LG Electronics Mobile Comm U.S.A., Inc. et al v. Xiaowen et al

Filing 127

AMENDED ORDER Granting 111 Motion for Default Judgment. It is ordered that the Court grants plaintiffs' motion for default judgment and grants plaintiffs' request for permanent injunction. The Court grants plaintiffs' request for statu tory fees in the amount of $168,100,000. The Court grants plaintiffs' request for attorneys' fees and costs. Plaintiffs shall submit evidence of their attorneys' fees and costs on or before 30 days from the date on which this orde r is electronically docketed. The Court directs Whois Privacy Corporation to reveal to LG the owner of the "lgtonewholesale.com" domain name. Said owner and/or the relevant registrar (Internet Domain Service BS Corp.) is directed to transfer the "lgtonewholesale.com" domain name to LG.Signed by Judge Janis L. Sammartino on 2/6/2017.(dxj)

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UNITED STATES DISTRICT COURT

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SOUTHERN DISTRICT OF CALIFORNIA

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LG CORPORATION, et al.,

Case No.: 16-CV-1162 JLS (NLS)
Plaintiffs,

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v.

AMENDED ORDER GRANTING
MOTION FOR DEFAULT
JUDGMENT

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HUANG XIAOWEN DBA TOPUUSHOP, et al.,

(ECF No. 111)

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Defendants.

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Presently before the Court is Plaintiffs LG Corporation, LG Electronics, Inc., and

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LG Electronics MobileComm U.S.A., Inc.’s (collectively, “Plaintiffs” or “LG”) Motion for

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Default Judgment (“Mot.,” ECF No. 111), against each of the following Defendants

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(“Defaulting Defendants”):

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 Huang Xiaowen doing business as top-uushop (“Xiaowen”);

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 Enjoy International Trading (HongKong) Co., Ltd. (“Enjoy”);

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 Guangzhou City Hosphone Electronic Co., Ltd. (“Hosphone Electronic”);

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 Shenzhen Bingos Trading Co. Ltd. (“Shenzhen Bingos”);

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 Guangzhou Winding Electronic Technology Co. Ltd. (“Winding Electronic”);

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 Guangzhou Newkingser Electronic Technology Co. Ltd. (“Newkingser”);

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 Shenzhen Little Link Communication Firm (“Little Link”);
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16-CV-1162 JLS (NLS)

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 Shenzhen King Flash Electronics Co. Ltd. (“King Flash”);

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 Shenzhen Smart Link Communications Co. Ltd. (“Smart Link”);

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 Ruilin Tech Limited Company (“Ruilin Tech”);

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 Herman Wheeler, Inc. (“Herman Wheeler”);

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 Zexiao Lu doing business as everydaysmile2015 (“Lu”);

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 Yoon Hee Park doing business as Deals-Wow (“Park”);

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 Shenzhen ZL Times Technology Co. (“Shenzhen ZL”);

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 Shenzhen Powerfire Technology Co. Ltd. (“Shenzhen Powerfire”);

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 Shenzhen Newsinte Electronics Co. Ltd. (“Shenzhen Newsinte”);

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 Shenzhen Leisen Technology Co., Ltd. (“Shenzhen Leisen”).

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(Mot. 11–12, ECF No. 111-1.1)

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Because the Clerk of Court entered default against the Defaulting Defendants on

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December 2, 2016, (ECF No. 108), and because on balance the Eitel factors guiding the

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exercise of the Court’s discretion in entering default judgment counsel in favor of the Court

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granting default judgment, the Court GRANTS Plaintiffs’ Motion for Default Judgment

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(ECF No. 111).
BACKGROUND

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LG is the owner of various registered Federal Trademarks. (See Compl. ¶ 34, ECF

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No. 1.) The following LG marks are at issue in this case:

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Mark

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Relevant

Reg. No. Reg. Date

Owner

3661175 07/28/2009

LG Corp.

Goods/Services

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Earphone for

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Mobile Phone

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Pin citations refer to the CM/ECF page numbers electronically stamped at the top of each page.
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16-CV-1162 JLS (NLS)

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2

Mark

Relevant

Reg. No. Reg. Date

Owner

Goods/Services

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Headphones;

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5

HBS

LG

Wireless

4894207 02/02/2016

Headphones

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7

Inc.

Headphones;

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Earphones;

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HBS-730

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12

LG
4894209 02/02/2016

Wireless

Headphones;
HBS-740

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Electronics,
Inc.

Headphones

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Electronics,

LG

Wireless

4894212 02/02/2016

Electronics,

Headphones

Inc.

Headphones;

LG

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HBS-750

Wireless

4894211 02/02/2016

Electronics,

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Headphones

Inc.

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Headphones;

LG

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HBS-760

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Wireless

4894210 02/02/2016

Electronics,

Headphones

Inc.

Headphones;

LG

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HBS-800

Electronics,

HBS-900

Inc.

Headphones;

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4894206 02/02/2016

Headphones

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Wireless

LG

Wireless

4894208 02/02/2016

Headphones

Electronics,
Inc.

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16-CV-1162 JLS (NLS)

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2

Mark

Relevant

Reg. No. Reg. Date

Owner

Goods/Services

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Earphones; Head

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Phones

LG
4694125 03/03/2015

Electronics,
Inc.

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LG

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Headphones

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4925092 03/29/2016

Electronics,
Inc.

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LG

Headphones;
Earphones

4820986 9/29/2015

Electronics,
Inc.

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TONE PRO

LG

Head Sets;

4734180 5/12/2015

Earphones

Inc.

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Wireless Cellular
TONE INFINIM

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Electronics,

Phone Headsets;

LG
4780031 7/28/2015

Earphones

Electronics,
Inc.

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Headphones;

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NECKBEHIND

LG

Earphones;

4630809 11/4/2014

Headsets for
Mobile Phones

Electronics,
Inc.

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16-CV-1162 JLS (NLS)

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2

Mark

Relevant

Reg. No. Reg. Date

Owner

Goods/Services

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Software For

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Wireless

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TONE&TALK

Communication
Between Mobile

LG
4900181 2/16/2016

Phone And

Electronics,
Inc.

Earphones

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(Compl. ¶ 34, ECF No. 1 (collectively, the “LG Trademarks”).)

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Defaulting Defendants are various individuals and companies located in the United

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States and in China. (Id. ¶¶ 6–30.) Plaintiffs filed suit against Defaulting Defendants,

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among other defendants, on May 16, 2016. (ECF No. 1.) The Complaint alleges several

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causes of action, including trademark counterfeiting and infringement, false advertising,

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and cybersquatting. (See generally id.) On December 2, 2016, the Clerk entered default

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against the Defaulting Defendants. (ECF No. 108.) Plaintiffs filed the instant motion for

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default judgment on December 13, 2016. (ECF No. 111.)

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LEGAL STANDARD

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Federal Rule of Civil Procedure 55 permits a court to enter default judgment upon

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party application. “If the party against whom a default judgment is sought has appeared

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personally or by a representative, that party or its representative must be served with written

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notice of the application at least 7 days before the hearing.” Fed. R. Civ. P. 55(b)(2).

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Although default judgments are ordinarily disfavored, a court may grant or deny a motion

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for default judgment at its discretion. See Alan Neuman Prods., Inc. v. Albright, 862 F.2d

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1388, 1392 (9th Cir. 1988) (citing Haw. Carpenters’ Tr. Funds v. Stone, 794 F.2d 508,

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511–12 (9th Cir. 1986); Eitel v. McCool, 782 F.2d 1470, 1471 (9th Cir. 1986); Aldabe v.

