Crossfit, Inc. v. Columbus Crossfitness, LLC et al

Filing 17

MEMORANDUM OPINION re 16 Order on Motion for Default Judgment, Order on Motion for Permanent Injunction. Signed by Senior Judge Glen H. Davidson on 4/30/14. (rel)

IN THE UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF MISSISSIPPI

ABERDEEN DIVISION

CROSSFIT, INC.

PLAINTIFF

v.

CIVIL ACTION NO.1: 13-cv-00144-GHD-DAS

COLUMBUS CROSSFITNESS, LLC;

CHANCE WIYGUL; and JOHN DOES 1-25

DEFENDANTS

MEMORANDUM OPINION GRANTING

MOTION FOR DEFAULT JUDGMENT AND PERMANENT INJUNCTION

Presently before the Court is a motion for default judgment and permanent injunction
[13] filed by Plaintiff CrossFit, Inc. ("Plaintiff") against Defendants Columbus Crossfitness,
LLC and Chance Wiygul (collectively, "Defendants"). Upon due consideration, the Court grants
the motion for default judgment as to liability and issues a permanent injunction against
Defendants Columbus Crossfitness, LLC and Chance Wiygul, but defers ruling on the issues of
damages, attorney's fees, and costs.

A. Factual and Procedural Background
On August 6, 2013, Plaintiff filed this action against Defendants, asserting the following
claims under the Lanham Act, 60 Stat. 427, as amended, 15 U.S.C. § 1051 et seq.: [1] trademark
infringement (15 U.S.C. § I 114(1)(a)); [2] false designation of origin (15 U.S.C. § 1125(a)); [3]
a violation of the Anticybersquatting Consumer Protection Act ("ACPA") (15 U.S.C. § I 125(d));
and [4] trademark dilution (15 U.S.C. § 1125(c)). See Pl.'s Compl. [1].
According to Plaintiff, it "has developed a revolutionary fitness training regimen that has
become the principal strength and conditioning program for many police academies and tactical
operations teams, military special operations units, champion martial artists, and thousands of
professional and amateur athletes worldwide." Id.

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10. Plaintiff further alleges that it "licenses

use of its intellectual property, including the 'CrossFit' name, to affiliates that have received
particularized training and received a certificate from CrossFit." Id.

Plaintiff avers that it

"diligently protects its intellectual property through, inter alia, trademark and service mark
registration" and that "CrossFit marks ... have been in continuous use in commerce since at
least the dates of their first use as indicated in their registrations to the present day." Id. ~ 11.
Plaintiff maintains that "[0]nly persons who have completed CrossFit's certificate process and
entered into valid affiliate license agreements are permitted to use CrossFit Marks." Id. ~ 12.
Plaintiff alleges that Defendants offered fitness training services under the names "CrossFitness"
and "CrossFitness 24/7" to offer and promote their services, despite that neither Defendant is a
CrossFit affiliate and CrossFit has never authorized Defendants' use of the CrossFit Marks or
infringing terms. Id.

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13. Plaintiffs further allege that Defendants offer services on the Internet

through its website and Facebook page which describe Defendants' exercise programs by using
the infringing terms. Id., 14. Plaintiff maintains that Defendants' use of the infringing terms
creates the false impression that Defendants are licensed CrossFit affiliates and/or certified
CrossFit trainers, which creates consumer confusion, and that Defendants intended to do this and
"to give their services and/or goods an instant credibility that is not otherwise warranted."

/d."

15, 19-21. Plaintiff maintains that Defendants' conduct is causing harm to Plaintiff and will
continue to do so. Plaintiff alleges that it contacted Defendants and that Defendants agreed to
remove the infringing content from their website and to delete their Facebook page and remove
the signage.

Id.' 24.

Plaintiff further alleges that despite Defendants' representations

Defendants are continuing to use the infringing terms to promote their business. Id. , 25.
On August 15, 2013, Plaintiff personally served its summons and complaint upon
Defendant Chance Wiygul individually, and served Defendant Columbus Crossfitness, LLC by

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and through its registered agent Chance Wiygul. See Summons Returned Executed-Chance
Wiygul [4]; Summons Returned Executed-Columbus Crossfitness, LLC [5]. Neither Defendant
filed an answer or otherwise responded to Plaintiffs complaint. On October 7,2013, the Clerk
of Court filed a notice of past due answer as to Defendants [10]. On October 15,2013, Plaintiff
filed a motion for entry of default [11], and on October 16, 2013, the Clerk of Court entered a
default [12] as to each Defendant. Pursuant to the entry of default by the Clerk of Court,
Plaintiff now requests permanent injunctive relief against Defendants, as well as monetary
damages including profits and statutory damages, attorney's fees, and court costs.

Plaintiff

maintains that it twice mailed copies of Plaintiffs present motion and accompanying
memorandum briefby United States mail, postage prepaid, to the address where Defendants had
been personally served with Plaintiffs summons and complaint. However, Plaintiff maintains
that the motion and brief were returned to Plaintiff by the United States Post Office as
undeliverable in both attempts. Thus, Plaintiff maintains that it hired the same process server
who successfully served Defendants with Plaintiffs summons and complaint to serve the present
motion and accompanying memorandum brief upon Defendants by hand delivery and that this
was successfully accomplished on April 14, 2014. See PL's Notice of Service of Mot. Default J.
& Permanent Injunction, Mem. Br. Supp., & Clerk's Entry of Default [15]. Defendants have
failed to plead, answer, or otherwise defend against Plaintiffs complaint and have not responded
to the present motion.

B. Legal Standard
A party is entitled to entry of a default by the clerk of the court if the opposing party fails
to plead or otherwise defend as required by law.

