Go Daddy Operating Company, LLC v. Ghaznavi et al

Filing 60

ORDER by Judge Phyllis J. Hamilton granting in part and deferring ruling on in part 37 Motion for Preliminary Injunction; granting in part and denying in part 30 Motion to Dismiss and Motion to Strike; denying in part and deferring ruling on in part 32 Motion to Quash and Motion to Dismiss. (pjhlc1, COURT STAFF) (Filed on 2/28/2018)

1
2
3
4

UNITED STATES DISTRICT COURT

5

NORTHERN DISTRICT OF CALIFORNIA

6
7
8

GO DADDY OPERATING COMPANY,
LLC,

Case No. 17-cv-06545-PJH

Plaintiff,
9

ORDER

v.

Re: Dkt. Nos. 30, 31, 32, 33, 37, 41, 42,

10
11

USMAN GHAZNAVI, et al.,

46, 47, 48, 51

United States District Court
Northern District of California

Defendants.
12
13
14

Defendants Usman Anis’s and Silicon Valley Graphic, LLC’s motion to dismiss

15

plaintiff’s complaint in its entirety and strike portions of the complaint; defendant Salman

16

Ghaznavi’s motion to quash service and dismiss the complaint; plaintiff GoDaddy’s

17

motion for a preliminary injunction; and the parties’ numerous requests for judicial notice

18

and evidentiary objections came on for hearing before this court on February 14, 2018.

19

Plaintiff appeared through its counsel, Nathan Dooley. Defendants appeared through

20

their counsel, Brenda Prackup. Having read the papers filed by the parties and carefully

21

considered their arguments and the relevant legal authority, and good cause appearing,

22

the court hereby rules as follows, for the reasons stated at the hearing and for the

23

following reasons.

24

BACKGROUND

25

Plaintiff Go Daddy Operating Company, LLC (“GoDaddy”) brought this action

26

against defendants Usman Ghaznavi a/k/a Usman Anis (“Usman Anis”), Salman

27

Ghaznavi a/k/a Salman Anis (“Salman Ghaznavi”), Silicon Valley Graphics (“SVG”), and

28

a number of unidentified “Doe” defendants for injunctive relief and damages arising from

1
2

alleged unauthorized use of GoDaddy’s trademarks.
GoDaddy asserts violations of 15 U.S.C. § 1114 (trademark infringement),
§ 1125(a) (false designation of origin, unfair competition, false advertising), § 1125(c)

4

(trademark dilution), § 1125(d) (cybersquatting), as well as state-law and common-law

5

claims of unfair competition, false advertising, trademark infringement, and intentional

6

interference with prospective economic advantage. Plaintiff also seeks an accounting.

7

In addition to acting as a domain name registrar, GoDaddy offers more than 50

8

online products and services to the public, including website design, logo design, and

9

business design. Compl. ¶¶ 2, 18–20. As set forth in the complaint, GoDaddy owns

10

certain trademarks and has developed significant common law rights in the GoDaddy

11
United States District Court
Northern District of California

3

trade name. See id. ¶¶ 21–22.

12

On November 29, 2017, GoDaddy filed certificates of service showing service of

13

the summons and complaint on each of the defendants at 45333 Fremont Blvd., Suite 5,

14

in Fremont, California (the “Fremont Address”). The proofs of service show (1) personal

15

service on Usman Anis on November 14, 2017; (2) substituted service on SVG on

16

November 14, 2017, at the address of its registered agent, by leaving papers with Usman

17

Anis, described as “Employee/Owner,” followed by service by mail; and (3) substituted

18

service on Salman Ghaznavi, by leaving papers with Lo Ann Do, graphic designer, on

19

November 17, 2017, following attempts on three successive days to personally serve

20

Salman Ghaznavi. Dkts. 16–18.

21

The complaint arises primarily from defendants’ alleged use of GoDaddy’s

22

trademarks on a number of websites they operate (the websites at issue are the

23

“Infringing Domains”). Defendants allegedly use the marks to advertise logo design,

24

business design, and website design services. Compl. ¶ 3. Plaintiff further alleges that

25

the defendants contacted GoDaddy customers and non-customers, falsely identified

26

themselves as working with GoDaddy, and solicited business based on those false

27

representations. Id. ¶¶ 4, 39–50. GoDaddy alleges a spam campaign and telephonic

28

conversations between defendants’ employees and potential customers. Id. ¶¶ 40–47.
2

1

Plaintiff alleges that defendants have orchestrated a similar pattern and practice of

2

offenses against others’ intellectual property, through a network of related corporate

3

entities, which are ultimately controlled by the named defendants in this action. Id. ¶¶ 6–

4

7, 28–29, 37–38. GoDaddy alleges that defendants conduct their network of operations

5

from two addresses, called the “Fremont Address” and the “Sunnyvale Address” (440

6

North Wolfe Road, MS# 142, Sunnyvale, California 94085).

7

GoDaddy alleges that the Infringing Domains utilize a “domain name privacy

8

service,” and that prior to utilizing the domain name privacy service, defendants

9

registered domains using alias names, including “Fedrick King.” Id. ¶¶ 24–25. GoDaddy
claims that such alleged acts make identifying the true owner of these domains difficult

11
United States District Court
Northern District of California

10

when relying on public information, although GoDaddy claims to have learned that some

12

were registered by defendants. Id. ¶¶ 24–27. For example, GoDaddy claims to have

13

learned through WhoIsGuard that Salman Ghaznavi is the registered owner of at least

14

one of the Infringing Domains. Id. ¶ 26.

15

GoDaddy asserts that it discovered defendants’ use of the Infringing Domains in

16

July 2017, when a customer brought it to GoDaddy’s attention. Id. ¶¶ 30–31. When

17

GoDaddy investigated, it learned that the infringing domain was registered using

18

GoDaddy, on an account paid for by Usman Anis using the Fremont Address. Id. ¶ 32.

19

GoDaddy terminated that account based on violations of GoDaddy’s terms of service and

20

discovered that the same account had registered four additional Infringing Domains. Id.

21

GoDaddy then learned that defendants had a second GoDaddy account, paid for by the

22

same credit card linked to Usman Anis, which listed the Sunnyvale Address as the

23

contact and billing address. Id. ¶ 33.

24

GoDaddy asserts that its discovery of the Infringing Domains also shed light on

25

their relation to a spam campaign involving the domain name route66d.com, which in the

26

summer of 2016 was used to send spam text messages that appeared to be from

27

GoDaddy. Id. ¶ 34. GoDaddy contends that this spam campaign gave rise to a large

28

number of customer complaints and threats of litigation from customers who believed
3

1

they had received the messages from GoDaddy. Id. ¶ 35. This spam campaign was

2

nearly identical to another spam campaign during the same time period that also used

3

GoDaddy marks and directed GoDaddy customers to a website at

4

theamericandesigns.com. Id.
The complaint goes on to explain how GoDaddy learned of other domains or

5
6

products that improperly used GoDaddy trademarks, and/or which engaged in spam

7

advertising that appeared to come from GoDaddy, and which it alleges originated with

8

defendants. See id. ¶¶ 37–51.
GoDaddy filed its complaint on November 10, 2017. Dkt. 1. On December 14,

9

2017, GoDaddy moved the court for a temporary restraining order (Dkt. 24), which was

11
United States District Court
Northern District of California

10

argued and denied on December 20, 2017 (Dkt. 27). In that order declining to issue a

12

TRO, the court reasoned:

13

It is undisputed that GoDaddy has a protectable interest in the
GoDaddy Marks, and that unauthorized use of the Marks by
persons or entities other than GoDaddy would be likely to
cause consumer confusion. However, the court finds that
GoDaddy has failed to make a clear showing that it is entitled
to the extraordinary remedy of temporary injunctive relief.
Primarily, GoDaddy has not made a sufficient showing that
any particular defendant is responsible for the alleged
infringement in this case. . . . [T]he interests of justice would
be better served by a fully-briefed motion for injunctive relief,
rather than the present hastily-assembled motion for a
temporary restraining order, heard on shortened time.

