Entrepreneur Media, Inc. v. Spencer et al

Filing 20

PERMANENT INJUNCTION AND DEFAULT JUDGMENT in favor of the plaintiff Entrepreneur Media, Inc. and against the defendants, Free Internet Media, Inc. and William Spencer. by Judge R. Brooke Jackson on 12/15/17. (jdyne, )

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLORADO
Civil Action No. 1:17-cv-01637-RBJ
ENTREPRENEUR MEDIA, INC.,
Plaintiff,
v.
WILLIAM SPENCER, an individual,
FREE INTERNET MEDIA, INC., a Colorado corporation dba MEMEBRIDGE, and
DOES 1-10,
Defendants.

ORDER REGARDING PLAINTIFF’S APPLICATION FOR DEFAULT JUDGMENT
AGAINST DEFENDANTS AND JUDGMENT AND PERMANENT INJUNCTION
AGAINST DEFENDANTS

Upon consideration of Plaintiff Entrepreneur Media, Inc.’s (“EMI”) Application for Entry
of Default Judgment against defendants Free Internet Media, Inc., dba Memebridge
(“Memebridge”) and William Spencer (“Spencer”) (collectively, “Defendants”) [ECF No. 19]
and all supporting documents and pleadings of record, and good cause appearing therein, the
Court hereby ORDERS that the application is GRANTED, enters this JUDGMENT and a
PERMANENT INJUNCTION against Defendants, and FINDS as follows:
I.

DEFAULT JUDGMENT AGAINST DEFENDANTS IS APPROPRIATE
Federal Rule of Civil Procedure 55(b)(2) provides that a court may enter default

judgment and, if necessary to effectuate judgment, conduct an accounting, determine the amount
of damages, establish the truth of any allegation by evidence, or investigate any other matter.
Entering default judgment is within the discretion of the Court and requires two considerations.

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See Bixler v. Foster, 596 F.3d 751, 762 (10th Cir. 2010). The “Court must first consider whether
it has jurisdiction over the subject matter and the defendants.” CrossFit, Inc. v. Jenkins, 69
F. Supp. 3d 1088, 1093 (D. Colo. 2014). “The Court then must consider whether the wellpleaded factual allegations in the complaint support a judgment on the claims against the
defaulting defendants.” Big O Tires, LLC v. C&S Tires, Inc., 2017 U.S. Dist. LEXIS 79939, at
*6-7 (D. Colo. May 24, 2017). A plaintiff establishes trademark infringement or unfair
competition by demonstrating that it “(1) owns a protectable trademark; [and] (2) that
Defendant[s] used [a] [disputed] trademark” that is “likely to cause confusion, or to cause
mistake, or to deceive as to the affiliation, connection, or association of such person with another
person, or as to the origin, sponsorship, or approval of his or her goods, services, or commercial
activities by another person.” Grady v. Nelson, 2014 U.S. Dist. LEXIS 172759, at *17 (D. Colo.
Dec. 15, 2014). As further discussed in Sections 2 and 3 below and briefly summarized here,
EMI has satisfied both requirements for the entry of default judgment against Defendants.
First, the Court has subject-matter jurisdiction over EMI’s claims for trademark
infringement, unfair competition, and false designation of origin because they are federal claims
brought under the Lanham Act. See 28 U.S.C. §§ 1391(b)(1), (b)(2), (c)(2); 15 U.S.C. §§ 1114,
1125. The Court also has personal jurisdiction over Defendants because they are residents of
Colorado and have conducted substantial business within Colorado under the ENTREPRENEUR
SUPPORT mark, thereby committing tortious acts within the State. See CrossFit, Inc., 69
F. Supp. 3d at 1094 (while Plaintiff “bears the burden of establishing personal jurisdiction,”
where, as here, “the issue is determined on the basis of the pleadings and affidavits, that burden
may be met by a prima facie showing”).
Second, the well-pleaded factual allegations in the Complaint support the entry of

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judgment against the Defendants. EMI has complied with the procedural requirements for
default judgment, including securing the entry of default against Defendants. As discussed
below, Defendants have infringed EMI’s strong, famous, and distinctive marks and this
misconduct shows no signs of abating. Because the “well-pleaded factual allegations of [the]
complaint are deemed true,” there is no possibility of a dispute concerning the material facts.
See Big O Tires, LLC, 2017 U.S. Dist. LEXIS 79939, at *7. Accordingly, the entry of default
judgment against Defendants is appropriate.
II.