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Aldabe, 616 F.2d 1089, 1092 (9th Cir. 1980)). The Ninth Circuit has set out seven factors,
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16-CV-1162 JLS (NLS)

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known as the Eitel factors, a court may consider when exercising its discretion:
(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, 782 F.2d at 1471–72.

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When weighing these factors, the well-pleaded factual allegations of the complaint

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are taken as true, except for those allegations relating to damages. TeleVideo Sys., Inc. v.

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Heidenthal, 826 F.2d 915, 917–18 (9th Cir. 1987); see also Fed. R. Civ. P. 8(b)(6). To

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prove damages, a plaintiff may submit declarations or the Court may hold an evidentiary

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hearing. See Affinity Grp., Inc. v. Balser Wealth Mgmt., LLC, No. 05CV1555 WQH (LSP),

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2007 WL 1111239, at *1 (S.D. Cal. Apr. 10, 2007); Taylor Made Golf Co. v. Carsten

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Sports, 175 F.R.D. 658, 661 (S.D. Cal. 1997) (“In assessing damages, the court must review

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facts of record, requesting more information if necessary, to establish the amount to which

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plaintiff is lawfully entitled upon judgment by default.”).

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ANALYSIS
I.

Jurisdiction

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Before turning to the merits, the Court must assess whether it has jurisdiction to enter

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default judgment against the Defaulting Defendants. The Court indisputably has subject

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matter jurisdiction under 28 U.S.C. §§ 1331, 1338, and 1367, since the core of Plaintiffs’

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claims arise under federal law. (See Compl. ¶ 31, ECF No. 1 (“This action arises under the

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federal Trademark Act, 15 U.S.C. §§ 1051, et seq., and under the related laws of

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California.”).)

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The Court must also have personal jurisdiction over each of the Defaulting

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Defendants, or else entry of default judgment is void. See Bittorrent, Inc. v. Bittorrent

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Mktg. GMBH, No. 12-CV-02525-BLF, 2014 WL 5773197, at *3 (N.D. Cal. Nov. 5, 2014)

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(citing Veeck v. Commodity Enters., Inc., 487 F.2d 423, 426 (9th Cir. 1973)). Here, the
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16-CV-1162 JLS (NLS)

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Court finds that it has personal jurisdiction over each of the Defaulting Defendants.

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A. Service of Process

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A court has personal jurisdiction over a defendant who has been served in

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accordance with Federal Rule of Civil Procedure 4. See Travelers Cas. & Sur. Co. of Am.

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v. Brenneke, 551 F.3d 1132, 1135 (9th Cir. 2009). “Rule 4 is a flexible rule that should be

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liberally construed so long as a party receives sufficient notice of the complaint.” United

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Food & Comm. Workers Union v. Alpha Beta Co., 736 F.2d 1371, 1382 (9th Cir. 1984).

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Pursuant to the Federal Rules of Civil Procedure, an individual or corporation “may be

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served at a place not within any judicial district of the United States . . . by other means not

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prohibited by international agreement, as the court orders.” Fed. R. Civ. P. 4(f)(3), (g).

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Service under Rule 4(f)(3) must be directed by the court, not prohibited by international

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agreement, and comport with constitutional notions of due process. Rio Props., Inc. v. Rio

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Int’l Interlink, 284 F.3d 1007, 1014–16 (9th Cir. 2002). It is within the court’s discretion

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“to craft alternate means of service.” Id. at 1016.

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The Court previously granted Plaintiffs’ Ex Parte Application for electronic service,

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finding that such a method did not run afoul of the Hague Convention. (See ECF No. 6, at

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4.) Thus, the Court directed Plaintiffs to electronically serve Defaulting Defendants using

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the email addresses that Plaintiffs’ agents used to communicate with and/or purchase

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certain counterfeit products or had determined were associated with the unknown and

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foreign Defaulting Defendants. (Id. at 9.) The email message was to include, among other

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things, a link to a secure website where each Defaulting Defendant could download PDF

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copies of the Summons and Complaint. (Id.) Plaintiffs complied with the Court-ordered

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service procedures. Specifically, throughout May and June 2016, Plaintiffs electronically

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served several of the Defaulting Defendants, which included substantial efforts to send, re-

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send, follow-up, and track delivery of their e-mail messages to certain unknown and foreign

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Defaulting Defendants. (Mot. 21–22, ECF No. 111-1 (collecting citations).) Plaintiffs

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additionally sent the Complaint and summons via courier to some of the unknown and

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foreign Defaulting Defendants where Plaintiffs believed it reasonably likely to provide
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notice, and delivery was confirmed for each of these Defendants. (Id. at 22.) Furthermore,

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Plaintiffs served Defendants Herman Wheeler and Park via process server because they

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were not subject to the Court’s electronic service order. (Id. at 23.) Accordingly, the Court

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finds that Plaintiffs have fully complied with the Court’s electronic service order and the

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requirements of Rule 4.

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B. Due Process

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Personal jurisdiction must also comport with due process. Bittorrent, Inc., 2014 WL

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5773197, at *4. Absent an applicable federal statutory basis for jurisdiction, a federal court

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must apply the personal jurisdiction laws of the state in which it sits. Panavision Int’l, L.P.

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v. Toeppen, 141 F.3d 1316, 1320 (9th Cir. 1998). Because “California’s long-arm

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jurisdictional statute is coextensive with federal due process requirements,” a court has

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personal jurisdiction so long as defendants have “sufficient minimum contacts with the

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forum state such that the exercise of jurisdiction does not offend traditional notions of fair

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play and substantial justice.” Bittorrent, Inc., 2014 WL 5773197, at *4 (internal quotation

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marks and citation omitted).

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The Ninth Circuit has established a three-prong test for analyzing a claim of specific
personal jurisdiction:

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(1) The non-resident defendant must purposefully direct his activities or
consummate some transaction with the forum or resident thereof; or perform
some act by which he purposefully avails himself of the privilege of
conducting activities in the forum, thereby invoking the benefits and
protections of its laws; (2) the claim must be one which arises out of or relates
to the defendant's forum-related activities; and (3) the exercise of jurisdiction
must comport with fair play and substantial justice, i.e. it must be reasonable.

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Schwarzenegger v. Fred Martin Motor Co., 374 F.3d 797, 802 (9th Cir. 2004). The plaintiff

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bears the burden of establishing the first two prongs. See Mavrix Photo, Inc. v. Brand

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Techs., Inc., 647 F.3d 1218, 1228 (9th Cir. 2011). If the plaintiff does so, the burden shifts

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to the defendant to argue that exercise of jurisdiction would be unreasonable. Id.
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1. Purposeful Direction

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A defendant purposefully directs its activities toward the forum state by “(1)

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commit[ing] an intentional act; (2) expressly aimed at the forum state; (3) causing harm

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that the defendant knows is likely to be suffered in the forum state.” Lindora, LLC v.

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Isagenix Int’l, LLC, No. 15-CV-2754-BAS-RBB, 2016 WL 4077712, at *5 (S.D. Cal. Aug.

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1, 2016) (quoting CollegeSource, Inc. v. AcademyOne, Inc., 653 F.3d 1066, 1077 (9th Cir.

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2011)).

