Once, LLC v. Pixly Group, Inc.

Opinion

1 UNITED STATES DISTRICT COURT 2 SOUTHERN DISTRICT OF CALIFORNIA 3 ONCE, LLC, Case No.: 25-cv-1503-AGS-DEB

4 Plaintiff, ORDER GRANTING IN PART 5 v. PLAINTIFF’S MOTION FOR DEFAULT JUDGMENT (ECF 7) AND 6 PIXLY GROUP, INC., GRANTING A PERMANENT 7 Defendant. INJUNCTION

9 This copyright-infringement suit focuses on a movie owned by plaintiff Once, LLC. 10 After defendant Pixly Group, Inc., failed to defend the action, the Clerk entered default 11 against it. Plaintiff now seeks to convert that default entry into a default judgment. 12 JURISDICTION 13 Before entering “judgment” “against a party who has failed to plead or otherwise 14 defend, a district court has an affirmative duty to look into its jurisdiction over both the 15 subject matter and the parties.” In re Tuli, 172 F.3d 707, 712 (9th Cir. 1999). In particular, 16 the Court must ensure “the defendant has been served properly under Fed. R. Civ. P. 4.” 17 Direct Mail Specialists v. Eclat Computerized Techs., 840 F.2d 685, 688 (9th Cir. 1988). 18 Subject-matter and personal jurisdiction are not barriers to this Court’s review here. 19 Subject-matter jurisdiction exists because district courts have “original jurisdiction of any 20 civil action” “relating to . . . copyrights.” See 28 U.S.C. § 1338(a). And this Court has 21 personal jurisdiction over Pixly because its “principal place of business” is in “California.” 22 (ECF 7-1, at 11–12.) Thus, it has “indicate[d]” a “general submission to” personal 23 jurisdiction in California courts. See J. McIntyre Mach., Ltd. v. Nicastro, 564 U.S. 873, 880 24 (2011); see also Cal. Civ. Proc. Code § 410.10 (permitting California courts to exercise 25 personal jurisdiction “on any basis not inconsistent with the Constitution of this state or of 26 the United States”). 27 As for service, a “corporation” is properly served when the party “follow[s] state 28 1 law [procedures] for serving a summons in an action brought in courts of general 2 jurisdiction in the state where the district court is located.” Fed. R. Civ. P. 4(e)(1), 3 (h)(1)(A). In California, “corporation[s]” may be served by “delivering a copy of the 4 summons and the complaint” to “the person designated as agent for service of process.” 5 Cal. Civ. Proc. Code § 416.10(a). Plaintiff Once did just that by serving Pixly’s 6 “[r]egistered [a]gent” “via personal service.” (ECF 4, at 1; ECF 7-1, at 11.) 7 DISCUSSION 8 A. Discretionary Factors 9 After jurisdiction is established, the “district court’s decision whether to enter a 10 default judgment is a discretionary one.” Aldabe v. Aldabe, 616 F.2d 1089, 1092 (9th Cir. 11 1980); Fed. R. Civ. P. 55(b)(2). This discretion is guided by the seven Eitel factors: “(1) the 12 possibility of prejudice to plaintiff, (2) the merits of plaintiff’s substantive claim, (3) the 13 sufficiency of the complaint, (4) the sum of money at stake in the action; (5) the possibility 14 of a dispute concerning the material facts; (6) whether the default was due to excusable 15 neglect, and (7) the strong [public] policy . . . favoring decisions on the merits.” Eitel v. 16 McCool, 782 F.2d 1470, 1471–72 (9th Cir. 1986). In this analysis, the “factual allegations 17 of the complaint, except those relating to the amount of damages, will be taken as true.” 18 Geddes v. United Fin. Grp., 559 F.2d 557, 560 (9th Cir. 1977). 19 Turning to the first factor—the possibility of prejudicing plaintiff—plaintiffs suffer 20 prejudice if, absent default, they would be “without other recourse for recovery.” PepsiCo 21 v. Cal. Sec. Cans, 238 F. Supp. 2d 1172, 1177 (C.D. Cal. 2002). This lawsuit was not 22 Once’s first step to resolve this dispute. After first discovering that “Pixly reproduced and 23 publicly displayed the copyrighted Work on its website,” Once “notified Pixly in writing 24 of [its] copyrights” and “demanded that it cease the infringing.” (ECF 7-1, at 18; ECF 7-2, 25 at 3.) But Once “never received a response,” and its copyright has now gone infringed for 26 more than “six (6) years.” (ECF 7-2, at 3.) Given Pixly’s ongoing failure to respond to 27 Once’s communications or to this lawsuit, Once “would be left without a remedy against 28 [Pixly]” for its infringement—and thus suffer prejudice—“if default judgment were not 1 entered.” See Nolan v. Calello, No. 2:21-cv-00981-AB-RAO, 2021 WL 4621945, at *3 2 (C.D. Cal. July 8, 2021). This consideration weighs in plaintiff’s favor. 