KENNEDY v. CREDITGO, LLC
OPINION. Signed by Chief Judge Jerome B. Simandle on 12/2/2015. (TH, )
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEW JERSEY
HONORABLE JEROME B. SIMANDLE
No. 15-1790 (JBS-KMW)
SIMANDLE, Chief Judge:
Presently before the Court is Plaintiff Stephen Kennedy’s
Motion for Default Judgment. (Dkt. Entry No. 14.) For the reasons
set forth below, Plaintiff’s Motion will be granted in part and
denied without prejudice in part.
brings this action against Defendant Creditgo, LLC (“Defendant” or
“Creditgo”), for copyright infringement and removal of copyright
management information (“CMI”) under 17 U.S.C. Chapters 5 and 12.
On December 8, 2008, Plaintiff registered a stock photography
image with the United States Copyright Office, Registration Number
VAu 1-012-293. (Compl. ¶ 15.) The image, published on Plaintiff’s
website, captures a model standing against a car. (Compl. ¶¶ 11,
12.) As the image’s creator, Plaintiff is credited with the rights
to the image by an identifying watermark displayed at the bottom
of the image. (Compl. ¶ 13.)
Subsequent to Plaintiff’s registering the image with the
Copyright Office, Defendant used the image in association with its
consent. (Compl. ¶ 41.) The image was displayed on Defendant’s
website above the caption, “24/7 Customer Service & Support” with
Plaintiff’s identifying watermark omitted. (Compl. ¶¶ 18, 22.)
On October 8, 2014, after discovering the image on Defendant’s
website, Plaintiff, by way of counsel, notified Defendant of the
infringing use of the image. (Compl. ¶ 27.)
Defendant responded to Plaintiff’s notification via telephone
conversation, the infringing image was removed from Defendant’s
website. (Compl. Ex. E.)
Plaintiff filed a Summons and Complaint on March 11, 2015,
alleging copyright infringement and removal of CMI. (Greenberg
Decl. ¶ 5; Compl. ¶¶ 41-55.)
On August 7, 2015, upon Defendant’s failure to submit an
Answer in the required time period, the Clerk of this Court entered
a default against Defendant. (Greenberg Decl. ¶ 10; Dkt. Entry No.
Plaintiff now moves for default judgment against Defendant
requesting a permanent injunction, statutory damages totaling
$175,000.00, and costs of $457.00. (Mem. Law Supp. 5, 6, 8.)
The entry of default judgment is a two-step process governed
by Federal Rule of Civil Procedure 55. First, the party seeking
default judgment must request that the Clerk of Court enter a
default against the party for failing to plead or otherwise defend.
Fed. R. Civ. P. 55(a). Second, after the Clerk of Court enters
default, the party must apply to the Court for a default judgment.
Fed. R. Civ. P. 55(b)(2). The entry of default by the Clerk does
not automatically entitle the non-defaulting party to default
judgment; rather, the entry of default judgment is left primarily
to the discretion of the district court. Hritz v. Woma Corp., 732
F.2d 1178, 1180 (3d Cir. 1984).
The Clerk of Court entered default against Defendant on August
7, 2015 (Dkt. Entry No. 12) fulfilling the first requirement of
Rule 55. The Court must now consider whether granting default
judgment against Defendant is appropriate. For the reasons set
forth below, Plaintiff’s Motion will be granted as to Defendant’s
A. Legitimate Cause of Action
Before granting a default judgment, the Court must consider
“whether the unchallenged facts constitute a legitimate cause of
action, since a party in default does not admit mere conclusions
of law.” DirecTV, Inc. v. Decroce, 332 F. Supp. 2d 715, 717 (D.N.J.
2004) (citing 10A Wright, Miller & Kane, Federal Practice and
Procedure § 2688, at 63 (3d ed. 1998)). Once a party has defaulted,
Plaintiff. See Comdyne I, Inc. v. Corbin, 908 F.2d 1142, 1149 (3d
infringement in violation of section 501 of the Copyright Act by
using an image registered to Plaintiff by the United States
Copyright Office without Plaintiff’s authorization, license or
consent. (Compl. ¶¶ 15, 41-42.) Additionally, Plaintiff alleges
that Defendant removed Plaintiff’s identifying watermark on the
image in violation of section 1202(b) of the Digital Millennium
Copyright Act (“DMCA”). (Compl. ¶ 50.) Each of these will be
addressed in turn.
