ISP has to block 25 domains promoting counterfeit goods, Dutch judge rules

But AltusHost's attorney says that ordering the ISP to take down domains is futile because their owners will just find new hosting providers

AltusHost, an ISP based in Belize, has to take 25 domains offline that are used to sell and promote counterfeit fashion goods, a court in The Hague ruled Tuesday.

AltusHost has to block the websites bestwatchonsale.com, cheap-watch.org, breitlingwatches-replica.com and fakewatchesuk.org among others within three days, judge E.F. Brinkman ruled in a summary judgment in the Civil Court in The Hague.

If AltusHost does not comply, it has to pay a penalty of ¬2,500 (US$3,112) per day with a maximum penalty of ¬100,000, the judge ruled.

Eleven companies, including Breitling, Chanel, Christian Dior and Omega, filed suit against AltusHost to protect their trademarks. The organization REACT, which calls itself the European Anti-Counterfeiting network, prepared the lawsuit on behalf of the organizations.

After the summary judgment, the trademark holders cut a deal with AltusHost, which agreed that it will block websites in the future that are reported to it by REACT and others if the websites are clearly promoting counterfeit goods, said solicitor Marc van Rijswijk of Griph Advocaten, who represented the ISP (Internet service provider), in an email. "AltusHost has agreed to indeed shut down the relevant website if such is the case," he wrote.

"This is good news," said Joris van Manen, partner at Hoyng Monegier LLP, which represented the trademark owners in the proceedings. "AltusHost has always been the naughtiest kid on the block on the Internet," he said, adding that the ISP was always one of the few that challenged take-down requests of counterfeit sites in court.

About half of the approximately 6,000 domains hosted by AltusHost fall into the counterfeiting category, van Manen alleged, adding that AltusHost has now shown its willingness to take down sites, calling this good news for his clients and for the Internet.

Van Manen's allegations were contradicted by van Rijswijk. "AltusHost does not host 2,500 websites that promote counterfeit goods," he wrote, adding that as far as AltusHost is aware, the 25 websites that were subject to the proceedings are the only websites hosted by AltusHost that promote counterfeit goods. These websites have been shut down by AltusHost, he wrote. AltusHost has, and always had, a policy to block, suspend and/or take down websites that infringe the rights of third parties, he added.

AltusHost can only block the host account of the website holder or request its client do so, and the ISP stated in the court proceedings that it cannot prevent website owners from moving their domains to another hosting provider, said van Rijswijk. "In fact this has happened for the ... 25 websites that were subject to the proceedings, making the actions of the market holders in the opinion of AltusHost futile," he said.

Van Manen said that he was aware that "a couple of them are already up and running with other providers," adding that is an ongoing problem that is hard to solve.

REACT prepared the lawsuit against AltusHost as a test case, said Ronald Brohm, director of REACT.

Targeting service providers is one of the focus points of REACT, said Brohm, who added that it is often difficult to reach the people who actually run the websites.

REACT first tried to contact the people running the sites before it decided to sue AltusHost, he said. But Web-hosting providers whose customers sell counterfeit goods benefit from those sites through hosting fees, he said.

Legislation and case law in Europe tend to hold ISPs responsible for sites they host, said van Rijswijk. "This presently creates an obligation for ISPs to autonomously and promptly shut down websites that infringe the rights of trademark holders upon reasonable request by or on behalf of trademark holders. ISPs should, therefore, take these requests seriously and seek legal advice in the earliest stage to avoid substantial costs and red tape involved in litigation," he said.

Loek covers all things tech for the IDG News Service. Follow him on Twitter at @loekessers or email tips and comments to loek_essers@idg.com

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