Amazon.com Inc v. White

District Court, W.D. Washington·Decided May 24, 2022·No. 2:20-cv-01773·Unknown

Opinion

UNITED STATES DISTRICT COURT AT SEATTLE AMAZON.COM, INC., a Delaware CASE NO. 2:20-cv-01773-JHC corporation; and YETI COOLERS, LLC, a Delaware limited liability company, ORDER

Plaintiffs, v. MICHAEL WHITE, an individual; KAREN WHITE, an individual; collectively d/b/a Gadsen Flags in USA AKA Cyber Venzz AKA Cyber Dream AKA PhoneCleaner, and d/b/a The Cyber Bargain Portal AKA Cloud Technic; and DOES 1-10,

Defendants.

I. This matter comes before the Court on Plaintiffs Amazon.com, Inc. and YETI Coolers, LLC’s Motion for Default Judgment (the “Motion”). Dkt. # 25. Defendants Michael White and Karen White, collectively d/b/a Gadsen Flags in USA a/k/a Cyber Venzz a/k/a Cyber Dream a/k/a PhoneCleaner, and d/b/a The Cyber Bargain Portal a/k/a Cloud Technic have not filed a response or otherwise appeared in this action. Dkt. # 22. Having reviewed the filings, the Court GRANTS Plaintiffs’ Motion. II. From about February to September 2020, Michael and Karen White, collectively d/b/a

Gadsen Flags in USA a/k/a Cyber Venzz a/k/a Cyber Dream a/k/a PhoneCleaner, and d/b/a The Cyber Bargain Portal a/k/a Cloud Technic sold counterfeit products bearing five of YETI’s registered trademarks on their Amazon storefront. Dkt. #1, Compl. ¶¶ 5, 30, 35, 39; Ex. A (trademarks). In April 2020, US Customs and Border Patrol (CBP) contacted YETI saying that in March they had seized a shipment from China of 500 suspected counterfeit cup lids branded with YETI’s trademark. Dkt. # 1, Compl. ¶ 36; Ex. D. The receiving address associated with the shipment was the same as the one associated with Defendants’ Amazon selling accounts. Id. YETI inspected the lids and confirmed they were counterfeit. Dkt. # 1, Compl. ¶ 37. In May, YETI sent a cease-and-desist letter to the address associated with the shipment; YETI received

no response. Dkt. # 1, Compl. ¶¶ 37, 38; Ex. E. In June, YETI performed a “test purchase” from Amazon selling account “Gadsen Flags in USA” of what was advertised as a “YETI RAMBLER® 20 oz. Tumbler, Stainless Steel, Vacuum Insulated with MagSlider™ Lid.” Dkt. # 1, Compl. ¶ 40. The selling account shipped a counterfeit product bearing YETI’s trademark. Dkt. # 1, Compl. ¶ 40. Amazon reviewed the selling account and identified other products likely to be counterfeit because of the number of customer complaints. Dkt. # 1, Compl. ¶ 41. Amazon noted that they issued “tens of thousands of dollars in refunds” to customers of that selling account. Dkt. # 26, Declaration of Alex Calvert (“Calvert Decl.”) ¶ 5.

In August, YETI sent another cease-and-desist letter to Michael White, the owner and operator of Gadsen Flags in USA and Cyber Bargain Portal; YETI received no response. Dkt. # 1, Compl. ¶ 42; Ex F. Amazon shut down the selling accounts Gadsen Flags in USA and Cyber Bargain Portal because of the violation of its anti-counterfeit policy and user agreement. Dkt. # 1, Compl. ¶ 45; Ex B (agreement), C (policy); Dkt. # 26, Calvert Decl. ¶ 2.

Plaintiffs sued Defendants in December 2020. Dkt. #1. Defendants were properly served. Dkt. # 10, 11. Michael White attempted to answer the complaint (Dkt. # 12), but the Court struck the answer as it was unsigned (Dkt. # 15). Defendants made no further attempts to respond or appear. Upon Plaintiffs’ request (Dkt. # 16), a clerk entered default (Dkt. # 22). Plaintiffs now move for default judgment. Dkt. # 25. A. Default Judgment After the entry of default, courts have the discretion to enter a default judgment under Federal Rule of Civil Procedure 55(b)(2). Aldabe v. Aldabe, 616 F.2d 1089, 1092 (9th Cir.

1980); see also Local Civil Rule (LCR) 55(b). “With respect to the determination of liability and the default judgment itself, the general rule is that well-pled allegations in the complaint regarding liability are deemed true,” except those related to damages. Fair Hous. of Marin v. Combs, 285 F.3d 899, 906 (9th Cir. 2002); Geddes v. United Fin. Grp., 559 F.2d 557, 560 (9th Cir. 1977). The law disfavors default judgments and courts should decide cases on their merits whenever reasonably possible. NewGen, LLC v. Safe Cig, LLC, 840 F.3d 606, 616 (9th Cir. 2016). When deciding whether to enter a default judgment, courts consider these factors: (1) the possibility of prejudice to the plaintiff, (2) the merits of 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 the default was due to excusable neglect, and (7) the strong policy underlying the Federal Rules of Civil Procedure favoring decisions on the merits.

Id. (quoting Eitel v. McCool, 782 F.2d 1470, 1471–72 (9th Cir. 1986)). 1. Possibility of prejudice to Plaintiffs This factor supports default judgment because without one, Plaintiffs will have no remedy for Defendants’ actions. See Crim. Prods., Inc. v. Gunderman, No. C16-1016-RAJ, 2017 WL 664047, at *2 (W.D. Wash. Feb. 17, 2017) (“Without entry of default judgment, Plaintiff will be prejudiced because it will be left without a proper remedy.”). Defendants did not respond to two cease-and-desist letters and have not appeared in this matter. Defendants’ actions of selling sub-par counterfeit products using the YETI trademarks on Amazon harm Plaintiffs’ reputations and goodwill. See Philip Morris USA, Inc. v. Castworld Prod., Inc., 219 F.R.D. 494, 499 (C.D. Cal. 2003) (“Plaintiff will likely suffer great prejudice through the loss of sales and diminution of goodwill if default is not entered.”). 2. Merits of Plaintiffs’ claims and sufficiency of their complaint “The second and third Eitel factors—the substantive merits of the claim and the sufficiency of the complaint—are often analyzed together.” Curtis v. Illumination Arts, Inc., 33 F. Supp. 3d 1200, 1211 (W.D. Wash. 2014). Upon analysis of each claim in the complaint, the Court finds these Eitel factors support default judgment. i. YETI’s trademark infringement claim (Claim One) YETI bases its trademark infringement claim on 15 U.S.C. § 1114. To establish such a claim, YETI must show that Defendants used (1) a reproduction, counterfeit, copy or colorable imitation of plaintiff’s registered trademark, (2) without its consent, (3) in commerce, (4) in connection with the sale, offering for sale, distribution or advertising of any goods, (5) where such use is likely to cause confusion, or to cause a mistake or to deceive.

Amazon.com v. Kurth, No. 2:18-CV-00353-RAJ, 2019 WL 3426064, at *2 (W.D. Wash. July 30, 2019) (citing 15 U.S.C. § 1114(a)). “The test for likelihood of confusion is whether a ‘reasonably prudent consumer’ in the marketplace is likely to be confused as to the origin of the good or service bearing one of the marks.” Dreamwerks Prod. Grp., Inc. v. SKG Studio, 142 F.3d 1127, 1129 (9th Cir. 1998). The allegations in the complaint, taken as true, establish YETI’s trademark infringement

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