Chanel, Inc. v. Matos

• Citation: 133 F.Supp.3d 678
• Decision Date: 13 August 2015
• Docket Number: Civil Action No. 14–3509 (JBS/KMW).
• Parties: CHANEL, INC., A New York Corporation, Plaintiff, v. Rafael MATOS, an individual, d/b/a Fandangotees.com d/b/a Jessmar d/b/a @Nenemott d/b/a Nenemott, and Does 1–10, Defendants.
• Court: U.S. District Court — District of New Jersey

133 F.Supp.3d 678

CHANEL, INC., A New York Corporation, Plaintiff,
v.
Rafael MATOS, an individual, d/b/a Fandangotees.com d/b/a Jessmar d/b/a @Nenemott d/b/a Nenemott, and Does 1–10, Defendants.

Civil Action No. 14–3509 (JBS/KMW).

United States District Court, D. New Jersey.

Signed Aug. 13, 2015.

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Gabriel H. Halpern, Esq., Pinilis Halpern, LLC, Morristown, NJ, for Plaintiff.

OPINION

SIMANDLE, Chief Judge:

I. INTRODUCTION

In this action for trademark infringement, counterfeiting, and false designation of origin under the Lanham Act, 15 U.S.C. §§ 1114, 1125(a) (hereinafter, the "Lanham Act"), Plaintiff Chanel, Inc. (hereinafter, "Plaintiff" or "Chanel") moves for default

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judgment under Rule 55(b)(2), Fed.R.Civ.P., against Defendant Rafael Matos, an individual, d/b/a fandangotees.com d/b/a jessmar d/b/a @nenemott d/b/a nenemott (hereinafter, "Defendant" or "Matos") for failure to answer or otherwise respond to Plaintiff's Complaint. [See Docket Item 9.]

For the reasons that follow, Plaintiff's motion will be granted in part, and the Court will enter a default judgment in favor of Plaintiff and against Defendant in the amount of $180,400. In addition, the Court will enter a permanent injunction, barring Defendant from, among other things, using Plaintiff's protected trademarks in connection with the sale of any unauthorized and/or counterfeit goods.

II. BACKGROUND

A. Factual and Procedural Background¹

Chanel manufactures and distributes high quality clothing products bearing its long held Trademarks protected under Registration Numbers 1,241,264, 1,241,265, and 4,241,822 (hereinafter, the "Chanel Marks" or "Marks").² (Compl. at ¶¶ 2, 7.)

As a result of Chanel's extensive use and promotion of the Chanel Marks, it alleges that these uniquely identifying marks distinctly symbolize "Chanel's quality, reputation, and goodwill," and states that members of the international consuming public "readily identify" and widely recognize "merchandise bearing the Chanel Marks, as being high quality merchandise sponsored and approved by Chanel."³ (Id. at ¶¶ 10–13.) As a result, Chanel "carefully monitor[s] and police[s] the use" of its Marks. (Id. at ¶ 12.) Indeed, "as part of its ongoing investigations regarding the sale of counterfeit" branded products, Chanel retains private investigative firms "to investigate the suspected sales of counterfeit Chanel branded products." (Sisbarro Dec. at ¶ 10.) This action arises from one such investigation.

Specifically, in January 2014, Plaintiff hired a private investigator (hereinafter, the "Investigator") to investigate Defendant's online advertisement of "CHANEL" and/or "Chanel Inspired" products. (See generally Popp Dec. at ¶ 3; see also Ex. 2 to Popp Dec.) In connection with this investigation, the Investigator researched Defendant and his website, and ultimately contacted him by telephone, in order to express interest in Defendant's "Chanel Inspired" products. (Popp Dec. at ¶ 4; Ex. 1 to Gaffigan Dec. (setting forth screenshots of Defendant's websites).) During the conversation, the Investigator certifies that Defendant identified himself as "Rafael Matos" and confirmed that his products "aren't the real Chanel shirts,"

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despite their markings. (Popp Dec. at ¶ 4.) The Investigator thereafter ordered "3 chanel blk shirts" from Defendant's online market for $45. (Id. at ¶ 5.)

Following receipt of the three shirts bearing marks seemingly identical to the Chanel Marks, the investigator forwarded the shirts to Adrienne Hahn Sibarro (hereinafter, "Ms. Sisbarro"), the Director of Intellectual Property and Legal Operations for Chanel, for purposes of review and inspection. (Id. at ¶ 8; see also Sisbarro Dec. at ¶ 2.) Upon visual inspection, Ms. Sisbarro certifies that she quickly identified them as "non-genuine, unauthorized Chanel branded products," of a quality and price point substantially different from that of Chanel's genuine goods. (Sisbarro Dec. at ¶ 12.)

