Nautilus, Inc. v. Chunchai Yu (In re Chunchai Yu)

545 B.R. 633, 2016 Bankr. LEXIS 500, 62 Bankr. Ct. Dec. (CRR) 64
CourtUnited States Bankruptcy Court, C.D. California
DecidedFebruary 18, 2016
DocketCase No. 6:15-bk-12567-SC; Adversary No. 6:15-ap-01153-SC
StatusPublished
Cited by5 cases

This text of 545 B.R. 633 (Nautilus, Inc. v. Chunchai Yu (In re Chunchai Yu)) is published on Counsel Stack Legal Research, covering United States Bankruptcy Court, C.D. California primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Nautilus, Inc. v. Chunchai Yu (In re Chunchai Yu), 545 B.R. 633, 2016 Bankr. LEXIS 500, 62 Bankr. Ct. Dec. (CRR) 64 (Cal. 2016).

Opinion

ORDER AND MEMORANDUM DECISION GRANTING PLAINTIFF’S MOTION FOR SUMMARY JUDGMENT

Scott C. Clarkson, United States Bankruptcy Judge

Before the Court is Plaintiff Nautilus, Inc.’s (“Plaintiff’) motion for summary judgment [Dk. 12] (“Motion for Summary Judgment”) filed November 24, 2015, which seeks a determination that a $4 million judgment against Debtor Chunchai Yu a/k/a Katherine Yu (“Defendant”) is non-dischargeable under 11 U.S.C. § 523(a)(6)1 based upon issue preclusion. The Defendant filed her opposition [Dk. 21] (“Opposition”) on December 23, 2015, and the Plaintiff filed its reply [Dk. 22] (“Reply”) on December 29, 2015. The matter came on for hearing on January 13, 2016. Samuel Watkins, Esq., appeared on behalf of Plaintiff, and Jeffrey Nadel, Esq. appeared on behalf of Defendant.

Upon consideration of the Motion for Summary Judgment, the Opposition, the Reply, oral argument of counsel, and the record as a whole, and for good cause shown, this court GRANTS summary judgment in favor of Plaintiff pursuant to § 523(a)(6) and' based upon issue preclusion.

I. BACKGROUND

As set forth below, the background of this proceeding is composed of certain undisputed facts. The following facts are undisputed:

1. On January 28, 2010, the Plaintiff filed a civil action against the Defendant in the United States District Court for the Central District of California, captioned Nautilus, Inc. v. Chunchai Yu, et al., Case [637]*637No. 2:10-cv-00624-MMM-MAN (“CM Case”). Defendant’s Statement ¶ 14.

2. The Defendant filed an answer [Declaration of Samuel R. Watkins (“Watkins Declaration”) [Dk. 16, Exh. 2]] which contained affirmative defenses and a certification of interested parties [Watkins Declaration Exh. 3] in the Civil Case on February 19, 2010. Defendant’s Statement ¶ 19.

3. The same day the Defendant filed her answer, on February 19, 2010, the United States District Court for the Central District of California handed down an indictment (“Criminal Indictment”) of the Defendant in the criminal case of United States of America v. Chunchai Yu, 2:10— cr-00171-PA (“Criminal Case”) on charges of bribery and trafficking in counterfeit goods, including trafficking in counterfeit BOWFLEX® brand exercise equipment. Defendant’s Statement of Genuine Issues in Opposition to Plaintiffs Motion for Summary Judgment (“Defendant’s Statement”) [Dk. 21-2, ¶¶ 9, 72].

4. Counts Four, Five, and Six of the Criminal Indictment allege that Defendant violated 18 U.S.C. § 2320(a) specifically with respect to trafficking in exercise equipment bearing counterfeit versions of the BOWFLEX®, BOWFLEX XTREME®, and SELECTECH® trademarks. Defendant’s Statement ¶ 10.

5. On April 12, 2010, approximately two months after the Criminal Indictment, the Defendant appeared in person at the offices of the Plaintiffs legal counsel and presented to the Plaintiffs counsel a typewritten statement that reflected the following complete statement (“Typewritten Statement”):

Chunchai Yu,
I formally decline to provide any information to the plaintiff due to a Criminal Case currently in process for which I have pleaded not guilty.
I am not a lawyer and I don’t fully understand the process of the civil case so I prefer not to complicate matters until my other case has been resolved. I reserve the right to request any disclosure from the plaintiff following the court appointed deadlines and wish only to communicate with Jerome Friedberg the attorney acting on the case.