14
15
16
17
18
19
20

Dkt. 27 at 3–4.

21

On December 26, 2017, defendants Usman Anis and SVG filed a motion to

22

dismiss and strike portions of the complaint. Dkt. 30. On December 29, 2017, defendant

23

Salman Ghaznavi moved to quash service of the complaint and dismiss it for lack of

24

personal jurisdiction. Dkt. 32. On January 10, 2018, GoDaddy filed a motion for a

25

preliminary injunction against defendants Usman Anis, Salman Ghaznavi, and SVG. Dkt.

26

37.
DISCUSSION

27
28

A.

Motion to Quash
4

To determine whether service of process is proper, courts look to the requirements

1
2

of Federal Rule of Civil Procedure 4, which provides that service is proper if it is done

3

“following state law for serving a summons in an action brought in courts of general

4

jurisdiction in the state where the district court is located or where service is made[.]”

5

Fed. R. Civ. P. 4(e)(1). California allows substitute service at one’s office, usual mailing

6

address, or usual place of business. Cal. Civ. Proc. Code § 415.20(a)–(b). Plaintiff

7

successfully effected substitute service on Salman Ghaznavi under California law by

8

leaving a copy of the summons and complaint at 45333 Fremont Blvd., Suite 5, Fremont,

9

CA 94538 in the presence of a person apparently in charge and thereafter mailing a copy
of the summons and complaint by first-class mail. See Dkt. 18. Salman Ghaznavi

11
United States District Court
Northern District of California

10

contends that service was ineffective because it did not comply with the additional

12

requirements of the Hague Convention. Dkt. 32 at 13–14; Dkt. 40 at 9. The Hague

13

Convention applies only when “a transmittal abroad . . . is required as a necessary part of

14

service.” Volkswagenwerk Aktiengesellschaft v. Schlunk, 486 U.S. 694, 707 (1988).

15

Furthermore, “the internal law of the forum is presumed to determine whether there is

16

occasion for service abroad.” Id. at 704. Because California law does not require the

17

mailing of documents abroad in order to effect service of process in the technical sense,

18

the Hague Convention does not apply. Id. at 707–08; Piatek v. Siudy, 351 F. App’x 232,

19

233 (9th Cir. 2009).
Defendant Salman Ghaznavi’s motion to quash service is therefore DENIED.

20
21

Defendant’s accompanying request for judicial notice (Dkt. 33) is DENIED as moot.

22

B.

Motion to Dismiss for Lack of Personal Jurisdiction
The party seeking to invoke the federal court’s jurisdiction bears the burden of

23
24

demonstrating jurisdiction. Picot v. Weston, 780 F.3d 1206, 1211 (9th Cir. 2015). When

25

resolving a motion to dismiss under Rule 12(b)(2) on written materials, the court accepts

26

uncontroverted facts in the complaint as true and resolves conflicts in affidavits in the

27

plaintiff’s favor. Mavrix Photo, Inc. v. Brand Techs., Inc., 647 F.3d 1218, 1223 (9th Cir.

28

2011).
5

1

The Due Process Clause of the Fourteenth Amendment “limits the power of a

2

state’s courts to exercise jurisdiction over defendants who do not consent to jurisdiction.”

3

Martinez v. Aero Caribbean, 764 F.3d 1062, 1066 (9th Cir. 2014). Due process requires

4

that the defendant “have certain minimum contacts with it such that the maintenance of

5

the suit does not offend traditional notions of fair play and substantial justice.” Int’l Shoe

6

Co. v. Wash., 326 U.S. 310, 316 (1945) (internal quotation marks omitted). Under the

7

“minimum contacts” analysis, a court can exercise either “general or all-purpose

8

jurisdiction,” or “specific or conduct-linked jurisdiction.” Daimler AG v. Bauman, 134 S.

9

Ct. 746, 751 (2014) (citing Goodyear Dunlop Tires Operations, S.A. v. Brown, 564 U.S.

10

United States District Court
Northern District of California

11

915, 919 (2011)); see Int’l Shoe Co., 326 U.S. at 316–20.
Under general jurisdiction, a nonresident defendant may be subject to suit even on

12

matters unrelated to his contacts with the forum. Daimler, 134 S. Ct. at 754–58. To

13

establish general jurisdiction, the plaintiff must demonstrate that the defendant has

14

continuous and systematic contacts sufficient to approximate physical presence in the

15

state. In re W. States Wholesale Natural Gas Antitrust Litig., 715 F.3d 716, 741 (9th Cir.

16

2013). “For an individual, the paradigm forum for the exercise of general jurisdiction is

17

the individual’s domicile[.]” Goodyear, 564 U.S. at 924; see generally Lockard v.

18

Lockard, 15 F.3d 1086 (9th Cir. 1993). Being an officer or owner of a California

19

corporation is not alone sufficient to establish general personal jurisdiction over an

20

individual. Ishiyama v. Glines, No. 216CV00222APGPAL, 2016 WL 5661991, at *2 (D.

21

Nev. Sept. 29, 2016); j2 Glob. Commc’ns, Inc. v. Blue Jay, Inc., No. 08-cv-4254-PJH,

22

2009 WL 29905, at *7 (N.D. Cal. Jan. 5, 2009); Swensen v. Murchison, 507 F. Supp. 509,

23

512 n.3 (N.D. Cal. 1981); see also Johnston Farms v. Yusufov, No.

24

117CV00016LJOSKO, 2017 WL 6571527, at *5 n.3 (E.D. Cal. Dec. 26, 2017) (Oberto,

25

Mag. J.); Logtale, Ltd. v. IKOR, Inc., No. 11-cv-05452-EDL, 2014 WL 1478901, at *5

26

(N.D. Cal. Apr. 14, 2014) (Laporte, Mag. J.).

27
28

In the absence of general jurisdiction, a court may exercise specific jurisdiction
over a defendant if his less-substantial contacts with the forum gave rise to the claim or
6

1

claims pending before the court—that is, if the cause of action “arises out of” or has a

2

substantial connection with that activity. Hanson v. Denckla, 357 U.S. 235, 250–53

3

(1958); see also Goodyear, 564 U.S. at 924–25. The inquiry into whether a forum state

4

may assert specific jurisdiction over a nonresident defendant focuses on the relationship

5

among the defendant, the forum, and the litigation. Walden v. Fiore, 134 S. Ct. 1115,

6

1121 (2014).
Specific jurisdiction is analyzed using a three-part test: First, the nonresident

7
8

defendant must have purposefully directed his activities or consummated some

9

transaction with the forum or a forum resident, or performed some act by which he
purposefully availed himself of the privilege of conducting activities in the forum, thereby

11
United States District Court
Northern District of California

10

invoking the benefits and protections of its laws; second, the claim must be one which

12

arises out of or relates to the nonresident defendant’s forum-related activities; and third,

13

the exercise of jurisdiction must comport with fair play and substantial justice, i.e., it must

14

be reasonable. See Picot, 780 F.3d at 1211. If the plaintiff is successful at establishing

15

the first two prongs, the burden shifts to the defendant to set forth a compelling case that

16

the exercise of jurisdiction would not be reasonable. Id. at 1211–12.

