Opinion
23-CV-00612 (JHR)(SN)
03-04-2024
THE KYJEN COMPANY, LLC, Plaintiff, v. THE INDIVIDUALS, CORPORATIONS, LIMITED LIABILITY COMPANIES, PARTNERSHIPS, AND UNICORPORATED ASSOCIATIONS IDENTIFIED ON SCHEDULE A TO THE COMPLAINT, Defendants.
TO THE HONORABLE JENNIFER H. REARDEN, JUDGE.
REPORT AND RECOMENDATION
SARAH NETBURN, UNITED STATES MAGISTRATE JUDGE.
This case concerns the unauthorized use of trademarked and patented pet products produced by the Plaintiff. Plaintiff filed this action against Defendants for, inter alia, trademark infringement and counterfeiting under 15 U.S.C. § 1114, and design patent infringement under 35 U.S.C. § 271.
After certain Defendants failed to appear, the Honorable Jennifer H. Rearden entered an order granting default and a permanent injunction in favor of the Plaintiff. ECF No. 86. Judge Rearden then referred this matter to my docket to conduct an inquest on damages. I recommend the Plaintiff be awarded a total of $100,000.00 per Defaulting Defendant in statutory damages for trademark infringement under 15 U.S.C. § 1114, and $250.00 in statutory damages for patent infringement under 35 U.S.C. § 289, plus applicable post-judgment interest.
PROCEDURAL BACKGROUND
Plaintiff specializes in the development and marketing of pet toys. It develops, manufactures, and markets pet products incorporating the Outward Hound IP (the “Outward Hound Products”). Plaintiff owns the trademarks and patents described in Exhibits 1 and 2 of the complaint on the Principal Register of the U.S. Patent and Trademark Office. Comp., ECF No. 1, ¶ 21. Since launching its Outward Hound Products in 2005, Plaintiff engaged in extensive promotional efforts. It has gained recognition in the pet-supply industry and sells its products to consumers internationally.
Defendants sell inferior and unauthorized imitations of the Outward Hound Products, infringing Plaintiff's Outward Hound IP (the “Counterfeit Products”) through numerous internet e-commerce stores operating under the online marketplace accounts identified in Schedule A of the complaint. Comp., Schedule A. Defendants facilitate sales by designing their internet stores so that they appear to unknowing consumers to be authorized online sellers of Plaintiff's products.
Plaintiff sued the Defendants for trademark and patent infringement and moved for: (1) a temporary restraining order (“TRO”); (2) an order authorizing expediated discovery; (3) an order restraining the Defendants' assets; (4) an order authorizing alterative service; and (5) an order to show cause for a Preliminary Injunction. The District Court granted the application and Plaintiff served the Defendants pursuant to the terms of the TRO. After a hearing, the Court entered a Preliminary Injunction against certain Defendants. Certain defaulting Defendants identified in the Third Amended Schedule A (the “Defaulting Defendants”) failed to respond to the complaint. Upon the Plaintiff's request, the Clerk issued a Certificate of Default. ECF No. 58.
Certain defendants are not subject to default because they have been either voluntarily dismissed, subject to a consent judgment entered by the Court, or because they have reached a settlement with Plaintiff. ECF No. 57 ¶ 4.
Plaintiff filed a motion for default against the Defaulting Defendants, and after a show cause hearing, Judge Rearden determined that Plaintiff established a basis for the Court to exercise personal jurisdiction over the Defaulting Defendants and granted the Plaintiff's Motion for Default. ECF No. 86. After Judge Rearden referred this matter to me for an inquest on damages, Plaintiff filed its Proposed Findings of Fact and Conclusions of Law (“FFCL”) in support of damages. To date, the Defaulting Defendants have failed to respond.
DISCUSSION
I. Legal Standard
The Court of Appeals set forth the procedural rules applicable to the entry of a default judgment in City of New York v. Mickalis Pawn Shop, LLC:
“Federal Rule of Civil Procedure 55 is the basic procedure to be followed when there is a default in the course of litigation.” Vt. Teddy Bear Co. v. 1-800 Beargram Co., 373 F.3d 241, 246 (2d Cir. 2004). Rule 55 provides a “two-step process” for the entry ofjudgment against a party who fails to defend: first, the entry of a default, and second, the entry of a default judgment. New York v. Green, 420 F.3d 99, 104 (2d Cir. 2005). The first step, entry of a default, formalizes a judicial recognition that a defendant has, through its failure to defend the action, admitted liability to the plaintiff.... The second step, entry of a default judgment, converts the defendant's admission of liability into a final judgment that terminates the litigation and awards the plaintiff any relief to which the court decides it is entitled, to the extent permitted by Rule 54(c).645 F.3d 114, 128 (2d Cir. 2011).
Where default has been entered against a defendant, courts accept as true all the well-pleaded facts alleged in the complaint, except those concerning the amount of damages. See In re Indus. Diamonds Antitrust Litig., 119 F.Supp.2d 418, 420 (S.D.N.Y. 2000).
In an inquest for damages where the plaintiff has sufficiently pleaded a claim on which relief can be granted, the only remaining issue is to determine the amount of damages owed. See Gucci Am., Inc. v. Tyrrell-Miller, 678 F.Supp.2d 117, 119 (S.D.N.Y. 2008) (citing Credit Lyonnais Sec. (USA), Inc. v. Alcantara, 183 F.3d 151, 155 (2d Cir. 1999)). The plaintiff must provide adequate support for the requested relief. Id.; see also Malletier v. Carducci Leather Fashions, Inc., 648 F.Supp.2d. 501, 503 (S.D.N.Y. 2009) (“[A] plaintiff seeking to recover damages against a defaulting defendant must prove its claim th[r]ough the submission of evidence ....”). A court may determine the amount a plaintiff is entitled to recover without a hearing, so long as: (1) the court determines the proper rule for calculating damages, and (2) the evidence submitted by the plaintiff establishes “with reasonable certainty” the basis for the damages. Id.
