Executive Corner

PSA: You must understand DMCA Safe Harbor

In Louis Vuitton Malletier, S.A., v. Akanoc Solutions, Inc., et al., CV07-03952 JW (N.D. Cal. 2007), Louis Vuitton brought suit against hosting companies Akanoc Solutions Inc., and Managed Solutions Group Inc., as well as Steven Chen, the owner of the two companies. Vuitton’s attorneys sued these entities for contributory infringement of both trademark and copyright, and won a $32.4 million dollar verdict against the hosting providers!

The hosts attempted to argue that the Safe Harbor act of the DMCA should shield them from liability. But apparently evidence seemed to show that they knew the illegal activity was occurring on their network and they failed to stop it.

Many people are fearing that this case will set a precedent for hosts that will affect us all in ways that set a detrimental precedent in other copyright cases — or that hosts will no longer have the full measure of protections they deserve. I’m not sure that’s true. There are many prior precedents that show trademark cases being given protection under DMCA, and it makes sense that this would be the case. It may just be that, in this situation, people didn’t follow DMCA guidelines and meet their own obligations, in the process intentionally or unintentionally breaking the law.

We host a lot of resellers – a lot of people who are hosting providers themselves. I am concerned that some hosting providers may not be aware of the protections they are provided under the Digital Millennium Copyright Act, but also of the OBLIGATIONS that DMCA requires of hosts as well.

I am not a lawyer, and I cannot tell you what you need to do to plan for a trademark or copyright infringement case. But I can tell you that if you don’t HAVE a lawyer you should get one – and talk this stuff through with them. If you host and feel you don’t need one you’re wrong.

As such, I urge managers of ALL web-based services and applications do the following:

1) Learn about the protections available to you under the Digital Millennium Copyright Act, particularly outlined in Title II of the Act.  A copy of the act is available
online at the USIIA web site at:

http://www.usiia.org/legis/title2.html

2) Ensure you are protected by the act.  Service providers are protected ONLY if they register an agent with the U.S. Copyright Office.  Details regarding the registration
process and forms can be found at the following site:

http://www.copyright.gov/onlinesp/

3) Remember that a request to remove copyrighted materials from any server under your control must be specific as to the content and location, and must meet a specific set of guidelines established for your protection.

4) If you receive such a request and do not know how to best proceed, seek assistance from an attorney familiar with copyright law and with experience dealing specifically with cases involving trademark infringement.  If you do not have an attorney familiar
with this area of law, contact your friends here at ServInt for assistance in finding one.

DON’T wait until there’s a crisis to get your ducks in a row on this one. If you host ANYTHING you need a plan. You need to do your legwork to protect yourself, and you need to research your legal rights and obligations. As we can see with Louis Vuitton Malletier, S.A., v. Akanoc Solutions, Inc., et al., CV07-03952 JW (N.D. Cal. 2007), the cost of negligence is pretty high!

As of today, it’s a $32.4 million dollar oversight.

Illustration by Christopher Dombres

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Comments
  1. Thank you for that. I didn't know thing one about Akanoc or any other player in the case I referenced. They could have been the best or the worst host in the world for all I knew. OK, best was pretty unlikely. There are tons of hosts out there who build their business on turning a blind eye to the illegal. I called them out in my recent piece when discussing the despicable practice of bulletproof hosting. If that is what was going on in this case there is no excuse. But the goal was to illustrate that there may be many small hosts out there who WANT to be upstanding citizens and do the right thing but don't know how. Some of those companies may be endangering themselves by their own ignorance - and in circumstances like that we want to help. Christian
  2. In this particular case, it wasn't an oversight--and the former owner of Akanoc is back at it again, hosting companies which (among other things) contain material lifted from other sites in violation of copyright laws. His new business venture, coloalacarte.com, is still engaging in the same activities that Akanoc did, and is still refusing to comply with (or even acknowledge) DMCA requests. In other words, this is a business policy, not a matter of mistake or oversight. It would seem that the owner of these Web hosting companies has made a policy of providing services to people he knows to be violating intellectual property law (among other laws), knowing that (a) he cang charge more money for hosting such sites and (b) should someone take him to court, he can fold the company and hang out a new shingle under a different name. Many folks in the spam-fighting community have taken to comparing his business ventures to the now-defunct McColo, a notorious company that for years provided services for spammers, counterfeiters, computer virus writers and distributors, and other profitable but otherwise undesirable clients: http://ksforum.inboxrevenge.com/viewtopic.php?f=1&t=2945&start=15
    Franklin Veaux /
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