Ploom, Inc. v. iPloom, LLC et al

Filing 25

ORDER by Judge Samuel Conti granting 21 Motion for Default Judgment (sclc1, COURT STAFF) (Filed on 5/12/2014)

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IN THE UNITED STATES DISTRICT COURT

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FOR THE NORTHERN DISTRICT OF CALIFORNIA

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PLOOM, INC.,
Plaintiff,

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v.

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For the Northern District of California

United States District Court

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IPLOOM, LLC, and ANTHONY MARINO,

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Defendants.

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) Case No. 13-cv-05813 SC
)
) ORDER GRANTING MOTION FOR
) DEFAULT JUDGMENT
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I.

INTRODUCTION
Plaintiff Ploom, Inc. ("Ploom") seeks the entry of a default

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judgment against Defendants iPloom, LLC ("iPloom") and Anthony

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Marino ("Defendants").

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action on December 16, 2013, asserting federal claims for trademark

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infringement, 15 U.S.C. § 1114; unfair competition, false

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representation, and false designation of origin, id. § 1125(a);

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cybersquatting, id. § 1125(d); and related claims under state law

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and common law, for Defendants' alleged sale of counterfeit Ploom

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products.

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papers submitted by Ploom, the Court concludes that an award of

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default judgment against Defendants is appropriate, and GRANTS

ECF No. 21 ("Mot.").

See ECF No. 1 ("Compl.") at 8-22.

Ploom filed this

Having considered the

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Ploom's Motion.

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II.

BACKGROUND
Except where otherwise indicated, the following allegations

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are taken from Ploom's Complaint.

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vaporizers (devices that heat tobacco for inhalation without

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smoke), tobacco, and related accessories.

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unique products include the "Ploom modelTwo" and "PAX" vaporizers,

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which it markets exclusively on its website and through authorized

Compl. ¶ 13.

Ploom's

United States District Court

For the Northern District of California

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retailers.

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trademarks, including the name PLOOM, as well as a stylized version

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of that brand name (the "Ploom Marks").

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holds two trademarks for the PAX product name (the "PAX Marks").

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Id. ¶¶ 21-23.

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the "X Design" trade dress it uses to identify its PAX vaporizer.

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Id. ¶¶ 25, 31.

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Ploom has invested substantial resources in establishing

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recognition of its brand.

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Id. ¶ 14.

Ploom designs and sells

Ploom owns a number of federally registered

Id. ¶¶ 18-20.

Ploom also

Finally, Ploom has filed for federal registration of

The Ploom Marks and Pax Marks are valuable because

Id. ¶¶ 26-32.

Ploom alleges that Defendants used reproductions of the Ploom

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Marks, X Design trade dress, and the PAX Marks in creating the

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"iPloom Pax" and "Pax by Ploom" vaporizers.

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claims that these vaporizers are counterfeit products that infringe

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upon Ploom's trademarks.

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iPloom to use its trademarks or trade dress.

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sold the iPloom Pax and Pax by Ploom vaporizers on its website,

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www.iploom.com.

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website show use of Ploom Marks, Pax Marks, and X Design.

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33-35 & Ex. G.

Id. ¶¶ 55-56.

Id. ¶¶ 35-46.

Ploom

Ploom has never authorized
Id. ¶ 49.

IPloom

Photographs of the products displayed on the

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Id. ¶¶

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In October of 2013, a private investigator retained by Ploom

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purchased two iPloom Pax units from Defendants' website for a total

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of $159.90.

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discovered that the units' packaging included the mark "PAX."

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¶¶ 38-40 & Ex. H.

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dress very similar to the Ploom Pax's.

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Ploom's investigator contacted iPloom by calling the phone number

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listed on Defendants' website.

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Marino, who stated that he was not affiliated with Ploom, but said

Upon delivery of the units, the investigator
Id.

The iPloom Pax also had a size, shape, and trade
Id.

On October 21, 2013,

The investigator spoke with Mr.

United States District Court

For the Northern District of California

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"I know all about them."

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similarities between the Ploom Marks and the marks used on iPloom

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products, as well as the Defendants' use of the Pax Marks.

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Marino laughed and said, "All's fair in love and war."

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Marino also told the investigator that he was expecting a delivery

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of 10,000 units of the "Pax II" in the next week.

