United States District Court, D. New Jersey
B. KUGLER UNITED STATES DISTRICT COURT JUDGE
the Court in this trademark infringement and unfair
competition action is plaintiff's motion for default
judgment, pre-judgment interest, attorneys' fees and
costs, and injunctive relief against defendants [“this
motion”] (ECF Doc. 100] under Federal Rule of Civil
Procedure [“Fed. R. Civ. P.” or
“Rule”] 55(b) (2). Defendants have neither
challenged nor filed an opposition to the motion. For the
reasons below, the Court GRANTS the motion
for default judgment and injunctive relief and
DENIES the requests for pre-judgment
interest and attorneys' fees and costs, except as to the
filing fee of this action.
appropriate Order accompanies this Opinion.
Factual and Procedural Background
September 2016, plaintiff Luxottica filed a complaint against
the following 15 named defendants and 10 unnamed ones: Shore
Enuff; One Stop Souvenirs LLC d/b/a/ Deck2sea; Beach Apparel;
Fashion Paradise LLC; Stop & Save d/b/a Moon Traders;
Dolma & Girls LLC; Sunshine Fashion; Shore Styles; City
of Souvenirs LLC; AC Gift Shop; Hot Stop LLC; Bags and
Accessories; Shore Gifts; Sea Star Souvenir; One Stop; and
on 10 August 2016, its investigators saw that defendants, at
their stores on the boardwalk in Atlantic City, New Jersey,
were selling certain products that bore the mark “Ray
Ban”. ECF Doc. 1: ¶32.
investigators purchased such products from each of the 15
named defendants. Id. -Luxottica representatives
reviewed samples of all such purchased products and
determined them to be counterfeit [“the counterfeit
products”]. Id. at ¶33.
marks on the counterfeit products appear confusingly similar
to plaintiff's registered marks. Id. at
were never authorized to manufacture, sell, and/or offer for
sale products bearing its trademarks. Id. at
complaint also alleges, on information and belief, that all
defendants had gotten the counterfeit products from the same
source as the same counterfeit products from each defendant
appeared substantially similar in style and price; and,
defendants' stores were geographically close to one
another on the boardwalk. Id. at ¶34.
defendants' confusingly similar products bear
plaintiff's registered Ray Ban® marks, the complaint
asserted: trademark infringement under the Lanham Act at 15
U.S.C. 1117 (a), (b) and/or (c); false designation of origin
and unfair competition; common law trademark infringement;
and unfair competition under New Jersey statutory and common
law at N.J. Stat. Ann. 56:4-1 and 4-2. Id. at ¶
the procedural background here relates to plaintiff's
obtaining orders of default for 13 of the defendants for
their failure to answer. On 13 June 2018, plaintiff voluntarily
dismissed without prejudice the 13 defendants for whom it had
obtained default: One Stop Souvenirs LLC d/b/a Deck2sea,
Beach Apparel, Fashion Paradise LLC, Stop & Save d/b/a
Moon Traders, Dolma & Girls LLC, Sunshine Fashion, Shore
Styles, City of Souvenirs LLC, AC Gift Shop, Hot Stop LLC,
Shore Gifts, Sea Star Souvenir, and One Stop. ECF Doc. 87.
action continued as to Shore Enuff and Bags and Accessories,
the named defendants here. As for these defendants, on 8
March 2018, plaintiff filed a motion to strike their answers
and obtain entry of default. On 24 Sep 2018, Magistrate Judge
Williams issued a report recommending a grant of the motion
to strike and entry of default because of these
defendants' repeated failure to attend court conferences
or otherwise defend the case, in the face of plaintiff's
evidence of its repeated notices to them. ECF Doc. 89.
October 2018, this Court in ECF Doc. 90 adopted Magistrate
Judge Williams's report and recommendation; and, on 12
March 2019 entered default against Shore Enuff, and Bags and
Accessories. On 18 March 2019, plaintiff filed this motion
for default judgment under Rule 55(b) against Shore Enuff and
Bags and Accessories, each of whom did not respond.
request for default judgment, plaintiff seeks the following
1. $750, 000.00 in statutory damages under the Lanham Act 15
U.S.C. 1117 (c), the calculation of which is based on
plaintiff's assertion of defendants' willful
infringement (ECF Doc. 100: 12-13);
2. Pre-judgment interest on the requested $750, 000 in
statutory damages at the rate of 6% from the date of service
of the complaint, 29 October 2016, to the date of filing this
motion, 18 March 2019, which equals $106, 645.85
(Id. at 14);
3. Adding 1. and 2. amounts to a currently ascertainable,
total damages request of $856, 645.85;
4. as yet un-totaled attorneys' fees and costs because
this case is “exceptional” and involving culpable
conduct on the part of the defendants (Id. at 13);
5. post-judgment interest computed daily from the date of
entry of the default judgment to the date of payment,
according to the weekly average 1-year constant maturity
Treasury yield rate (Id. at 15); and
6. a permanent injunction (Id. at 15-16) to enjoin
defendants from engaging in further infringement of the Ray
Ban® marks and in unfair competition against plaintiff.