3 The next two factors—the “merits” of the claim and the “sufficiency of the 4 complaint”—are often considered together, and they “require that a plaintiff ‘state a claim 5 on which the [plaintiff] may recover.’” PepsiCo, Inc., 238 F. Supp. 2d at 1175 (considering 6 these factors together and quoting Danning v. Lavine, 572 F.2d 1386, 1388 (9th Cir. 1978)). 7 The complaint asserts three causes of action (ECF 1, at 4–6), but plaintiff only moves for 8 default judgment on its copyright-infringement claim (ECF 7-1, at 13). To prevail on that 9 claim, plaintiff must show “(1) ownership of a valid copyright, and (2) copying of 10 constituent elements of the work that are original.” Woodland v. Hill, 136 F.4th 1199, 1206 11 (9th Cir. 2025). The first element is met: Plaintiff holds a registered copyright for its film 12 (ECF 1-2, at 2), which is “prima facie evidence of the validity of the copyright,” see 13 17 U.S.C. § 410(c). The second element is “bifurcate[d]” into “two distinct components: 14 copying and unlawful appropriation.” Woodland, 136 F.4th at 1206 (cleaned up). Plaintiff 15 Once alleges that Pixly “reproduce[d], display[ed], and distribute[d]” the copyrighted film 16 without Once’s permission. (ECF 7-1, at 14.) So, plaintiff sufficiently stated a claim that 17 Pixly both “cop[ied]” and “unlawful[ly] appropriate[ed]” the film. See Woodland, 18 136 F.4th at 1206. Both these factors favor plaintiff. 19 For the fourth Eitel factor, a “substantial amount at stake disfavors default 20 judgment,” but “when the money at stake is tailored to defendant’s specific misconduct, 21 default judgment may still be appropriate.” INNsight.com v. Myeres.com Rsrvs, No. 22-cv- 22 0360-AGS-DEB, 2023 WL 6217361, at *2 (S.D. Cal. May 1, 2023). Even if the Court 23 assumes that the award sought is “substantial”—and that this factor cuts against a default 24 judgment—the sum is still within the statutory damages amount set by Congress. So, this 25 factor alone would not preclude default judgment. 26 Next, there is no “possibility of a dispute concerning material facts,” see Eitel, 27 782 F.2d at 1471–72, so the fifth factor also favors plaintiff. Because the defendant never 28 1 appeared and default has been entered, “no genuine dispute of material facts would 2 preclude granting [p]laintiff’s motion.” See PepsiCo, Inc., 238 F. Supp. 2d at 1177. 3 Turning to the sixth factor—excusable neglect—“the Court considers whether 4 defendant was provided adequate notice as well as the circumstances surrounding 5 defendant’s failure to answer the complaint.” INNsight.com, 2023 WL 6217361, at *3. 6 Pixly had proper notice of the complaint upon service and may have been on notice even 7 before that—“[p]rior to retaining counsel,” Once’s owner “notified Pixly of the infringing 8 use, but never received a response.” (ECF 7-2, at 3.) As the notice here was adequate, and 9 nothing in the record suggests that Pixly’s neglect was excusable, this factor supports 10 default judgment. 11 Finally, the public-policy factor favors “decisions on the merits” and usually weighs 12 against default judgment. See Eitel, 782 F.2d at 1472. But when a defendant’s failure to 13 defend an action “makes a decision on the merits impracticable, if not impossible,” as here, 14 an entry of default judgment is nevertheless warranted. See PepsiCo, Inc., 238 F. Supp. 2d 15 at 1177. 16 In sum, the discretionary factors weigh heavily in favor of default judgment. 17 B. Requested Relief 18 Once seeks: (1) “$150,000,” which is the maximum “statutory damages award” for 19 willful infringement, (2) “attorneys’ fees and costs,” (3) “pre- and post-judgment interest,” 20 and (4) “permanent injunctive relief.” (ECF 7-1, at 14–15, 21–22.) 21 1. Damages 22 If the Court finds that “infringement was committed willfully,” it “may increase the 23 award of statutory damages to a sum of not more than $150,000.” 17 U.S.C. § 504(c)(2). 24 The Court has “wide discretion in determining the amount of statutory damages to be 25 awarded.” Harris v. Emus Records Corp., 734 F.2d 1329, 1335 (9th Cir. 1984). 