United States District Court, D. New Jersey
COACH, INC. and COACH SERVICES, INC., Plaintiffs,
PAULA'S STORE SPORTWEAR LLC d/b/a
STANLEY R. CHESLER, District Judge.
This matter comes before the Court upon the motion for entry of default judgment pursuant to Federal Rule of Civil Procedure 55(b) filed by Plaintiffs Coach, Inc. and Coach Services, Inc. (collectively, "Coach"). Defaulting Defendants Paula's Store Sportwear, LLC and Paula Sanchez (collectively, "Defendants") have failed to oppose the motion. For the reasons expressed below, the Court will grant Coach's motion for entry of default judgment.
This is a trademark counterfeiting and infringement action. The Complaint and the record before the Court, which includes the declaration of a private investigator retained by Coach to investigate the suspected sale of counterfeit items and the declaration of Coach's intellectual property coordinator, provide the following pertinent facts:
Coach is a publicly-traded corporation engaged, since its founding 70 years ago, in the business of designing, marketing and selling fine leather and mixed material products. These products include handbags, wallets, accessories, eyewear, footwear, jewelry and watches. In connection with this business, Coach owns a number of trademarks, trade dresses, design elements and copyrights (collectively the "Coach Marks") registered with the United States Patent and Trademark Office. Coach's products, which bear the Coach Marks, are sold throughout the United States and elsewhere in Coach's own specialty retail stores, department stores, catalogs and the internet.
This case arises from the discovery of counterfeit Coach wallets and handbags displayed and offered for sale in a store owned and operated by Defendants and located at 160 Lexington Avenue in Passaic, New Jersey. On April 2, 2013, the Passaic County Sheriff's Office executed a search warrant at the store. The private investigator whose firm, MSA Investigations, had been retained by Coach to investigate the suspected sale of counterfeit Coach goods at Defendants' store was present for the search. The search resulted in the seizure of four counterfeit Coach wallets and two counterfeit Coach handbags as well as the arrest of Paula Sanchez. Coach's investigator photographed the seized counterfeit Coach items.
Coach's intellectual property coordinator, Samanta Bangaree, examined digital images of the seized goods. According to Bangaree, the quality and craftsmanship of the counterfeit goods did not meet the standards of authentic Coach merchandise. She asserts, for example, that the hardware used in the handbags and wallets (such as zippers and buckles) was not of the type used in Coach merchandise and that the counterfeit goods' linings and stitching were inconsistent with authentic Coach goods. Bangaree further declares that the counterfeit goods at issue involved the following federally protected Coach Marks: Storypatch (Registration No. 3, 338, 048); Op Art (Registration No. 4, 105, 636; Horse & Carriage (Registration No. 3, 441, 671; Coach Stylized (Registration No. 3, 413, 536); Coach Work Mark (Registration No. 1, 071, 000); Coach Lozenge (Registration No. 1, 070, 999; Hangtag (Registration No. 2, 088, 707; and Coach Word Mark Paper Tag (Registration No. 3, 157, 972).
Coach filed the instant action on May 23, 2013. The docket shows that Defendants were served with the Summons and a copy of the Complaint on June 5, 2013. They failed to answer or otherwise respond to the Complaint. Upon Coach's request, The Clerk of the Court entered default against them pursuant to Federal Rule of Civil Procedure 55(a) on August 21, 2013.
The Complaint alleges that the four counterfeit wallets and two counterfeit handbags discovered at Defendants' store during the April 2, 2013 search were not authentic Coach products. It contains nine counts asserting claims under the Lanham Act, 15 U.S.C. § 1221 et seq., as well as New Jersey statutory and common law, which will be discussed in more detail below. Coach seeks statutory damages as well as injunctive relief. The Court has subject matter jurisdiction pursuant to 28 U.S.C. § 1331, 28 U.S.C. § 1338 and 28 U.S.C. § 1367(a).
A. Legal Standard
Fed.R.Civ.P. 55(b)(2) authorizes the entry of a default judgment against a party that has defaulted. A consequence of the entry of a default judgment is that "the factual allegations of the complaint, except those relating to the amount of damages, will be taken as true." Comdyne I, Inc. v. Corbin , 908 F.2d 1142, 1149 (3d Cir. 1990) (quoting 10 C. Wright, A. Miller, & M. Kane, Federal Practice and Procedure, § 2688 at 444 (2d ed. 1983)). Even so, before entering default judgment, the Court must first determine whether the unchallenged facts constitute a legitimate cause of action. Chanel, Inc. v. Gordashevsky , 558 F.Supp.2d 532, 536 (D.N.J. 2008). Moreover, a party seeking default judgment pursuant to Rule 55(b)(2) must prove damages. Comdyne , 908 F.2d at 1149. It is well-established in the Third Circuit that "the entry of a default judgment is left primarily to the discretion of the district court." Hritz v. Woma Corp. , 732 F.2d 1178, 1180 (3d Cir. 1984).
The Court will accordingly proceed to determine whether the unchallenged facts, as set forth in the Complaint's allegations and in the declarations filed in support of this motion, suffice to establish the causes of action pled by Coach. It will then proceed to address Coach's ...