THE COURT HAS JURISDICTION OVER DEFENDANTS
“Colorado’s long arm statute provides that a defendant is subject to personal jurisdiction

where he or she engages in the ‘transaction of any business within this state’ or commits a
‘tortious act within this state.’” CrossFit, Inc., 69 F. Supp. 3d at 1094 (citing Colo. Rev. Stat.
§ 13-1-124). This Court thus has personal jurisdiction over Defendants because they are
residents of Colorado and have conducted substantial business within Colorado under the
ENTREPRENEUR SUPPORT mark, thereby committing tortious acts within the State.
Moreover, this Court has personal jurisdiction over Defendants because, at all relevant times,
they were residents of and domiciled in the State of Colorado. Goodyear Dunlop Tires
Operations, S.A. v. Brown, 564 U.S. 915, 924 (2011) (noting that Defendant’s domicile in the
District is a “paradigm” basis for establishing personal jurisdiction). Asserting claims against
Defendants in their home court in this case thus comports with “traditional notions of fair play
and substantial justice.” Big O Tires, LLC, 2017 U.S. Dist. LEXIS 79939, at *14-15 (quoting
Int’l Shoe Co. v. Washington, 326 U.S. 310, 316 (1945)).
Accordingly, the Court hereby FINDS that it has specific jurisdiction over Defendants
and may properly enter a default judgment against Defendants.

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III.

DEFENDANTS HAVE INFRINGED EMI’S TRADEMARK RIGHTS
A.

EMI’S TRADEMARK RIGHTS

EMI owns the following valid U.S. trademark registrations (collectively, “EMI Marks”):

TRADEMARK

CLASS: GOODS/SERVICES

ENTREPRENEUR

16: Paper goods and printed matter; namely
magazines, books and published reports pertaining to
business opportunities

ENTREPRENEUR

ENTREPRENEUR

ENTREPRENEUR

ENTREPRENEUR

ENTREPRENEUR
BOOKSTORE

35: Advertising and business services, namely,
arranging for the promotion of the goods and services
of others by means of a global computer network and
other computer online services providers; providing
business information for the use of customers in the
field of starting and operating small businesses and
permitting customers to obtain information via a
global computer network and other computer online
service providers and; web advertising services,
namely, providing active links to the websites of
others

Aug. 25,
1987
2,263,883
July 27,
1999

35: Arranging and conducting trade show exhibitions
in the field of entrepreneurial activities, namely the
start-up and operation of small business enterprises
41: Educational services, namely, conducting
seminars on the development and operation of
businesses, and conducting workshops on computer
technology, telecommunications, marketing,
financing options, real estate management, tax
planning and insurance

2,502,032

38: Streaming of video and digital material on the
Internet

4,260,948

9: downloadable computer software and software for
mobile devices for the reproduction, display and
distribution of digitized content.
35: Online ordering services featuring printed and
electronically downloadable publications, namely,
books, study guides, legal and business forms, and
newsletters, concerning advice and information
relating to starting and operating a business and other
topics concerning and of interest to entrepreneurs,
new and existing businesses, and members of the
general public

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REG. NO.
REG.
DATE
1,453,968