FED.

R. CIV. P. 55(a). Under Rule 55(a), a

default must be entered before the Court may enter a default judgment. See id. As stated, the

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Clerk of the Court has entered default, and Plaintiff now requests the Court to enter a final
default judgment against both Defendants.
Defendants, by failing to answer or otherwise respond to Plaintiff s complaint, have
admitted the well pleaded allegations of the complaint and are precluded from contesting the
established facts on appeal. Nishimatsu Constr. Co. v. Houston Nat'l Bank, 515 F.2d 1200, 1206
(5th Cir. 1975) (citations omitted).

Based on the well pleaded allegations of Plaintiffs

complaint, which the Court accepts as true, and the record in this action, the Court determines
that Defendants have violated the previously stated provisions of the Lanham Act.
C. Damages

Plaintiff claims entitlement to Defendants' profits by use of Plaintiffs mark and
infringing language, damages sustained by Plaintiff, and the costs of the action. Actual damages
may include injury to Plaintiffs goodwill and business reputation.

15 U.S.C. § 1125(c).

Plaintiff concedes that it cannot precisely calculate its actual damages and Defendants' profits
resulting from Defendants' unlawful infringement of Plaintiffs mark.

However, Plaintiff

"believes that a conservative, reasonable estimate of profits and treble damages, given the willful
conduct of the Defendants ... is $75,000.00, as Defendants' past and ongoing conduct is
damaging to [Plaintiffs] reputation and goodwill, and further supports the requested amount."
Pl.'s Mem. Br. Supp. Mot. Default J. [14] at 23.
The Fifth Circuit has held that in the context of a default judgment, "[ d]amages may not
be awarded without a hearing or a demonstration by detailed affidavits establishing the necessary
facts."

United Artists Corp. v. Freeman, 605 F.2d 854, 857 (5th Cir. 1979). In addition,

"[w ]here the amount of damages and/or costs can be determined with certainty by reference to

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the pleadings and supporting documents and where a hearing would not be beneficial, a hearing
is unnecessary." James v. Frame, 6 F.3d 307,310 (5th Cir. 1993).
Although the Court holds that Plaintiff is entitled to damages, the amount of damages
cannot be quantified at this time. Because Plaintiff s damages are not a sum certain or a sum that
can be certain by computation, a hearing is necessary as provided in Rule 55(b)(2) of the Federal
Rules of Civil Procedure. Thus, an award of damages is premature at this juncture.

D. Attorney's Fees and Costs
Plaintiff has submitted an affidavit for the amount of attorney's fees and costs incurred
for them to prosecute this case. Plaintiff is entitled to attorney's fees by statute. However, an
award of attorney's fees at this juncture is premature.

E. Injunctive Relief
Plaintiff also seeks a permanent injunction to ensure that all infringing CrossFit materials
are removed from the Internet website owned and maintained by Defendants and that the
Facebook page containing infringing CrossFit materials is deleted.
Injunctive reliefis authorized under the Lanham Act. 15 U.S.C. §1116(d). The elements
of a permanent injunction are essentially the same as those for a preliminary injunction "with the
exception that the plaintiff must show actual success on the merits rather than a mere likelihood
of success." Amoco Prod. Co. v. Vii/age of Gambell, 480 U.S. 531, 546 n.12, 107 S. Ct. 1396,
94 L. Ed. 2d 542 (1987). A party seeking a preliminary injunction must establish that:
(1) there is a substantial likelihood that the movant will prevail on
the merits; (2) there is a substantial threat that irreparable harm
will result if the injunction is not granted; (3) the threatened injury
[to the movant] outweighs the threatened harm to the defendant;
and (4) the granting of the preliminary injunction will not disserve
the public interest.

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Clark v. Prichard, 812 F.2d 991, 993 (5th Cir. 1987) (citing Canal Auth. of the State ofFla. v.
Callaway, 489 F.2d 567, 572 (5th Cir. 1974) (en banc)). The party seeking such relief must

satisfy a cumulative burden of proving each of the four elements enumerated before a
preliminary injunction can be granted. Miss. Power & Light Co. v. United Gas Pipeline, 760
F.2d 618, 621 (5th Cir. 1985); Clark, 812 F.2d at 993.
Because the Court has found liability against both Defendants, Plaintiff has succeeded on
the merits of its claims. The Court further determines that irreparable harm will result if the
injunction is not granted because Defendants have produced no evidence that the infringing
materials have all been removed from the Internet and that they will not repost the infringing
materials. The Court further determines that the injury to Plaintiff outweighs any harm to
Defendants because Congress has declared conduct in which Defendants engaged is illegal.
Finally, the Court is of the opinion that the public interest will not be disserved if a permanent
injunctive is issued, as the injunction bars conduct that Congress has declared to be unlawful.
The public has an interest in knowing or being assured that persons do not violate laws regarding
trademarks, copyrights, and fair competition. For these reasons, the court will issue a permanent
injunction requiring Defendants to refrain from specified conduct and to take specified action to
ensure that their violations cease.
F. Conclusion

For all the foregoing reasons, the Court GRANTS PlaintiffCrossFit, Inc.'s motion for
default judgment [13] as to liability; DEFERS ruling on the amount of damages, attorney's fees,
and costs; and GRANTS permanent injunctive relief as detailed in the order that shall be issued
in accordance therewith.

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The hearing to detennine the amount of damages, attorney's fees, and costs shall
commence at 10:00 a.m. Thursday, May 29, 2014, in the United States Courthouse in Aberdeen,
Mississippi.
THIS, the

SO

f!

Ja-JiS)~

day of April, 2014.

SENIOR JUDGE

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