Montblanc-Simplo GmbH v. The Internet Domain Names identified on Schedule A (FILED UNDER SEAL) et al

Filing 44

ORDER- that the 43 Report and Recommendations is ADOPTED, plaintiff's 39 Motion for Default Judgment is GRANTED; default judgment be and is entered against defendant Miroslav Ilnitskiy on Counts 2, 3, and 4 of the First Amended Complaint i n the total amount of $32,150,000.00(consisting of $150,000 in statutory damages for violations of the Copyright Act and $2 million in statutory damages for each of the 16 identified trademark violations under the Anticounterfeiting Co nsumer Protection Act), with prejudgment interest calculated in accordance with Va. Code § 6.2-302 and accruing from August 17, 2015 until the date of entry of judgment and postjudgment interest calculated in accordance with 28 U.S.C. § 196 1 and accruing from the date of entry of judgment; Count 1 be and is DISMISSED WITHOUT PREJUDICE; defendant Miroslav Ilnitskiy, together with all those in active concert or participation with him, is enjoined from copying, distributing, altering, dis playing, hosting, selling and/or promoting copyright protected images and websites authored or owned by plaintiff(the "Montblanc Works")(See order for details). Signed by District Judge Leonie M. Brinkema on 2/13/2018. (Attachments: # 1 First Amended Verified Complaint and Schedules A-D)(acha, )

IN THE UNITED STATES DISTRICT COURT FOR THE
EASTERN DISTRICT OF VIRGINIA
Alexandria Division

MONTBLANC-SIMPLO GMBH,
Plaintiff,

l:17-cv-415(LMB/TCB)
MIROSLAV ILNITSKY,
Defendant.
ORDER

Before the Court is a Report and Recommendation ("Report") issued by a magistrate

judge on January 25, 2018 [Dkt. No. 43], which recommended that plaintiff Montblanc-SimpIo
GmbH's ("plaintiff or "Montblanc") Motion for Default Judgment [Dkt. No. 39] be granted and
that default judgment be entered against defendant Miroslav Ilnitskiy ("defendant" or "Ilnitsky")
on Counts 2, 3, and 4 of the First Amended Verified Complaint. S^ Report at 26-27. The parties
were advised that any objections to the Report had to be filed within 14 days and that failure to

file a timely objection waived the right to appeal any judgment based on the Report. Id. at 28. As
of February 12, 2018, no party has filed an objection. The Court has reviewed the Report,

plaintiffs motion for default judgment, and the case file and adopts the Report in full.
The magistrate judge correctly determined that the Court has subject matter jurisdiction
over this action under 28 U.S.C. §§ 1331 and 1338(a) because it involves federal questions

arising under the Copyright Act and the Lanham Act. Report at 2. The magistrate judge also
correctly concluded that this Court has personal jurisdiction over Ilnitskiy because Ilnitskiy "set
up an interactive e-commerce website and social media accounts accessible to Virginia

residents" and used these "websites and accounts to individually communicate with, receive

payment from, and ship counterfeit products to at least one customer in Virginia." Id. at 4.

Moreover, the magistrate judge correctly concluded that venue is appropriate in this district
under 28 U.S.C. § 1391(b)(2) because a substantial portion of the activity described in the
Complaint has taken place in this district. Id Lastly, the magistrate judge has correctly
concluded that plaintiff properly served Ilnitskiy by publishing notice of the action and emailing

notice to eight email accounts associated with Ilnitskiy. Id at 5-6. Moreover, Ilnitskiy apparently
responded at least twice to plaintiffs notice-related emails, indicating that he has received actual
notice of the litigation. Id. at 6 n.3.

The Court finds that the magistrate judge correctly determined that plaintiff has pleaded

the requirements for obtaining relief under the Copyright Act and the Lanham Act, by pleading
that it owns the copyrights and trademarks in a variety of images, words, and expressions and

that defendant has used those copyrights and trademarks to replicate plaintiffs website and sell
counterfeit replicas of plaintiffs products. Report at 8-10. Moreover, the magistrate judge
correctly found that plaintiff has adequately pleaded that it has registered various marks as
trademarks with the U.S. Patent and Trademark Office, that defendant has knowingly and
intentionally produced counterfeit versions of plaintiffs marks, that defendant's use of these
marks occurred in connection with the distribution of goods, and that defendant's use of the
marks is likely to confuse consumers, all in violation of the Lanham Act. Id at 10-15.