Defendant’s Statement ¶ 20; Watkins Declaration Exh. 4.

6. The Defendant filed the following documents, in addition to her answer, in the Civil Case: (1) an initial Rule 26(f) joint report [Watkins Declaration Exh. 5] on April 19, 2010 [Defendant’s Statement ¶ 22]; (2) a joint ADR program questionnaire [Watkins Declaration Exh. 6] in the Civil Case on April 19, 2010 [Defendant’s Statement ¶ 24]; (3) a joint request to continue a scheduling conference [Watkins Declaration Exh. 7] with the District Court on May 11, 2010 [Defendant’s Statement ¶ 25]; and (4) a revised Rule 26(f) joint report [Watkins Declaration Exh. 8] on July 28, 2010 [Defendant’s Statement 1126].

7. On July 15, 2010, after a federal jury trial, the Defendant was found guilty on all counts alleged in the Criminal Indictment in the Defendant’s Criminal Case. Defendant’s Statement ¶ 12.

8. The Defendant personally attended a scheduling conference before the District Court on August 2, 2010 in the Civil Case, approximately two weeks after her Criminal Indictment and less than one month after she was found guilty in the Criminal Case. Defendant’s Statement ¶ 28.

9. In October of 2010, the Plaintiff served requests for admission [Watkins Declaration Exh. 11] (“RFAs”) on the Defendant, and the Defendant never respond[638]*638ed to the RFAs. Defendant’s Statement ¶¶ 29, 30.

10. On January 10, 2011, the Defendant failed to appear at a scheduling conference in the Civil Case, and the District Court issued an order to show cause (“OSC”) why the Defendant’s answer should not be stricken and a default entered against her. Defendant’s Statement ¶¶ 32, 33. The OSC required the Defendant to submit written response no later than January 24, 2011. Defendant’s Statement ¶ 34.

11. The Defendant did not respond to the OSC [Defendant’s Statement ¶ 35], and on February 10, 2011, the District Court ordered the Defendant’s answer stricken and a default entered against her, and that the Plaintiff file a motion for default judgment by no later than March 31, 2011. Defendant’s Statement ¶¶ 36, 37.

12. The District Court entered default in the Civil Case on February 10, 2011, and the Plaintiff filed a motion for default judgment on March 31, 2011. Defendant’s Statement ¶¶ 38, 39. The Plaintiff served the Defendant with the motion for default judgment. Defendant’s Statement ¶ 40. The Defendant did not respond to the motion for default judgment. Defendant’s Statement ¶ 41.

13. On December 19, 2011, the District Court entered a default judgment [Watkins Declaration, Exh. 23] (“Default Judgment”) in the Civil Case against the Defendant for $4 million in statutory damages for willful trademark infringement under the Lanham Act, 15 U.S.C. § 1117(c), plus interest at 0.11 percent. Defendant’s Statement ¶ 15. On the same day, December 19, 2011, the District Court entered an order granting the Plaintiffs motion for default judgment [Watkins Declaration, Exh. 22] (“Default Judgment Order”). Defendant’s Statement ¶ 58.

As fully set forth below, the Court finds that there are no genuine issues of material fact and that summary judgment is therefore appropriate. The Court finds that the detailed findings contained in the Default Judgment and Default Judgment Order are preclusive and conclusively establish that the Plaintiff is entitled to a non-dischargeable judgment against the Defendant in the amount of $4,000,000.00, plus 0.11% interest, pursuant to 11 U.S.C. § 523(a)(6).

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Cite This Page — Counsel Stack

Bluebook (online)
545 B.R. 633, 2016 Bankr. LEXIS 500, 62 Bankr. Ct. Dec. (CRR) 64, Counsel Stack Legal Research, https://law.counselstack.com/opinion/nautilus-inc-v-chunchai-yu-in-re-chunchai-yu-cacb-2016.