26 Copyright infringement is “willful” when committed with “knowledge that the 27 defendants’ conduct constituted an act of infringement.” Peer Int’l Corp. v. Pausa Records, 28 909 F.2d 1332, 1335 (9th Cir. 1990). “[T]o prove willfulness under the Copyright Act, the 1 plaintiff must show (1) that the defendant was actually aware of the infringing activity, or 2 (2) that the defendant’s actions were the result of reckless disregard for, or willful blindness 3 to, the copyright holder’s rights.” Unicolors v. Urban Outfitters, 853 F.3d 980, 991 4 (9th Cir. 2017). In the default-judgment context, when a plaintiff has “specifically pled that 5 the defendant[] engaged in continuing willful infringement of its copyright[],” there is an 6 “implied finding of willfulness.” Aries Music Ent. v. Angelica’s Rec. Distributors, 7 506 F. App’x 550, 552 (9th Cir. 2013). 8 Once’s contention of willfulness is well supported by the undisputed facts in the 9 record. (See ECF 1, at 5–6.) Pixly “displayed” plaintiff’s film on its website, ignored both 10 this lawsuit and Once’s “notifi[cation]” of the “infringing use,” and likely did not believe 11 that it owned the copyright itself. (ECF 7-2, at 2–3.) So, it was either “actually aware” of 12 its infringing activity or “willful[ly] blind[]” to it, and thus acted willfully. See Unicolors, 13 853 F.3d at 991. In any event, plaintiff Once “specifically pled that the defendant[] engaged 14 in continuing willful infringement,” see Aries Music, 506 F. App’x at 552, in that it alleged 15 that Pixly’s “acts were willful” and that the infringement has continued since Once 16 “discovered the unauthorized use of its” film years ago (ECF 1, at 4–5). So, there’s also an 17 “implied finding of willfulness.” See Aries Music, 506 F. App’x at 552. 18 Still, “statutory damages should be proportional to the damages suffered by the 19 copyright holder.” Star Fabrics v. Zappos Retail, No. CV 13-00229 MMM (MRWx), 20 2013 WL 12123687, at *7 (C.D. Cal. Sept. 10, 2013). That assessment is complicated here, 21 as Once provided none of the information necessary to calculate a proportional damage 22 award. The Court does not know, for example, Once’s customary licensing fee, the cost of 23 making the video, or lost revenues. Plaintiff merely asserts that its “damages are 24 substantial” and that the film has “lost significant value,” without specifying any values. 25 (See ECF 7-1, at 15; ECF 7-2, at 4.) When a plaintiff establishes willfulness at the default- 26 judgment stage but “adduce[s] no specific factual support for the damages it seeks,” many 27 courts decline to award the $150,000 maximum and instead award “$30,000,” the statutory 28 maximum for non-willful infringement. See, e.g., Star Fabrics, 2013 WL 12123687, at *7 1 (collecting cases and awarding $30,000). This Court agrees that $150,000 would be 2 disproportionate to the actual damages on this record and awards Once $30,000 instead. 3 This amount adequately “send[s] a signal” that infringers “will pay a substantial price for 4 willfully infringing the intellectual property rights of others.” Id. (cleaned up). 5 2. Attorneys’ Fees and Costs 6 Plaintiff Once also seeks “$4,475.00” in attorney’s fees and “$505.00” in costs. 7 (ECF 7-1, at 24.) Courts may award “recovery of full costs” and a “reasonable attorney’s 8 fee to the prevailing party.” 17 U.S.C. § 505. Once’s counsel provided a detailed account 9 of its hourly rate, hours spent on this litigation, and costs incurred. The requested amounts 10 are well within the range that this Court granted in a similar case. See INNsight.com, 11 2023 WL 6217361, at *4 (allowing “$5,040.00 in attorney fees” and “798.97 in costs” for 12 a copyright-case default judgment). So, the fee and cost requests are granted. 13 3. Pre- and Post-Judgment Interest 14 Plaintiff next seeks “pre- and post-judgment interest” “for the total damage award,” 15 including fees and costs. (ECF 1, at 7; ECF 7-1, at 21.) Prejudgment interest “is available 16 under the Copyright Act,” Polar Bear Productions v. Timex Corp., 384 F.3d 700, 716, 718 17 (9th Cir. 2004), and “post[-]judgment interest on a district court judgment is mandatory,” 18 Air Separation v. Underwriters at Lloyd’s of London, 45 F.3d 288, 290 (9th Cir. 1995) 19 (citing 28 U.S.C. § 1961(a)). To qualify for “prejudgment interest on default judgment,” 20 plaintiff must “allege[] entitlement to such interest in its complaint,” as Once has done 21 here. See Shaw v. Ultimate Franchises, No. 8:18-cv-02273-JLS-ADS, 2022 WL 2132688, 22 at *6 (C.D. Cal. Feb. 2, 2022); (ECF 1, at 7). 