17

With regard to the first prong, the “purposeful availment” standard and the

18

“purposeful direction” standard are two distinct concepts. Washington Shoe Co. v. A-Z

19

Sporting Goods Inc., 704 F.3d 668, 672 (9th Cir. 2012). For claims sounding in tort,

20

courts apply the “purposeful direction” test. Schwarzenegger v. Fred Martin Motor Co.,

21

374 F.3d 797, 802–03 (9th Cir. 2004). Because GoDaddy’s claims are based on

22

trademark infringement, generally characterized as a tort, personal jurisdiction may be

23

found if Salman Ghaznavi has purposefully directed his activities at the forum.1 See

24

Panavision Int’l, L.P. v. Toeppen, 141 F.3d 1316, 1321 (9th Cir. 1998), modified on other

25

grounds by Yahoo! Inc. v. La Ligue Contre Le Racisme Et L’Antisemitisme, 433 F.3d

26
1

27
28

For claims sounding in contract, courts apply the “purposeful availment” analysis, asking
whether the defendant has “purposefully avail[ed]” itself of “the privilege of conducting
activities within the forum State, thus invoking the benefits and protections of its laws.”
Schwarzenegger, 374 F.3d at 802 (quoting Hanson, 357 U.S. at 253).
7

1

1199 (9th Cir. 2006). The plaintiff must allege that the defendant “(1) committed an

2

intentional act, (2) expressly aimed at the forum state, (3) causing harm that the

3

defendant knows is likely to be suffered in the forum state.” Yahoo! Inc., 433 F.3d at

4

1206.

5

Acting as an employee or agent of a corporation does not shield one from

6

individual personal jurisdiction when one’s own actions within that corporation otherwise

7

satisfy the personal jurisdiction test. E.g., Davis v. Metro Productions, Inc., 885 F.2d 515,

8

522 (9th Cir. 1989); j2 Glob. Commc’ns, 2009 WL 29905, at *7 (“the fiduciary shield

9

doctrine does not prevent this court from exercising jurisdiction over Luxenberg
[corporate officer] merely because his acts in California were undertaken in an official,

11
United States District Court
Northern District of California

10

business capacity. . . . The conduct that may be considered in determining whether the

12

assertion of personal jurisdiction over Luxenberg is appropriate are those acts which

13

Luxenberg would be personally liable for, i.e., tortious acts he authorized, directed, or

14

meaningfully participated in.”); Johnston Farms, 2017 WL 6571527, at *5 n.3.

15

Under Federal Rule of Civil Procedure 4(k)(2), “a court may exercise jurisdiction

16

when three requirements are met. First, the claim against the defendant must arise

17

under federal law . . . . Second, the defendant must not be subject to the personal

18

jurisdiction of any state court of general jurisdiction. Third, the federal court’s exercise of

19

personal jurisdiction must comport with due process.” Holland Am. Line Inc. v. Wartsila

20

N. Am., Inc., 485 F.3d 450, 461 (9th Cir. 2007) (citations omitted). “The due process

21

analysis is identical to the one discussed above when the forum was California, except

22

here the relevant forum is the entire United States.” Pebble Beach Co. v. Caddy, 453

23

F.3d 1151, 1159 (9th Cir. 2006); Holland, 485 F.3d at 462 (“The due process analysis

24

under Rule 4(k)(2) is nearly identical to traditional personal jurisdiction analysis with one

25

significant difference: rather than considering contacts between the [defendants] and the

26

forum state, we consider contacts with the nation as a whole.”).

27
28

Plaintiff fails to allege sufficient facts to support the exercise of general personal
jurisdiction. Plaintiff alleges in its complaint that Salman Ghaznavi is a California
8

1

resident. Compl. ¶ 11. However, a declaration from Salman Ghaznavi states that he

2

resides full time and is employed in Pakistan. Dkt. 32-1 ¶¶ 2–9. Although the court must

3

accept uncontroverted allegations in plaintiff’s favor, plaintiff has not submitted a

4

competing affidavit actually disputing that controverted point. See Mavrix Photo, Inc.,

5

647 F.3d at 1223 (“We may not assume the truth of allegations in a pleading which are

6

contradicted by affidavit, but we resolve factual disputes in the plaintiff’s favor.”) (citations

7

and internal quotation marks omitted). Plaintiff argues that this court can exercise

8

general personal jurisdiction over Salman Ghaznavi due to his positions in and ownership

9

of various California corporations and similar entities. That is not enough. Plaintiff has
failed to allege that Salman Ghaznavi has sufficiently continuous and systematic contacts

11
United States District Court
Northern District of California

10

with California or the United States for this court to exercise general personal jurisdiction

12

over him.

13

Plaintiff has similarly failed to allege sufficient facts to support the exercise of

14

specific personal jurisdiction. For example, plaintiff may have alleged that companies

15

with which Salman Ghaznavi is associated have committed intentional acts aimed at

16

California, but plaintiff has not alleged that Salman Ghaznavi himself undertook such acts

17

or directed or meaningfully participated in such acts.

18

Because a more satisfactory showing of the facts is necessary to determine

19

whether the court has personal jurisdiction over Salman Ghaznavi—including Salman

20

Ghaznavi’s place of residence, the extent of his ownership of and control over the various

21

entities in plaintiff’s complaint, and whether he personally conducted or directed any of

22

the actions alleged in the complaint—jurisdictional discovery is appropriate. Boschetto v.

23

Hansing, 539 F.3d 1011, 1020 (9th Cir. 2008); America West Airlines, Inc. v. GPA Group,

24

Ltd., 877 F.2d 793, 801 (9th Cir. 1989) (“where pertinent facts bearing on the question of

25

jurisdiction are in dispute, discovery should be allowed”); Halo Elecs., Inc. v. Bel Fuse

26

Inc., No. CIV. C-07-06222 RMW, 2010 WL 2605195, at *7 (N.D. Cal. June 28, 2010).

27

Discovery will allow plaintiff to determine the level of control Salman Ghaznavi exercised

28

over the entities it alleges have violated its trademarks. Second, the parties dispute
9

1

material facts on the issue. For example, plaintiff alleges Salman Ghaznavi is a

2

California resident (Compl. ¶ 11) and defendants disagree (Dkt. 32-1 ¶ 2); plaintiff claims

3

Salman Ghaznavi sent or directed the sending of text messages, phone calls, and

4

advertisements to California citizens (Dkt. 38 at 12–13), and defendants claim Salman

5

Ghaznavi does not advertise in the U.S. at all (Dkt. 32-1 ¶ 8).
Therefore, the court DEFERS JUDGMENT on defendant Salman Ghaznavi’s

6
7

motion to dismiss for lack of personal jurisdiction. The court GRANTS a 90-day period of

8

jurisdictional discovery for plaintiff, ending on May 15, 2018. Plaintiff may file a

9

supplemental brief concerning this court’s personal jurisdiction over Salman Ghaznavi on
or before June 14, 2018; defendant may respond on or before June 28, 2018; and

11
United States District Court
Northern District of California

10

plaintiff may reply on or before July 5, 2018. The briefing shall conform to Civil Local

12

Rule 7, with respect to page limits and otherwise. No hearing shall be held on the

13

supplemental briefing. As discussed below, the briefing may also address whether

14

Salman Ghaznavi should be enjoined by the preliminary injunction issued herein.

15

C.

16

Motion to Dismiss for Failure to State A Claim
A motion to dismiss under Rule 12(b)(6) tests for the legal sufficiency of the claims

17

alleged in the complaint. Ileto v. Glock, 349 F.3d 1191, 1199–1200 (9th Cir. 2003).

18

Under Federal Rule of Civil Procedure 8, which requires that a complaint include a “short

19

and plain statement of the claim showing that the pleader is entitled to relief,” (Fed. R.

20

Civ. P. 8(a)(2)), a complaint may be dismissed under Rule 12(b)(6) if the plaintiff fails to

21

state a cognizable legal theory or has not alleged sufficient facts to support a cognizable

22

legal theory. Somers v. Apple, Inc., 729 F.3d 953, 959 (9th Cir. 2013).

23

While the court must accept factual allegations in the complaint, legally conclusory

24

statements not supported by actual factual allegations need not be accepted. Ashcroft v.

25

Iqbal, 556 U.S. 662, 678–79 (2009). The complaint must proffer sufficient facts to state a

26

claim for relief that is plausible on its face. Bell Atlantic Corp. v. Twombly, 550 U.S. 544,

27

555, 558–59 (2007) (citations and internal quotation marks omitted).