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Id. ¶ 37.

The investigator mentioned the

Id.

Mr.
Mr.

Id.

On December 9, 2013, another of Ploom's investigators placed

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an order on iPloom's website for one Pax by Ploom for a total of

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$199.95.

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[e-mail] informing the investigator that the Pax by

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Ploom products were backordered, but that a new shipment was due on

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December 16.

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the second investigator ever received this order.

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The next day, the investigator received an email from

Id. ¶¶ 43-44.

The Complaint does not specify whether

In January of 2014, Ploom submitted a takedown request to

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Defendants' web hosting provider.

The hosting provider

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communicated the request to iPloom and shut down the website eleven

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days later.

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Defendants then switched hosting providers, registered the domain

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aroma420.com, and continued to sell their products from that

ECF No. 16-1 ("Pfefferkorn Decl. II") ¶ 17.

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website.

Id. ¶¶ 18-19.

Defendants have also registered at least

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two other domain names to sell their products and have started an

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email-based advertising campaign.

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Neither defendant has responded to any of the summonses issued in

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this action or participated in these proceedings in any way.

Id. ¶¶ 20-25 & Exs. A-B.

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III. LEGAL STANDARD
After entry of a default, the Court may enter a default
judgment.

Fed. R. Civ. P. 55(b)(2).

Its decision whether to do

United States District Court

For the Northern District of California

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so, while "discretionary," Aldabe v. Aldabe, 616 F.2d 1089, 1092

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(9th Cir. 1980), is guided by several factors.

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As a preliminary matter, the Court must "assess the adequacy

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of the service of process on the party against whom default

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judgment is requested."

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Workers v. Peters, No. 00-0395, 2000 U.S. Dist. LEXIS 19065, *2

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(N.D. Cal. Jan. 2, 2001).

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sufficient, it may consider the following factors in its decision

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on the merits of a motion for default judgment:

Bd. of Trs. of the N. Cal. Sheet Metal

If the Court determines that service was

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(1) the possibility of prejudice to the
plaintiff, (2) the merits of plaintiff's
substantive claim, (3) the sufficiency of the
complaint, (4) the sum of money at stake in the
action; (5) the possibility of a dispute
concerning material facts; (6) whether the
default was due to excusable neglect, and (7)
the strong policy underlying the Federal Rules
of Civil Procedure favoring decisions on the
merits.

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Eitel v. McCool, 782 F.2d 1470, 1471-72 (9th Cir. 1986).

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general rule of law is that upon default the factual allegations of

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the complaint, except those relating to the amount of damages, will

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"The

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be taken as true."

Geddes v. United Fin. Group, 559 F.2d 557, 560

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(9th Cir. 1977).

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Court accepts as true the facts as presented in the Complaint.

Therefore, for the purposes of this Motion, the

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IV.

DISCUSSION

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A.

Adequacy of Service

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Federal Rule of Civil Procedure 4(h) provides that a

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corporation, partnership, or other unincorporated association may

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be served in the manner prescribed by Rule 4(e)(1), which allows

United States District Court

For the Northern District of California

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service to be perfected in the manner prescribed by state law.

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California law provides that a corporation or unincorporated

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association may be served by delivery of a copy of the summons and

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complaint:

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To the president, chief executive officer, or
other
head
of
the
corporation,
a
vice
president, a secretary or assistant secretary,
a
treasurer
or
assistant
treasurer,
a
controller or chief financial officer, a
general manager, or a person authorized by the
corporation to receive service of process.

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Cal. Civ. Proc. Code § 416.10.

Federal Rule of Civil Procedure

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4(e)(2)(A) provides that an individual may be served in a judicial

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district of the United States by "delivering a copy of the summons

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and of the complaint to the individual personally."
Here, service was delivered personally to Anthony Marino, both

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in his capacity as an individual and in his capacity as the

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authorized agent and principal officer of iPloom, on December 24,

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2013.

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("Pfefferkorn Decl. I") Ex. A; ECF No. 9 ("iPloom Proof of

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Service").

ECF No. 10 ("Marino Proof of Service"); ECF No. 22

The Court finds that service of process upon defendants

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iPloom and Anthony Marino was adequate and complete by December 24,

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2013.