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Plaintiffs’ Complaint establishes that each of Defaulting Defendants “targeted and

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solicited sales from California residents by operating online stores that offer shipping to

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California,” (Compl. ¶ 32, ECF No. 1), “sold counterfeit LG wireless headsets to residents

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of California,” (id.), are “infringing one or more of the LG Trademarks in this District,”

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(id.), and “use[d] slavish copies of the federally registered LG Trademarks,” (id. ¶ 124), to

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sell counterfeit LG products through online stores on eBay.com, Alibaba.com, wish.com,

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and self-hosted sites like www.lgtonewholesale.com, (id. ¶¶ 49, 52, 56, 59, 62, 65, 68, 71,

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77, 80, 83, 86, 94, 97, 103, 106, 112). Furthermore, Plaintiffs allege that these counterfeit

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sales “are likely to mislead consumers into believing that Defendants’ products are genuine

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LG products” and “have damaged and irreparably injured . . . the public’s interest in being

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free from confusion and deception.” (Id. ¶¶ 32, 118, 122.) Additionally, Plaintiff LG

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Electronics MobileComm U.S.A., Inc. has its principal place of business in San Diego, CA,

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and “a corporation can suffer economic harm both where the bad acts occurred and where

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the corporation has its principal place of business.” Mavrix Photo, Inc., 647 F.3d at 1231.

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Accordingly, the Court finds that Defaulting Defendants directly targeted California in

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conducting their illegal activities. See Deckers Outdoor Corp. v. Ozwear Connection Pty

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Ltd., No. CV 14-2307 RSWL FFMX, 2014 WL 4679001, at *4 (C.D. Cal. Sept. 18, 2014)

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(finding personal jurisdiction for default judgment because “Plaintiff has alleged facts,

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deemed admitted by Defendants’ default . . . that Defendants sell and ship infringing

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products to California residents through Defendants’ website, ozwearuggs.com.au, and that

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such infringing products are the subject of Plaintiff’s claims and injuries in this Action”)
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(citations omitted).

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2. Relatedness

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“The Ninth Circuit adopted the ‘but for’ test to determine the ‘arising out of’

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requirement. . . . The Ninth Circuit has recognized that, in trademark or copyright

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infringement actions, if the defendant’s infringing conduct harms the plaintiff in the forum,

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this element is satisfied.” Fighter’s Mkt., Inc. v. Champion Courage LLC, No. 3:16-cv-

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1271-GPC (BGS), 2016 WL 4879437, at *7 (citing Gray & Co. v. Firstenberg Mach. Co.,

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913 F.2d 758, 761 (9th Cir. 1990), and Adobe Sys. Inc. v. Blue Source Grp., Inc., 125 F.

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Supp. 3d 945, 963 (N.D. Cal. 2015)).

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Here, Plaintiffs’ claims arise out of Defaulting Defendants’ advertising and sale of

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counterfeit goods bearing Plaintiffs’ trademarks. Accordingly, the Court finds that

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Defaulting Defendants’ infringing actions are related to Plaintiffs’ claims.

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3. Fair Play and Substantial Justice

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Plaintiffs have met their burden on the first two prongs. Defaulting Defendants have

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not responded to any of Plaintiffs’ allegations, much less their arguments here. And the

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Court cannot discern how its exercise of jurisdiction over Defaulting Defendants would be

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unfair or unjust.

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Accordingly, the Court finds that it has personal jurisdiction over Defaulting

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Defendants.

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II.

Entry of Default Judgment

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Plaintiffs move the Court for entry of default judgment and have adequately noticed

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the Defaulting Defendants, to the extent possible. (ECF No. 111-15.) Accordingly, Rule

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55’s requirements have been met and the Court must turn to the Eitel factors to govern its

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discretion in this matter.

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A. Factor I—Prejudice to Plaintiff

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The first factor weighs in favor of entering default judgment. Plaintiffs state several

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valid causes of action against the Defaulting Defendants, and Defaulting Defendants have

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failed to appear or otherwise participate in this action. (Mot. 34, ECF No. 111-1.) Thus,
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LG has suffered and continues to suffer injury from the Defaulting Defendants’ illicit use

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of LG’s marks, and LG lacks any other recourse to recover damages in absence of any

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answer from the Defaulting Defendants. This constitutes prejudice. See PepsiCo, Inc. v.

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Cal. Sec. Cans, 238 F. Supp. 2d 1172, 1177 (C.D. Cal. 2002) (“Potential prejudice to

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Plaintiffs favors granting a default judgment. If Plaintiffs’ motion for default judgment is

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not granted, Plaintiffs will likely be without other recourse for recovery.”); see also

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Moroccanoil, Inc. v. Allstate Beauty Prods., Inc., 847 F. Supp. 2d 1197, 1200–01 (C.D.

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Cal. 2012).

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B. Factors II and III—Claim Merits and Sufficiency of Complaint

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To warrant entering a default judgment, the complaint’s allegations must be

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sufficient to state a claim upon which relief can be granted. Danning v. Lavine, 572 F.2d

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1386, 1388 (9th Cir. 1978). A complaint satisfies this standard when the claims “cross the

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line from conceivable to plausible.” Ashcroft v. Iqbal, 556 U.S. 662, 680 (2009) (citing

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Bell Atl. Corp. v. Twombly, 550 U.S. 544 (2007)). A default concedes the truth of the

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allegations in the complaint, except those relating to damages. Televideo Sys., Inc. v.

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Heidenthal, 826 F.2d 915, 917–18 (9th Cir. 1987) (quoting Geddes v. United Fin. Grp.,

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559 F.2d 557, 560 (9th Cir. 1977)); Taylor Made Golf Co. v. Carsten Sports, Ltd., 175

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F.R.D. 658, 661 (S.D. Cal. 1997) (noting that “[i]n assessing liability, the complaint’s

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allegations are taken as true” because “a defendant’s default functions as an admission of

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the plaintiff’s well-pleaded allegations of fact”).

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At issue in the present case are claims for (1) trademark counterfeiting under 15

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U.S.C. §§ 114(1)(b), 116(d); (2) trademark infringement under Federal and California law,

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as well as related California unfair competition law; (3) false advertising under 15 U.S.C.

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§ 1125(a)(1)(B); (4) trademark dilution under 15 U.S.C. § 1125(c) and Cal. Bus. & Prof.

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Code § 14245 et seq.; and (5) cybersquatting under 15 U.S.C. § 1125(d).

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1. Trademark Counterfeiting

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To state a valid cause of action for trademark counterfeiting under the Lanham Act,

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a plaintiff must show that its mark is valid and has been infringed. 15 U.S.C. § 1114(1).
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Registration of a mark on the principal register is “prima facie evidence . . . of the

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registrant’s ownership of the mark, and of the registrant’s exclusive right to use the

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registered mark in commerce . . . .” 15 U.S.C. § 1115(a). The Lanham Act prohibits use of

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“counterfeit” marks in connection with the “sale, offering for sale, or distribution of

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goods.” 15 U.S.C. § 1116(d)(1)(A). A counterfeit mark is defined as “a spurious mark

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which is identical with, or substantially indistinguishable from, a registered mark.” 15

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U.S.C. §§ 1116(d)(1)(B), 1127.

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As discussed, LG has valid trademark registrations for several marks, including in

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connection with the sale of earphones, headphones, and headsets. (Compl. ¶ 34, ECF No.

