Quel Dommage! Federal Court Awards Significant Damages For Counterfeit Louis Vuitton Merch

On July 23, 2024, the Federal Court of Canada (the Court) issued its decision in Louis Vuitton Malletier S.A. v Torf, 2024 FC 1152, finding certain defendants liable for violations of Canada’s Trademarks Act and Copyright Act deriving from the sale of counterfeit Louis Vuitton merchandise.

Louis Vuitton launched an investigation in August 2021 relating to an Ontario-based business that was selling counterfeit Louis Vuitton goods through online and brick and mortar storefronts.  After gathering evidence of these counterfeit sales, Louis Vuitton sent a cease and desist letter to the sellers, demanding that they immediately cease any further distribution and sale of counterfeit Luis Vuitton merchandise and deliver up all such goods in their possession or control.  The sellers refused to comply, which led Louis Vuitton to commence a lawsuit against them alleging, among other things, trademark infringement and passing off contrary to sections 7(b), 19 and 20 of the Trademarks Act; and copyright infringement contrary to section 3 and 27 of the Copyright Act.

The Court determined that the matter could be dealt with under summary trial and the defendants’ counterfeit activities amounted to violations under the Trademarks Act and Copyright Act.  It then focused on the main issue of whether all nine defendants (i.e., seven personal defendants and two corporate defendants) were jointly liable for the violations and what damages ought to be awarded.

The Court found, on a balance of probabilities, that three of the personal defendants and the two corporate defendants were liable for the violations.  For the liable defendants, the Court was convinced by evidence that focused on the defendants’ active involvement in the advertising, offering for sale, and eventual sale of the counterfeit goods.  For the defendants not found liable, there was not enough evidence showing that the defendants engaged in or were otherwise sufficiently involved in the business to be personally liable for the violations (e.g., less involvement in sales, not profiting from business, etc.).

Ultimately, the Court awarded damages against the liable defendants in the total amount of $110,750.  It also imposed punitive damages against certain of the liable defendants, jointly and severally, which ranged between $50,000 - $100,000.

Summary By: Imtiaz Karamat