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B.

Default Judgment

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After entry of a default, a court may grant a default judgment

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on the merits of the case.

See Fed. R. Civ. P. 55.

A default

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judgment may not be entered, however, against an infant or

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incompetent person unless represented in the action by a general

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guardian or other such representative who has appeared.

See id.

United States District Court

For the Northern District of California

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Furthermore, a default judgment may not be entered against an

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individual in military service until after the court appoints an

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attorney to represent the defendant.

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Mr. Marino is not an infant, incompetent person, or person in

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military service.

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Court may consider whether a default judgment may be entered

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against Defendants.

Pfefferkorn Decl. II ¶¶ 14-16.

Accordingly, the

Here, the majority of the Eitel factors favor default

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See 50 U.S.C. app. § 521.

judgment.
1.

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Prejudice

Ploom has tried to work with web hosting providers and

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Defendants' referral service to shut down Defendants' websites that

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sell counterfeit Ploom products.

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new websites, with new hosting providers, and continuing to sell

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their products.

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denied, then Ploom would likely be left without a remedy, as its

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efforts to shut down Defendants' operations have been unsuccessful.

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Thus, Ploom would be prejudiced absent entry of default judgment.

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//

Defendants responded by creating

If the motion for default judgment were to be

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2.

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Merits of Plaintiffs' Substantive Claims and
Sufficiency of the Complaint

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Taken together, the second and third Eitel factors essentially

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require that "a plaintiff state a claim on which [it] may recover."

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Pepsico, Inc. v. Cal. Sec. Cans, 238 F. Supp. 2d 1172, 1175 (C.D.

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Cal. 2002) (internal quotations omitted).

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(1) trademark counterfeiting and infringement, 15 U.S.C. § 1114;

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(2) unfair competition, false representation, and false designation

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of origin, id. § 1125(a); (3) cybersquatting, id. § 1125(d); and

Ploom asserts claims for

United States District Court

For the Northern District of California

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(4) related claims under state and common law.

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Ploom seeks to recover statutory damages in lieu of actual damages

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as relief.

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Accordingly, the Court examines only Ploom's claims for which

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statutory damages are available -- its claims for trademark

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counterfeiting and infringement, see 15 U.S.C. § 1117(c) (providing

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for statutory damages for trademark counterfeiting), and

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cybersquatting see id. § 1117(d) (providing for statutory damages

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for cybersquatting).

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3592, 2008 U.S. Dist. LEXIS 118783, *17 (N.D. Cal. July 15, 2008)

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(adopting same approach).

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See Compl. at 8-22.

Mot. at 14-15; see 15 U.S.C. §§ 1117(c)-(d).

See also Chanel, Inc. v. Tshimanga, No. C-07-

To prevail on its trademark infringement claim, Ploom must

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prove that, without its consent, Defendants used in commerce a

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reproduction or copy of Ploom's registered trademark in connection

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with the sale or advertising of any goods or services, and that

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such use is likely to cause confusion, mistake, or deceive

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customers.

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Coast Entm't, 174 F.3d 1036, 1046-47 (9th Cir. 1999).

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in Part I above, Ploom has properly alleged all of these elements.

15 U.S.C. § 1114(1)(a); Brookfield Commc'n v. West

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As outlined

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Taking these allegations to be true, as the Court must, Ploom has

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adequately stated a claim on which it may recover.

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To prevail on its cybersquatting claim, Ploom must prove that

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iPloom (1) registered or used a domain name that was identical or

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confusingly similar to Ploom's distinctive registered trademark

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with (2) a bad faith intent to profit from Ploom's mark.

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alleges that iPloom registered the iploom.com domain name, which is

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confusingly similar to the Ploom Marks and Ploom's domain,

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ploom.com.

Ploom

The Ninth Circuit has developed the Sleekcraft factors

United States District Court

For the Northern District of California

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to determine whether potentially infringing marks are confusingly

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similar.

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the relatedness of the two companies' services; (3) the marketing

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channel used; (4) the strength of [Plaintiff's] mark; (5) [the

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Defendants'] intent in selecting its mark; (6) evidence of actual

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confusion; (7) the likelihood of expansion into other markets; and

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(8) the degree of care likely to be exercised by purchasers."

