Hollander Glass Tex., Inc. v. Rosen-Paramount Glass Co.

• Decision Date: 12 March 2018
• Docket Number: 17 Civ. 2105 (VSB) (GWG)
• Citation: 291 F.Supp.3d 554
• Parties: HOLLANDER GLASS TEXAS, INC., Plaintiff, v. ROSEN–PARAMOUNT GLASS CO., INC., et al., Defendants.
• Court: U.S. District Court — Southern District of New York

291 F.Supp.3d 554

HOLLANDER GLASS TEXAS, INC., Plaintiff,

v.ROSEN–PARAMOUNT GLASS CO., INC., et al., Defendants.

17 Civ. 2105 (VSB) (GWG)

United States District Court, S.D. New York.

Signed March 12, 2018

Jeffrey Mark Rollings, Lackenbach Siegel LLP, Scarsdale, NY, for Plaintiff.

REPORT AND RECOMMENDATION

GABRIEL W. GORENSTEIN, UNITED STATES MAGISTRATE JUDGE

Plaintiff Hollander Glass Texas, Inc. ("Hollander") brought this action alleging federal copyright infringement, trademark infringement and unfair competition under the Lanham Act, and trademark infringement under New York statutory and common law against defendants Rosen Paramount Glass & Mirror, LLC ("RPGM") and David Gutman (collectively, the "Gutman defendants"), and Rosen–Paramount Glass Co., Inc. and Stanley Rosen (collectively, the "Rosen defendants"). The Gutman defendants have defaulted and now Hollander seeks a judgment for damages as well as attorneys' fees and costs.¹ For the following reasons, Hollander should be awarded a judgment of $48,173.31.

I. BACKGROUND

On March 23, 2017, Hollander filed a complaint against the Rosen defendants. See Complaint, filed Mar. 23, 2017 (Docket # 1). Following an appearance by counsel for the Rosen defendants, Hollander learned that Rosen had sold its business to the Gutman defendants in November 2016. See Affidavit of Stanley Rosen, dated May 30, 2017 (annexed as Ex. 1 to Declaration of Stephanie J. Kaufman, filed May 31, 2017 (Docket # 26) ), ¶ 9. Accordingly, Hollander amended its complaint to name the Gutman defendants. See Amended Complaint, filed June 22, 2017 (Docket # 27) ("Am. Compl."). RPGM was served on July 3, 2017, see Affidavit of Service, filed July 20, 2017 (Docket # 33), and David Gutman was served on July 6, 2017, see Affidavit of Service, filed July 20, 2017 (Docket # 34). The amended complaint alleged infringement of a registered trademark and a registered copyright of Hollander's online content. See Am. Compl. ¶¶ 35, 37, 38, 42. The Gutman defendants failed to respond and the Clerk issued a certificate of default on August 3, 2017. See Clerk's Certificate of Default, filed Aug. 3, 2017 (Docket # 40).

Several months later, the Rosen defendants were dismissed from the case in accordance with a settlement they entered into with Hollander. See Stipulation of Dismissal, filed Jan. 10, 2018 (Docket # 67); Letter from Stephanie J. Kaufman, dated Nov. 7, 2017 (Docket # 63) ("Kaufman letter").

On August 24, 2017, District Judge Vernon S. Broderick issued an Order requiring the Gutman defendants to show cause why a default judgment should not be entered against them. Order to Show Cause for Default Judgment Against Defendants Rosen–Paramount Glass & Mirror, LLC, and David Gutman, filed Aug. 24, 2017 (Docket # 41). On September 19, 2017, Judge Broderick ordered that a default judgment be entered against the Gutman defendants in an amount to be determined after inquest, and decreed that the Gutman defendants be permanently enjoined from further infringement of Hollander's trademark and copyright as alleged in the amended complaint. See Default Judgment Order, filed Sept. 19, 2017 (Docket # 46) ("Default Judgment Order").

Shortly thereafter, Hollander filed the instant motion for a default judgment against the Gutman defendants seeking damages in the amount of $150,000, together with attorneys' fees in the amount of $54,102.25 and costs in the amount of $1663.42, for a total of $205,765.67. Pl. Mem. at 8, 10, 11. On October 20, 2017, Judge Broderick referred the motion to the undersigned for an inquest as to damages. See Amended Order Referring Case to Magistrate Judge, filed Oct. 20, 2017 (Docket # 59). On October 23, 2017, this Court directed the Gutman defendants to respond to Hollander's motion for default judgment by December 15, 2017. Order, filed Oct. 23, 2017 (Docket # 60) ("October 23 Order"). They never filed a response.

After reviewing Hollander's submission, the Court requested further explanation for Hollander's application for attorneys' fees and costs. See Order, filed Feb. 15, 2018 (Docket # 68). Hollander submitted further explanation on March 1, 2018. See Rollings 2d Decl.