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1.) Furthermore, each of the Defaulting Defendants have used and continue to use

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counterfeit/identical versions of LG’s registered trademarks in connection with the sale of

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their own, non-LG wireless headsets. (Mot. 25, ECF No. 111-1 (providing table

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summarizing the allegations against each Defaulting Defendant with respect to the

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counterfeit marks used).) Thus, the Court finds that Plaintiffs have set forth a valid claim

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for trademark counterfeiting.
2. Trademark Infringement & Unfair Competition2

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To state a valid cause of action for trademark infringement under the Lanham Act,

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a plaintiff “must prove: (1) that it has a protectable ownership interest in the mark; and (2)

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that the defendant’s use of the mark is likely to cause consumer confusion.” Rearden LLC

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v. Rearden Commerce, Inc., 683 F.3d 1190, 1202 (9th Cir. 2012) (quoting Network

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Automation, Inc. v. Advanced Sys. Concepts, Inc., 638 F.3d 1137, 1144 (9th Cir. 2011)). In

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the present case, Plaintiffs have shown a protectable interest in the marks at issue, (Compl.

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¶ 34, ECF No. 1 (setting forth trademark registration numbers)), and therefore the Court’s

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inquiry focuses solely on likelihood of confusion.

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///

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Counts 2, 3, 6, and 8: Trademark Infringement, 15 U.S.C. §§ 1114(1)(a), 1125(a)(1)(A); Violation of
California’s Unfair Competition Law, Cal. Bus. & Prof. Code § 17200 et seq.; Common-Law Trademark
Infringement and Unfair Competition.
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In analyzing whether there is a likelihood of confusion between the two marks at

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issue courts consider eight factors, known as the Sleekcraft factors.3 Rearden, 683 F.3d at

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1209. These eight factors are: (1) strength of the mark; (2) proximity of the goods; (3)

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similarity of the marks; (4) evidence of actual confusion; (5) marketing channels used; (6)

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type of goods and the degree of care likely to be exercised by the purchaser; (7) defendant’s

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intent in selecting the mark; and (8) likelihood of expansion of the product lines. Id. (citing

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AMF Inc. v. Sleekcraft Boats, 599 F.2d 341, 348–49 (9th Cir. 1979), abrogated in part by

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Mattel, Inc. v. Walking Mountain Prods., 353 F.3d 792 (9th Cir. 2003)). However, these

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eight factors are not exhaustive and “other variables besides the enumerated factors should

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also be taken into account based on the particular circumstances.” Id. Additionally, “[w]hen

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the goods produced by the alleged infringer compete for sales with those of the trademark

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owner, infringement usually will be found if the marks are sufficiently similar that

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confusion can be expected.” See Sleekcraft, 599 F.2d at 348. Furthermore, the

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counterfeiting of another’s trademark establishes a presumption of a likelihood of

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confusion. Brookfield Commc’ns, Inc. v. W. Coast Entm’t Corp., 174 F.3d 1036, 1056 (9th

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Cir. 1999) (“In light of the virtual identity of marks, if they were used with identical

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products or services likelihood of confusion would follow as a matter of course.”); Louis

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Vuitton Malletier, S.A. v. Akanoc Sols., Inc., 658 F.3d 936, 945 (9th Cir. 2011) (“[T]he

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presumption [of likelihood of confusion] arises when intent to cause confusion is coupled

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with the use of a counterfeit mark or a mark virtually identical to a previously registered

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mark.”).

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3

The test for infringement and unfair competition under 15 U.S.C. § 43(a) is the same as for trademark
infringement under Section 32(a). Brookfield Commc’ns, Inc. v. W. Coast Entm’t Corp., 174 F.3d 1036,
1046 nn.6 & 8 (9th Cir. 1999). Trademark infringement and unfair competition claims under California
law are “substantially congruent” with federal trademark infringement and unfair competition claims, and
are thus subject to the same analysis. See Grupo Gigante S.A. de C.V. v. Dallo & Co., 391 F.3d 1088, 1100
(9th Cir. 2004) (quoting Playboy Enters., Inc. v. Netscape Commc’ns Corp., 354 F.3d 1020, 1024 n.10
(9th Cir. 2004)); Sebastian Int’l, Inc. v. Russolillo, 186 F. Supp. 2d 1055, 1071 (C.D. Cal. 2000) (finding
that because the plaintiff adequately plead a claim for trademark infringement, it also adequately plead a
claim for unfair competition under Section 17200).
13
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1

Regarding factor one, Plaintiffs have valid trademark registrations for several marks,

2

including for use in conjunction with earphones, headphones, and headsets. (Compl. ¶ 34,

3

ECF No. 1; Mot. 29, ECF No. 111-1.) Additionally, some of Plaintiffs’ marks (e.g., “LG”

4

and its corresponding logo) appear to have no relation to the products on which they are

5

attached (e.g., wireless headsets) nor any independent meaning. Thus, these marks are

6

probably “fanciful” marks, “which are words or phrases invented solely to function as

7

trademarks, [and thus] receive a high level of trademark protection because they are

8

inherently distinctive.” Hokto Kinoko Co. v. Concord Farms, Inc., 738 F.3d 1085, 1096

9

(9th Cir. 2013). These marks are stronger than other of Plaintiffs’ marks, such as their

10

NECKBEHIND and TONE&TALK marks, which appear to be more descriptive of the

11

products and are weaker marks as a result. See Dreamwerks Prod. Grp., Inc. v. SKG Studio,

12

142 F.3d 1127, 1130–31 (9th Cir. 1998) (discussing the difference in strength between

13

fanciful and descriptive/suggestive marks). Accordingly, some of Plaintiffs’ marks are

14

stronger than others.

15

Regarding factors two and three, Defaulting Defendants use the LG Trademarks in

16

connection with the advertising, offering for sale, and sale of counterfeit LG wireless

17

headset products in the United States and California over the Internet. All of the Defaulting

18

Defendants use the LG Trademarks in their entirety. Additionally, some of the Defaulting

19

Defendants incorporate the LG word mark into the URLs of their sites. (See Compl. ¶¶ 45–

20

47, ECF No. 1.) Because both Plaintiffs and Defaulting Defendants’ goods are similar (e.g.,

21

headsets), and because Defaulting Defendants use Plaintiffs’ exact marks on both their

22

infringing products and websites, both of these factors favor likelihood of confusion.

23

Regarding factor four, although Plaintiff has not shown any specific evidence of

24

actual confusion, failing “to prove instances of actual confusion is not dispositive against

25

a trademark plaintiff” because “difficulties in gathering evidence of actual confusion make

26

its absence generally unnoteworthy.” Pom Wonderful LLC v. Hubbard, 775 F.3d 1118,

27

1131 (9th Cir. 2014). Nonetheless, in the instant case this factor weighs slightly against

28

Plaintiffs.
14
16-CV-1162 JLS (NLS)

1

The remaining four factors favor Plaintiffs. Both Plaintiffs and Defaulting

2

Defendants market their goods via website, and the type of goods are those that could be

3

purchased and easily confused by a reasonable consumer searching for an LG headset. This

4

is especially true here because all of Defaulting Defendants’ websites are sophisticated in

5

appearance, and some even use the LG marks in the domain name, making it more likely

6

that consumers will be confused into thinking they are actually purchasing from LG.