28

“A claim has facial plausibility when the plaintiff pleads factual content that allows
10

1

the court to draw the reasonable inference that the defendant is liable for the misconduct

2

alleged.” Iqbal, 556 U.S. at 678 (citation omitted). “[W]here the well-pleaded facts do not

3

permit the court to infer more than the mere possibility of misconduct, the complaint has

4

alleged—but it has not ‘show[n]’—‘that the pleader is entitled to relief.” Id. at 679 (quoting

5

Fed. R. Civ. P. 8(a)(2)). Where dismissal is warranted, it is generally without prejudice,

6

unless it is clear the complaint cannot be saved by any amendment. Sparling v. Daou,

7

411 F.3d 1006, 1013 (9th Cir. 2005).

8

1.

Trademark Infringement, 15 U.S.C. § 1114

9

“To prevail on a claim of trademark infringement under the Lanham Act, 15 U.S.C.
§ 1114, a party ‘must prove: (1) that it has a protectible ownership interest in the mark;

11
United States District Court
Northern District of California

10

and (2) that the defendant’s use of the mark is likely to cause consumer confusion.’”

12

Network Automation, Inc. v. Advanced Sys. Concepts, Inc., 638 F.3d 1137, 1144 (9th Cir.

13

2011) (quoting Dep’t of Parks & Recreation v. Bazaar Del Mundo Inc., 448 F.3d 1118,

14

1124 (9th Cir. 2006)). The statute also requires plaintiff to show defendant’s use of the

15

mark “in commerce.” 15 U.S.C. § 1114(1). The Lanham Act defines “use in commerce”

16

as “the bona fide use of a mark in the ordinary course of trade.” 15 U.S.C. § 1127. The

17

Ninth Circuit has held that, for example, “the use of a trademark as a search engine

18

keyword that triggers the display of a competitor’s advertisement is a ‘use in commerce’

19

under the Lanham Act.” Network Automation, 638 F.3d at 1144; see also Brookfield

20

Commc’ns, Inc. v. W. Coast Entm’t Corp., 174 F.3d 1036, 1053 (9th Cir. 1999) (plaintiff

21

was entitled to a preliminary injunction with respect to infringing domain name registration

22

and purchasing search engine keywords because it had shown the marks were protected

23

and that there was a likelihood of confusion, although the court did not directly address

24

the “use in commerce” requirement).

25

Plaintiff’s complaint contains deep factual detail, including specific allegations that

26

defendants have now and historically undertaken efforts to disguise their identities when

27

registering domains. Compl. ¶¶ 6–7, 24–27, 36. The complaint also details particular

28

mechanisms defendants allegedly employed to mask their identities, and plaintiff’s
11

1

investigatory efforts to reveal the same. Id. ¶¶ 24–27, 32–36. Given plaintiff’s well-pled,

2

factual allegations tying Usman Anis to the Fremont and Sunnyvale Addresses (id. ¶ 10),

3

tying SVG to the Fremont Address (id. ¶ 12), tying a number of domains at issue to

4

domain name privacy services (id. ¶ 24), and tying at least one domain using a privacy

5

service to the Fremont Address (id. ¶ 26), tying a domain registered to Fredrick King to a

6

GoDaddy account paid for by Usman Anis (id. ¶¶ 25, 32), plaintiff has proffered sufficient

7

facts to state a claim for relief that is plausible on its face by allowing the court to draw a

8

reasonable inference that the defendants are liable for the misconduct alleged.
Moreover, plaintiff specifically alleges that an email from “g0daddydesigns.com”

9

was sent “On Behalf of GoDaddy”, that the domain hosted a website displaying infringing

11
United States District Court
Northern District of California

10

marks, and that the domain was hosted by “an account paid for by [Usman] Anis, and

12

registered to the Fremont Address”; plaintiff further alleges that the domain resolved to an

13

IP address registered to Usman Anis at the Fremont Address. Id. ¶¶ 30–32. Plaintiff’s

14

complaint is sufficient to allege a claim for trademark infringement against Usman Anis

15

under Rule 8.

16

Plaintiff alleges that SVG shares a physical address and phone number2 with a

17

number of allegedly-infringing domains and that SVG’s website was registered by the

18

same account that registered certain allegedly-infringing domains. Compl. ¶¶ 33, 37–38.

19

Although plaintiff pleads SVG’s actions with less particularity than it does Usman Anis’s,

20

the complaint as a whole—including the credible allegations that defendants are

21

attempting to use technical means to mask their identities online—allow the court to draw

22

the reasonable inference that defendant SVG, whose contact information is attached to

23

many of the allegedly-infringing materials, is liable for the misconduct alleged.
Plaintiff also makes sufficient allegations to establish “use in commerce.” The

24
25
26
27
28

2

Defendants’ briefing contests this point, but no cited declaration controverts plaintiff’s
allegation. Dkt. 39 at 5:8–10 (citing a declaration of Usman Anis, Dkt. 26-1). Notably,
Usman Anis’s declaration does not deny that the alleged number is associated with SVG.
Rather, the declaration attaches a printout of a Yelp webpage that shows another number
associated with the business.
12

1

domain registrations alone are sufficient. Even if they are not, plaintiff alleges that

2

defendants included images confusingly similar to their registered marks on websites and

3

in email communications advertising services in direct competition with plaintiff’s own

4

services.
Defendants Usman Anis’s and SVG’s motion to dismiss plaintiff’s trademark

5
6

infringement claim is therefore DENIED.

7

2.

8

The same standard is embodied in 15 U.S.C. § 1125(a), which applies to both

9

False Designation of Origin, 15 U.S.C. § 1125(a)

registered and unregistered trademarks, and 15 U.S.C. § 1114, which provides protection
only to registered marks. Brookfield Communications, Inc. v. W. Coast Entertainment

11
United States District Court
Northern District of California

10

Corp., 174 F. 3d 1036, 1046 nn.6 & 8 (9th Cir. 1999).
For the reasons stated above, defendants Usman Anis’s and SVG’s motion to

12
13

dismiss plaintiff’s false designation of origin claim is therefore DENIED.

14

3.

Trademark Dilution, 15 U.S.C. § 1125(c)

15

“In order to prove a violation of the Federal Trademark Dilution Act, a plaintiff must

16

show that (1) the mark is famous; (2) the defendant is making a commercial use of the

17

mark in commerce; (3) the defendant’s use began after the mark became famous; and

18

(4) the defendant’s use of the mark dilutes the quality of the mark by diminishing the

19

capacity of the mark to identify and distinguish goods and services.” Panavision Int’l,

20

L.P., 141 F.3d at 1324 (citing 15 U.S.C. § 1125(c)).
Defendant only challenges whether plaintiff’s complaint “make[s] any allegation

21
22

that [Usman] Anis or SVG is making commercial use of the Marks in commerce.” Dkt. 30

23

at 13.

24

GoDaddy alleges that its marks are famous, and identifies the marks with

25

particularity. Compl. ¶¶ 21–22, 74. The complaint alleges that SVG and Usman Anis are

26

making commercial use of the marks by: displaying the marks on particular domains to

27

siphon traffic from GoDaddy’s websites by operating websites confusingly related to

28

GoDaddy (id. ¶ 23); registering domain names that are themselves confusingly similar to
13

1

the marks (id.); making public communications purporting to be related to GoDaddy (id.

2

¶¶ 30–31, 40); funding certain of the accounts at issue (id. ¶¶ 27, 32–33); and purporting

3

to represent a relationship between GoDaddy and defendants using SVG’s phone

4

number, Usman Anis’s Sunnyvale Address, and a domain allegedly registered and paid

5

for by Usman Anis via his GoDaddy account (id. ¶¶ 29–33). Given the allegations pled

6

and the allegation that defendants are actively concealing the true name or identify of the

7

owners of the Infringing Domains, the court can draw a reasonable inference that Usman

8

Anis and SVG are responsible for the alleged commercial use of the GoDaddy marks.

