Deckers Outdoor Corp. v. Ozwear Connection Pty Ltd.
| Decision Date | 18 September 2014 |
| Docket Number | CV 14-2307 RSWL (FFMx) |
| Court | U.S. District Court — Central District of California |
| Parties | Deckers Outdoor Corporation, Plaintiff, v. Ozwear Connection Pty Ltd., Alexander Adams, and Does 1-10, inclusive, Defendants. |
Currently before the Court is Plaintiff Deckers Outdoor Corporation's ("Deckers" or "Plaintiff") Motion for Default Judgment [15] against Defendants Ozwear Connection Pty Ltd. ("Ozwear") and Alexander Adams ("Adams") (collectively, "Defendants"), filed by Plaintiff on July 31, 2014. Plaintiff moves for Default Judgment against Defendants as to the following claims: (1) Trademark Infringement in violation of 15 U.S.C. §§ 1114(1) and 1125(a); (2) Unfair Competitionand False Designation of Origin in violation of 15 U.S.C. § 1125(a); (3) Dilution of a Famous Mark in violation of 15 U.S.C. § 1125(c); (4) "Cybersquatting" in violation of 15 U.S.C. § 1125(d); and (5) two claims of Patent Infringement in violation of 35 U.S.C. § 271. Plaintiff requests as relief $4 million ($2 million per defendant) in statutory damages pursuant to 15 U.S.C. § 1117(c)(2), a permanent injunction, and various orders.
The Motion was set for hearing on September 10, 2014, and was taken under submission by the Court on September 4, 2014 [16]. The Court, having reviewed all papers submitted pertaining to this Motion, NOW FINDS AND RULES AS FOLLOWS: The Court GRANTS in part and DENIES in part Plaintiff's Motion for Default Judgment.
Plaintiff Deckers is an American corporation that designs, markets, and sells footwear and other merchandise under its UGG® brand. Compl. ¶¶ 6, 14-19. Plaintiff owns the trademark "UGG," a valid and incontestible trademark registered with the U.S. Patent & Trademark Office (hereinafter referred to as the "UGG Trademark"). Compl. ¶¶ 15-17. Plaintiff and its predecessors in interest have continuously used the UGG trademark since at least 1979, and since acquiring the UGG trademark and its business goodwill in 1995, Plaintiff has continuously sold footwear, clothing, and accessories under the UGG trademark. Compl. ¶ 15, 16. Plaintiff's UGG®-brand products are distributed andsold to consumers throughout the United States, including on the Internet through Plaintiff's website, www.ugg.com. Compl. ¶ 14.
Plaintiff also owns two United States design patents, registered with the U.S. Patent & Trademark Office as design patent No. D616,189 and No.D599,999. Compl. ¶ 20-21. Plaintiff has not granted to Defendants any form of consent to use Plaintiff's patents or the UGG Trademark. Compl. ¶¶ 17, 22.
Defendant Ozwear is an Australian business that sells products, including sheepskin footwear, that bear a label that includes the "UGG" mark. Compl. ¶ 7; Mot. for Default J. ("Mot.") at 22-23, Decl. Of Robert L. Holmes; id. at 28-46, Exs. A-D. Ozwear owns or operates the website ozwearuggs.com.au, through which Ozwear sells its products to United States customers, including customers in California. Compl. ¶ 10-12. Defendant Adams is an Australian citizen who is the owner or agent of Ozwear and who, through the website ozwearuggs.com.au, sells Ozwear products bearing the "UGG" mark in the United States, including in California. Compl. ¶¶ 8-12; Mot. at 22-23, Holmes Decl. ¶¶ 2-5; id. at 32-46, Exs. B-D.
Plaintiff alleges that Defendants Ozwear and Adams have and continue to knowingly and willfully infringe on Plaintiff's UGG Trademark by advertising, manufacturing for sale, offering for sale, importing, or selling counterfeit products bearing Plaintiff's UGGTrademark in the United States through Defendants' Internet website, ozwearuggs.com.au. Compl. ¶¶ 12, 27-36. Plaintiff also alleges that Defendants, through ozwearuggs.com.au, sell footwear in the United States that infringes on the ornamental design protected in two of Plaintiff's design patents, Patent No. D599,999 and Patent No. D616,189. Compl. ¶¶ 25-26, 65-72, & Exs. B-C.
