A lawsuit filed by luxury fashion retailer Louis Vuitton against a Toronto flea market could potentially give brands a long-awaited hand in cracking down on counterfeiters, intellectual property lawyers said Monday.
If successful, the suit would allow companies to go after mall and flea market landlords whose vendors infringe on trademark rights – an added weapon in an ongoing and often frustrating battle against counterfeit goods, they said.
"A lot of brand owners would love to see the law in Canada expanded just because it gives us a tool to get assistance from flea markets in order to try and shut down this activity," said Karen MacDonald, a Vancouver lawyer who specializes in trademarks and patents.
"Otherwise it's death by 1,000 cuts for brand owners when you're dealing with flea markets and there's so many people who are selling them," she said. "It's a bit of a whack-a-mole game."
MacDonald said the ability to hold landlords accountable for their vendors' activities is already established under U.S. law and Canada is seen as lagging behind.
The lawsuit filed last year alleges the owners and operators of Dr. Flea's Flea Market have knowingly or negligently allowed vendors at the facility to advertise, offer and sell counterfeit Louis Vuitton merchandise, which harms the brand.
None of the allegations have been proven in court.
Last month, an Ontario Superior Court judge ruled that details on various police raids on the market that targeted counterfeit products over several years should be allowed to remain part of the suit, overturning an earlier decision.
In its statement of claim, Louis Vuitton says police raided the flea market in 2008 and seized an unspecified amount of counterfeit merchandise.
It says that four years later, investigators seized roughly $1-million in counterfeit toys, clothes, accessories and other goods – including some Louis Vuitton knockoffs.
Another such raid took place in late 2015 and led to the seizure of a variety of counterfeit products, including fake Louis Vuitton items, the document says.
Should the case be successful, it would increase pressure on landlords to monitor their tenants, said Giuseppina D'Agostino, the founder and director of the intellectual property law program at York University's Osgoode Hall Law School.
Some may include clauses forbidding the sale of knockoffs in their contracts with vendors, a practice already adopted by some, D'Agostino said.
Those changes will be toothless without enforcement, however, she said. "You can have whatever contract written down, whatever law, whatever lawsuit, if it's not enforced, the problem proliferates," she said.
So while there may be gains for brands when it comes to dealing with infractions, the issue of counterfeiting isn't likely to go away, she said.
"I think it may change some behaviour in terms of landlords being more judicious in who they lease their space to but long term I don't think it will really address the bigger problem of infringing merchandise," she said.
"There's just too many outlets, too many hubs... it's very hard to contain."