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GoTo.com, Inc. v. Walt Disney Co., 202 F.3d 1199, 1205 (9th Cir.

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2000).

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important Sleekcraft factors are (1) the similarity of the marks,

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(2) the relatedness of the goods or services, and (3) the

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simultaneous use of the Web as a marketing channel."

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quotation marks omitted).

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Those factors are: "(1) the similarity of the marks; (2)

"In the context of the Web in particular, the three most

Id. (internal

With regard to the similarity factor, there can be no doubt

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that iPloom and Ploom are very similar.

The companies also provide

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virtually identical services: selling vaporizers and other tobacco

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products.

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apparently even advertised as, legitimate Ploom products.

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the Internet to sell their products.

IPloom's products were made to look like, and some were

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Both use

Ploom has produced evidence

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of the strength of its mark based on the uniqueness of its product,

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substantial press coverage, and significant traffic to its website.

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Compl. ¶¶ 26-30.

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intent, but much can be inferred by the fact that the iPloom Pax

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and Pax by Ploom appeared to be its flagship products.

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G.

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Given that the first five factors strongly favor a finding of

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confusing similarity, and the Ninth Circuit's emphasis on three

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that particularly favor that finding in this context, the Court

There is little evidence regarding Defendants'

Compl. Ex.

No evidence has been presented on the last three factors.

United States District Court

For the Northern District of California

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finds that the domain iploom.com was confusingly similar to Ploom's

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ploom.com domain.

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Ploom must also demonstrate that Defendants registered the

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iploom.com domain with bad faith intent to profit from Ploom's

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marks.

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registered the iploom.com domain with the intention of profiting by

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selling counterfeit Ploom products.

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the similarity of the products offered for sale by Defendants, and

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Mr. Marino's statements establishing his knowledge of Ploom's brand

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are sufficient evidence of the required bad faith intent.

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has adequately stated a claim on which it may recover.

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The facts Ploom has pled demonstrate that Defendants

3.

The similarity of the marks,

Ploom

Amount of Money at Stake

Pursuant to the fourth Eitel factor, "the court must consider

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the amount of money at stake in relation to the seriousness of

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Defendant's conduct."

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iPloom has engaged in the advertising, sale, and distribution of

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counterfeit goods bearing at least three of Ploom's marks.

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Defendants' continued sale of counterfeit Ploom merchandise despite

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this lawsuit and multiple attempts by Ploom to shut down

Pepsico, 238 F. Supp. 2d at 1176.

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Here,

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Defendants' website augments the seriousness of Defendants'

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conduct.

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likelihood that Defendants' conduct may cause confusion or mistake

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or otherwise deceive customers, and Defendants' failure to comply

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with the judicial process or to participate in any way in the

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present litigation, the imposition of a substantial monetary award

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is justified.

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proportionate to Defendants' conduct, especially in light of the

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fact that the size of the award is limited by what the Court

United States District Court

For the Northern District of California

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Given Defendants' disregard of these attempts, the

The amount of money at stake is therefore

considers just.
4.

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Possibility of Dispute Concerning Material Facts

The fifth Eitel factor considers the possibility of dispute as

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to any material facts in the case.

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pleaded complaint alleging the facts necessary to establish its

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claims and provided evidence in the form of declarations and

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attached exhibits.

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proceedings in this case, and thus no dispute has been raised

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regarding the material averments of the Complaint.

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that any genuine dispute may exist is, at best, remote.

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factor therefore favors the entry of default.
5.

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Here, Ploom filed a well-

Defendants have not responded to any of the

The likelihood
This

Whether Default Was Due to Excusable Neglect

Defendants have had nearly five months to respond to the

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Complaint and have not done so.

There is no evidence in the record

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that Defendants' failure to appear and otherwise defend was the

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result of excusable neglect.

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being served with the Complaint indicates that their failure to

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appear was willful.

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//

Defendants' failure to appear after

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6.

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2

Strong Policy Favoring Decision on the Merits

Finally, the mere existence of Federal Rule of Civil Procedure

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55(b) indicates that the seventh Eitel factor is not alone

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dispositive.

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Defendants' failure to answer Plaintiffs' Complaint makes a

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decision on the merits impractical, if not impossible.