23 Like many other courts, this Court finds that “the interest rate prescribed for 24 post-judgment interest under 28 U.S.C. § 1961 is appropriate for fixing the rate of 25 pre-judgment interest.” See Oracle USA v. Rimini St., 879 F.3d 948, 963 (9th Cir. 2018), 26 overruled on other grounds by Rimini St. v. Oracle USA, 586 U.S. 334 (2019). The 27 applicable interest rate for both the pre- and post-judgment period is “the weekly average 28 1-year constant maturity Treasury yield, as published by the Board of Governors of the 1 Federal Reserve System, for the calendar week preceding[] the date of the judgment.” 2 28 U.S.C. § 1961(a). 3 4. Injunctive Relief 4 Finally, plaintiff Once asks the Court to “permanently enjoin” Pixly from infringing 5 its copyrighted film. (ECF 1, at 6.) A party “seeking a permanent injunction” must show 6 that: (1) “it has suffered an irreparable injury;” (2) “remedies available at law, such as 7 monetary damages, are inadequate to compensate for that injury;” (3) “considering the 8 balance of hardships between the plaintiff and defendant, a remedy in equity is warranted;” 9 and (4) “the public interest would not be disserved by a permanent injunction.” eBay Inc. 10 v. MercExchange, 547 U.S. 388, 391 (2006). 11 Once asserts that, after a party establishes “copyright” infringement, there is a 12 “presumption of irreparable injury” “[w]ith regard to the first two factors.” (ECF 7-1, at 23 13 (citing Cadence Design Sys. v. Avant! Corp., 125 F.3d 824, 826 (9th Cir. 1997) and MAI 14 Sys. Corp. v. Peak Comput., 991 F.2d 511, 520 (9th Cir. 1993)).) But that “presumption” 15 was “effectively overruled” by eBay, so this Court cannot “presum[e] irreparable harm.” 16 Flexible Lifeline Sys. v. Precision Lift., 654 F.3d 989, 998 (9th Cir. 2011). 17 Instead, to satisfy the first two factors, Once must “establish that remedies available 18 at law, such as monetary damages, are inadequate to compensate for the injury arising 19 from” Pixly’s “continuing . . . infringing.” Herb Reed Enters. v. Florida Ent. Mgmt., 20 736 F.3d 1239, 1249–50 (9th Cir. 2013). Once has met that burden. Given “the unique 21 techniques” used to “create” this movie, Once asserts that this film is “scarce.” (ECF 7-2, 22 at 3.) Yet that same video, on Pixly’s webpage, has “29.8 million views” (and counting), 23 rendering it less and less scarce. (See id.) There is no amount of money that could undo the 24 film’s lost “scarc[ity]” and “exclusiv[ity]” (id. at 4), so “remedies available at law” would 25 be “inadequate,” see Herb Reed, 736 F.3d at 1249–50. 26 The balance of hardships also decidedly supports an injunction. Injunctive relief 27 would save Once from the illegal infringement of its copyrighted work, while imposing 28 upon Pixly the duty merely to comply with the law. It’s a “long-settled principle that harm 1 || caused by illegal conduct does not merit significant equitable protection.” Disney Enters. 2 || v. VidAngel, 869 F.3d 848, 867 (9th Cir. 2017). 3 Finally, the “public interest would not be disserved by a permanent injunction.” See 4 || eBay, 547 U.S. at 391. To the contrary, “the public has a compelling interest in protecting 5 || copyright owners’ marketable rights to their work.” Disney, 869 F.3d at 867. 6 Thus, Once’s request for a permanent injunction is granted to the extent set forth 7 || below. See 17 U.S.C. § 502(a) (allowing courts to “grant temporary and final injunctions” 8 “copyright” cases); see also Fed. R. Civ. P. 65(d). 9 CONCLUSION 10 Plaintiff's motion for default judgment is GRANTED in part. By March 20, 2026, 11 |}Once is ordered to file its proposed calculation using the interest rate under 28 U.S.C. 12 1961(a), as applied to the $34,980 damages award (that is, the $30,000 statutory award 13 $4,475 in fees and $505 in costs). The prejudgment interest calculation will run from 14 “date of infringement” on “May 7, 2019” (ECF 7-3, at 3), through the date of this 15 ||judgment. The post-judgment calculation will run from the date of this judgment “to the 16 ||date of payment,” with interest “computed daily” and “compounded annually.” See 17 U.S.C. § 1961(b). 18 Pixly, as well as its officers, agents, employees, and attorneys, are 19 || PERMANENTLY ENJOINED from directly or indirectly infringing upon Once’s film 20 |/entitled “Tarlton Construction — Brand Film,” which is copyrighted under registration 21 ||number PA 1-896-406. (See ECF 1, at 3; ECF 1-2, at 2.) They may not reproduce, display, 22 || or distribute that film—or copies of it—without Once’s authorization. 23 The Clerk is directed to enter judgment in plaintiff's favor. 24 Dated: March 6, 2026

26 Hon. Afidrew G. Schopler United States District Judge 28