Because the default order entered in this case establishes the Gutman defendants' liability, see Bambu Sales, Inc. v. Ozak Trading Inc., 58 F.3d 849, 854 (2d Cir. 1995), the only remaining issue is whether Hollander has supplied adequate support for the damages it seeks, Kuruwa v. Meyers, 823 F.Supp.2d 253, 256 (S.D.N.Y. 2011), aff'd, 512 Fed.Appx. 45 (2d Cir. 2013) ; accord GAKM Res. LLC v. Jaylyn Sales Inc., 2009 WL 2150891, at *2 (S.D.N.Y. July 20, 2009). The Second Circuit has held that a damages inquest may be held on the basis of documentary evidence alone "as long as [the court has] ensured that there was a basis for the damages specified in [the] default judgment." Fustok v. ContiCommodity Servs., Inc., 873 F.2d 38, 40 (2d Cir. 1989) ; accord Action S.A. v. Marc Rich & Co., Inc., 951 F.2d 504, 508 (2d Cir. 1991). The October 23 Order notified the parties that the Court would conduct the inquest based upon the written submissions of the parties unless a party sought an evidentiary hearing. See October 23 Order ¶ 3. No party has requested an evidentiary hearing. Moreover, because Hollander's submissions provide a basis for an award of damages, no hearing is required.

II. FINDINGS OF FACT AND CONCLUSIONS OF LAW

In light of the Gutman defendants' default, Hollander's properly pleaded allegations in the complaint, except those related to damages, are accepted as true. See, e.g., City of New York v. Mickalis Pawn Shop, LLC, 645 F.3d 114, 137 (2d Cir. 2011) ("It is an 'ancient common law axiom' that a defendant who defaults thereby admits all 'well-pleaded' factual allegations contained in the complaint.") (quoting Vt. Teddy Bear Co., Inc. v. 1–800 Beargram Co., 373 F.3d 241, 246 (2d Cir. 2004) ); Finkel v. Romanowicz, 577 F.3d 79, 84 (2d Cir. 2009) ("In light of [defendant's] default, a court is required to accept all ... factual allegations as true and draw all reasonable inferences in [plaintiff's] favor.") (citation omitted). Thus, the Court's findings of fact are based on the allegations in Hollander's amended complaint regarding liability and the admissible evidence regarding damages contained in its submissions.

A. Facts Relating to Liability

Hollander is a Texas corporation with its principal place of business in Houston, Texas. Am. Compl. ¶ 10. Defendant RPGM is a New York limited liability corporation with its principal place of business in the Bronx, New York. Id. ¶ 12. Defendant Gutman is an individual residing in New York who serves as president or chief executive officer of RPGM. Id. ¶ 14.

Hollander is the owner and user of a federally registered trademark—"WINTERLAKE, (the 'Trademark')"—"for use in connection with decorative glass not for building purposes, namely, pattern glass." Id. ¶ 22. It is also the owner and operator of a website that displays federally registered copyrighted text, photographs, artwork, and other original content showing examples of Hollander's "Clear Patterned Architectural Glass" products. Id. ¶ 29 (the "Copyright"). Hollander is a "well-known and established manufacturer and distributor of architectural window glass and other speciality glass products and accessories." Id. ¶ 17. It has sold products bearing the Trademark since at least October 2007 and displayed its Copyright since January 2011. Id. ¶¶ 23, 31. The Trademark is "extensive[ly] use[d] and promot[ed]," and with help from "unsolicited media coverage and notoriety [sic]," the Trademark "has become distinctive and prominent." Id. ¶ 26. Consumers associate the Trademark with Hollander. Id. ¶ 27.

The Gutman defendants purchased the domain name "rosenparamountglass.com" in November 2016 from the Rosen defendants, who had owned and operated the website since 2003. Id. ¶¶ 33–34. The website displays "an exact duplicate copy," id. ¶ 38, of Hollander's Copyright "without license or authority from Hollander" and did so both before and after November 2016, id. ¶¶ 35–36. The website also displays, "without Hollander's authority, permission, consent, [or] license," the Trademark. Id. ¶ 42. The Gutman defendants have used the Copyright to "advertise and promote [their] products and related services and accessories" and thereby "generate revenue through the marketing, advertising, and sale of [their] goods and services." Id. ¶¶ 40–41. The Gutman defendants do not "actively or currently sell Hollander glass products," and they do not "maintain[ ] an inventory of Hollander glass products available for sale." Id. ¶ 43. By using the Trademark, the Gutman defendants "mislead[ ] consumers into believing that [the Gutman defendants] sell[ ] Hollander glass products, or that [the Gutman defendants] otherwise are or have been affiliated with or sponsored by Hollander." Id. ¶ 44. The Gutman defendants are "aware of Hollander and Hollander's use of its Trademark in connection with Hollander's goods and services," id. ¶ 47, and "adopted and commenced use of the [Trademark] with the intent to deceive consumers and to cause confusion among purchasers for the purpose of benefitting from the goodwill and public recognition associated with Hollander's Trademark," id. ¶ 49. The defendants "ha[ve] refused to remove either the [Trademark] or [the Copyright] from [their] website." Id. ¶ 58.

B. Claimed Damages

Hollander requests damages for willful copyright infringement in the amount of $150,000 under 17 U.S.C. § 504(c). Pl. Mem. at 7. In addition, Hollander seeks attorneys' fees in the amount of $54,102.25 and costs in the amount of $1663.42. Pl. Mem. at 10, 11. It does not seek damages for any other claims. Pl. Mem. at 9.

1. Copyright Damages

Hollander seeks statutory damages under 17 U.S.C. § 504(c) of the Copyright Act for infringement of its Copyright after registration.

Section 504(c) of the Copyright Act permits a court to award statutory damages "with...