1. Copyright Infringement
First, Plaintiff seeks default judgment against Defendant for
copyright infringement under 17 U.S.C. § 501 of the Copyright Act.
To succeed on a claim for copyright infringement, a plaintiff must
show: “(1) ownership of a valid copyright; and (2) unauthorized
copying of original elements of the plaintiff’s work.” Dun &
Bradstreet Software Servs. v. Grace Consulting, Inc., 307 F.3d
197, 206 (3d Cir. 2002). “Copying refers to the act of infringing
any of the exclusive rights . . . as set forth at 17 U.S.C. § 106,
‘including the rights to distribute and reproduce copyrighted
material.’” Kay Berry, Inc. v. Taylor Gifts, Inc., 421 F.3d 199,
207 (3d Cir. 2005) (quoting Ford Motor Co. v. Summit Motor Prods.,
Inc., 930 F.2d 277, 291 (3d Cir. 1991)).
The uncontested record indicates that Plaintiff owned a valid
Copyright Office. (Compl. ¶ 15.) Furthermore, the record indicates
that Defendant used the registered image on its website without
Plaintiff’s authorization. (Compl. ¶ 41.) The Court accepts these
allegations as true and concludes that Plaintiff has established
a legitimate claim for copyright infringement on which relief can
2. Removal of CMI
removal of copyright management information (“CMI”) as prohibited
under 17 U.S.C. § 1202 of the DMCA. Section 1202(b) provides in
part: “No person shall, without the authority of the copyright
owner or the law—(1) intentionally remove or alter any copyright
management information.” 17 U.S.C. § 1202(b). The definition of
“copyright management information” under section 1202(c) includes
“[t]he name of, and other identifying information about, the author
of a work.” 17 U.S.C. § 1202(c)(2).1
Plaintiff has established that Defendant removed the CMI in
violation of 17 U.S.C. § 1202 by displaying the image on its
Addressing a similar cause of action under the DCMA, the Third
Circuit stated, “the mere fact that [Plaintiff]’s name appeared in
a printed gutter credit near the Image rather than as data in an
“automated copyright protection or management system” does not
prevent it from qualifying as CMI or remove it from the protection
of § 1202.” Murphy v. Millennium Radio Grp. LLC, 650 F.3d 295, 305
(3d Cir. 2011).
website in a way that omitted Plaintiff’s ownership watermark.
(Compl. ¶ 50.) The Court accepts these allegations as true and
concludes that Plaintiff has established a legitimate cause of
action under the DCMA.
B. Default Judgment
The Court must now consider three factors that control whether
a default judgment should be granted: “(1) prejudice to the
plaintiff if default is denied, (2) whether the defendant appears
to have a litigable defense, and (3) whether defendant’s delay is
due to culpable conduct.” Chamberlain v. Giampapa, 210 F.3d 154,
164 (3d Cir. 2000).
judgment were denied because Plaintiff has no other remedy against
Defendant. Under the second and third factors, Defendant’s failure
constitutes culpable conduct. See York Int’l Corp. v. York HVAC
Sys. Corp., No. 09-3546, 2010 U.S. Dist. LEXIS 36709, at *9 (D.N.J.
Apr. 14, 2010) (holding that failure to respond to the Complaint
or Motion for Default Judgment is culpable conduct and indicates
apparent from the pleadings. Accordingly, default judgment against
Defendant is appropriate.
For these reasons, Plaintiff’s Motion will be granted as to
Defendant’s liability for copyright infringement and removal of
III. APPROPRIATE RELIEF
injunctive relief, damages, and costs. “Although the Court should
Complaint when considering a motion for default judgment, the Court
need not accept the moving party’s legal conclusions or factual
allegations relating to the amount of damages.” Broad. Music, Inc.
v. Spring Mt. Area Bavarian Resort, LTD, 555 F. Supp. 2d 537, 541
(E.D. Pa. 2008) (citing Comdyne I, Inc. v. Corbin, 908 F.2d 1142,
1149 (3d Cir. 1990)).