7

(Compl. ¶¶ 46–47, ECF No. 1.) Additionally, because default was entered against

8

Defaulting Defendants, Plaintiffs’ allegations that Defaulting Defendants were wilful

9

infringers of Plaintiffs’ marks is taken as true.

10

On balance, weighing the Sleekcraft factors strongly favors a finding of likelihood

11

of confusion. Taken in concert with Defaulting Defendants’ continued failure to respond

12

to the claims at issue, the Court finds that Plaintiffs have set forth a valid claim for

13

likelihood of confusion.
3. False Advertising4

14
15

The Lanham Act prohibits “[a]ny person . . . in commercial advertising or

16

promotion” from misrepresenting “the nature, characteristics, qualities, or geographic

17

origin of his or her or another person’s goods, services, or commercial activities . . . .” 15

18

U.S.C. § 1125(a)(1)(B). To state a valid cause of action under the Lanham Act for false

19

advertising, a plaintiff must provide “a showing that . . . the defendant made a false

20

statement either about the plaintiff’s or its own product . . . .” PhotoMedex, Inc. v. Irwin,

21

601 F.3d 919, 923 (9th Cir. 2010) (quoting Newcal Indus., Inc. v. Ikon Office Sol., 513 F.3d

22

1038, 1052 (9th Cir. 2008)). A statement is proven to be false either by showing (1) that

23

the statement is literally false, or (2) that the statement is literally true but likely to mislead

24

or confuse customers. Mutual Pharm. Co. v. Ivax Pharms., Inc., 459 F. Supp. 2d 925, 932

25

(C.D. Cal. 2006) (citing Southland Sod Farms v. Stover Seed Co., 108 F.3d 1134, 1139–40

26

(9th Cir. 1997)). A violation may be established without evidence of consumer confusion

27
28

4

Count 4: False Advertising, 15 U.S.C. § 1125(a)(1)(B).
15
16-CV-1162 JLS (NLS)

1

if the statement is literally false. Id. at 933 (citation omitted).

2

The allegations in the Complaint demonstrate that each of Defaulting Defendants

3

used LG’s marks to falsely identify their products as genuine “LG,” “Tone,” and/or “HBS”

4

products. (Mot. 30–32, ECF No. 111-1 (providing table summarizing the allegations

5

against each Defaulting Defendant with respect to the false marks used).) Because the use

6

of LG’s marks in this case is literally false, no evidence of consumer confusion is necessary

7

and default judgment is appropriate. iYogi Holding Pvt. Ltd. v. Secure Remote Support,

8

Inc., No. C-11-0592 CW, 2011 WL 6291793, at *15 (N.D. Cal. Oct. 25, 2011), report and

9

recommendation adopted, 2011 WL 6260364 (N.D. Cal. Dec. 15, 2011) (granting default

10

judgment on Section 43(a)(1)(B) claim because plaintiff alleged defendants made literally

11

false statements in the course of advertising their services). Accordingly, the Court finds

12

that Plaintiffs have stated a valid claim for false advertising.
4. Trademark Dilution5

13
14

In order to state a valid claim for trademark dilution, “a plaintiff must show that (1)

15

the mark is famous; (2) the defendant is making a commercial use of the mark in commerce;

16

(3) the defendant’s use began after the mark became famous; and (4) the defendant’s use

17

of the mark dilutes the quality of the mark by diminishing the capacity of the mark to

18

identify and distinguish goods and services.” Jada Toys, Inc. v. Mattel, Inc., 496 F.3d 974,

19

980–81 (9th Cir. 2007), opinion amended and superseded on other grounds by, 518 F.3d

20

628 (9th Cir. 2008). The analysis for dilution under federal and California state law is the

21

same. Id.

22

Plaintiffs bring a dilution claim only for their LG logo mark (Reg. No. 3661175).

23

(Compl. ¶ 146, ECF No. 1.) The Complaint establishes that (1) LG’s logo is and was

24

famous, through its national registration and extensive nationwide use and recognition, (id.

25

///

26
27
28

5

Counts 5 and 7: Trademark Dilution, 15 U.S.C. § 1125(c) and Cal. Bus. & Prof. Code § 14245 et seq.

16
16-CV-1162 JLS (NLS)

1

¶ 146); the relevant Defaulting Defendants (“Diluting Defendants”)6 are using the mark in

2

commerce, (id. ¶ 147); (3) Diluting Defendants’ use of the mark occurred after the mark

3

became famous, (id. ¶ 146); and (4) Diluting Defendants’ use of the mark dilutes the

4

distinctiveness of LG’s mark by diminishing the capacity of consumers to identify genuine

5

LG products, (id. ¶¶ 145–50). Accordingly, the Court finds that Plaintiffs have stated a

6

valid claim for dilution against the Diluting Defendants.
5. Cybersquatting7

7
8

To state a valid cybersquatting claim under the Lanham Act, a Plaintiff must show

9

that “(1) the defendant registered, trafficked in, or used a domain name; (2) the domain

10

name is identical or confusingly similar to a protected mark owned by the plaintiff; and (3)

11

the defendant acted ‘with bad faith intent to profit from that mark.’” Rearden, 683 F.3d at

12

1219 (quoting DSPT Int’l, Inc. v. Nahum, 624 F.3d 1213, 1218–19 (9th Cir. 2010)).

13

Again, taking Plaintiffs’ allegations as true given the entry of default, it is clear that

14

(1) Defendant Shenzhen ZL has a bad-faith intent to profit from its use of two of LG’s

15

marks; (2) Shenzhen ZL registered and/or uses the lgtonewhoesale.com domain name to

16

sell counterfeit mobile headsets; (3) the two LG marks were distinctive at the time the

17

lgtonewholesale.com domain name was registered; and (4) the lgtonewhoesale.com

18

domain name is confusingly similar to LG’s two marks at issue. (Mot. 33, ECF No. 111-1;

19

Compl. ¶¶ 167–75.) Because each element required for a finding of cybersquatting is met,

20

the Court finds that Plaintiffs have set forth a valid claim for cybersquatting against

21

Defendant Shenzhen ZL.
Accordingly, because the complaint is legally sufficient and each of Plaintiffs’

22
23

claims has merit, this factor weighs in favor of entering default judgment.

24

///

25
26
27
28

6

Mot. 32, ECF No. 111-1 (accusing Xiaowen, Enjoy, Hosphone Electronic, Shenzhen, Bingos, Shenzhen
ZL, Winding Electronic, Shenzhen Powerfire, Newkingser, Little Link, Shenzhen Newsinte, Ruilin Tech,
Shenzhen Leisen, Herman Wheeler, and Lu of trademark dilution).
7

Count Nine: Cybersquatting, 15 U.S.C. § 1125(d).
17
16-CV-1162 JLS (NLS)

1

C. Factor IV—Sum of Money at Stake

2

This factor turns on whether the damages sought are proportional to the alleged

3

harm. Landstar Ranger, Inc. v. Parth Enter., Inc., 725 F. Supp. 2d 916, 921 (N.D. Cal.

4

2010). Here, Plaintiffs’ damages sought all are within the Lanham Act’s provisions for

5

violations of the magnitude at issue in this case. Specifically, Plaintiffs seek permanent

6

injunctive relief, statutory damages of $2 million per Defaulting Defendant per mark used,

7

$100,000 per domain name, as well as attorneys’ fees and costs. (Mot. 33–34, ECF No.

8

111-1.) While substantial, the amount of money, by itself, is not necessarily unreasonable.