Oct. 30,
2001

Dec. 18,
2012
4,345,424
June 4, 2013
4,612,937
September
30, 2014

ENTREPRENEUR
PRESS

16: Paper goods and printed matter, namely, books,
manuals, prepared reports, work books, study guides,
legal and business forms, and newsletters concerning
advice and information relating to the subjects of
starting, running and operating a business, and
individuals who succeeded in business, which
subjects are of interest to entrepreneurs, new and
existing businesses and members of the general
public
35: On-line ordering services featuring printed and
electronically downloadable publications, namely,
books, study guides, legal and business forms, and
newsletters, concerning advice and information
relating to the subjects of starting, running and
operating a business and individuals who succeeded
in business, which subjects are of interest to
entrepreneurs, new and existing businesses and
members of the general public

3,470,064

16: Paper goods and printed matter, namely, books,
manuals, prepared reports, work books, study guides,
legal and business forms, and newsletters concerning
advice and information relating to the subjects of
starting, running and operating a business, and
individuals who succeeded in business, which
subjects are of interest to entrepreneurs, new and
existing businesses, and members of the general
public
35: Online ordering services featuring printed and
electronically downloadable publications, namely,
books, study guides, legal and business forms, and
newsletters, concerning advice and information
relating to the subjects of starting, running, and
operating a business and individuals who succeeded
in business, which subjects are of interest to
entrepreneurs, new and existing businesses, and
members of the general public

3,470,063
July 22,
2008

ENTREPRENEUR’S 9: Downloadable computer software and software for
STARTUPS
mobile devices for the reproduction, display,
distribution, and sharing of digitized content;
downloadable electronic publications, namely,
magazines in the fields of business, finance, sales,
marketing, current events, lifestyle issues, and
developments in science and technology

4,532,577
May 20,
2014

ENTREPRENEUR’S 16: Paper goods and printed matter; namely,
STARTUPS
magazines, books, booklets and published reports
pertaining to business opportunities

3,204,899

ENTREPRENEUR
360

16: Annual featured issue of magazine featuring the
achievements of successful non-franchise and
privately-owned businesses and publications related
thereto, providing information and incentive to others

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July 22,
2008

Feb. 6, 2007
5,052,999
October 4,
2016

to pursue excellence in business pursuits by
presenting awards on an annual basis, and promoting
award recipients and providing recognition by the
way of awards to demonstrate excellence in the field
of business.
35: Advertising and business services, namely,
arranging for the promotion of the goods and services
of others by means of a global computer network and
other computer online services providers; providing
business information to customers in the field of
starting and operating non-franchise and privatelyowned businesses by means of a global computer
network and other computer online service providers;
advertising services, namely, providing advertising
space in a magazine featuring news and information
concerning the field of non-franchise and privatelyowned businesses; providing statistics, ratings, and
rankings and other information capable of being
updated on a continuing basis through an interactive
database and about businesses which are not
franchises and are privately-owned.
41: Recognizing the achievements of successful nonfranchise and privately-owned businesses and
providing incentive to others to pursue excellence in
business pursuits by presenting a wards on an annual
basis and promoting award recipients; providing
recognition by the way of awards to demonstrate
excellence in the field of business; arranging and
conducting educational conferences; educational
services, namely, developing, arranging, and
conducting educational conferences and programs
and providing courses of instruction in the field of
business administration and management
EMI’s registration numbers 1,453,968; 2,263,883; and 2,502,032 for
ENTREPRENEUR® and 3,204,899 for ENTREPRENEUR’S STARTUPS® are incontestable.
The federal registrations for the EMI Marks constitute prima facie evidence that the
marks are valid and owned by EMI. 15 U.S.C. § 1115(a). The incontestable registrations for the
EMI Marks noted above constitute “conclusive evidence” of the validity of those registered
marks, EMI’s ownership of those marks, and EMI’s “exclusive right to use the mark[s] in
commerce.” 15 U.S.C. § 1115(b).
Further, other courts have already recognized the validity and strength of the EMI Marks,