Plaintiff filed this action against Defendants on March 26, 2014 [1]. The Summons and Complaint were served on Defendants on April 10, 2014. Mot. at 4; id. at 26, Wang Decl. ¶ 2. Proofs of service for Defendants were filed on May 7, 2014 [9]. On May 30, 2014, Plaintiff requested the Clerk to enter default against Defendants [11]. The Clerk entered Defendants' default on June 3, 2014 [13, 14]. On July 31, 2014, Plaintiff filed this Motion for Default Judgment against Defendants [15]. On July 31, 2014, Plaintiff served Defendants with this Motion, Notice of Motion, and supporting papers. Mot. at 26-27, Wang Decl. ¶ 7. To date, Defendants have not filed responsive pleadings or otherwise appeared in this action.
Federal Rule of Civil Procedure 55 governs the entry of default judgment: "[w]hen a party against whom a judgment for affirmative relief is sought has failed to plead or otherwise defend . . ., the clerk must enter the party's default." Fed. R. Civ. P. 55(a).After default is properly entered, a party seeking relief other than a sum certain must apply to the Court for a default judgment. See Fed. R. Civ. P. 55(b). A party moving for default judgment by the Court must satisfy both procedural and substantive requirements.
When application is made to the Court for default judgment, the application must comply with the procedural requirements in Federal Rules of Civil Procedure 55 and 56, and must comply with Local Rule 55-1. Vogel v. Rite Aid Corp., 992 F. Supp. 2d 998, 1006 (C.D. Cal. 2014).
Substantively, the decision to grant or deny default judgment is within the discretion of the district court. Vogel, 992 F. Supp. 2d at 1005; see Fed. R. Civ. P. 55. The Ninth Circuit has established seven factors to assist the court in determining whether default judgment is substantively appropriate:
(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 default was due to excusable neglect; and;
(7) the strong policy underlying the Federal Rules of Civil Procedure that favors decisions on the merits. Eitel v. McCool, 782 F.2d 1470, 1472-73 (9th Cir. 1986). When analyzing whether entry of defaultjudgment is substantively proper, the factual allegations in the complaint are taken as true, as all factual allegations in the complaint, except those proving the amount of actual damages, are deemed admitted by the defaulting party once default has been properly entered against that party. Geddes v. United Financial Grp., 559 F.2d 557, 560 (9th Cir. 1977); see Fed. R. Civ. P. 8(b)(6).
Additionally, "[w]hen entry of judgment is sought against a party who has failed to plead or otherwise defend, a district court has an affirmative duty to look into its jurisdiction over both the subject matter and the parties." In re Tuli, 172 F.3d 707, 712 (9th Cir.1999). When assessing whether jurisdiction is proper, "a court must also determine whether the service of process on the party against whom default judgment is requested is adequate." DFSB Kollective Co. v. Tran, No. 11-CV-0104 9-LHK, 2011 WL 6730678, at *6 (N.D. Cal. Dec. 21, 2011).
The Court has subject matter jurisdiction over Plaintiff's claims pursuant to 28 U.S.C. § 1338, 15 U.S.C. § 1121, and 28 U.S.C. § 1331.
For a district court to properly exercise personal jurisdiction over a nonresident defendant, the forumstate's laws must provide a basis for exercising personal jurisdiction, and the assertion of personal jurisdiction must comport with due process. CollegeSource, Inc. v. AcademyOne, Inc., 653 F.3d 1066, 1073-74 (9th Cir. 2011).
The California long-arm statute permits the exercise of jurisdiction "on any basis not inconsistent with the Constitution . . . of the United States." Cal. Civ. Proc. Code § 410.10. This language renders California's long-arm statute "coextensive with federal due process requirements" so that only a due-process analysis is required. See CollegeSource, 653 F.3d at 1073 (citation omitted).
Due process requires a nonresident defendant to have "certain minimum contacts" with the forum state "such that the maintenance of the suit does not offend traditional notions of fair play and substantial justice." Int'l Shoe Co. v. Washington, 326 U.S. 310, 316 (1945). The defendant's contacts must be "such that the [defendant] should reasonably anticipate being haled into court there." World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 297 (1980).
As both Defendants are "nonresidents" of California, Compl. ¶¶ 7-10, Plaintiff must show that Defendants have sufficient contacts with California to justify personal jurisdiction. Sufficient contacts can be established by proving either general or specific personal jurisdiction. Id. a. Specific Personal Jurisdiction
A district court may assert specific personal jurisdiction over a defendant if the defendant has "purposefully directed" his activities at the forum and if the plaintiff's alleged claims and injuries "arise out of or relate to those activities." Burger King Corp. v. Rudzewicz, 471 U.S. 462, 472-73 (1985).
The Ninth Circuit applies a three-part test to determine whether the exercise of specific jurisdiction over a nonresident defendant comports with due process:
(3) the exercise of jurisdiction must comport with fair play and substantial justice, i.e. it must be reasonable.
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