9

See Deckers Outdoor Corp., 2014 WL 4679001, at *10. Rather, the court must balance

10

“the amount of money at stake in relation to the seriousness of the defendant’s conduct.”

11

Vogel v. Rite Aid Corp., 992 F. Supp. 2d 998, 1012 (C.D. Cal. 2014) (internal quotation

12

marks, alterations, and citations omitted). Here, Plaintiffs accuse Defaulting Defendants of

13

using LG’s various marks in hopes of deceiving customers into buying their counterfeit

14

products. Given the gravity of this harm, the need to protect Plaintiffs’ marks, consumers,

15

and deter further counterfeiting, and the fact that Plaintiffs seek statutory (and thus

16

discretionary) damages, see Deckers Outdoor Corp., 2014 WL 4679001, at *10, the Court

17

finds that this factor does not weigh against default judgment.

18

D. Factor V—Possibility of Factual Dispute

19

This factor turns on the degree of possibility that a dispute concerning material facts

20

exists or may later arise. Eitel, 782 F.2d at 1471–72. In the present case, Plaintiffs’

21

allegations must be taken as true due to the default. And Defaulting Defendants have been

22

unresponsive since the start of this case. Accordingly, this factor favors Plaintiffs—any

23

purported factual dispute appears settled and there is no indication Defaulting Defendants

24

will further defend against the action.

25

E. Factor VI—Reason for Default

26

This factor turns on whether a Defaulting Defendant’s default may have been the

27

product of excusable neglect. Eitel, 782 F.2d at 1471–72. There is no evidence of excusable

28

neglect here. Plaintiffs note that at some point their counsel spoke with one of the
18
16-CV-1162 JLS (NLS)

1

Defaulting Defendants (Park) and counsel for another (Xiaowen) about this action. (Mot.

2

34, ECF No. 111-1.) But there has been no further response from either of these defendants

3

or the remainder of Defaulting Defendants. (Id.) Furthermore, this factor favors default

4

judgment where, as here, Defaulting Defendants have been properly served or Plaintiffs

5

have demonstrated that Defaulting Defendants are aware of the lawsuit. Landstar Ranger,

6

725 F. Supp. 2d at 922. As discussed above, Plaintiffs have properly served Defaulting

7

Defendants pursuant to the Court’s electronic service order. Additionally, Plaintiffs note

8

they have confirmation that their service emails were delivered to the Defaulting

9

Defendants’ email addresses and that some of them downloaded the documents served.

10

(Id.) Accordingly, this factor favors granting a default judgment.

11

F. Factor VII—Policy Favoring Merits Decisions

12

Although this factor, by its nature, favors defendants because it encourages merits

13

decisions, “[t]he fact that Rule 55(b) has been enacted . . . indicates that ‘this preference,

14

standing alone, is not dispositive.’” Landstar Ranger, 725 F. Supp. 2d at 922 (citing

15

Pepsico, 238 F. Supp. 2d at 1177 (quoting Kloepping v. Fireman’s Fund, No. 94-2684,

16

1996 WL 75314, at *3 (N.D. Cal. 1996))). Further, in the present case there is no indication

17

that a merits decision is practicable; Defaulting Defendants have yet to answer Plaintiffs’

18

complaint and thus defend this action. Thus, here the timely administration of justice

19

outweighs the strong policy for merits decisions.

20

On balance, weighing the Eitel factors reveals that a default judgment is appropriate

21

in this case. Accordingly, the Court GRANTS Plaintiffs’ motion for default judgment.

22

III.

Assessment of Damages

23

A. Trademark Counterfeiting

24

Given Defaulting Defendants’ failure to participate in the case, Plaintiffs seek

25

statutory damages as their sole monetary remedy for counterfeiting under 15 U.S.C.

26

§ 1117(c). Section 1117(c) authorizes statutory damages in the amount of “(1) not less than

27

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

28

offered for sale, or distributed, as the court considers just; or (2) if the court finds that the
19
16-CV-1162 JLS (NLS)

1

use of the counterfeit mark was willful, not more than $2,000,000 per counterfeit mark per

2

type of goods or services sold, offered for sale, or distributed, as the court considers just.”

3

15 U.S.C. § 1117(c). In order to invoke the civil monetary remedies under § 1117, a

4

plaintiff “must establish that (1) [the defendant] intentionally used a counterfeit mark in

5

commerce; (2) knowing the mark was counterfeit; (3) in connection with the sale, offering

6

for sale, or distribution of goods; and (4) its use was likely to confuse or deceive.” State of

7

Idaho Potato Comm’n v. G & T Terminal Packaging, Inc., 425 F.3d 708, 721 (9th Cir.

8

2005) (citations omitted).

9

As discussed above, supra Section II.B.2, Defaulting Defendants intentionally used

10

counterfeit marks in commerce in connection with their offering for sale and sales of

11

mobile phone headsets, which was likely to confuse or deceive consumers. (Mot. 36, ECF

12

No. 111-1 (citing Compl. ¶¶ 123–25, 136).) Thus, the Court finds that Plaintiffs are entitled

13

to statutory damages under Section 1117(c), and more specifically to the damages for

14

willful counterfeiting under Section 117(c)(2). Nevertheless, the Court is explicitly granted

15

wide latitude under the Lanham Act to use its discretion in determining a just damages

16

award. And while Plaintiffs seek the $2,000,000 maximum per counterfeit mark per type

17

of good or service offered, totaling $168,000,000 broken down per Defaulting Defendant

18

in their accompanying Proposed Judgment (Mot. 38, ECF No. 111-1), Plaintiffs’ citations

19

to Ninth Circuit authority is a mixed bag of some granting the $2,000,000 maximum

20

amount, and some not. Compare, e.g., Deckers Outdoor Corp., 2014 WL 4679001, at *12

21

(granting default judgment and awarding $2 million in statutory damages for defendants’

22

counterfeit use of UGG mark), with, e.g., Philip Morris U.S.A. Inc. v. Castworld Prods.,

23

219 F.R.D. 494, 500 (C.D. Cal. 2003) (awarding $1 million per counterfeit use of two

24

marks, for a total of $2 million in statutory damages). But given the strength and

25

recognition of the LG brand in electronics, and the wilful actions of the large number of

26

Defaulting Defendants, which demonstrates the serious counterfeiting problem LG faces,

27

the Court finds that granting Plaintiffs’ the statutory maximum is appropriate. Accordingly,

28

the Court GRANTS Plaintiffs’ request of $168,000,000 broken down per Defaulting
20
16-CV-1162 JLS (NLS)

1

Defendant as explained at the conclusion of this Order.

2

B. Cybersquatting Statutory Damages

3

When a violation is found under 15 U.S.C. § 1125(d), “the plaintiff may elect, at any

4

time before final judgment is rendered by the trial court, to recover, instead of actual

5

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

6

and not more than $100,000 per domain name, as the court considers just.” § 1117(d). To

7

determine a reasonable amount of statutory damages for cybersquatting, “courts generally

8

consider a number of factors . . . , including the egregiousness or willfulness of the

9

defendant’s cybersquatting, the defendant’s use of false contact information to conceal its

10

infringing activities, the defendant’s status as a ‘serial’ cybersquatter . . . and other behavior

11

by the defendant evidencing an attitude of contempt towards the court of the proceedings.”