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including the ENTREPRENEUR® Mark, and this Court concurs with those decisions.
For example, the U.S. District Court for the Central District of California held that:
(1) “[t]he extensive advertising and public recognition over the past 25 years have established
[the ENTREPRENEUR® mark] as a strong mark in the industry;” (2) the ENTREPRENEUR®
mark “is a strong distinctive mark, deserving of significant protection;” and
(3) the ENTREPRENEUR® mark “has acquired secondary meaning.” Entrepreneur Media, Inc.
v. Smith, No. 98-3607, 2004 U.S. Dist. Lexis 24078, at *9-10, 13 (C.D. Cal. June 23, 2004).
The Ninth Circuit reviewed the District Court’s findings and affirmed them on appeal.
Entrepreneur Media, Inc. v. Smith, 101 Fed. Appx. 212 (9th Cir. 2004).
Similarly, the U.S. District Court for the District of Connecticut recognized that “the EMI
Marks, and in particular the ENTREPRENEUR Mark, have acquired extensive goodwill,
developed a high degree of distinctiveness and secondary meaning, and become well known and
recognized as identifying goods and services that originate from EMI, such that they are
deserving of strong protection.” Entrepreneur Media, Inc. v. Whitehill et al., No. 13-cv-01819,
Dkt. # 19 (D. Conn. Aug. 19, 2015).
Both a Magistrate Judge and District Court judge in the Eastern District of Virginia found
the ENTREPRENEUR® mark to be distinctive, and the U.S. District Court for the District of
Maryland recognized the EMI Marks as valid, strong, and distinctive. Entrepreneur Media, Inc.
v. seattleentrepreneur.com, Dkt. # 11-00409, 2011 U.S. Dist. Lexis 139817, at *3-5 (E.D. Va.
Dec. 6, 2011); Entrepreneur Media, Inc. v. JMD Entertainment Group, LLC, et al, 958 F. Supp.
2d 588, 594-596 (D. Md. 2013).
EMI has also developed extensive common law rights in the EMI Marks through
consistent, wide-spread use of the marks throughout the United States. EMI and its predecessor

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companies have used the ENTREPRENEUR® mark for over forty years to publish magazines
and books that provide editorial content and other information, as well as offer products and
services related or of interest to businesses, business owners, and prospective business owners.
EMI’s ENTREPRENEUR® magazine has a current paid circulation, including both subscriptions
and newsstand sales, of more than 590,000 in the United States, it is sold and distributed in over
100 foreign countries, and it regularly features articles with high-profile entrepreneurs. EMI has
also published over 200 books (and multiple e-books) under the ENTREPRENEUR® and
ENTREPRENEUR PRESS® marks and it has conducted numerous seminars, workshops, and
other educational events, many of which are sponsored by large, well known corporations such
as American Airlines, Canon USA, and The Lincoln Motor Company.
EMI also owns and operates several websites, such as entrepreneur.com, to promote its
goods and services. The entrepreneur.com website has averaged over 18 million unique visitors
and over 46 million page views per month. EMI’s fame and high-quality content and services
have resulted in numerous co-branding business relationships with various companies, such as
the NFL Players Association, General Motors, Princeton Review, CNBC, and Business Insider.
As a result of the above activities and success, the EMI Marks, and in particular the
ENTREPRENEUR® mark, have acquired extensive goodwill, developed a high degree of
distinctiveness and secondary meaning, and become well known, famous, and recognized as
identifying goods and services that originate from EMI, such that they are deserving of strong
protection.
B.

DEFENDANTS INFRINGE EMI’S TRADEMARK RIGHTS

Defendants have used the ENTREPRENEUR SUPPORT mark in commerce to offer
similar goods and services to the same class of consumers targeted by EMI, namely various sized

