Axcess Global Sciences, LLC v. Revolution Laboratories LLC dba RevLabs

District Court, D. Nevada·Decided July 22, 2024·No. 2:23-cv-01169·Unknown

Opinion

1 || JAMES D. BOYLE, ESQ. (NBN 08384) jboyle@nevadafirm.com 2 || JESSICA M. LUJAN (NBN 14913) jlujan@nevadafirm.com 3 |} HOLLEY DRIGGS 300 South Fourth Street, Suite 1600 4 ll Las Vegas, Nevada 89101 ; Telephone: 702/791-0308 Brian N. Platt (pro hac vice) 6 | bplatt@wnlaw.com Collin D. Hansen (pro hac vice) 7 |) chansen@wnlaw.com WORKMAN NYDEGGER 8 || 60 East South Temple Suite 1000 Salt Lake City, UT 84111 9 | Telephone: (801) 533-9800 10 Facsimile: (801) 328-1707

Attorneys for Plaintiff Axcess Global Sciences, LLC

14 15 || Axcess Global Sciences, LLC, Case No.: 2:23-cv-01169-JAD-MDC 16 Plaintiff fPROPOSED] ORDER GRANTING 17 |) v. PLAINTIFF’S MOTION FOR PARTIAL DEFAULT JUDGMENT 18 Revolution Laboratories LLC dba AND POST-JUDGMENT DISCOVERY Revlabs, Rev Labs Distribution LLC, 19 and Rev Labs Management Inc., (ECF Nos. 18, 19) 20 Defendants 21 22 Axcess Global Sciences, LLC (“Plaintiff”) moves for partial default judgment as to 23 liability and for post-judgment discovery as to damages against Revolution Laboratories, 24 |} LLC dba RevLabs, Rev Labs Distribution LLC, and Rev Labs Management Inc. 25 || (collectively, “Defendants”).’ Defendants failed to appear in this case, and default was 26 27 || | (ECF Nos. 18, 19) (Motions for partial default judgment and post-judgment discovery).

