Petmed Exp., Inc. v. Medpets.Com, Inc.

• Decision Date: 28 June 2004
• Docket Number: No. 03-62019-CIV.,03-62019-CIV.
• Citation: 336 F.Supp.2d 1213
• Parties: PETMED EXPRESS, INC., Plaintiffs, v. MEDPETS.COM, INC. and Satwant Singh, Defendants.
• Court: U.S. District Court — Southern District of Florida

336 F.Supp.2d 1213

PETMED EXPRESS, INC., Plaintiffs, v. MEDPETS.COM, INC. and Satwant Singh, Defendants.

No. 03-62019-CIV.

United States District Court, S.D. Florida.

June 28, 2004.

COPYRIGHT MATERIAL OMITTED

COPYRIGHT MATERIAL OMITTED

Kevin P. Jacobs and Francisco Sanchez of Homer & Bonner, P.A. Miami, FL, for PetMed Exp., Inc.

ORDER GRANTING FINAL DEFAULT JUDGMENT AND ENTERING PERMANENT INJUNCTION AGAINST DEFENDANTS

COHN, District Judge.

THIS CAUSE came before the Court upon Plaintiff's Motion for Final Default Judgment and Incorporated Memorandum of Law filed on April 27, 2004 [DE # 10]. The Court has reviewed the pleadings, accompanying declarations, and applicable law.

I. BACKGROUND

Plaintiff PetMed is a leading nationwide pet pharmacy that has been selling pet care medicines and products directly to consumers since 1996. PetMed advertises through direct catalogue sales, television commercials, and its website linked to its domain names www.1888PetMeds.com, www.PetMeds.com, www.1800PetMeds.com, and www.PetMedExpress.com. PetMed is a public company traded on the NASDAQ under the symbol "PETS" and owns the federally-registered service marks "PetMed Express, Inc." and "1888PetMeds." PetMed's financial success depends largely upon its reputation among pet owners as a convenient and efficient supplier of pet care products. (See DE # 10 at 2).

Defendant MedPets also advertises and sells pet care products through its website, which is linked to www.MedPets.com and www.1888MedPets.com. Satwant Singh is the President of MedPets. (See DE # 10, Exh. A, Declaration of Steve Roadruck). Because Defendants' domain names are almost identical to Plaintiff's, only transposing the terms "Med" and "Pet," Plaintiff warned Defendants that www.MedPets.com and www.1888MedPets.com violated Plaintiff's federally-registered trademarks and demanded that Defendants cease their infringing conduct. (See DE # 10, Exh. C, Declaration of Alison Berges, Esq.). Despite Plaintiff's warnings and attempts at resolving the matter without legal action, Defendants continued to use the domain names. Consequently, Plaintiff filed its Complaint on November 10, 2003 alleging federal trademark infringement (Count I), federal unfair competition (Count II), federal trademark dilution (Count III), federal cyberpiracy (Count IV). Florida common law trademark infringement (Count V), and Florida common law unfair competition (Count VI). Defendants response was due on December 15, 2003. Since Defendants did not respond, the Clerk entered default on January 8, 2004 [DE # 8]. Thereafter, Plaintiff filed the instant Motion for Final Default Judgment on April 27, 2004, to which Defendants have also failed to respond.

II. DISCUSSION

In defaulting, Defendants "admit the plaintiff's well-pleaded allegations of fact." Buchanan v. Bowman, 820 F.2d 359 (11th Cir.1987). If the facts in the complaint are sufficient to establish liability, then the court must conduct an inquiry to ascertain the amount of damages. See Ortiz-Gonzalez v. Fonovisa, 277 F.3d 59, 62-63 (1st Cir.2002); Arista Records, Inc. v. Beker Enter., Inc., 298 F.Supp.2d 1310, 1312 (S.D.Fla.2003); Tiffany v. Luban, 282 F.Supp.2d 123, 124 (S.D.N.Y.2003). Damages may be awarded only if the record adequately reflects the basis for the award via a hearing or a demonstration of detailed affidavits establishing the necessary facts. See Adolph Coors Co. v. Movement Against Racism and The Klan, 777 F.2d 1538, 1544 (11th Cir.1985); United Artists Corp. v. Freeman, 605 F.2d 854, 857 (5th Cir.1979); Rolex Watch, USA, Inc. v. Brown, 2002 WL 1226863, *2 (S.D.N.Y.2002) (finding that where "the issue is statutory damages," the court can hold an inquest into damages "on a paper record" rather than through an in-person court hearing). In the instant case, a hearing is unnecessary to determine damages as Plaintiff seeks statutory damages and has attached detailed declarations with accompanying documentary evidence to its Motion for Final Default Judgment.¹

A. Defendants are Liable for the Trademark Violations Alleged in Plaintiff's Complaint

As a result of their default, Defendants concede that they violated PetMed's federally-registered trademarks and the Court finds them liable for federal trademark infringement (Count I), federal unfair competition (Count II), federal trademark dilution (Count III), federal cyberpiracy (Count IV), Florida common law trademark infringement (Count V), and unfair competition (Count VI).

