GS Holistic LLC v. LFP Shah Corporation

CourtDistrict Court, W.D. Washington
DecidedNovember 16, 2023
Docket2:23-cv-01198
StatusUnknown

This text of GS Holistic LLC v. LFP Shah Corporation (GS Holistic LLC v. LFP Shah Corporation) is published on Counsel Stack Legal Research, covering District Court, W.D. Washington primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
GS Holistic LLC v. LFP Shah Corporation, (W.D. Wash. 2023).

Opinion

1 2

3 4 5 6 7 UNITED STATES DISTRICT COURT WESTERN DISTRICT OF WASHINGTON 8 AT SEATTLE

9 10 GS HOLISTIC, LLC, CASE NO. C23-1198JLR 11 Plaintiff, ORDER v. 12 LFP SHAH CORPORATION, et al., 13 Defendants. 14

15 I. INTRODUCTION 16 Before the court is Plaintiff GS Holistic, LLC’s (“GS Holistic”) motion for entry 17 of default judgment against Defendants LFP Shah Corporation d/b/a Zakks Smoke & 18 Beverages (“Zakks”) and Aamir Shah (together, “Defendants”). (Mot. (Dkt. # 10); see 19 Prop. Judgment (Dkt. # 10-3).) Neither Defendant has appeared in this action, and the 20 Clerk has entered default against both Defendants. (See Dkt.; Entry of Default (Dkt. 21 # 8).) The court has considered GS Holistic’s motion, the materials it submitted in 22 support of its motion, the relevant portions of the record, and the governing law. Being 1 fully advised, the court GRANTS in part and DENIES in part GS Holistic’s motion for 2 entry of default judgment.

3 II. BACKGROUND 4 GS Holistic is a Delaware limited liability corporation (“LLC”) that has its 5 principal place of business in California. (Compl. (Dkt. # 1) ¶ 4.) It alleges that it is the 6 registered owner of the “Stündenglass” trademark, has worked to distinguish the 7 Stündenglass brand as “the premier manufacturer of glass infusers,” and has devoted 8 significant time and resources to promoting and protecting its trademark. (Id. ¶¶ 4, 7-9,

9 14.) GS Holistic has registered the following trademarks: (1) U.S. Trademark 10 Registration No. 6,633,884 “for the standard character mark ‘Stündenglass’ in association 11 with goods further identified in registration in international class 011”; (2) U.S. 12 Trademark Registration No. 6,174,292 “for the design plus words mark ‘S’ and its logo 13 in association with goods further identified in the registration in international class 034”;

14 and (3) U.S. Trademark Registration No. 6,174,291 “for the standard character mark 15 ‘Stündenglass’ in association with goods further identified in registration in international 16 class 034” (together, the “Stündenglass Marks”). (Id. ¶ 10; see also Mot., Ex. A 17 (screenshots of pages from the United States Patent and Trademark Office’s Trademark 18 Electronic Search System that describe each trademark).) GS Holistic asserts that

19 consumers are willing to pay more for “the recognized quality and innovation associated 20 with the Stündenglass Marks.” (Compl. ¶ 20.) Thus, genuine Stündenglass glass infusers 21 are priced at $599.95, while non-Stündenglass infusers sell for between $199.00 and 22 $600.00. (Id.) 1 Defendant Zakks is a Washington LLC that has its principal place of business in 2 Washington. (Id. ¶ 5.) Defendant Aamir Shah is a resident and citizen of Washington

3 and the owner of Zakks. (Id. ¶¶ 6, 23.) GS Holistic asserts that Defendants sold 4 counterfeit products bearing the Stündenglass Marks. (Id. ¶¶ 24-27.) On February 1, 5 2023, according to GS Holistic, its investigator visited Zakks’s location; observed that the 6 shop had a glass infuser that displayed the Stündenglass Marks; purchased a glass infuser 7 “with a Stündenglass Mark affixed to it” for $440.39; and determined the glass infuser 8 was a counterfeit product that displayed “the Infringing Marks.” (Id. ¶ 29; see also id.