9

Plaintiff also adequately pleads that defendants’ alleged acts are confusing to customers,

10

United States District Court
Northern District of California

11
12

and they harass and annoy customers in a way that dilutes GoDaddy’s marks.
Defendants Usman Anis’s and SVG’s motion to dismiss plaintiff’s trademark
dilution claim is therefore DENIED.

13

4.

14

“The Anti–Cybersquatting Consumer Protection Act establishes civil liability for

15

‘cyberpiracy’ where a plaintiff proves that (1) the defendant registered, trafficked in, or

16

used a domain name; (2) the domain name is identical or confusingly similar to a

17

protected mark owned by the plaintiff; and (3) the defendant acted ‘with bad faith intent to

18

profit from that mark.’” DSPT Int’l, Inc. v. Nahum, 624 F.3d 1213, 1218–19 (9th Cir.

19

2010) (citing 15 U.S.C. § 1125(d)(1)(A)). The Ninth Circuit has described cybersquatting

20

as “when a person other than the trademark holder registers the domain name of a well

21

known trademark and then attempts to profit from this by either ransoming the domain

22

name back to the trademark holder or by using the domain name to divert business from

23

the trademark holder to the domain name holder.” Bosley Med. Inst., Inc. v. Kremer, 403

24

F.3d 672, 680 (9th Cir. 2005) (quoting DaimlerChrysler v. The Net Inc., 388 F.3d 201,

25

204 (6th Cir. 2004)).

26

Cybersquatting, 15 U.S.C. § 1125(d)

GoDaddy alleges that defendants Usman Anis and SVG “registered, trafficked in,

27

or used” certain domains (Compl. ¶¶ 23–27, 32–33); that such domains contain or are

28

confusingly similar to GoDaddy’s protected marks (id. ¶¶ 23, 30–31); and that defendants
14

1
2
3

acted with bad faith intent to profit from the trademarks (id. ¶¶ 23–25, 30–31, 87).
Defendants Usman Anis’s and SVG’s motion to dismiss plaintiff’s cybersquatting
claim is therefore DENIED.

4

5.

Unfair Competition, Cal. Bus & Prof. Code § 17200

5

A claim under § 17200 can be founded on the same conduct underlying a Lanham

6

Act claim. Cleary v. News Corp., 30 F.3d 1255, 1262–63 (9th Cir. 1994) (“This Circuit

7

has consistently held that state common law claims of unfair competition and actions

8

pursuant to California Business and Professions Code § 17200 are ‘substantially

9

congruent’ to claims made under the Lanham Act.”). The law also encompasses
practices that are unfair even if not specifically proscribed by some other law. Cel-Tech

11
United States District Court
Northern District of California

10

Commc’ns, Inc. v. Los Angeles Cellular Tel. Co., 20 Cal. 4th 163, 180 (1999) (“The

12

statutory language referring to ‘any unlawful, unfair or fraudulent’ practice (italics added)

13

makes clear that a practice may be deemed unfair even if not specifically proscribed by

14

some other law. . . . In other words, a practice is prohibited as ‘unfair’ or ‘deceptive’ even

15

if not ‘unlawful’ and vice versa.”) (citations and internal quotation marks omitted).

16
17
18
19

The parties agree that this claim survives if plaintiff’s trademark infringement claim
survives. Dkt. 30 at 14–15; Dkt. 39 at 5; Dkt. 36 at 14–15. The court agrees.
Defendants Usman Anis’s and SVG’s motion to dismiss plaintiff’s unfair
competition claim under §17200 is therefore DENIED.

20

6.

False Advertising, Cal. Bus. & Prof. Code § 17500

21

“California’s False Advertising Law makes it unlawful for any person to ‘induce the

22

public to enter into any obligation’ based on a statement that is ‘untrue or misleading, and

23

which is known, or which by the exercise of reasonable care should be known, to be

24

untrue or misleading.’” Davis v. HSBC Bank Nevada, N.A., 691 F.3d 1152, 1161 (9th Cir.

25

2012) (quoting Cal. Bus. & Prof. Code § 17500). “Whether an advertisement is

26

‘misleading’ must be judged by the effect it would have on a reasonable consumer. . . .

27

In applying this test, we are mindful that whether a business practice is deceptive will

28

usually be a question of fact not appropriate for decision on a motion to dismiss.” Id. at
15

1

1161–62 (citations and internal quotation marks omitted).

2

Plaintiff sufficiently alleges—at least—false statements of fact regarding an

3

association with GoDaddy. Compl. ¶¶ 30–31, 40. Defendants Usman Anis’s and SVG’s

4

motion to dismiss plaintiff’s false advertising claim under §17500 is therefore DENIED.

5

7.

California Common Law Trademark Infringement

6

The parties agree this claim survives or fails for the same reasons as plaintiff’s

7

trademark infringement claim, addressed above, as it requires proof of the same

8

elements. Dkt. 30 at 16; Dkt. 36 at 16; Dkt. 39 at 5. The court agrees. Defendants

9

Usman Anis’s and SVG’s motion to dismiss plaintiff’s common law trademark

10

infringement claim is therefore DENIED.

United States District Court
Northern District of California

11

8.

Intentional Interference With Prospective Economic Advantage

12

The elements of intentional interference with prospective economic advantage are

13

“(1) an economic relationship between the plaintiff and another, containing a probable

14

future economic benefit or advantage to plaintiff, (2) defendant’s knowledge of the

15

existence of the relationship, (3) that defendant intentionally engaged in acts or conduct

16

designed to interfere with or disrupt the relationship, (4) actual disruption, and

17

(5) damage to the plaintiff as a result of defendant’s acts.” Della Penna v. Toyota Motor

18

Sales, U.S.A., Inc., 11 Cal. 4th 376, 380 n.1 (1995) (internal quotation marks omitted).

19

The sixth element (6) requires “that the defendant not only knowingly interfered with the

20

plaintiff’s expectancy, but engaged in conduct that was wrongful by some legal measure

21

other than the fact of interference itself.” Id. at 393.

22

GoDaddy alleges that it provides domain name registration services (Compl.

23

¶¶ 18–19), and services to facilitate the use of those domains once registered, like web

24

design and search optimization (id. ¶ 20). GoDaddy alleges that defendants solicit

25

business only for the second category of services. Id. ¶¶ 3–4.

26

The first element of the claim requires pleading “an existing economic relationship

27

or one ‘containing the probability of future economic benefit.’” Transcription Commc’ns

28

Corp. v. John Muir Health, 2009 WL 666943, at *10 (N.D. Cal. Mar. 13, 2009) (quoting
16

1

AccuImage Diagnostics Corp v. Terarecon, Inc., 260 F. Supp. 2d 941, 956 (N.D. Cal.

2

2003)). “California state law requires ‘proof that it is reasonably probable that the lost

3

economic advantage would have been realized but for the defendant’s interference.’” Id.

4

(quoting Youst v. Longo, 43 Cal. 3d 64, 71 (1987)); Youst, 43 Cal. 3d at 72 (plaintiff must

5

“show a probability of the prospective advantage, that is, that plaintiff would have

6

benefited economically but for the interference”).

7

GoDaddy likely adequately pleads that it has existing or probable economic

8

relationships for domain name registration services. For example, it describes its

9

response to spamming campaigns, where it wrote that “GoDaddy has neither provided
nor shared any customer data with [the spammers]. Instead, they pulled contact

11
United States District Court
Northern District of California

10

information from the public WHOIS database.” Compl. ¶ 34. That public WHOIS

12

information would relate to registration services, but not GoDaddy’s other services. See,

13

e.g., id., Ex. R. Plaintiff elsewhere refers to spam emails sent to “GoDaddy customers,”

14

although it does not specify the GoDaddy services those customers contracted for. Id.

15

¶ 39. However, GoDaddy does not identify any contracts it has, or other reasons to

16

anticipate economic advantage, relating to any services other than domain registration—

17

including with respect to any services that compete with defendants.