12

Wecosign, Inc. v. IFG Holdings, Inc., 845 F. Supp. 2d 1072, 1086 (C.D. Cal. 2012) (internal

13

quotation marks and citation omitted). As above, Plaintiffs elect for an award of statutory

14

damages for this claim because of Defendant Shenzhen ZL’s lack of participation in this

15

case. (See Mot. 38, ECF No. 111-1; Compl. ¶ G, at 54, ECF No. 1.) Thus, the Court must

16

consider what would constitute a just damage award.8

17

Plaintiffs argue they are entitled to the statutory maximum of $100,000 for

18

Defendant Shenzhen ZL’s infringing domain name “lgtonewholesale.com.” (Mot. 38–39,

19

ECF No. 111-1.) In support of their request, Plaintiffs cite eAdGear, Inc. v. Liu, where the

20

court granted the statutory maximum against a defendant who used the plaintiff’s

21

trademarks in its domain name in order to compete with the plaintiff by confusing its

22
23
24
25
26
27
28

8

Unsurprisingly, courts vary widely in assessing what constitutes a just damage award for cybersquatting.
For a sampling, 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 the 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 the 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”).

21
16-CV-1162 JLS (NLS)

1

potential customers. No. CV-11-05398 JCS, 2012 WL 2367805, at *19 (N.D. Cal. June 21,

2

2012), report and recommendation adopted, No. C-11-05398 RMW JCS, 2012 WL

3

4005454 (N.D. Cal. Sept. 11, 2012). Here, there is an even stronger case for imposition of

4

the statutory maximum, since Shenzhen ZL’s domain name not only contains two LG

5

marks, and thus may already confuse consumers, but also contains the term “wholesale,”

6

which may further confuse consumers into thinking that they can purchase LG-authorized

7

products at a lower price, thus seriously harming consumers and Plaintiffs alike.

8

Accordingly, the Court GRANTS Plaintiffs’ request for the statutory maximum and

9

assesses a total of $100,000 against Defendant Shenzhen ZL for violating 15 U.S.C.

10

§ 1125(d).

11

C. Permanent Injunction

12

The Lanham Act “vests the district court with the power to grant injunctions

13

according to principles of equity and upon such terms as the court may deem reasonable,

14

to prevent the violation of any right of the trademark owner.” Reno Air Racing Ass’n v.

15

McCord, 452 F.3d 1126, 1137 (9th Cir. 2006) (citing 15 U.S.C. § 1116). A party seeking

16

a permanent injunction must show: “(1) that it has suffered an irreparable injury; (2) that

17

remedies available at law, such as monetary damages, are inadequate to compensate for

18

that injury; (3) that, considering the balance of the hardships between the plaintiff and

19

defendant, a remedy in equity is warranted; and (4) that the public interest would not be

20

disserved by a permanent injunction.” La Quinta Worldwide LLC v. Q.R.T.M., S.A. de C.V.,

21

762 F.3d 867, 879 (9th Cir. 2014) (citations omitted). Although irreparable harm was once

22

presumed in meritorious trademark infringement actions, irreparable harm now “must be

23

demonstrated to obtain a permanent injunction in a trademark infringement action.” Herb

24

Reed Enters., LLC v. Fla. Entm’t Mgmt., Inc., 736 F.3d 1239, 1248–49 (9th Cir. 2013)

25

(emphasis added) (recounting via caselaw prior presumption and subsequent Supreme

26

Court and Ninth Circuit developments).

27

Plaintiffs demonstrate that a permanent injunction is appropriate. As to irreparable

28

injury, Plaintiffs argue that Defaulting Defendants’ continuing sales of counterfeit and
22
16-CV-1162 JLS (NLS)

1

infringing products will cause Plaintiffs lost profits and customers, as well as damage to

2

goodwill and business reputation. (Mot. 40, ECF No. 111-1 (citing Stuhlbarg Int’l Sales

3

Co. v. John D. Brush and Co., 240 F.3d 832, 841 (9th Cir. 2001) (holding that “evidence

4

of threatened loss of prospective customers or goodwill certainly supports a finding of”

5

irreparable harm)).) Here, Plaintiffs provide evidence that LG spends millions of dollars

6

promoting its trademarks, building and maintaining its reputation among customers as a

7

premium consumer electronics brand, and uses distribution agreements to control the sales

8

of its mobile headsets. (Id.) Thus, Defaulting Defendants’ continuing illegal activities

9

undermines LG’s investment in its brands and its customer and distributor relationships,

10

which constitutes irreparable harm. (Id. (collecting cases).) Accordingly, the Court finds

11

that this constitutes irreparable harm and that this factor weighs in favor of issuing a

12

permanent injunction.

13

As to inadequate remedies at law, Plaintiffs argue that Defaulting Defendants’

14

failure to respond to Plaintiffs’ service attempts or otherwise appear in this action suggests

15

they continue their counterfeiting and infringing activities. (Id. at 41 (citing Herman Miller

16

Inc. v. Alphaville Design Inc., No. C 08-03437 WHA, 2009 WL 3429739, at *8 (N.D. Cal.

17

Oct. 22, 2009) (granting permanent injunction on default because “[defendant]’s refusal to

18

answer or appear in this action makes it difficult for plaintiff to prevent further

19

infringement. An injunction would serve to prevent [defendant] from continuing to infringe

20

plaintiff’s trademarks”)).) Accordingly, the Court finds that Plaintiffs have no adequate

21

remedy at law and that this factor weighs in favor of issuing a permanent injunction.

22

Third, the balance of hardships weighs decisively in Plaintiffs’ favor. As Plaintiffs

23

note, refraining from willful trademark infringement and counterfeiting imposes no

24

hardship on the infringing party. (Mot. 41, ECF No. 111-1 (citing Ozwear Connection Pty

25

Ltd., 2014 WL 4679001, at *13 (“There is no hardship to a defendant when a permanent

26

injunction would merely require the defendant to comply with law.”)).) Defaulting

27

Defendants can simply sell their own products without using LG’s marks. Plaintiffs, on the

28

other hand, will continue to suffer the irreparable harm detailed above. Accordingly, the
23
16-CV-1162 JLS (NLS)

1

Court finds that the balance of hardships tips in Plaintiffs’ favor and that this factor weighs

2

in favor of issuing a permanent injunction.

3

Fourth and finally, issuing a permanent injunction would serve the public interest.

4

As Plaintiffs argue, such an order would prevent consumer confusion and protect their

5

property interests in their various trademarks. (Mot. 42, ECF No. 111-1 (citing Herman

6

Miller Inc., 2009 WL 3429739, at *8 (noting that a permanent injunction against sale of

7

counterfeit goods serves the public interest by “resolv[ing] the on-going public confusion

8

regarding [the counterfeit goods]”)).) And there is no discernable public interest served by

9

allowing Defaulting Defendants to continue their counterfeit and infringing sales.

10

Accordingly, the Court finds that the public interest is served by granting a permanent

11

injunction and that this factor weighs in favor of issuing a permanent injunction.

12
13

All four factors weigh in favor of granting a permanent injunction. Accordingly, the
Court GRANTS Plaintiffs’ request for a permanent injunction.

14

D. Post-Judgment Interest

15

“Interest shall be allowed on any money judgment in a civil case recovered in a

16

district court.” 28 U.S.C. § 1961(a). Post-judgment interest is calculated pursuant to the

17

statutory rate at the date of entry of the judgment. Id. Plaintiffs simply assert that they are

18

entitled to this interest without argument. (Mot. 42, ECF No. 111-1.) Nevertheless, there

19

appears to be no reason why the Court should not grant this request. Accordingly, the Court

20

GRANTS Plaintiffs post-judgment interest.