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businesses, business owners, and prospective business owners. Defendants have marketed their
goods and services through their website at entrepreneur-support.com.
Defendants’ ENTREPRENEUR SUPPORT mark is likely to cause consumer confusion
with the EMI Marks based on an examination of the relevant Sally Beauty factors, which are
(1) the degree of similarity between the marks; (2) the strength or weakness of the plaintiff’s
mark; (3) the similarity of products and manner of marketing; (4) the intent of the alleged
infringer in using the mark; and (5) the degree of care likely to be exercised by purchasers. Sally
Beauty Co., Inc. v. Beautyco, Inc., 304 F.3d 964, 972 (10th Cir. 2002). 1
First, the ENTREPRENEUR® and ENTREPRENEUR SUPPORT marks are closely
similar as they both share the leading and dominant “ENTREPRENEUR” term and the
descriptive and non-source identifying “support” term does little to distinguish the marks. See,
e.g., Dun-Rite Home Improvements, Inc. v. Dun-Rite, LLC, 2016 U.S. Dist. LEXIS 40329, at
*11-12 (D. Colo. Feb. 2, 2016) (recognizing the high degree of similarity between “Dun-Rite”
and “Dun-Rite Home Improvements”).
Second, the EMI Marks, as discussed above, are strong and distinctive marks, especially
the famous ENTREPRENEUR® mark.
Third, EMI and Defendants offer closely related – if not identical – goods and services
(e.g., business advice, information, and resources) to the same class of consumers (e.g., various
sized businesses, business owners, and prospective business owners). EMI and Defendants also
offer these goods through the same or similar marketing channels, such as through their

1

Given the posture of this litigation, EMI did not provide any evidence of actual confusion.
However, evidence of actual confusion is not dispositive, nor is any other single Sally Beauty
factor. Therefore, the scales balancing the likelihood of confusion still tip in EMI’s favor. See
Sally Beauty Co., Inc., 304 F.3d at 972.

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respective websites.
Fourth, as alleged in the Complaint (which is accepted as true), Defendants have
intentionally, knowingly, deliberately, and willfully used the ENTREPRENEUR SUPPORT
mark to violate EMI’s trademark rights and trade off EMI’s goodwill and reputation, and have
refused to cease this infringement.
Fifth, consumers are unlikely to exercise a substantial degree of care when reading
Defendants’ free online articles and otherwise utilizing Defendants’ free services and products
under the ENTREPRENEUR SUPPORT mark. This low degree of care increases the likelihood
of confusion. See Heartsprings, Inc. v. Heartspring, Inc., 143 F.3d 550, 557 (10th Cir. 1998).
As all of the relevant Sally Beauty factors weigh in favor of finding a likelihood of
confusion, the Court hereby FINDS that: (1) Defendants have infringed EMI’s federally
registered trademarks in violation of 15. U.S.C. § 1114; and (2) Defendants have created a false
designation of origin and false representation of association in violation of 15 U.S.C. § 1125(a).
IV.

PERMANENT INJUNCTION
In consideration of the above and after weighing all appropriate equitable factors

applicable to this case, the Court finds that permanent injunctive relief is appropriate because
EMI has suffered irreparable injury that cannot be adequately compensated by monetary
damages. See Patagonia, Inc. v. Hunt, 2016 U.S. Dist. LEXIS 166713, at *8 (D. Colo. Nov. 2,
2016). Indeed, Defendants’ lack of response to this lawsuit indicates that Defendants’ infringing
activities might continue, and therefore Defendants’ wrongful conduct must be ceased. See DunRite., 2016 U.S. Dist. LEXIS 40329, at *18. As Defendants are operating their business in direct
violation of the Lanham Act, the balance of hardships tilts in EMI’s favor, and the public’s
interest in preventing consumer confusion would be best served by a permanent injunction

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against such unlawful behavior.
Therefore, the Court hereby enters the following PERMANENT INJUNCTION:
A.