Additionally, the magistratejudge correctly found that plaintiff has adequately pleaded that it
owns the Montblanc Works copyright and that defendant "replicated Montblanc Works and
displayed them during his promotion and sale of counterfeit Montblanc Products," in violation of
the Copyright Act. Id at 15-16.

Accordingly, the magistrate judge's recommendation that plaintiff is entitled to relief
under the Copyright Act and the Lanham Act is fully supported, as is the recommendation that
plaintiff is entitled to statutory damages, injunctive relief, and prejudgment and postjudgment
interest. Id at 16-26.

The recommendation that despite plaintiffs request for attorney's fees and costs, plaintiff
has not provided adequate information about the fees and costs it has incurred to allow the Court
to include such an award in the default judgment is also fully supported, and plaintiff has not
objected to that recommendation. Id at 17 n.4.
Accordingly, the Report is ADOPTED, plaintiff's Motion for Default Judgment [Dkt.
No. 39] is GRANTED, and it is hereby

ORDERED that default judgment be and is entered against defendant Miroslav Ilnitskiy
on Counts 2, 3, and 4 of the First Amended Complaint in the total amount of $32,150,000.00

(consisting of $ 150,000 in statutory damages for violations of the Copyright Act and $2 million
in statutory damages for each of the 16 identified trademark violations under the

Anticounterfeiting Consumer Protection Act), with prejudgment interest calculated in accordance
with Va. Code § 6.2-302 and accruing from August 17, 2015 until the date of entry ofjudgment
and postjudgment interest calculated in accordance with 28 U.S.C. § 1961 and accruing from the
date of entry ofjudgment; and it is further
ORDERED that Count 1 be and is DISMISSED WITHOUT PREJUDICE; and it is
further

ORDERED that defendant Miroslav Ilnitskiy, together with all those in active concert or

participation with him, is enjoined from copying, distributing, altering, displaying, hosting,

selling and/or promoting copyright protected images and websites authored or owned by plaintiff
(the "Montblanc Works"); and it is further

ORDERED that defendant Miroslav Ilnitskiy, together with all those in active concert or
participation with him, is enjoined from using any copy or colorable imitation of any mark
registered to plaintiff with the United States Patent and Trademark Office (the "Montblanc

Marks"), including but not limited to the marks identified in Paragraphs 24 and 26 and Schedules
B and C of the First Amended Verified Complaint, which is attached to this Order, in connection

with the promotion, advertisement, display, sale, offering for sale, manufacture, printing,
importation, production, circulation, or distribution of any product or service, in such fashion as
to relate or connect such product in any way to Montblanc, or to any goods sold, manufactured,
sponsored, approved by, or connected with Montblanc; and it is further

ORDERED that defendant Miroslav Ilnitskiy, together with all those in active concert or
participation with him, is enjoined from engaging in any other activity constituting unfair
competition with Montblanc, or constituting an infringement of the Montblanc Marks or the
Montblanc Works, or constituting any damage to Montblanc's name, reputation, or goodwill;
and it is further

ORDERED that any person or entity in active concert or participation with defendant

Miroslav Ilnitskiy and with notice of the injunction, including any Internet search engines, web
hosting and Internet service providers, domain name registrars (including, but not limited to,
eNom, Inc.), domain name registries, email service providers (including, but not limited to,

Google), social media network operators (including, but not limited to, Instagram, LLC and

VKontakte), and payment processors (including, but not limited to, Paypal), cease facilitating
access to any or all domain names, websites, accounts, and services through which defendant

engages in unlawful access to, use, reproduction, distribution, and sale of the Montblanc Works
or Montblanc Marks or goods bearing the Montblanc Marks, including without limitation all
such domain names, websites, accounts, and services identified in the First Amended Verified

Complaint and Exhibit A thereto, which is attached to this Order.

The Clerk is directed to enter judgment in plaintiffs favor pursuant to Fed. R. Civ. P. 55
and forward copies of this Order to counsel of record and defendant, pro se.

Entered this / 3 day ofFebruary, 2018.

Alexandria, Virginia

/]

MUJfll
Leonie M. Brinkeiita

United States District Judge