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the seventh Eitel factor does not preclude the Court from entering

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default judgment against Defendants.

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C.

United States District Court

For the Northern District of California

Moreover,

Therefore,

Remedies
1. Statutory Damages for Trademark Infringement

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Pepsico, 238 F. Supp. 2d at 1177.

The remedies available to a plaintiff who prevails on a claim

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for trademark infringement and counterfeiting under 15 U.S.C.

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§ 1114 are listed under 15 U.S.C. § 1117(a)-(c).

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a registered mark holder may recover: (1) defendant's profits, (2)

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any damages sustained by the plaintiff, and (3) the costs of the

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action, subject to the principles of equity.

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requires the court to treble the damages assessed under subsection

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(a) if the defendant "intentionally us[es] a mark or designation,

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knowing such mark . . . is a counterfeit mark . . . in connection

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with the sale, offering for sale, or distribution of goods or

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services."

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damages, instead of actual damages and profits, in cases involving

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the use of a counterfeit mark in connection with the sale of goods.

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Plaintiffs who elect statutory damages may recover "not less than

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$1,000 or more than $200,000 per counterfeit mark per type of goods

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or services sold, offered for sale, or distributed, as the court

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considers just."

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where the defendant's conduct is willful, a court may enhance the

Under § 1117(a),

Section 1117(b)

Section 1117(c) permits a plaintiff to elect statutory

15 U.S.C. § 1117(c)(1).

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Additionally, in cases

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statutory damages award to an amount "not more than $2,000,000 per

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counterfeit mark per type of goods or services sold, offered for

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sale, or distributed, as the court considers just."

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§ 1117(c)(2).

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the court has wide discretion in determining the amount of

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statutory damages to be awarded.

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04996, 2010 U.S. Dist. LEXIS 61295, at *39 (N.D. Cal. May 7, 2010)

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(citing Columbia Pictures Television, Inc. v. Krypton Broad. of

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Birmingham, 259 F.3d 1186, 1194 (9th Cir. 2001)).

United States District Court

For the Northern District of California

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15 U.S.C.

If a plaintiff elects to recover statutory damages,

Chanel, Inc. v. Lin, No. C-09-

In the instant case, where Ploom has established that

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Defendants' conduct was willful, Ploom may recover statutory

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damages pursuant to § 1117(c) in an amount not less than $1,000 and

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not more than $2,000,000 per counterfeit mark per type of goods

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sold or offered for sale, as the Court considers just.

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alleges that Defendants offered for sale two types of goods -- the

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iPloom Pax (which included counterfeit Ploom and Pax marks) and the

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Pax by Ploom (which included two distinct counterfeit Ploom Marks

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and counterfeit Pax marks).

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that the iPloom Pax and the Pax by Ploom are different types of

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goods.

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goods' to be the general product type as opposed to many sub-forms

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of that product."

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Food & Beverage Inc., 704 F. Supp. 2d 288, 292 (S.D.N.Y. 2010).

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Because both the iPloom Pax and the Pax by Ploom were vaporizers

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that were substantially similar to one another, the Court finds

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that Defendants used counterfeit marks on only one type of good.

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Nonetheless, Ploom has properly alleged infringement of three

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distinct marks used on one type of good: the Ploom trademark, the

Ploom

However, the Court is not satisfied

"Common sense cuts in favor of defining the phrase 'type of

Union of Orthodox Jewish Congregations v. Am.

12

1

stylized Ploom trademark, and the Pax Marks.

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each of the three counterfeit marks.

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the Court finds that Ploom may recover not less than $3,000 and not

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more than $6,000,000.

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Ploom may recover for

Under § 1117(c), therefore,

Section 1117(c) does not give any specific guidance as to how

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a court should determine an appropriate statutory damages award.

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"Although the statutory damages need not reflect the defendants'

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unlawfully obtained profits, some district courts use § 1117(b) as

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a guide for setting damages under § 1117(c). In doing so, courts

United States District Court

For the Northern District of California

10

both counteract the profitability of counterfeiting and execute the

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punitive purposes of the statute."

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03464 VRW, 2007 U.S. Dist. LEXIS 22691, *13 (N.D. Cal. Mar. 13,

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2007) (calculating statutory damages by estimating defendant's

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profits and trebling for willfulness).