9 ¶ 25 (defining the “Infringing Marks” as “reproductions, counterfeits, copies, and/or 10 colorable imitations of one or more of the Stündenglass Marks”).) 11 GS Holistic filed its complaint on August 7, 2023. (See id. at 1.) It alleges claims 12 under the Lanham Act against both Defendants for counterfeiting and trademark 13 infringement in violation of 15 U.S.C. § 1114 and for false designation of origin and

14 unfair competition in violation of 15 U.S.C. § 1125(a). (Id. ¶¶ 51-68.) Among other 15 relief, it seeks damages, costs of suit, a permanent injunction prohibiting Defendants 16 from continuing to infringe its Stündenglass trademarks, and an order requiring 17 Defendants to deliver all infringing products to GS Holistic for destruction. (Id. at 18 12-14.)

19 GS Holistic served Zakks and Mr. Shah on August 20, 2023. (See Service Affs. 20 (Dkt. ## 5-6).) The Clerk entered default against both Defendants on October 3, 2023. 21 (Entry of Default.) GS Holistic filed this motion for entry of default judgment on 22 October 31, 2023. (Mot.) The court subsequently ordered GS Holistic to file an affidavit 1 that it cited in its motion but had not previously filed. (11/7/23 Min. Order (Dkt. # 14).) 2 GS Holistic filed the missing affidavit on November 9, 2023. (See Harris Decl. (Dkt.

3 # 15).) 4 III. ANALYSIS 5 Below, the court sets forth the relevant legal standard and then evaluates GS 6 Holistic’s motion for entry of default judgment. 7 A. Legal Standard 8 Federal Rule of Civil Procedure 55(b)(2) authorizes the court to enter default

9 judgment against a defaulting defendant upon the plaintiff’s motion. Fed. R. Civ. P. 10 55(a), (b)(2). After default is entered, well-pleaded factual allegations in the complaint, 11 except those related to damages, are considered admitted and are sufficient to establish a 12 defendant’s liability. TeleVideo Sys., Inc. v. Heidenthal, 826 F.2d 915, 917-18 (9th Cir. 13 1987) (citing Geddes v. United Fin. Grp., 559 F.2d 557, 560 (9th Cir. 1977)).

14 Entry of default judgment is left to the court’s sound discretion. Aldabe v. Aldabe, 15 616 F.2d 1089, 1092 (9th Cir. 1980). In exercising its discretion, the court considers 16 seven factors (the “Eitel factors”): (1) the possibility of prejudice to the plaintiff if relief 17 is denied; (2) the substantive merits of the plaintiff’s claims; (3) the sufficiency of the 18 claims raised in the complaint; (4) the sum of money at stake in relationship to the

19 defendant’s behavior; (5) the possibility of a dispute concerning material facts; 20 (6) whether default was due to excusable neglect; and (7) the preference for decisions on 21 the merits when reasonably possible. Eitel v. McCool, 782 F.2d 1470, 1471-72 (9th Cir. 22 1986). After the court determines that default judgment is appropriate, it must then 1 determine the amount and character of the relief that should be awarded. See TeleVideo, 2 826 F.2d at 917-18.

3 B. Whether the Eitel Factors Favor Default Judgment 4 The court preliminarily determines that default judgment is warranted in this case 5 because, on balance, the Eitel factors weigh in favor of such judgment. The court 6 discusses each factor in turn. 7 1. Possibility of Prejudice to Plaintiff 8 The first Eitel factor considers whether the plaintiff will suffer prejudice if default

9 judgment is not entered. See PepsiCo, Inc., v. Cal. Sec. Cans, 238 F. Supp. 2d 1172, 10 1177 (C.D. Cal. 2002). Without default judgment, GS Holistic will suffer prejudice 11 because it will “be denied the right to judicial resolution” of its claims and will be 12 “without other recourse for recovery.” Elektra Entm’t Grp. Inc. v. Crawford, 226 F.R.D. 13 388, 392 (C.D. Cal. 2005). Thus, the first Eitel factor weighs in favor of entering default

14 judgment. 15 2.

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