Defendants, and their principals, officers, directors, members, partners, agents,
servants, employees, and attorneys, and all other persons acting in concert or
participating with them, who receive actual notice of the injunction order by
personal or other service, are hereby PERMANENTLY ENJOINED and shall
immediately:
i.

cease all use and never use the ENTREPRENEUR SUPPORT mark, the
EMI Marks, or any other mark likely to cause confusion with the EMI
Marks, in connection with the promotion, advertising, offering for sale, or
sale, of any products or services;

ii.

never use any false designation of origin, false representation, or any false
or misleading description of fact, that can, or is likely to, lead the
consuming public or individual members thereof, to believe that any
products or services produced, offered, promoted, marketed, advertised,
provided, or sold by Defendants is in any manner associated or connected
with EMI, or are licensed, approved, or authorized in any way by EMI;

iii.

never represent, suggest in any fashion to any third party, or perform any
act that may give rise to the belief, that Defendants, or any of their goods
or services, are related to, authorized, or sponsored by EMI;

iv.

cease all use of the entrepreneur-support.com domain name and any
similar domain names, and never register any domain names that contain

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any of the EMI Marks, or any domain names confusingly similar to any of
the EMI Marks;
v.

cease all use of the Social Media Accounts
(https://twitter.com/FounderSupport;
https://www.facebook.com/pg/Entrepreneur-Support279776088706581/about) and any similar accounts or social media
websites, and never register any social media account that contains the
ENTREPRENEUR SUPPORT mark, any of the EMI Marks, or any other
social media account confusingly similar to any of the EMI Marks;

vi.

never unfairly compete with EMI in any manner whatsoever, or engage in
any unfair, fraudulent, or deceptive business practices that relate in any
way to the production, distribution, marketing, and/or sale of products and
services bearing any of the EMI Marks;

vii.

never apply for or seek to register any mark that is likely to cause
confusion with any of the EMI Marks;

viii.

transfer to EMI all domain names, including but not limited to
entrepreneur-support.com, in Defendants’ possession, custody, or control
that include the word “entrepreneur” or any misspelling thereof, or are
otherwise confusingly similar to or contain any of the EMI Marks; and

ix.

transfer to EMI all of Defendants’ Social Media Accounts, including all
such accounts in Defendants’ possession, custody, or control that include
the word “entrepreneur” or any misspelling thereof, or are otherwise
confusingly similar to or contain any of the EMI Marks.

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B.

To give practical effect to the Permanent Injunction, the Registrar for any domain

name subject to this Order shall, within fourteen (14) days of receipt of this Order, transfer those
subject domain names to EMI if Defendants have not already done so.
C.

To give practical effect to the Permanent Injunction, the social networking service

or entity (e.g., Twitter, Facebook) related to any of the social media accounts subject to this
Order shall, within fourteen (14) days of receipt of the Order, transfer those subject accounts to
EMI if Defendants have not already done so.
D.

Defendants shall file with the Court and serve upon EMI’s counsel, within thirty

(30) days after service of this Order, a report in writing under oath setting forth in detail the
manner and form in which Defendants have complied with the Permanent Injunction.
V.

EMI IS AWARDED ITS COSTS AND REASONABLE ATTORNEYS’ FEES
The Court hereby deems EMI to be the prevailing party in this action under 15 U.S.C.

§ 1117(a) and 54(d)(1) of the Federal Rules of Civil Procedure. Further, the Court deems this
case to be exceptional under 15 U.S.C. § 1117(a) because of Defendants’ intentional and willful
misconduct, as well as their defiance and protraction of the judicial process by not responding or
appearing in this matter. United Phosphorus, Ltd. v. Midland Fumigant, Inc., 205 F.3d 1219,
1232 (10th Cir. 2000). Accordingly, EMI is hereby provisionally awarded its costs and
reasonable attorneys’ fees, and is directed to submit a request for costs and attorneys’ fees in
accordance with the procedures and deadlines set forth in Federal Rule of Civil Procedure 54(d)
and Local Rule 54.
VI.

DISMISSAL OF DOE DEFENDANTS
Pursuant to EMI’s voluntary dismissal, it is further ORDERED that Doe Defendants

1-10 are hereby dismissed without prejudice.

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On this 15th day of December, 2017, IT IS SO ORDERED.

______________________________
Hon. R. Brooke Jackson
United States District Judge

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