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statutory damages are meant to serve as a substitute for actual

16

damages the Court should discern whether the requested damages

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"bear some relation to the actual damages suffered."

18

v. Ocean Point Gifts, No. C-09-4215 JBS, 2010 U.S. Dist. LEXIS

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59003, *15 (D. N.J. June 14, 2010) (internal citations omitted).

20

Chanel, Inc. v. Doan, No. C-05-

In other words, because

Coach, Inc.

When determining the appropriate amount of statutory damages

21

to award under § 1117(c), some courts have considered the following

22

factors that guide the award of statutory damages under an

23

analogous provision of the Copyright Act: (1) the expenses saved

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and the profits reaped by the defendant; (2) the revenues lost by

25

the plaintiff; (3) the value of the copyright; (4) the deterrent

26

effect on others besides the defendant; (5) whether the defendant's

27

conduct was innocent or willful; (6) whether a defendant has

28

cooperated in providing particular records from which to assess the

13

1

value of the infringing material produced; and (7) the potential

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for discouraging the defendant.

3

Dist. LEXIS 118783 at *34; Microsoft Corp. v. Nop, 549 F. Supp. 2d

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1233, 1237-38 (E.D. Cal. 2008).

5

See, e.g., Tshimanga, 2008 U.S.

Here, Ploom requests $100,000 in statutory damages per

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counterfeit mark, for a total of $500,000.

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Order") at 4.

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the Court will consider both the willful nature of Defendants' acts

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and the scale of Defendants' operations.

ECF No. 21-1 ("Proposed

Ploom provides no basis for this figure.

However,

See Philip Morris U.S.A.,

United States District Court

For the Northern District of California

10

Inc. v. Castworld Prods., 219 F.R.D. 494, 500-01 (C.D. Cal. 2003)

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(awarding $2,000,000 in statutory damages against defendant in

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light of the defendant's "importation of large, commercial

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quantities" of counterfeit cigarettes "having a street value of

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millions of dollars").

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factors commonly considered in copyright law.

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17

a.

The Court proceeds to consider the seven

Expenses Saved and Profits Reaped

The lack of discovery in this case leaves no data as to

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Defendants' expenses saved and profits reaped.

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investigators purchased products from Ploom at prices of $79.95

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(the iPloom Pax) and $199.95 (the Pax by Ploom).

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however, no way for the Court to determine how many infringing

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items Defendants sold.

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operation is Mr. Marino's statement to Ploom's investigator that he

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was expecting an order of 10,000 units of the Pax II.

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that Defendants did receive such an order and managed to sell all

26

such units at the $199.95 price, Defendants reaped revenues of

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$1,999,500.

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deliver the investigator's order of the Pax by Ploom indicates that

Ploom's

There is,

The only evidence of the scale of the

Assuming

However, the fact that Defendants were unable to

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1

Defendants did not have such large inventories.

2

evidence on this point, the Court cannot make a determination as to

3

whether the requested damages of $100,000 per infringement are

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proportionate to Ploom's actual damages.
b.

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Given the lack of

Revenues Lost

Ploom has provided no evidence of its revenues lost, either as

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7

a result of Defendants' infringing activities or as a result of

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counterfeiting in general.

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unlawfully obtained the benefits of Ploom's brand and reputation

Ploom alleges that Defendants have

United States District Court

For the Northern District of California

10

and caused confusion among potential customers by using Ploom's

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marks and trade dress.

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evidentiary showing, the Court cannot reach any conclusion about

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the magnitude of lost revenues to Ploom.
c.

14

Compl. ¶ 52.

Nonetheless, absent some

Value of the Intellectual Property

The Ploom Marks, Pax Marks, and X Design trade dress are

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16

valuable because they are affiliated with a unique and recognizable

17

brand that has garnered considerable media attention.

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26-30.
d.

19

Compl. ¶¶

Willfulness of Defendants' Conduct

Defendants' conduct was undoubtedly willful, as they admitted

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knowledge of Ploom's brand, continued their infringing conduct

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after the commencement of this lawsuit, and repeatedly evaded

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Ploom's efforts to shut down their websites.
e.

24

Defendants' Lack of Cooperation in Providing
Records

25

Defendants have not provided any discovery or participated in

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27

this litigation in any way.

