Beijing No 2 intermediate Court told Beijing Xiushui Haosen Clothing Co, which owns the Silk Market, that it must pay North Face Rmb40,000 ($5,365).

The ruling was made at the end of October.

The award is double the amount that a Chinese court ordered the landlord to pay to luxury goods companies Burberry, Chanel, Gucci, Louis Vuitton and Prada in December 2005.

Joe Simone, the Baker & McKenzie partner who advised the luxury goods companies, and a leading member of the anti-piracy Quality Brands Protection Committee (QBPC), told MIP Week that the Court based its decision in part on the fact that the landlord did not check the source of the goods.

“It makes clear the landlord has a duty to proactively investigate once they get notice of possible fakes. This is something we’ve been pressing for in our own work,” he said.

The North Face case began last year when the company found a large number of fakes available in the Silk Market, located in the Chaoyang district of Beijing and a popular destination for tourists eager to buy counterfeits.

According to Xinhua, China’s state news agency, North Face demanded Rmb500,000 ($67,000) in compensation.

Despite earlier legal victories against the landlord, the Silk Market remains one of China’s worst counterfeit hotspots and is reported to be blocking attempts to crack down on sales of fake goods.

North Face did not respond to MIP Week’s requests for comment before press time.

IP owners are becoming increasingly interested in suing landlords worldwide who allow fakes to be sold on their premises.

In the next issue of Managing IP, lawyers from a number of key jurisdictions will outline the rules on landlord liability in their own countries.