French fashion group Kering has filed a suit in New York alleging China’s Alibaba has knowingly allowed the sale of counterfeit goods through its online stores.

Kering, parent of Gucci and Yves Saint Laurent, among others, claim it told Alibaba of counterfeits being sold on its sites but allege the online retailer failed to take sufficient action to block their sale. Now Kering is seeking a court order blocking sale of counterfeit goods and claimed damages which could come to $2 per item. It says Alibaba violated trademark and racketeering laws .

Alibaba responded by saying it was surprised by Kering’s action.

“We continue to work in partnership with numerous brands to help them protect their intellectual property and we have a strong track record of doing so,” the company said in a statement.

“Unfortunately, Kering Group has chosen the path of wasteful litigation instead of the path of constructive cooperation. We believe this complaint has no basis and we will fight it vigorously.”

Alibaba says it has invested $161 million trying to prevent the sale of counterfeit goods on its websites since 2013.

Kering filed a suit against Alibaba back in July last year, but withdrew it a month later after the two parties agreed to work on the issue together. That suit alleged, among other things, that Alibaba and related entities “provide the marketplace advertising and other essential services necessary for counterfeiters to sell their counterfeit products to customers in the United States”. It cited as an example, a Gucci handbag offered at US$2 to $5 a unit in quantities of 2000 or more when an authentic bag retailed at $795.