18

The second element requires GoDaddy to plead “knowledge by the defendant of

19

the relationship with which the interference occurred.” Transcription Commc’ns Corp.,

20

2009 WL 666943, at *10. The Ninth Circuit has stated that “[w]hen the defendant

21

performs the act that causes the interference, the defendant need not know exactly who

22

is a party to the contract, so long as he knows he is interfering with a contractual

23

relationship.” Altera Corp. v. Clear Logic, Inc., 424 F.3d 1079, 1092 (9th Cir. 2005). In

24

holding the same, the California Supreme Court relied upon the Restatement Second of

25

Torts: “conduct must be intended to affect the contract of a specific person. It is not

26

enough that one has been prevented from obtaining performance of a contract as a result

27

of the actor’s conduct. . . . Only when the actor’s conduct is intended to affect a specific

28

person is the actor subject to liability under this rule.” Ramona Manor Convalescent
17

1

Hosp. v. Care Enterprises, 177 Cal. App. 3d 1120, 1133 (1986) (citing Rest. 2d Torts,

2

§ 766, com. p). In Ramona Manor Convalescent Hosp., an action “made with the

3

knowledge that such action would frustrate the legitimate contractual expectations of a

4

specific, albeit unnamed” person was sufficient to incur liability. In sum, the defendant

5

must know of a specific contractual subject matter that would be interfered with, although

6

it need not know who specifically will be harmed by its interference with that relationship.

7

See, e.g., id.; Sebastian Int’l, Inc. v. Russolillo, 162 F. Supp. 2d 1198, 1204 (C.D. Cal.

8

2001) (“If a potential defendant was completely unaware of contractual relations with a

9

third party, then it would be impossible to infer any intent to interfere on the defendant’s
part. However, such intent can certainly be inferred if the defendant knows that

11
United States District Court
Northern District of California

10

contractual relations with a third party exist, but does not know the specific identity of the

12

contractual party.”).

13

Plaintiff alleges that defendants knew of GoDaddy’s relationships with customers

14

for domain registration services through querying the public WHOIS database. Compl.

15

¶ 34, Ex. R. GoDaddy fails to allege that any defendant knew of contracts or other

16

“reasonably probable” prospective economic relationships for other services.

17

The third element requires GoDaddy to plead “acts by defendant designed to

18

disrupt the relationship.” Transcription Commc’ns Corp., 2009 WL 666943, at *11

19

(quoting Accuimage Diagnostics Corp., 260 F. Supp. 2d at 956). “California law clearly

20

establishes an intent requirement for this element.” Id. (citing Korea Supply Co. v.

21

Lockheed Martin Corp., 29 Cal. 4th 1134, 1153 (2003)). Substantial certainty is an

22

alternative to pleading intent—“a plaintiff may alternately plead that the defendant knew

23

that the interference was certain or substantially certain to occur as a result of its

24

action.” Id.

25

GoDaddy argues that its complaint “is replete with allegations of intentional acts

26

performed by all Defendants to disrupt GoDaddy’s relationship with its customers.” Dkt.

27

36 at 17. But “intentional acts” is not the standard. California requires either specific

28

intent or “knowledge that its actions were certain or substantially certain to interfere with
18

1

plaintiff’s business expectancy.” Korea Supply Co., 29 Cal. 4th at 1166. Regarding

2

GoDaddy’s domain registration services, GoDaddy does not allege and the complaint

3

does not lead to a reasonable inference that defendants had the intent or knowledge that

4

their actions would interfere with those contracts. Regarding GoDaddy’s website design

5

services—assuming GoDaddy were to adequately allege probable future economic

6

benefit from them—GoDaddy’s allegations satisfy this element. Specifically, GoDaddy

7

alleges that defendants’ agents represented to customers that they were a subsidiary of

8

GoDaddy. That intentional act makes it sufficiently clear that defendants knew they were

9

soliciting customers who were seeking to contract with GoDaddy.

10

The fourth and fifth elements require plaintiff to plead “actual disruption” and

United States District Court
Northern District of California

11

“damages proximately caused by the acts of the defendant.” Accuimage Diagnostics

12

Corp., 260 F. Supp. 2d at 956. For the closely related tort of interference with contract,

13

the California Supreme Court permits “liability where the defendant does not literally

14

induce a breach of contract, but makes plaintiff’s performance of the contract ‘more

15

expensive or burdensome[.]’” Ramona Manor Convalescent Hosp., 177 Cal. App. 3d at

16

1131. Plaintiffs can offer credible evidence that defendants’ intentional actions resulted

17

in greater expense or burden on the performance of its contractual obligations with third

18

parties. Sebastian Int’l, Inc., 162 F. Supp. 2d at 1205.

19

GoDaddy’s complaint describes in some detail the adverse impact defendants’

20

actions have had on its relationships with customers, although it is unclear what services

21

these customers obtained or sought from GoDaddy. Compl. ¶¶ 34, 46–47, 50–51.

22

Sixth, plaintiff must allege that defendant “engaged in conduct that was wrongful

23

by some legal measure other than the fact of interference itself.” Della Penna, 11 Cal.

24

4th at 393. Given the other related causes of action, GoDaddy satisfies this element.

25

Put simply, GoDaddy does not identify any particular prospective economic

26

relationship that defendants knew about and actually disrupted. Plaintiff instead alleges

27

general reputational harm, unmoored from disrupted relationships regarding the types of

28

services defendants offer. GoDaddy confirmed at oral argument that its claim is based
19

1

on defendants’ interference with GoDaddy’s services other than domain registration; but

2

GoDaddy does not allege that it lost (or even has) any particular relationships for services

3

that defendants provide, much less ones that defendants knew of or actually interfered

4

with.

5

Defendants Usman Anis’s and SVG’s motion to dismiss plaintiff’s intentional

6

interference with prospective economic advantage claim is therefore GRANTED WITH

7

LEAVE TO AMEND.

8

9.

Accounting

9

An accounting is supported when any of the following conditions are met in a
Lanham Act claim: “if the defendant is unjustly enriched, if the plaintiff sustained

11
United States District Court
Northern District of California

10

damages from the infringement, or if the accounting is necessary to deter a willful

12

infringer from doing so again.” George Basch Co. v. Blue Coral, Inc., 968 F.2d 1532,

13

1537 (2d Cir. 1992) (citations and internal quotation marks omitted). Taking plaintiff’s

14

pleadings as true, the complaint satisfies each of the three justifications for an

15

accounting.

16
17

Defendants Usman Anis’s and SVG’s motion to dismiss plaintiff’s request for an
accounting is therefore DENIED.

18

10.

Injunctive Relief

19

Defendants move to court to dismiss “Plaintiff’s claim for injunctive relief” because

20

it “is not an independent cause of action.” Dkt. 30 at 19. The court understands plaintiff’s

21

complaint to seek injunctive relief as a remedy, not as a cause of action. Compl. at

22

41:18–42:15. Defendants Usman Anis’s and SVG’s motion to dismiss plaintiff’s claim for

23

injunctive relief is therefore DENIED AS MOOT.

24

Defendants’ accompanying request for judicial notice (Dkt. 31) is also DENIED.

25

Defendants request the court take judicial notice of a document pursuant to Federal Rule

26

of Evidence 201. Dkt. 31. Defendants describe the exhibit as a printout from the

27

California Secretary of State website that would show one of the entities plaintiff alleges

28

defendants control, AppDesignAgency, LLC, is in “suspended” status. However, no
20

1

exhibit was attached to its submission, nor did counsel bring a copy of the document to

2

the hearing. The request is to “take judicial notice of the following documents attached

3

as Exhibit 1.” Because there is no such document, the request is DENIED AS MOOT.

4

D.

Motion to Strike
Defendants move to strike certain portions of and exhibits to plaintiff’s complaint.