A. Injunctive Relief
Plaintiff requests a permanent injunction against Defendant
to guarantee Defendant will not continue to offend Plaintiff’s
copyrights. Section 502(a) of the Copyright Act provides that the
Court may grant “final injunctions on such terms as it may deem
reasonable to prevent or restrain infringement of a copyright.” 17
U.S.C. § 502(a).
In order for a permanent injunction to be granted, Plaintiff
must show some cognizable danger that, without the injunction,
Defendant will continue to injure Plaintiff by infringing on
copyrights. See Granger v. One Call Lender Servs., LLC, No. 103442, 2012 U.S. Dist. LEXIS 104885, at *16 (E.D. Pa. July 26,
2012.) (“Because injunctive relief is prospective, ‘a permanent
injunction will issue only where a threat of harm exists, not just
where potential harm exists.’”) (quoting McLendon v. Cont’l Can
Co., 908 F.2d 1171, 1182 (3d Cir. 1990)); see also Primepoint, LLC
v. PrimePay, Inc., 401 F. App’x 663, 664 (3d Cir. 2010.) (“Where
the illegal conduct has ceased, the party seeking the injunction
bears the burden of proving that there exists some cognizable
possibility which serves to keep the case alive.”).
Defendant’s website upon notice of violation and because there is
no indication that such infringement has been, or is likely to be,
repeated, Defendant no longer presents a threat of continued
Furthermore, Plaintiff has shown no basis for an existing threat
of harm; rather, Plaintiff’s request for an injunction is premised
copyrights in the future. Absent any indication of an existing
threat against Plaintiff, a permanent injunction is not warranted.
For these reasons, Plaintiff’s Motion as to injunctive relief
is denied without prejudice.
$150,000.00 under 17 U.S.C. § 504 for copyright infringement and
$25,000.00 under 17 U.S.C. § 1203(c)(3)(B) for removal of CMI.
An award of statutory damages serves two purposes: 1) to
compensate the plaintiff for the violation; and 2) to deter the
defendant from future violations. See Broad. Music, 555 F. Supp.
2d at 544 (quoting Schiffer Publ’g, Ltd. v. Chronicle Books, LLC,
No. 03-4962, 2005 U.S. Dist. LEXIS 416, at *12 (E.D. Pa. Jan. 11,
When considering the appropriate amount of statutory damages,
courts should consider the following factors: “(1) expenses saved
and profits reaped by the infringer; (2) revenues lost by the
plaintiff; (3) the strong public interest in insuring the integrity
of the copyright laws; and (4) whether the infringement was willful
and knowing or innocent and accidental.” Original Appalachian
Artworks, Inc. v. J.F. Reichert, Inc., 658 F. Supp. 458, 465 (E.D.
Pa. 1987). “In determining the amount of statutory damages, it is
important that an infringer ‘not reap a benefit from its violation
of the copyright laws [and] that statutory damages should exceed
the unpaid license fees so that defendant will be put on notice
that it costs less to obey the copyright laws than to violate
them.’” Broad. Music, 555 F. Supp. 2d at 544 (quoting A & N Music
Corp. v. Venezia, 733 F. Supp. 955, 958 (E.D. Pa. 1990)).
In the context of default judgment cases, courts can award
the minimum statutory damages without conducting a hearing2 and
In Fonovisa, Inc. v. Merino, the District Court for the
District of New Jersey noted that “[i]n default judgments in
copyright infringement cases, federal courts routinely award
can award above the minimum if the facts and filings provide a
sufficient basis to determine whether the requested statutory
damages are just. See id. at 544-45. In determining the just amount
of statutory damages to award, “[t]he defendant’s conduct is the
most important factor.” Schiffer Publ’g, Ltd v. Chronicle Books,
LLC, No. 03-4962, 2005 U.S. Dist. LEXIS 416, at *14 (E.D. Pa. Jan.
