, underscoring that corporate form is not a shield where an individual directs the infringing conduct.

Frequently asked questions

Was Akanoc itself selling counterfeit Louis Vuitton goods? No. Akanoc was a web host; the counterfeit goods were sold by third-party websites that Akanoc hosted. Liability was contributory—based on providing the servers and connectivity and failing to act on notice—rather than direct.

Why did the Ninth Circuit reduce the damages? The jury awarded the full statutory amount against each defendant separately. The court held that 15 U.S.C. § 1117(c) measures statutory damages by the number of counterfeit marks and types of goods, not by the number of defendants, so jointly liable defendants share a single award rather than each owing the maximum.

How is this different from Tiffany v. eBay? Both apply the Inwood knowledge standard. eBay promptly removed listings when notified and avoided liability; Akanoc received specific notices and failed to respond, so it was held contributorily liable. Conduct after notice was the dividing line.

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