1. Federal Trademark Infringement (Count I) and Florida Common Law Trademark Infringement (Count V)

Under § 32(a) of the Lanham Act, 15 U.S.C. § 1114(1)(a), liability for trademark infringement occurs when a person "use[s] in commerce any reproduction, counterfeit, copy, or colorable imitation of a registered mark" which "is likely to cause confusion, or to cause mistake, or to deceive." Thus, to prevail on a trademark infringement claim a plaintiff must demonstrate that (1) its mark has priority, (2) defendant used its mark in commerce, and (3) defendant's mark is likely to cause consumer confusion. Int'l Cosmetics Exch., Inc. v. Gapardis Health & Beauty, Inc., 303 F.3d 1242 (11th Cir.2002); Frehling Enter., Inc. v. Int'l Select Group, Inc., 192 F.3d 1330 (11th Cir.1999). The analysis of liability for Florida common law trademark infringement is the same as under the Lanham Act, Gift of Learning Found., Inc. v. TGC, Inc., 329 F.3d 792, 802 (11th Cir.2003); Carnival Corp., 74 F.Supp.2d at 1264 n. 2.

Plaintiff has satisfied the above three elements and established Defendants' liability for federal and Florida common law trademark infringement. Plaintiff's mark has priority since PetMed has been selling its products since 1996, while Defendant created the domain names www.MedPets.com and www.1888MedPets.com in 2001. (See DE # 10, Exh. A, Declaration of Steve Roadruck). In establishing a website on the Internet, Defendants have used the infringing marks in commerce. See Planetary Motion, Inc. v. Techsplosion, Inc., 261 F.3d 1188, 1194 (11th Cir.2001). Lastly, Defendants' default establishes that www.MedPets.com and www.1888MedPets.com are likely to cause confusion among consumers as to whether PetMed and MedPets are one and the same.

2. Federal Unfair Competition (Count II)

The elements of an unfair competition claim under § 43(a) of the Lanham Act, 15 U.S.C. § 1125(a), include the plaintiff showing (1) that it had prior rights to the mark at issue and (2) that the defendant adopted a mark or name that was the same, or confusingly similar, to plaintiff's mark such that consumers were likely to confuse the two. Planetary Motion, Inc., 261 F.3d at 1993. As discussed above, Plaintiff has established that it had prior rights to the mark and that Defendants' marks are confusingly similar and likely to confuse consumers.

3. Federal Trademark Dilution (Count III)

To prevail on a federal trademark dilution claim under § 43(c) of the Lanham Act, 15 U.S.C. § 1125(c), a Plaintiff must demonstrate that (1) its mark is famous, (2) the defendant adopted the mark after the plaintiff's mark became famous, (3) the defendant's mark diluted the plaintiff's mark, and (4) the defendant's use is commercial and in commerce. Victoria's Cyber Secret, Ltd. v. V Secret Cataiogue, Inc., 161 F.Supp.2d 1339, 1354 (S.D.Fla.2001); Carnival Corp. v. SeaEscape Casino Cruises, Inc., 74 F.Supp.2d 1261, 1269 (S.D.Fla.1999). Again, due to Defendants default, the factual allegations in Plaintiff's Complaint are taken as true establishing a claim for federal trademark dilution. Thus, by their Default. Defendants admit that Plaintiff's marks are famous, that they adopted the infringing marks willfully after Plaintiff's marks became famous, that the infringing domain names diluted Plaintiff's marks, and that they used the domain names in commerce by means of the Internet.

4. Federal Cyberpiracy (Count IV)

The Cyberpiracy prevention section of the Lanham Act, 15 U.S.C. § 1125(d), makes a person liable for the "bad faith intent to profit" from a protected mark by using a domain name that is identical or confusingly similar. Liability for federal cyberpiracy occurs when a plaintiff proves that (1) its mark is a distinctive or famous mark entitled to protection, (2) the defendant's domain names are identical or confusingly similar to the plaintiff's marks, and (3) the defendant registered the domain names with the bad faith intent to profit from them. Shields v. Zuccarini, 254 F.3d 476, 482 (3d Cir.2001). Plaintiff has met these elements, establishing through Defendants' default that its mark is distinctive, that the domain names are confusingly similar as they simply interchange the words "Med" and "Pets", and that Defendants registered the domain names with the bad faith intent to profit from them. Plaintiff has established the distinctiveness of its trademarks not only through Defendants default, but also by having registered the marks. See Victoria's Cyber Secret Ltd. Partnership v. V Secret Catalogue, Inc., 161 F.Supp.2d 1339, 1349 (S.D.Fla.2001). With respect to the bad faith element, not only do Defendants establish their bad faith intent as a result of their default,² but Plaintiff has also come forward with evidence to show Defendants bad faith intentions. Plaintiff points out that while PetMed's mark "1888PetMeds" represents a telephone number that connects to PetMed, "1888MedPets" does not. (See DE # 10, Exh. A, Declaration of Steve Roadruck).

5. Florida Common Law Unfair Competition (Count VI)

To prevail on a Florida common law unfair competition claim, a plaintiff must prove that (1) the plaintiff is the prior user of the trade name or service mark, (2) the trade name or service mark is arbitrary or suggestive or has acquired secondary meaning, (3) the defendant is using a confusingly similar trade name or service mark to indicate or identify similar services rendered (or similar goods marketed) by it in...