11, 2005) (citing Original Appalachian, 658 F. Supp. at 465).
Each of Plaintiff’s requests for statutory damages will be
addressed in turn.
1. Copyright Infringement
Plaintiff requests the maximum statutory damages of $150,000
for willful copyright infringement. Under 17 U.S.C. § 504(c), a
plaintiff may “recover, instead of actual damages and profits, an
award of statutory damages for all infringements involved in the
action, with respect to any one work . . . a sum not less than
$750 or more than $30,000 as the court considers just.” 17 U.S.C.
§ 504(c)(1). If the infringement was committed willfully, the court
“may increase the award of statutory damages to a sum of not more
than $150,000.” 17 U.S.C. § 504(c)(2).
As willfulness is not defined in either the Copyright Act or
its legislative history, its meaning has come from the courts. See
Original Appalachian, 658 F. Supp. at 464. Courts have defined
willfulness “as requiring the plaintiff to show that the infringer
minimum statutory damages.” No. 06-3538, 2006 U.S. Dist. LEXIS
89212, at *6 (D.N.J. Nov. 27, 2006).
acted with actual knowledge or reckless disregard for whether its
defendant’s knowledge or reckless disregard does not have to be
shown directly but “may be inferred from the defendant’s conduct.”
Bly v. Banbury Books, Inc., 638 F. Supp. 983, 986 (E.D. Pa 1986).
Plaintiff alleges that Defendant’s infringement is willful
management data before displaying the photo. Because Defendant has
defaulted, the Court must accept as true Plaintiff’s factual
allegations. See Comdyne I, Inc., 908 F.2d at 1149. The uncontested
record indicates Defendant removed Plaintiff’s watermark, which
identified the image as belonging to the Plaintiff. From this
behavior, the Court infers evidence of willfulness. This is to be
considered, among other evidence, to determine whether Defendant
knew it was infringing on Plaintiff’s copyright or exhibited
reckless disregard by displaying the image in such a manner on its
Some courts have inferred willfulness by way of defendant’s
default alone. See Sony Music Entertainment v. Cassette Prods.,
No. 92-4494, 1996 U.S. Dist. LEXIS 21552, at *11 (D.N.J. Aug. 16,
1996) (“The Court may infer that Defendant Lopez willfully
infringed Plaintiffs’ copyrights in the sound recordings because
Defendant Lopez defaulted and consciously chose not to defend this
action); Peer Int’l Corp. v. Max Music & Entm’t, Inc., No. 030996, 2004 U.S. Dist. LEXIS 12760, at *8 (S.D.N.Y. July 9, 2004)
(“Additionally, the entry of default judgment alone supports the
finding of willfulness.”); Miche Bag, LLC v. Ayers, No. 4-09-3261,
2010 U.S. Dist. LEXIS 130663, at *10 (D.S.C. Sept. 22, 2010)
(“Furthermore, a defendant’s default may establish willful
In addition, willful infringement does not automatically give
rise to heightened statutory damages. See Broad. Music, 555 F.
Supp. 2d at 545 (finding plaintiff’s request for $2,000 per
infringed work reasonable despite willful infringement including
defendant’s persistent conduct after notification of violation).4
“exceptional cases” or with evidence of “especially egregious
circumstances.” See Schiffer Publ’g, Ltd v. Chronicle Books, LLC,
No. 03-4962, 2005 U.S. Dist. LEXIS 416, at *16 (E.D. Pa. Jan. 11,
2005) (“awards outside the ordinary statutory range are made only
in ‘exceptional cases,’ and there must be evidence of ‘especially
egregious circumstances.’”) (citing Joe Hand Promotions v. Burg’s
Lounge, 955 F. Supp. 42, 44 (E.D. Pa. 1997)(internal citations
Because this is a default judgment case with a request for
See also Granger v. Once Call Lender Servs., LLC, No. 10-3442,
2012 U.S. Dist. LEXIS 104885, at *8-9 (E.D. Pa. July 26, 2012)
(using multiplier of ten to award $12,000 per willful infringement
where award of $150,000 was “clearly excessive” because the only
evidence presented as to Plaintiff’s actual loss was licensing
fee); Palmer v. Slaughter, No. 99-899, 2000 U.S. Dist. LEXIS 22118,
at *14 (D. Del. July 13, 2000) (awarding $10,000 per work where
willful infringement involved defendant’s refusal to cease
infringing activities after plaintiff’s repeated requests); but
see Teri Woods Publ’g, L.L.C. v. Williams, No. 12-4854, 2013 U.S.
