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Coach, Inc. v. Sexy Fashion

United States District Court, Ninth Circuit

June 25, 2013

Coach, Inc.; Coach Services, Inc., Plaintiffs,
v.
Sexy Fashion; Blanca Montes, Defendants.

ORDER Re: PLAINTIFFS' MOTION FOR DEFAULT JUDGMENT [24]

RONALD S.W. LEW, District Judge.

On May 24, 2013, Plaintiffs Coach, Inc. and Coach Services, Inc. (collectively "Plaintiffs") filed the present Motion for Default Judgment [24]. The Court, having considered all papers submitted pertaining to this Motion, NOW FINDS AND RULES AS FOLLOWS:

Plaintiffs' Motion for Default Judgment is GRANTED.

I. INTRODUCTION

Plaintiffs bring the present Motion for Default Judgment against Defendants Sexy Fashion and Blanca Montes (collectively "Defendants") [24]. Plaintiffs are in the business of manufacturing, marketing, and selling fine leather and mixed material products including handbags, apparel, and accessories. Second Amend. Compl. ("SAC") ¶ 9. Plaintiffs are the worldwide owners of the trademark "COACH" and various composite trademarks and assorted design components (collectively "Coach Marks"). Id. at ¶ 10. Coach Marks include a "CC" mark designed in what is generally known as the "CC Design." Id. at ¶ 11. Many of Plaintiffs' products exhibit composites of the CC mark in an assortment of different sizes, patterns, and colors. Id . Plaintiffs also own the copyright registration of an "Op Art Design." Id. at ¶ 14.

Plaintiffs allege that in April 2012, they discovered that Defendants were selling handbags with counterfeit reproductions of the Coach Marks, CC Design, and Op Art Design on them. Mot. 7:15-17; SAC ¶ 19. Plaintiffs instigated the present Action against Defendants on March 7, 2013, alleging various trademark and copyright infringements [18]. On March 28, 2013, Plaintiffs served Defendants with the Summons and Second Amended Complaint ("SAC") [19, 20], but to date, Defendants have not appeared in this Action. Accordingly, Plaintiffs filed the instant Motion for Default Judgment against all Defendants on May 24, 2013 [24].

II. DISCUSSION

As a matter of initial concern, the Court finds that it has proper subject matter and personal jurisdiction in this case. Pursuant to 28 U.S.C. §§ 1331 and 1367, the Court has subject matter jurisdiction because this Action was brought, in part, under the Lanham Trademark Act of 1946 (the "Lanham Act"). The Court also has personal jurisdiction over Defendants because Defendant Sexy Fashion is a corporation organized and existing under the laws of the state of California, and Defendant Montes allegedly conducts business within California. SAC at ¶ 2

With regard to the present Motion, Plaintiffs have met the procedural requirements of Local Rule 55-1 for default judgment. Specifically, the Court Clerk entered default against Defendants as to the SAC on April 22, 2013 [22]. Defendants are not minors, incompetent, in the military, or otherwise exempted under the Servicemembers Civil Relief Act. Marchand Decl. ¶ 5. Lastly, Plaintiffs served Defendants notice of this Motion on May 24, 2013. Id. at ¶ 6.

Furthermore, the Court finds that the seven substantive factors set forth in Eitel v. McCool , 782 F.2d 1470, 1471-72 (9th Cir. 1986), weigh in favor of granting default judgment. As to the first factor, Plaintiffs will likely be prejudiced if the Court denies the instant Motion because Plaintiffs will have no other recourse for obtaining damages or injunctive relief. See Elektra Entm't Group Inc. v. Crawford , 226 F.R.D. 388, 392 (C.D. Cal. 2005). The second and third Eitel factors concerning the merits of Plaintiffs' case and the sufficiency of their Complaint also favor granting default judgment. Plaintiffs sufficiently allege facts in the SAC to support a claim for federal trademark infringement under the Lanham Act, which alone provides a basis for awarding the relief Plaintiffs request.

However, the fourth factor, which balances the amount of money at stake in the claim with the seriousness of the Defendants' conduct, weighs against awarding default judgment. Plaintiffs seek $100, 000 in statutory damages, which outweighs the egregiousness of Defendants' conduct. Moreover, federal courts have found that much lesser amounts are sufficient to deter trademark infringers in similar situations. See, e.g., Coach, Inc. v. Am. Fashion Gift, No. CV 12-07649-MWF (Rzx), 2013 WL 950938, at *2 (C.D. Cal. Mar. 12, 2013).

With regard to the fifth factor, there is nothing to suggest the possibility of a dispute over material facts here because Defendants have not filed a responsive pleading to the SAC. Additionally, where a plaintiff has filed a well-pled complaint, the possibility of a dispute over material facts is remote. Landstar Ranger, Inc. v. Parth Enters., Inc. , 725 F.Supp.2d 916, 921-22 (C.D. Cal. 2010). Moreover, there is no evidence that Defendants' failure to respond was the result of excusable neglect. Thus, the sixth factor also weighs in favor of granting default judgment.

Finally, as to the seventh factor, although federal policy favors decisions on the merits, Federal Rule of Civil Procedure 55(b) permits the entry of default judgment in situations, such as this, where the defendant has refused to litigate. In addition, a defendant's failure to answer a complaint "makes a decision on the merits impractical, if not impossible." Elektra , 226 F.R.D. at 393; Pepsico, Inc. v. Cal. Security Cans. , 238 F.Supp.2d 1172, 1177 (C.D. Cal. 2002).

Based on these considerations, the Court finds that default judgment against Defendants is warranted and ...


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