21

E. Attorneys’ Fees and Costs

22

Title 15 U.S.C. § 1117(a) provides that a court “in exceptional cases may award

23

reasonable attorney fees to the prevailing party.” For a case to warrant an award of attorney

24

fees under this provision requires a court finding that “the defendant acted maliciously,

25

fraudulently, deliberately, or willfully.” K & N Eng’g, Inc. v. Bulat, 510 F.3d 1079, 1081–

26

82 (9th Cir. 2007) (citing Watec Co. v. Liu, 403 F.3d 645, 656 (9th Cir. 2005)). This

27

determination is a question of law for the court. Watec Co., 403 F.3d at 656.

28

///
24
16-CV-1162 JLS (NLS)

1

As discussed above, Plaintiffs’ Complaint alleges that Defaulting Defendants

2

willfully infringed LG’s marks. (Mot. 43, ECF No. 111-1.) Because Defaulting Defendants

3

have not responded to Plaintiffs’ allegations, the Court awards Plaintiffs reasonable

4

attorneys’ fees and costs. Herman Miller Inc., 2009 WL 3429739, at *10 (awarding

5

plaintiff attorneys’ fees and costs on default judgment in a trademark counterfeiting and

6

infringement case where defendant willfully infringed). Thus, Plaintiffs SHALL SUBMIT

7

evidence of their attorneys’ fees and costs on or before thirty (30) days from the date on

8

which this Order is electronically docketed.

9

CONCLUSION

10

For the reasons stated above, the Court:

11

(1) GRANTS Plaintiffs’ motion for default judgment.

12

(2) GRANTS Plaintiffs’ request for a permanent injunction. Defaulting Defendants,

13

and each of their respective employees, agents, partners, officers, directors,

14

owners, shareholders, principals, subsidiaries, related companies, affiliates,

15

distributors, dealers, alter-egos, and all persons in active concert or participation

16

with any of them are HEREBY ENJOINED from:

17

a. Using the LG Trademarks or any reproductions, counterfeit copies or

18

colorable imitations thereof in any manner in connection with the

19

distribution, advertising, offering for sale, or sale of any product that is not

20

a genuine LG branded product or not authorized by LG to be sold in

21

connection with the LG Trademarks;

22

b. Passing off, inducing, or enabling others to sell or pass off any product as

23

a genuine LG branded product or any other product produced by LG, that

24

are LG’s or not produced under the authorization, control or supervision

25

of LG and approved by LG for sale under the LG Trademarks;

26

c. Shipping, delivering, holding for sale, transferring or otherwise moving,

27

storing, distributing, returning, or otherwise disposing of, in any manner,

28

products or inventory not manufactured by or for LG, nor authorized by
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16-CV-1162 JLS (NLS)

1

LG to be sold or offered for sale, and which bear any of the LG Trademarks

2

or any reproductions, counterfeit copies or colorable imitations thereof;

3

and

4

d. Representing by any means whatsoever, directly or indirectly, that any

5

Defendant is an authorized reseller of LG products and/or that any

6

defendant or any of its products or activities are associated or connected in

7

any way with LG or sponsored or otherwise affiliated with LG.

8

(3) GRANTS Plaintiffs’ request for statutory fees in the amount of $168,100,000

9

broken down as follows:

10
11
12

Defendant

13
14
15
16
17
18
19
20
21
22
23
24
25
26

Total
Number
Total
of
Number Domain
of Marks Names
Used
Used

Statutory
Damages

HUANG XIAOWEN dba TOPUUSHOP

9

$18,000,000

ENJOY INTERNATIONAL
TRADING (HONGKONG)
CO., LTD.

6

$12,000,000

GUANGZHOU CITY
HOSPHONE ELECTRONIC
TECHNOLOGY CO. LTD.

4

$8,000,000

4

$8,000,000

SHENZHEN BINGOS
TRADING CO. LTD.
SHENZHEN ZL TIMES
TECHNOLOGY CO.

7

1

$14,100,000

GUANGZHOU WINDING
ELECTRONIC
TECHNOLOGY CO. LTD.

7

$14,000,000

SHENZHEN POWERFIRE
TECHNOLOGY CO. LTD.

3

$6,000,000

27
28
26
16-CV-1162 JLS (NLS)

1
2
3

Defendant

4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20

Total
Number
Total
of
Number Domain
of Marks Names
Used
Used

GUANGZHOU
NEWKINGSER ELECTRONIC
TECHNOLOGY CO. LTD.

Statutory
Damages

5
5

$10,000,000

3

$6,000,000

8

$16,000,000

1

$2,000,000

6
7

$12,000,000
$14,000,000

4

$8,000,000

2

$4,000,000

3
84

SHENZHEN LITTLE LINK
COMMUNICATION FIRM
SHENZHEN KING FLASH
ELECTRONICS CO. LTD.
SHENZHEN NEWSINTE
ELECTRONICS CO. LTD.
SHENZHEN SMART LINK
COMMUNICATION CO. LTD.
RUILIN TECH LIMITED
COMPANY
HERMAN WHEELER, INC.
ZEXIAO LU DBA
EVERYDAYSMILE2015
YOON HEE PARK DBA
DEALS-WOW
SHENZHEN LEISEN
TECHNOLOGY CO
Total

$10,000,000

$6,000,000
$168,100,000

1

21
22

(4) In view of the above, the Court HEREBY ORDERS that all monies currently

23

retained in the Defaulting Defendants’ financial accounts, including monies held

24

by PayPal, Inc. (“PayPal”), are hereby released to LG as partial payment of the

25

above-identified damages, and PayPal is ordered to release to LG the amounts

26

from the Defaulting Defendants’ PayPal accounts within ten (10) days of receipt

27

of this Order. Until LG has recovered full payment of monies owed to it by any

28

Defaulting Defendant, LG shall have ongoing authority to serve this Order on
27
16-CV-1162 JLS (NLS)

1

any banks, savings and loan associations, or other financial institutions including,

2

without limitation, PayPal (collectively, the “Financial Service Providers”) in the

3

event that any new financial accounts controlled or operated by the Defaulting

4

Defendants or those in privity with them are identified. Upon receipt of this

5

Order, the Financial Service Providers shall immediately locate and restrain any

6

newly discovered accounts connected to the Defaulting Defendants or the

7

Defaulting Defendants’ websites, and any funds in such accounts shall be

8

transferred to LG within ten (10) days of receipt of this Order.

9

(5) GRANTS Plaintiffs’ request for attorneys’ fees and costs. Plaintiffs SHALL

10

SUBMIT evidence of their attorneys’ fees and costs on or before thirty (30) days

11

from the date on which this Order is electronically docketed.

12

(6) DIRECTS Whois Privacy Corporation to reveal to LG the owner of the

13

“lgtonewholesale.com” domain name. Said owner and/or the relevant registrar

14

(Internet

15

“lgtonewholesale.com” domain name to LG.

16
17

Domain

Service

BS

Corp.)

is

directed

to

transfer

the

IT IS SO ORDERED.
Dated: February 6, 2017

18
19
20
21
22
23
24
25
26
27
28
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16-CV-1162 JLS (NLS)