Chanel, however, has "never" authorized Defendant to use its Marks, nor consented to Defendant's distribution of infringing products. (Compl. at ¶ 9, 20; see also Sisbarro Dec. at ¶ 9.) Nevertheless, Defendant has, with "full knowledge of Chanel's ownership of the Chanel Marks," actively advertised, distributed, and sold clothing products unlawfully bearing the Chanel Marks. (Compl. at ¶¶ 15–17.) As a result, Chanel alleges that Defendant has knowingly, intentionally, and/or blindfully engaged in activities that infringe upon "Chanel's rights for the purpose of trading on the goodwill and reputation of Chanel," and to the detriment of the "consuming public" and Chanel. (Id. at ¶¶ 21–22.) Chanel therefore seeks monetary damages and injunctive relief for Defendant's various violations of Lanham Act. (Id. at ¶¶ 27–41.)

B. Plaintiff's Arguments

In the pending motion, Plaintiff argues that the unchallenged record in this action demonstrates its entitlement to a default judgment on Plaintiff's Lanham Act claims for trademark infringement, counterfeiting, and false designation, and an award of statutory damages, permanent injunctive relief, as well as costs of suit and interest. (See Pl.'s Br. at 6–16.)

III. STANDARD OF REVIEW

Federal Rule of Civil Procedure 55(b)(2) authorizes courts to enter a default judgment against a properly served defendant who fails to a file a timely responsive pleading. See Fed.R.Civ.P. 55(b)(2) ; see also Chanel v. Gordashevsky, 558 F.Supp.2d 532, 535 (D.N.J.2008) (citing Anchorage Assoc. v. Virgin Is. Bd. of Tax Rev., 922 F.2d 168, 177 n. 9 (3d Cir.1990) ). Nevertheless, the decision of whether to enter a default judgment rests within the sound "discretion of the district court," Hritz v. Woma Corp., 732 F.2d 1178, 1180 (3d Cir.1984), and the Court of Appeals for the Third Circuit has "repeatedly state[d] [its] preference that cases be disposed of on the merits whenever practicable." Id. at 1181.

As a result, prior to entering a judgment of default, a court must determine: (1) whether the plaintiff produced sufficient proof of valid service and evidence of jurisdiction,⁴ (2) whether the unchallenged facts present a legitimate cause of action, and (3) whether the circumstances otherwise render the entry of default judgment "proper." Teamsters Health & Welfare Fund of Phila. & Vicinity

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v. Dubin Paper Co., No. 11–7137, 2012 WL 3018062, at *2 (D.N.J. July 24, 2012) (internal citations omitted). In so considering, a court must accept as true every "well-pled" factual allegation of the complaint. Comdyne I, Inc. v. Corbin, 908 F.2d 1142, 1149 (3d Cir.1990). A court need not, however, accept the plaintiff's legal conclusions, nor the plaintiff's assertions concerning damages. See id.; see also Doe v. Simone, No. 12–5825, 2013 WL 3772532, at *2 (D.N.J. July 17, 2013) (citations omitted).

IV. DISCUSSION

A. The Court Has Personal Jurisdiction over Defendant

As to the first inquiry, the Court must consider whether it possesses specific or general personal jurisdiction over Defendant, an individual who resides and conducts business in New Jersey.⁵ For that reason, however, this inquiry proves relatively straightforward, because an "individual's domicile," or home, constitutes the paradigmatic "forum for the exercise of general jurisdiction." Daimler AG v. Bauman, ––– U.S. ––––, 134 S.Ct. 746, 760, 187 L.Ed.2d 624 (2014) (quoting Goodyear Dunlop Tires Operations, S.A. v. Brown, 564 U.S. 915, 131 S.Ct. 2846, 2853–54, 180 L.Ed.2d 796 (2011) ). Here, the record developed in this action plainly reflects that this forum constitutes Defendant's domicile. (See, e.g., Compl. at ¶ 3 (identifying Defendant's New Jersey address); Ex. 4 to Popp Dec. (identifying the same address).) Moreover, Plaintiff personally served its Complaint upon Defendant at his residence in New Jersey, and this method of in-forum service has long provided a basis to exercise personal jurisdiction. See, e.g., Erwin v. Waller Capital Partners, LLC, No. 10–3283, 2010 WL 4053553, at *3 (D.N.J. Oct. 14, 2010) (finding the exercise of personal jurisdiction over the defendant proper, the plaintiff "properly served" the defendant "with a copy of the Summons and the Complaint at his Mantoloking, N.J. residence"). As a result, the Court finds that the undisputed facts readily support the exercise of personal jurisdiction over Defendant.

B. The Unchallenged Record Establishes Legitimate Claims for Trademark Infringement and Counterfeiting under the Lanham Act

With respect to the second inquiry, the Court must consider whether the undisputed facts of Plaintiff's Complaint allege legitimate claims for trademark infringement, counterfeiting, and/or false designation of origin.⁶

1. Trademark Infringement

" ‘The law of trademark protects trademark owners in the exclusive use of their marks when...