Dist. LEXIS 167759, at *9-10 (E.D. Pa. Nov. 25, 2013) (awarding
maximum statutory damages of $150,000 without evidence of
plaintiff’s lost profits).
provide a sufficient basis for the Court to determine whether the
requested statutory damages are just. See Broad. Music, 555 F.
Supp. 2d at 544. Plaintiff has not established that Defendant’s
especially since Defendant did not persist in the infringing
conduct and instead promptly removed the offending image from its
To make an appropriate determination on damages, the Court
requires more information including, if possible, the methods and
motives of this infringement, expenses saved and profits reaped by
the infringer and revenues lost by the plaintiff. See Original
Appalachian, 658 F. Supp. at 465. Plaintiff provided the Court
with the relevant ranges for awarding statutory damages under the
statute. However, Plaintiff has not advised the Court of his
licensing rate, nor has he provided an estimate of the loss he
experienced. For this reason, the Court will direct Plaintiff to
submit additional briefing and an affidavit or certification of
facts relevant to the question of damages, consistent with the
above discussion. In lieu thereof, Plaintiff may indicate that the
statutory minimum of $750 is sufficient.
2. Removal of CMI
Plaintiff also requests the maximum statutory damages of
$25,000 for Defendant’s removal of CMI. Under 17 U.S.C. § 1203(c),
a plaintiff may “recover an award of statutory damages for each
violation of section 1202 in the sum of not less than $2,500 or
more than $25,000.” 17 U.S.C. § 1203(c)(3)(B).
As noted above, the Court requires additional information to
determine the appropriate award of statutory damages. The Court
must have a basis to make this determination, such as revenues
lost by Plaintiff and the amount of expenses saved and profits
gained by Defendant. See Original Appalachian, 658 F. Supp. at
465. Additionally, the Court requires additional information as to
how Defendant’s conduct rises to such an egregious level as to
warrant the maximum award of statutory damages.
The Court will direct Plaintiff to submit additional briefing
and an affidavit or certification on damages. In lieu thereof,
Plaintiff may indicate that the statutory minimum of $2,500 is
Finally, Plaintiff requests costs totaling $457.00.
Pursuant to 17 U.S.C. § 505, a court may, at its discretion,
copyright infringement suit. 17 U.S.C. § 505.
Here, the Court finds the award of costs is appropriate.
Plaintiff’s request for $457.00 is reasonable.5
Plaintiff has not sought attorneys’ fees in connection with
counsel’s work to date, pointing out that these actions are
“routinely” litigated by counsel’s office. Because additional
services are now required of counsel, Plaintiff may seek fees in
an amount documented as required by Local Civil Rule 54.2 within
the above fourteen (14) day period.
For these reasons, Plaintiff’s Motion as to costs is granted.
In light of the foregoing, Plaintiff’s Motion for Default
Judgment will be granted as to Defendant’s liability, denied as to
injunctive relief without prejudice, and granted as to costs. The
further submissions; the Court will direct Plaintiff to submit
supplemental briefing and an affidavit or certification of facts
relevant to damages within fourteen (14) days of entry of this
Order. An appropriate Order accompanies this Opinion.
December 2, 2015
s/ Jerome B. Simandle
JEROME B. SIMANDLE
Chief U.S. District Judge
Disclaimer: Justia Dockets & Filings provides public litigation records from the federal appellate and district courts. These filings and docket sheets should not be considered findings of fact or liability, nor do they necessarily reflect the view of Justia.
Why Is My Information Online?