Fuzzy Logic Productions, Inc. v. Trapflix, LLC

         IN CHAMBERS - COURT ORDER

          Present: Honorable PERCY ANDERSON, UNITED STATES DISTRICT JUDGE

          CIVIL MINUTES - GENERAL

          Honorable PERCY ANDERSON, UNITED STATES DISTRICT JUDGE

         Before the Court are a Motion for Default Judgment (Docket No. 94) and a Motion for Attorneys' Fees (Docket No. 91) filed by plaintiff and counter-defendant Fuzzy Logic Productions, Inc. ("Fuzzy Logic" or "Plaintiff"). Fuzzy Logic seeks entry of Judgment and attorneys' fees from defendants and counter-claimants Joseph Tom, also known as "Figg Panamera" and "JT the Bigga Figga" ("Tom"), and Trapflix, LLC, a Georgia limited liability company ("Trapflix GA"). Pursuant to Rule 78 of the Federal Rules of Civil Procedure and Local Rule 7-15, the Court finds that these matters are appropriate for decision without oral argument. The hearing scheduled for July 18, 2016 is vacated, and the matters taken off calendar.

         I. Factual and Procedural Background

         This is a trademark and copyright infringement action. Plaintiff owns the intellectual property rights related to the motion picture "Snow on tha Bluff" that was released commercially in 2012. The operative Second Amended Complaint ("SAC") alleges that "Snow on tha Bluff" is a fictional movie loosely based on the experiences of an individual named Curtis Snow and the Atlanta neighborhood called "the Bluff" in which Snow resides. (SAC ¶ 22.) "Snow on tha Bluff" has been released through a variety of platforms, including home DVD and Netflix. Plaintiff asserts that the "trade name ‘Snow on tha Bluff' has achieved substantial national recognition and acquired secondary meaning." (SAC ¶ 26.)

         Plaintiff alleges that defendants Tom, Trapflix GA, of which Tom is the sole shareholder and Chief Executive Officer, Calvin Broadus, who is also known by his stage name "Snoop Dogg" ("Broadus"), and Trapflix, LLC, a California limited liability company ("Trapflix CA"), operated by Broadus, together produced, marketed, and distributed "unauthorized movie sequels" with the names "Snow on tha Bluff 2" and possibly "Snow on tha Bluff 3." (SAC ¶ 28.) "Snow on tha Bluff 2" had been distributed on the "Trapflix" website operated by Trapflix GA. (FAC ¶¶ 27-29.) The title cards appearing in "Snow on tha Bluff 2" include statements that it is a "Trapflix original motion picture, " "A JT the Bigga Figga film, " and "a Trapflix production." (SAC ¶ 30.) The credits for "Snow on tha Bluff 2" list "Figg Panamera" and "Snoop Dogg" as executive producers. (Id.)

         The SAC alleges claims for: (1) copyright infringement against Tom and Trapflix GA; (2) infringement of an unregistered trademark against Tom and Trapflix GA; (3) trademark dilution pursuant to 15 U.S.C. § 1125(c) against Tom and Trapflix GA; (4) false advertising pursuant to 15 U.S.C. § 1125(a) against Tom and Trapflix GA; (5) false designation of origin pursuant to 15 U.S.C. § 1125(a) against Tom and Trapflix GA; (6) common law trademark infringement against Tom and Trapflix GA; (7) unfair competition pursuant to California Business and Professions Code section 17200 against Tom and Trapflix GA; (8) trademark dilution and injury to business reputation pursuant to California Business and Professions Code section 14330 against Tom and Trapflix GA; (9) unjust enrichment against Tom and Trapflix GA; (10) contributory copyright infringement against all defendants; and (11) contributory trademark infringement against all defendants.

         Plaintiff has settled and dismissed his claims against Broadus and Trapflix CA. (See Docket Nos. 84, 90, & 93.) Trapflix GA and Tom filed a Counterclaim for copyright infringement against Fuzzy Logic. The attorneys retained by Tom and Trapflix GA eventually sought the Court's permission to withdraw as counsel as a result of the failures by Tom and Trapflix GA to pay their attorneys' fees or cooperate with their counsel, and because Tom and Trapflix GA were, according to their attorneys, engaging in a course of conduct that created a risk that continued representation would breach counsel's ethical obligations. In granting the Motion to Withdraw as Counsel, the Court warned Trapflix GA that, consistent with Local Rule 83-2.2.2, it could not represent itself. The Court gave Trapflix GA time to obtain new counsel, but stated that if it did not do so, the Court would strike its Answer and Counterclaim and enter its default. At the same time, the Court advised Tom that if he did not timely obtain new counsel or enter an appearance as counsel on his own behalf, that his Answer and Counterclaim would be stricken and his default entered. After the expiration of the deadline for an appearance by Tom or new counsel on behalf of him and Trapflix GA, the Court struck their Answers and Counterclaims and entered their defaults on May 26, 2016.

         In its Motion for Default Judgment, Fuzzy Logic seeks an award of damages, attorneys' fees, injunctive relief, and pre- and post-judgment interest against Tom and Trapflix GA (collectively "Defendants"), on its copyright and trademark claims. Specifically, Fuzzy Logic seeks an award of $150, 000 in statutory damages under the Copyright Act. Fuzzy Logic also seeks damages under the Lanham Act for its actual damages and lost profits of $417, 430, $250, 000 in unjust enrichment obtained by Defendants, and $155, 300 for corrective advertising. Fuzzy Logic requests that the Court exercise its discretion under the Lanham Act to triple these damages as a result of the willful infringement committed by Tom and Trapflix GA. Fuzzy Logic also seeks an award of $179, 709 in attorneys' fees and costs incurred to prosecute its copyright and trademark claims, and an additional $28, 965 in attorneys' fees and costs in its successful defense of the Counterclaim for copyright infringement asserted by Tom and Trapflix GA.

         II. Legal Standard and Liability

         Federal Rule of Civil Procedure 55(b)(2) grants the Court the power to enter a default judgment. The Court need not make detailed findings of fact in the event of a default judgment. Adriana Int'l v. Thoeren, 913 F.2d 1406, 1414 (9th Cir. 1990). The general rule is that upon entry of default, well-pled allegations in the complaint regarding liability are deemed true. Geddes v. United Fin. Corp., 559 F.2d 557, 560 (9th Cir. 1977). Factors the Court should consider in evaluating a motion for entry of default judgment include: "(1) the possibility of prejudice to the plaintiff; (2) the merits of the plaintiff's substantive claim; (3) the sufficiency of the complaint; (4) the sum of money at stake in the action; (5) the possibility of a dispute concerning material facts; (6) whether the default was due to excusable neglect; and (7) the strong policy underlying the Federal Rules of Civil Procedure favoring decisions on the merits." Eitel v. McCool, 782 F.2d 1470, 1471-72 (9th Cir. 1986).

         The Court finds that these factors weigh in favor of granting the Motion for Default Judgment with respect to liability. In light of the allegations in the SAC, Defendants' abandonment of their defense and counterclaims, and willful failure to participate in the action, Plaintiff's interest in efficient resolution of the case outweighs any interest in an adjudication on the merits. See PepsiCo, Inc. v. Cal. Sec. Cans, 238 F.Supp.2d 1172, 1177 (C.D. Cal. 2002) ("Under Fed.R.Civ.P. 55(a), termination of a case before hearing the merits is allowed whenever a defendant fails to defend an action."). The Court therefore grants Plaintiff's Motion for Default Judgment with respect to liability.

         III. ...