5
6

Dkt. 30 at 19–24. Rule 12(f) provides that the “court may strike from a pleading an

7

insufficient defense or any redundant, immaterial, impertinent, or scandalous matter.”

8

Fed. R. Civ. P. 12. The function of a motion to strike is to “avoid the expenditure of time

9

and money that must arise from litigating spurious issues by dispensing with those issues
prior to trial.” Whittlestone, Inc. v. Handi-Craft Co., 618 F.3d 970, 973 (9th Cir. 2010)

11
United States District Court
Northern District of California

10

(citation and internal quotation marks omitted). To determine whether to grant a motion

12

to strike under Rule 12(f), the court considers whether the matter the moving party seeks

13

to have stricken is (1) an insufficient defense; (2) redundant; (3) immaterial;

14

(4) impertinent; or (5) scandalous. Id. at 973–74.
Motions to strike are not favored and “should not be granted unless it is clear that

15
16

the matter to be stricken could have no possible bearing on the subject matter of the

17

litigation.” Colaprico v. Sun Microsystem, Inc., 758 F. Supp. 1335, 1339 (N.D. Cal. 1991).

18

When a court considers a motion to strike, it “must view the pleadings in a light most

19

favorable to the pleading party.” In re 2TheMart.com, Inc. Sec. Litig., 114 F Supp. 2d

20

955, 965 (C.D. Cal. 2000). A court must deny the motion to strike if there is any doubt

21

whether the allegations in the pleadings might be relevant in the action. Id.
The materials defendants seek to strike could possibly have a bearing on the

22
23

subject matter of the litigation. The portions defendants seek to strike are background

24

materials, particularly when read in light of the conduct alleged throughout the complaint.

25

Defendants Usman Anis’s and SVG’s motion to strike is therefore DENIED.

26

E.

27
28

Preliminary Injunction
Federal Rule of Civil Procedure 65 provides federal courts with the authority to

issue temporary restraining orders and preliminary injunctions. Fed. R. Civ. P. 65(a)–(b).
21

1

Generally, the purpose of a preliminary injunction is to preserve the status quo and the

2

rights of the parties until a final judgment on the merits can be rendered. See U.S.

3

Philips Corp. v. KBC Bank N.V., 590 F.3d 1091, 1094 (9th Cir. 2010).
A plaintiff seeking a preliminary injunction can satisfy either of two tests. His first

4
5

option is to establish that (1) he is likely to succeed on the merits; (2) he is likely to suffer

6

irreparable harm in the absence of preliminary relief; (3) the balance of equities tips in his

7

favor; and (4) an injunction is in the public interest. Winter v. Nat. Res. Def. Council, Inc.,

8

555 U.S. 7, 20 (2008).
Alternatively, the plaintiff’s second option is to show that (1) “serious questions

9

going to the merits were raised”; (2) “the balance of hardships tips sharply in the plaintiff’s

11
United States District Court
Northern District of California

10

favor”; (3) “there is a likelihood of irreparable injury”; and (4) “the injunction is in the public

12

interest.” Alliance for the Wild Rockies v. Cottrell, 632 F.3d 1127, 1135 (9th Cir. 2011).

13

This is sometimes referred to as the “sliding scale approach.” Showing “serious

14

questions going to the merits” requires a plaintiff to demonstrate a “substantial case for

15

relief on the merits.” Leiva-Perez v. Holder, 640 F.3d 962, 967 (9th Cir. 2011). A

16

“serious question” is one on which the plaintiff “has a fair chance of success on the

17

merits.” Sierra On-Line, Inc. v. Phoenix Software, Inc., 739 F.2d 1415, 1421 (9th Cir.

18

1984).

19

GoDaddy’s complaint is long and detailed, and its preliminary injunction motion

20

and accompanying declarations establish sufficient evidence to support a preliminary

21

injunction. Although GoDaddy has presented substantially more evidence about a

22

number of Usman Anis’s and SVG’s activities, the court summarizes some of the relevant

23

information regarding g0daddydesigns.com in particular:

24



¶ 17) and hosted by Usman Anis (Dkt. 37-1 ¶ 18, Ex. F).

25
26



Usman Anis has paid for the domain. Dkt. 37-2 ¶ 40; Dkt. 37-1 ¶¶ 14 & 16,
Exs. C & E.

27
28

The domain has been registered to Fredrick King (Dkt. 37-2 ¶ 44; Dkt. 37-1



The domain is tied to both the Fremont Address (Dkt. 37-2 ¶ 44; Dkt. 37-1
22

¶¶ 14 & 16, Exs. C & E) and the Sunnyvale Address (Dkt. 37-1, Ex. B).

1


2

The domain is tied to a commonly-used phone number, 800-589-2951. Dkt.
37-1, Ex. B.

3


4

The domain has been the source of customer spam or confusing emails to
customers. Dkt. 37-1, Ex. B.

5


6

A customer has contacted GoDaddy regarding confusing emails sent from
the domain. Dkt. 37-1 ¶ 13, Ex. B.

7
8

1.

Likelihood of Success or Serious Questions Going to the Merits

9

Defendants did not dispute in their papers or at oral argument that GoDaddy is
likely to succeed on the merits against some defendant; they instead argue that GoDaddy

11
United States District Court
Northern District of California

10

is unlikely to succeed on the merits against these particular defendants. Much of

12

plaintiff’s motion is dedicated to explicating its factual investigation into the ownership and

13

interrelated control of the Infringing Domains. Dkt. 37 at 4–10.

14

Plaintiff has shown serious questions going to the merits given: (1) regarding the

15

substantive law, it is undisputed that plaintiff is likely to succeed on the merits against the

16

correct defendant; (2) plaintiff has demonstrated competent evidence demonstrating

17

Usman Anis has registered or owns certain of the Infringing Domains; and (3) plaintiff has

18

proffered evidence demonstrating a likelihood that many more of the domains at issue

19

are part of a common plan or scheme with the domains tied to Usman Anis and SVG.

20

2.

21

Under the “sliding scale” approach, plaintiff must show that the balance of

22

hardships tips sharply in its favor if it only shows “serious questions going to the merits”

23

rather than a likelihood of success on the merits.

24

Balance of Hardships

Defendants cannot claim any hardship from an injunction that would prevent them

25

from using GoDaddy’s trademarks, especially considering they have no current right to

26

do so (they do not allege to have a contractual right or any other right). In fact,

27

defendants deny any participation in the alleged infringing activities at all. GoDaddy,

28

however, faces strong, cognizable hardship. As discussed in the irreparable harm
23

1

analysis below, GoDaddy is suffering ongoing reputational harm, loss of goodwill, and

2

loss of control over their federally-protected marks.

3

3.

Irreparable Harm

4

Reputational harm and loss of goodwill can constitute irreparable harm. 11A

5

Charles Alan Wright & Arthur R. Miller, Federal Practice and Procedure § 2948.1 (3d ed.

6

1998) (“Injury to reputation or goodwill is not easily measurable in monetary terms, and

7

so often is viewed as irreparable.”) (collecting cases); American Trucking Associations,

8

Inc. v. City of Los Angeles, 559 F.3d 1046 (9th Cir. 2009) (potential loss of customer

9

goodwill); Stuhlbarg Int’l Sales Co., Inc. v. John D. Brush and Co., Inc., 240 F.3d 832,
841 (9th Cir. 2001) (evidence of loss of customer goodwill supports finding of irreparable

11
United States District Court
Northern District of California

10

harm).

12

The district court must base a finding of likelihood if irreparable harm on evidence

13

in the record. In the Ninth Circuit, an employee declaration “reporting numerous and

14

persistent complaints from would-be customers who received robo-calls for what they

15

believed were [plaintiff’s] products” and “emails and social media posts from consumers”

16

is sufficient to support a finding of a threat to plaintiff’s “reputation and goodwill.” Life

17

Alert Emergency Response, Inc. v. LifeWatch, Inc., 601 F. App’x 469, 473–74 (9th Cir.