28

//

15

f.

1

Deterrent Effect on Defendants

Defendants have created multiple websites to sell products

2
3

that infringe upon Ploom's trademarks.

4

down those websites have clearly not been an effective deterrent.

5

Defendants' persistence suggests that a modest damages award will

6

not deter them.
g.

7

Ploom's efforts to shut

Deterrent Effect on Others

8

A significant award against Defendants would clearly have some

9

kind of deterrent effect on other would-be infringers, although the

United States District Court

For the Northern District of California

10

magnitude of this effect is difficult to determine.
Taking into account all of the above, the Court finds the

11
12

requested $100,000 per infringement to be an appropriate award.

13

This amount is well within the guidelines established by Congress,

14

takes into account the willfulness shown by continuing to sell

15

counterfeit merchandise after multiple efforts to shut down its

16

website and the culpability of failing to respond, and is

17

significant enough to serve as compensation to Ploom and a

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deterrent to both the Defendants and others.
2. Statutory Damages for Cybersquatting

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A party that prevails on a claim of cybersquatting may elect

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21

to recover "instead of actual damages and profits, an award of

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statutory damages in the amount of not less than $1,000 and not

23

more than $100,000 per domain name, as the court considers just."

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15 U.S.C. § 1117(d).

25

of $100,000.

Ploom requests the maximum statutory damages

Proposed Order at 4.

In determining appropriate statutory damages for

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cybersquatting,

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//

16

courts
generally
consider
a
number
of
factors . . . including the egregiousness or
willfulness of the defendant's cybersquatting,
the
defendant's
use
of
false
contact
information
to
conceal
its
infringing
activities,
the
defendant's
status
as
a
"serial" cybersquatter -- i.e., one who has
engaged in a pattern of registering and using a
multitude of domain names that infringe the
rights of other parties -- and other behavior
by the defendant evidencing an attitude of
contempt towards the court or the proceedings.

1
2
3
4
5
6
7
8

Verizon Cal. Inc. v. Onlinenic, Inc., C 08-2832 JF (RS), 2009 WL

9

2706393 (N.D. Cal. Aug. 25, 2009).

In this case, Defendants'

United States District Court

For the Northern District of California

10

cybersquatting was both willful and egregious.

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registered their domains with the intent to sell counterfeit Ploom

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products and repeatedly registered new domains as Ploom discovered

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them.

14

proceedings by consistently failing to respond to summons.

15

However, there is no evidence in the record that Defendants ever

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used false contact information or of serial cybersquatting (which

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requires evidence of domain names that infringe on the rights of

18

other parties).

Defendants

Defendants have also shown contempt towards these

19

Courts in similar cases have awarded a range of damages. 1

20

Defendants' conduct in this case was willful and in bad faith, and

21

they have shown contempt for this Court and these proceedings.

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1

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24
25
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27
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The

See, e.g., Partners for Health & Home, L.P. v. Yang, 488 B.R. 109
(C.D. Cal. 2012) (awarding $25,000 for domain through which
defendant had sold products willfully infringing on plaintiff's
trademarks); Wecosign, Inc. v. IFG Holdings, Inc., 845 F. Supp. 2d
1072, 1085-87 (C.D. Cal. 2012) (awarding $50,000 where defendant
had provided false contact information to the domain registrar but
no other factors were present); Verizon Cal. Inc. v. Onlinenic,
Inc., C 08-2832 JF (RS), 2009 WL 2706393 (N.D. Cal. Aug. 25, 2009)
(awarding $50,000 per violation where all four factors were
present); Citigroup, Inc. v. Shui, 611 F. Supp. 2d 507, 513 (E.D.
Va. 2009) (awarding $100,000 where defendant's use of the domain
was "sufficiently willful, deliberate, and performed in bad
faith").

17

1

Court finds that $50,000 in statutory damages appropriately

2

reflects the gravity of Defendants' violation of the law.
3. Injunctive Relief

3
4

In addition to damages, Ploom requests a permanent injunction

5

enjoining Defendants from using in commerce: (1) Ploom trademarks

6

and trade dress or similar marks; (2) the iPloom mark; (3) trade

7

dress confusingly similar to Ploom's PAX trade dress; and (4) the

8

iploom.com domain name.

