Magpul Industries Corp. v. John Does 1-10

Filing 39

ORDER GRANTING PRELIMINARY INJUNCTION. Signed by Judge Jeffrey S. White on 4/28/14. (jjoS, COURT STAFF) (Filed on 4/28/2014)

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1 JEFFREY C. HALLAM (State Bar No. 161259)
E-Mail:
[e-mail]
2 LOUIS P. FEUCHTBAUM (State Bar No. 219826)
E-Mail:
[e-mail]
3 DAVID W. FERMINO (State Bar No. 154131)
E-Mail:
[e-mail]
4 SIDEMAN & BANCROFT LLP
One Embarcadero Center, Twenty-Second Floor
5 San Francisco, California 94111-3711
Telephone:
[phone]
[phone]
6 Facsimile:
7 Attorneys for Plaintiff
MAGPUL INDUSTRIES CORP.
8
UNITED STATES DISTRICT COURT

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ONE EMBARCADERO CENTER, 22ND FLOOR
SAN FRANCISCO, CALIFORNIA 94111-3711

LAW OFFICES

SIDEMAN & BANCROFT LLP

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NORTHERN DISTRICT OF CALIFORNIA, OAKLAND DIVISION

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12 MAGPUL INDUSTRIES CORP.,
Plaintiff,

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14

Case No. 4:14-cv-1556 JSW
[PROPOSED] ORDER GRANTING
PRELIMINARY INJUNCTION

v.
Judge:
Date:
Time:
Crtrm.:

15 JOHN DOE 1-10,
Defendants.

16

Honorable Jeffrey S. White
April 28, 2014
11:00 a.m.
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[PROPOSED] ORDER
Defendants JOHN DOE 1-10 (“Defendants”) were ordered to appear in this court on April

20 28, 2014, to show cause why a temporary restraining order [Doc. 28], which freezes assets held in
21 certain financial accounts belonging to them, should not become a preliminary injunction.
22 Defendants have failed to present any facts that would show cause to prevent entry of that
23 preliminary injunction.
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FINDINGS OF FACT

25

Having considered all filings in this matter, as well as any evidence presented at a hearing,

26 this Court makes the following findings of fact:
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1.

Magpul has filed a Complaint that alleges, inter alia, that Defendants have engaged

28 in a scheme through which they offer to sell Magpul-branded products on eBay.com (“eBay”),
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1 using the seller names “arctic_trader” (hereinafter “Arctic Trader”), and “thebuzzybeecentral”
2 (hereinafter “Buzzy Bee”), and Defendants sell counterfeit Magpul-branded products.
3

2.

Magpul is likely to prevail in its lawsuit against Defendants for trademark

4 counterfeiting (15 U.S.C. § 1114) because there is sufficient evidence to support findings that:
5 Magpul has a protectable ownership interest in various trademarks that are registered with the U.S.
6 Patent and Trademark Office (“Magpul’s Registered Marks”); Defendants have repeatedly sold
7 products that appear identical, or substantially similar to products that are sold by Magpul, which
8 also had Magpul’s Registered Marks affixed to them; these products were not manufactured by

10 likely to cause confusion or deception amongst the consuming public as to the products’ origins,
ONE EMBARCADERO CENTER, 22ND FLOOR
SAN FRANCISCO, CALIFORNIA 94111-3711

LAW OFFICES

SIDEMAN & BANCROFT LLP

9 Magpul, nor by its authority; Defendants’ unauthorized use of Magpul’s Registered Marks are

11 and; that these products are “counterfeit,” as that term is defined at 15 U.S.C. § 1116(d)(B)(i).
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3.

Magpul is likely to establish that Defendants’ trademark counterfeiting was done

13 willfully in that: Defendants were provided notice on at least seventy-seven occasions that they
14 were selling products that infringed upon Magpul’s trademarks, but continued to sell them
15 anyway; Defendants have received numerous notices from its customers who complained through
16 eBay that the products sold by Defendants were inferior, or counterfeit, but continued to sell these
17 products, and; the price at which Defendants were selling their products was so far below the
18 market price for genuine products that they must have known that the products were derived
19 through an illegal source.
20

4.

Defendants have used PayPal to process financial transactions associated with their

21 sale of Magpul-branded products. Defendants’ PayPal accounts are identified by the following
22 email addresses: “[e-mail],” “[e-mail],” and
23 “[e-mail].”
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5.

Defendants have exhibited behaviors that make it likely that they will seek to avoid

25 legal responsibility that may arise from this lawsuit: Defendants have used multiple addresses to
26 conduct business that are not traceable to them; Defendants use multiple seller names on eBay that
27 seem intended to allow listings under one seller name if the listings are removed under the other
28 seller name; the names used by Defendants are not traceable to them because they are either too
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1 common, or because they have used only initials to identify themselves, and; according to
2 customer complaints, Defendants refused to honor obligations to ship products that had been
3 ordered by those customers. Based upon this finding, it is likely that Defendants will attempt to
4 disperse their assets from PayPal to accounts beyond the jurisdiction of the United States, prior to
5 the time that this matter is finally adjudicated.
6

6.

In the likelihood that Magpul prevails in this action, it will be entitled to an

7 accounting of Defendants’ profits. It is necessary that the assets remain in Defendants’ PayPal
8 accounts to provide for this equitable remedy.
7.

An Order, freezing the assets in Defendants’ PayPal accounts is necessary to

10 preserve Magpul’s equitable remedies.
ONE EMBARCADERO CENTER, 22ND FLOOR
SAN FRANCISCO, CALIFORNIA 94111-3711

LAW OFFICES

SIDEMAN & BANCROFT LLP

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IT IS THEREFORE ORDERED that the temporary restraining order previously entered

12 by this Court [Doc. 28] shall become a preliminary injunction:
13

A.

PayPal shall prevent the disbursement of any assets held in accounts associated

14 with the email addresses: “[e-mail],” “[e-mail],” and
15 “[e-mail].” However, PayPal shall still allow the deposit of funds that are destined
16 to those accounts.
17

B.

PayPal shall promptly notify the parties of any changes to the balance in these

18 accounts, including the reasons for any change.
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C.

This order shall remain in effect until further notice from this Court.

20

D.

100
Magpul is directed to deposit $_______ with the clerk of this court, to be held as

21 security for any wrongful harm that Defendants experience as a result of this preliminary
22 injunction.
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23 DATED: April __, 2014
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25
Judge, United States District Court

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