18

2015). Because reputational harm and loss of goodwill “constitutes irreparable harm, as

19

it is not readily compensable,” such a showing is sufficient to establish irreparable harm

20

for a preliminary injunction. Id.

21

Plaintiff has made the necessary showing. Plaintiff has submitted a declaration

22

attesting that GoDaddy has received numerous customer complaints in response to

23

communications originating from domains at issue in this case. Dkt. 37 at 20 (citing

24

Becerra Decl. ¶¶ 34–43, Exs. O–S).

25

4.

Balance of Equities

26

The balance of the equities favors GoDaddy. Contrary to defendants’ arguments,

27

GoDaddy’s size does not preclude it from suffering irreparable reputational harm.

28

Furthermore, the ongoing infringing use of GoDaddy’s trademarks to promote deceptive
24

1

and annoying business practices is causing real, public harm to GoDaddy.

2

Defendants respond by denying the allegations, so an injunction would not prevent them

3

from any ongoing legitimate business practice. Second, to the extent they are using

4

GoDaddy’s trademarks, an injunction preventing them from continuing illegal activities is

5

not inequitable. Defendants expressed concern at oral argument that the injunction

6

would be enforced against them even if they did not violate it; that concern is not

7

sufficient to tip the balance of equities against GoDaddy.

8

5.

Public Interest

9

The public has a strong interest in protecting trademarks. If plaintiff’s allegations
are true, defendants are serial infringers who have so far evaded attempts to police their

11
United States District Court
Northern District of California

10

infringing conduct by pleading ignorance. It is in the public’s interest to stop the conduct.

12

It is against the public’s interest to enjoin a party from infringing trademarks when he has

13

not in fact been infringing them, but a narrowly-tailored injunction can ease that concern

14

by enjoining only illegal conduct.
Plaintiff’s motion for a preliminary injunction is therefore GRANTED with respect to

15
16

defendants Usman Anis and SVG, in accordance with the terms specified below. The

17

court’s ruling is DEFERRED with respect to Salman Ghaznavi, which will be determined

18

on the papers submitted by the parties concerning personal jurisdiction.

19

F.

20
21

Evidentiary Objections
Plaintiff and defendants Usman Anis and SVG have filed a number of evidentiary

objections and materials related to evidentiary objections.

22

First, Local Rule 7-3(a) governs opposition briefs and provides, in relevant part:

23

“Any evidentiary and procedural objections to the motion must be contained within the

24

brief or memorandum. Pursuant to Civil L.R. 7-4(b), such brief or memorandum may not

25

exceed 25 pages of text.” Rules 7-3(c) & (d) govern replies and supplementary

26

materials, respectively. Courts in this district regularly strike separately-filed evidentiary

27

objections and responses for violating Local Rule 7-3. Hennighan v. Insphere Ins. Sols.,

28

Inc., 38 F. Supp. 3d 1083, 1095 (N.D. Cal. 2014), aff’d, 650 F. App’x 500 (9th Cir. 2016);
25

1

Beauperthuy v. 24 Hour Fitness USA, Inc., 772 F. Supp. 2d 1111, 1119 (N.D. Cal. 2011);

2

see also Coleman v. Kaiser Permanente, No. 12-CV-02668-JST, 2014 WL 2886293, at

3

*3 (N.D. Cal. June 25, 2014); Ashley v. City & Cty. of San Francisco, No. 12-CV-00045-

4

JST, 2014 WL 4627736, at *14 (N.D. Cal. Feb. 4, 2014).

5

Second, “the Federal Rules of Evidence do not strictly apply to preliminary

6

injunction proceedings.” Disney Enterprises, Inc. v. VidAngel, Inc., 224 F. Supp. 3d 957,

7

966 (C.D. Cal. 2016), aff’d, 869 F.3d 848 (9th Cir. 2017) (citing Republic of the

8

Philippines v. Marcos, 862 F.2d 1355, 1363 (9th Cir. 1988) (en banc)); Herb Reed

9

Enterprises, LLC v. Fla. Entm’t Mgmt., Inc., 736 F.3d 1239, 1250 n.5 (9th Cir. 2013);
Flynt Distrib. Co. v. Harvey, 734 F.2d 1389, 1394 (9th Cir. 1984) (citing 11C Charles Alan

11
United States District Court
Northern District of California

10

Wright & Arthur R. Miller, Federal Practice and Procedure § 2949 (1973)). For example,

12

a district court may “consider hearsay in deciding whether to issue a preliminary

13

injunction.” Johnson v. Couturier, 572 F.3d 1067, 1083 (9th Cir. 2009) (citations omitted).

14

“While district courts may consider inadmissible evidence in the context of a preliminary

15

injunction, this does not mean that evidentiary issues have no relevance to this

16

proceeding. Such issues, however, properly go to weight rather than admissibility.”

17

Disney Enterprises, 224 F. Supp. 3d at 966 (citation omitted); 11A Charles Alan Wright &

18

Arthur R. Miller, Federal Practice and Procedure § 2949 (3d ed. 1998).
Accordingly, the parties’ separate filings concerning evidentiary objections (Dkts.

19
20

41, 42, 46, 47 & 48) violate Civil Local rule 7-3 and are hereby STRICKEN.3 Plaintiff’s

21

evidentiary objections to Usman Anis’s declaration (Dkt. 48 at 3; Dkt. 51 at 15) are

22

OVERRULED. In light of the relaxed evidentiary standard for preliminary injunction

23

proceedings, the court need not rule on admissibility; the court has considered the likely

24

admissibility of the evidence when assessing whether to order the preliminary injunction.

25

See Disney Enterprises, 224 F. Supp. 3d at 966 n.1.

26
27
28

3

Even if the objections were not stricken, the court need not rule on admissibility given
that “the Federal Rules of Evidence do not strictly apply to preliminary injunction
proceedings.” Disney Enterprises, Inc., 224 F. Supp. 3d at 966.
26

1

G.

Pursuant to Rule 65 of the Federal Rules of Civil Procedure, IT IS HEREBY

2
3

PRELIMINARY INJUNCTIVE RELIEF

ORDERED that:
1. Defendants Usman Anis and SVG, as well as their officers, agents, servants,

4

employees, members, and managers, are enjoined from the following:

5

a. Advertising, marketing, distributing, selling, sending emails, text messages,

7

making phone calls, or publishing, including the publication of any webpage

8

or electronic media, any materials bearing a GoDaddy trademark or any

9

similar representations or renderings of GoDaddy trademarks, including any

10

kind of distribution on any social media displaying any GoDaddy trademark,

11
United States District Court
Northern District of California

6

or similar representations or renderings thereof;
b. Operating, registering, continuing to use, continuing to display GoDaddy

12
13

trademarks upon, siphoning traffic from, generating sales, leads, or internet

14

traffic from, or otherwise continuing to utilize in any manner, any domain

15

containing the words “go” and “daddy,” or domains using a combination of

16

characters creating a confusingly similar display, for example containing

17

“g0” rather than “go”;
c. Destroying, moving, concealing, transferring, damaging, or failing to

18
19

preserve any data, media, documents, materials, or information of any kind

20

that contains any representation or information related to GoDaddy

21

trademarks;
d. Concealing, altering, injuring, destroying, or failing to preserve in their

22
23

present form, corporate books and records, including any and all financial

24

records related to any use, misuse, or reference to any GoDaddy

25

trademarks including, but not limited to, any and all sales made in

26

connection with or reference to GoDaddy trademarks;

27

///

28

///
27

1

IT IS FURTHER ORDERED that pursuant to Rule 65(c), Plaintiff shall by March

2

23, 2018, post a bond in the total amount of $5,000 as a condition to entry of this

3

preliminary injunction.

4
5
6
7

IT IS SO ORDERED.
Dated: February 28, 2018
__________________________________
PHYLLIS J. HAMILTON
United States District Judge

8
9
10

United States District Court
Northern District of California

11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
28