Legal Standard of Review
Civ. Proc. 55(b)(2) authorizes courts, upon plaintiff's
motion, to enter a default judgment against a properly served
defendant who fails to plead or otherwise timely defend
against a claim for affirmative relief. If a defendant is in
default of prosecuting the case, the Court accepts as true
all of plaintiff's well-pleaded factual allegations in
the complaint. Comdyne I, Inc. v Corbin, 908 F.2d
1142, 1149 (3d Cir. 1990). The Court, however, does not
accept plaintiff's legal conclusions as it's the
Court that determines whether the pleaded facts set forth an
actionable claim (Doe v. Simone, No. 12-5825, 2013
WL 3772532, at *2 (D.N.J. 17 July 2013)). Nor does the Court
accept plaintiff's allegations concerning damages.
Id. [citing 10A Charles A. Wright, Arthur
R. Miller & Mary Kay Kane, Federal Practice &
Procedure §2688, at 58-59 (3d ed. 1998 and Supp. 2013).
“decision to enter default judgment rests within the
sound ‘discretion of the district court'
(Chanel, Inc. v. Matos, 133 F.Supp.3d 678, 683
(D.N.J. 2015) [citing Hritz v. Woma Corp., 732 F.2d
1178, 1180 (3d Cir. 1984). The Third Circuit's repeatedly
stated preference is that “cases be disposed of on the
merits whenever practicable”. Hritz, 732 F.2d
Default Judgment Discussion
matter being an action for trademark infringement and unfair
competition under the Lanham Act, 15 USC §1051 et
seq., the Court has subject matter jurisdiction under 15
U.S.C. §1121 and 28 U.S.C. §§1331 and 1338 (b)
as well as supplemental jurisdiction over plaintiff's New
Jersey state law claims for trademark infringement under N.J.
Stat. Ann. 56:4-1 and 4-2 under 28 U.S.C. §1367(a).
is unclear where defendants are currently located, this Court
reviews both its general and specific personal jurisdiction
over defendants. ECF filings show that personal service of
the complaint upon Shore Enuff and Bags and Accessories was
executed on 29 October 2016 at addresses on the boardwalk in
Atlantic City, New Jersey. Defendants timely served their answers,
also stating their boardwalk addresses.
Rule 4, a defendant is subject to the general personal
jurisdiction of a United States district court if the
defendant is “subject to the jurisdiction of a court of
general jurisdiction in the state where the district court is
located”. Fed. R. Civ. Proc. 4(k)(1)(A). Thus,
a New Jersey federal district court exercises general
personal jurisdiction over parties who are domiciled in New
Jersey to the extent provided under New Jersey state law.
Miller Yacht Sales, Inc. v. Smith, 384 F.3d 93, 96
(3d Cir. 2004) [citations omitted]. Since the complaint was
personally served on defendants at a New Jersey business
address and defendants in their answers identified themselves
as domiciled in New Jersey, this Court may exercise general
personal jurisdiction over them. See, e.g., Erwin v.
Waller Capital Partners, LLC, No. 10-3283, 2010 WL
4053553, at *3 (D.N.J. 14 October 2010).
years have passed since defendants filed their answers. As
subsequent documents notifying defendants of court meetings
were mailed to defendants' last known boardwalk
addresses, and as boardwalk addresses are typically not
year-round domiciles but transient summer business locations,
it occurs to the Court that these defendants no longer
conduct business or are even domiciled in New Jersey. As an
example, in November 2017, a process server executed proof of
service by mail to each defendant to the addresses in their
answers in order to notify them of a court-scheduled
telephone conference. ECF Docs. 76 and 77. Neither defendant
participated in that conference or in any subsequent
proceeding, notices of which were typically sent by
defendants are no longer domiciled in New Jersey, the Court
still exercises specific personal jurisdiction over them. The
New Jersey long-arm statute “permits the exercise of
personal jurisdiction to the fullest limits of due
process” (IMO Indus., Inc. v. Kiekert AG, 155
F.3d 254, 259 (3d Cir. 1998) [citing DeJames v.
Magnificence Carrier, Inc., 654 F.2d 280, 284 (3d Cir.
1981)]) when the cause of action is related to or arises out
of defendants' activities that took place in New Jersey.
Powerhouse Equipment & Engineering Co., Inc. v. Power
Mechanical, Inc. et al., No. 18-10744, 2019 WL 3334758,
at *2 (D.N.J. 25 Jul 2019) [citing Helicopteros
Nacionales de Colombia, S.A. v. Hall, 466 U.S. 408, 414
n. 8 (1984).
trademark infringement is considered an intentional tort,
whenever that occurs in New Jersey, the Supreme Court's
“effects” test (Calder v. Jones, 465
U.S. 783 (1984) is applied (AT&T v. Winback &
Conserve Program, Inc.,42 F.3d ...