1 entered against them.2 After reviewing Plaintiff’s motions, the court concludes that each of 2 the default-judgment factors in Eitel v. McCool3 have been met and the court grants 3 Plaintiff’s motions for partial default judgment and for post-judgment discovery as to 4 damages. 6 Plaintiff filed this action4 for false advertising under Section 43(a) of the Lanham 7 Act5 and state deceptive trade practices under the Nevada Deceptive Trade Practices Act.6 8 Plaintiff is the owner of several U.S. Patents7 which include claims for unique formulations 9 of the health supplement Beta-Hyrdoxybutyrate (“BHB”). Defendants sell a line of 10 products which purportedly contain a substance called “raspberry ketones.”8 Defendants 11 promote raspberry ketones as having broad health benefits including weight loss, burning 12 fat, improving sleep, and more.9 Plaintiffs’ complaint further cites to several academic 13 articles explaining that raspberry ketones have no health benefits and can even be 14 harmful.10 Plaintiffs allege that Defendants’ false health claims misrepresent the nature, 15 characteristics, and qualities of Defendants’ products and of raspberry ketone ingredients.11 16 Plaintiffs allege further that these misrepresentations cause harm by lowering the public 17 perception of Plaintiff’s legitimate ketone products, weakening the goodwill associated 18 with its brand, and diverting sales away from Plaintiff’s ketone products.12 19 2 (ECF No. 16) (Clerk’s entry of default). 20 3 782 F.2d 1470 (9th Cir. 1986). 21 4 (ECF No. 1) (Complaint). 5 15 U.S.C. § 1125(a)(1)(B) 22 6 Nev. Rev. Stat. § 598.0915. 23 7 Including U.S. Pat. Nos. 11,241,403 and 11,020,362. 24 8 (ECF No. 1) at ¶ 2. 9 Id. at ¶¶ 3, 18. 25 10 Id. at ¶¶ 15-17. 26 11 Id. at ¶ 5. 27 12 Id. at ¶ 20. 1 Plaintiff filed its complaint on July 25, 202313, and this Court issued summons to 2 each of the Defendants on the same day.14 Subsequently, Plaintiff served each of the 3 Defendants on July 26, 2023.15 Pursuant to Fed. R. Civ. P. 12(a), the Defendants were 4 required to respond to the Complaint by August 16, 2023. However, the Defendants failed 5 to appear or otherwise respond to the Complaint and default was entered against them on 6 October 17, 2023.16 Plaintiff now moves for default judgment against each of the 7 Defendants pursuant to Fed. R. Civ. P. 55(b) and for leave to conduct damages discovery.17 9 Rule 55 of the Federal Rules of Civil Procedure governs default proceedings. “The 10 general rule of law is that upon default the factual allegations of the complaint, except those 11 relating to the amount of damages, will be taken as true.”18 Pursuant to this standard, “[t]he 12 Ninth Circuit has implicitly endorsed the practice of entering partial default judgment” as 13 to liability, while deferring the issue of damages until after damages discovery.19 14 Accordingly, it is appropriate to grant partial default judgment and the requested discovery. 16 A. Partial default judgment 17 Obtaining a default judgment is a two-step process.20 First, “[w]hen a party against 18 13 Id. 19 14 (ECF Nos. 4, 4-1, 4-2). 15 (ECF Nos. 10, 11, 12). 20 16 (ECF No. 16). 21 17 (ECF No. 18, 19). 22 18 Garamendi v. Henin, 683 F.3d 1069, 1080 (9th Cir. 2012). 19 Paramount Pictures Corp. v. Does, No. 2:21-CV-09317-MCS-SK, 2022 WL 2189633, 23 at *2 (C.D. Cal. Apr. 20, 2022) (granting default judgment as to liability for copyright infringement and also granting leave to conduct damages discovery); see also Dreith v. Nu 24 Image, Inc., 648 F.3d 779, 785–86, 790 (9th Cir. 2011) (reviewing with approval district court’s entry of partial default judgment “with respect only to liability” and deferral of the 25 issue of damages until after damages discovery); see also Howard v. Polley, No. 2:15-CV- 01458-APG-VCF, 2017 WL 481456, at *1 (D. Nev. Feb. 6, 2017) (granting partial default 26 judgment “as to liability” only, but deferring damages). 27 20 See Fed. R. Civ. P. 55(a)-(b). 1 whom a judgment for affirmative relief is sought has failed to plead or otherwise defend, 2 and that failure is shown by affidavit or otherwise, the clerk must enter the party’s 3 default.”21 After the clerk enters default, a party may seek default judgment.22 4 While reviewing a motion for default judgment, the Court may consider “the 5 pleadings, declarations, exhibits, and memoranda filed by the parties” and may also require 6 a “hearing on the merits.”23 7 Courts in this Circuit consider the Eitel factors in determining whether to grant 8 default judgment.24 These factors are: “(1) the possibility of prejudice to plaintiff, (2) the 9 merits of the claims, (3) the sufficiency of the complaint, (4) the amount of money at stake, 10 (5) the possibility of a dispute concerning material facts, (6) whether default was due to 11 excusable neglect, and (7) the policy favoring a decision on the merits.”25 The Court must 12 also confirm that it has “jurisdiction over both the subject matter and the parties.”26 13 1. Jurisdiction over the subject matter and the parties 14 “Federal courts are courts of limited jurisdiction.”27 The burden of establishing that 15 a federal court has jurisdiction over the action “rests upon the party asserting 16 jurisdiction.”28 Under 29 U.S.C. § 1331, “[t]he district courts shall have original 17 jurisdiction of all civil actions arising under the Constitution, laws, or treaties of the United 18 States.” The Court finds that Plaintiff has established that this Court has subject matter 19 21 Id. 20 22 Id. 23 See Comm. Futures Trading Comm’n v. Saffron, No.

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Axcess Global Sciences, LLC v. Revolution Laboratories LLC dba RevLabs, (D. Nev. 2024).

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