9

grant injunctions according to the rules of equity and upon such

The Lanham Act gives the court "power to

United States District Court

For the Northern District of California

10

terms as the court may deem reasonable, to prevent the violation"

11

of a trademark holder's rights.

12

injunctions are routinely granted in cases like the instant one

13

where a defendant has not appeared in the action at all.

14

e.g., Philip Morris, 219 F.R.D. at 502; Pepsico, 238 F. Supp. 2d at

15

1178; Coach Servs. v. Cheap Sunglasses, No. 09CV1059 BEN (JMA),

16

2010 U.S. Dist. LEXIS 68200, at *6-*8 (S.D. Cal. July 2, 2010).

17

Accordingly, a permanent injunction shall be entered with the

18

judgment.

19

15 U.S.C.

§ 1116(a).

Permanent

See,

Ploom also requests the transfer of the iploom.com domain name

20

to it.

21

forfeiture or cancellation of the domain name or the transfer of

22

the domain name to the owner of the mark."

23

§ 1125(d)(1)(C).

24

intentional misuse of the domain at Ploom's expense.

25

The Lanham Act gives the Court the power to "order the

15 U.S.C.

The court finds such relief appropriate given the

4. Costs

26

Ploom also requests costs and attorney's fees under 15 U.S.C.

27

§ 1117(a), which authorizes recovery of the costs of an action for

28

the violation of any right of the registrant of a trademark.

18

That

1

section also authorizes the court to award attorney's fees to a

2

plaintiff in "exceptional cases."

3

case is exceptional where the district court finds that the

4

defendant acted maliciously, fraudulently, deliberately, or

5

willfully."

6

(9th Cir. 2007) (quoting Watec Co. v. Liu, 403 F.3d 645, 656 (9th

7

Cir. 2005)).

8

in this case, and so this is an exceptional case for the purposes

9

of § 1117(a).

United States District Court

For the Northern District of California

10

Id. § 1117(a).

"A trademark

K & N Eng'g, Inc. v. Bulat, 510 F.3d 1079, 1081-82

The Court has found that Defendants acted willfully

However, it is still not immediately obvious that Ploom may

11

recover its attorney's fees.

12

statutory damages under § 1117(c) may also recover costs under

13

§ 1117(a) is an open question in this Circuit: "we do not reach the

14

issue whether an election to receive statutory damages under

15

§ 1117(c) precludes an award of attorney's fees for exceptional

16

cases under the final sentence of § 1117(a)."

17

F.3d at 1082 n.5 (9th Cir. 2007).

18

resolved this issue, holding that "an award of attorney's fees is

19

available under section 1117(a) in 'exceptional' cases even for

20

those plaintiffs who opt to receive statutory damages under section

21

1117(c)."

22

83, 111 (2d Cir. 2012).

23

reasoning persuasive.

24

Whether a plaintiff who elects

K & N Eng'g, 510

The Second Circuit, though, has

Louis Vuitton Malletier S.A. v. LY USA, Inc., 676 F.3d
The Court finds the Second Circuit's

Ploom is entitled to the costs of this action.

See Lindy Pen

25

Co. v. Bic Pen Corp., 982 F.2d 1400, 1405 (9th Cir. 1993).

Ploom

26

is also entitled to attorney's fees in addition to its statutory

27

damages.

28

Civil Local Rule 54-1.

Ploom may submit its Bill of Costs in accordance with

19

1
2

V.

CONCLUSION
The Court GRANTS the Motion for Default Judgment filed by

3

Ploom against Defendants iPloom, LLC and Anthony Marino.

4

Defendants are jointly and severally liable for $350,000 to Ploom,

5

plus Ploom's costs.

6

within fourteen (14) days of this Order as provided by Civil Local

7

Rule 54-1.

8

injunction shall issue with the judgment.

9

responsibility to serve the injunction in such a manner to make it

United States District Court

For the Northern District of California

10

Plaintiffs shall submit their Bill of Costs

Failure to do so will result in a waiver of costs.
Plaintiffs have the

operative in contempt proceedings.

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12

IT IS SO ORDERED.

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15

Dated: May 12, 2014
UNITED STATES DISTRICT JUDGE

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An