II. Liability
Courts evaluating damages in a default context first look to the complaint to determine whether the plaintiff has established aprimafacie case for recovery. See Lenard v. Design Studio, 889 F.Supp.2d 518, 528 (S.D.N.Y. 2012) (the court must first determine whether the allegations in the complaint were sufficiently pleaded to establish liability); Eurosteel Corp. v. M/V Koggegracht, No. 01-cv-7731 (DLC), 2003 WL 1872652, at *1 (S.D.N.Y. Apr. 11, 2003) (finding that plaintiff had established a prima facie case for recovery). In light of the Defendants' default, the Plaintiff's properly-pleaded allegations are accepted as true, except those relating to damages. See Cotton v. Slone, 4 F.3d 176, 181 (2d. Cir. 1993).
Plaintiff seeks $100,000.00 per Defaulting Defendant in statutory damages under the Lanham Act and $250.00 per Defaulting Defendant in statutory damages under the Patent Act.
A. The Lanham Act
Plaintiff alleges that the Defaulting Defendants engaged in trademark counterfeiting and infringement in violation of the Lanham Act. See 15 U.S.C. §§ 1114(1)(a)-(b). “The Lanham Act imposes liability on any person who in connection with the sale, offering for sale, or distribution of a good either uses a counterfeit of a registered mark or counterfeits such mark in advertising or packaging materials when such use or counterfeiting is likely to cause confusion.” Off-White LLC v. 5HK5584, No. 19-cv-672 (RA) (JLC), 2020 WL 1646692, at *5 (Apr. 3, 2020), report and recommendation adopted by 2020 WL 3050552 (S.D.N.Y. June 8, 2020). To establish a claim for either trademark counterfeiting or infringement, a plaintiff must demonstrate that the allegedly infringed mark is entitled to protection and the use of the allegedly infringed mark “is likely to cause consumer confusion as to the origin or sponsorship of the products to which it is attached.” Cross Commerce Media, Inc. v. Collective, Inc., 841 F.3d 155, 168 (2d Cir. 2016) (quoting Virgin Enters. Ltd. v. Nawab, 335 F.3d 141, 146 (2d Cir. 2003)).
“A certificate of registration with the [Patent and Trademark Office] is prima facie evidence that the mark is registered and valid (i.e., protectible), that the registrant owns the mark, and that the registrant has the exclusive right to use the mark in commerce.” Lane Cap. Mgmt., Inc. v. Lane Cap. Mgmt., Inc., 192 F.3d 337, 345 (2d Cir. 1999). There is no dispute that Plaintiff owns the trademarks and patents described in Exhibits 1 and 2 of the complaint on the Principal Register of the U.S. Patent and Trademark Office. Comp., ECF No. 1, ¶ 21. Because the trademarks are lawfully registered with the U.S. Patent and Trademark Office, they are entitled to protection. As to the likelihood of confusion, courts in this circuit have recognized that “counterfeits, by their very nature, cause confusion.” Coach, Inc. v. Horizon Trading USA Inc., 908 F.Supp.2d 426, 433 (S.D.N.Y. 2012) (quoting Gucci Am., Inc. v. Duty Free Apparel, Ltd., 286 F.Supp.2d 284, 287 (S.D.N.Y. 2003)). Under the Lanham Act, a “counterfeit” is “a spurious mark which is identical with, or substantially indistinguishable from, a registered mark.” 15 U.S.C. § 1127.
Taking the allegations in the complaint as true, “[t]he Defendants design the online marketplace accounts to appear to be selling genuine products properly bearing, using, and sold utilizing the [Outward Hound Patents and Outward Hound Trademarks], while selling inferior imitations of such products.” Comp. ¶ 6. Because “the average purchaser would find the allegedly counterfeit mark to be substantially similar to the registered mark as it appears on the actual merchandising,” these allegations are sufficient to support a finding that the Defaulting Defendants' products are counterfeit. Off-White LLC, 2020 WL 1646692, at *5. The Court therefore finds that the Defaulting Defendants are liable for trademark infringement.
B. The Patent Act
Under the Patent Act, “whoever without authority makes, uses, offers to sell, or sells any patented invention . . . during the term of the patent therefor, infringes the patent.” 35 U.S.C. § 271(a). There are “five elements of a patent infringement pleading, to (i) allege ownership of the patent, (ii) name each defendant, (iii) cite the patent that is allegedly infringed, (iv) state the means by which the defendant allegedly infringes, and (v) point to the sections of the patent law invoked.” Display Techs., LLC v. Leantegra, Inc., No. 20-cv-7816 (LJL), 2022 WL 354667, at *3 (S.D.N.Y. Feb. 7, 2022) (quoting Hall v. Bed Bath & Beyond, Inc., 705 F.3d 1357, 1362 (Fed. Cir. 2013)).
Plaintiff has satisfied each of the five elements required to establish the Defaulting Defendants' liability for patent infringement. Plaintiff alleges its ownership of the Outward Hound Products patents described in Exhibits 1 and 2 of the complaint. Comp., ¶ 21. Plaintiff has identified the Defaulting Defendant through their internet storefronts and provided screen captures and explanations of how the Defaulting Defendants engaged in counterfeit use of the Plaintiff's patent designs. See generally Compl. ¶¶ 1-47; see also IPVX Pat. Holdings, Inc. v. Taridium, LLC, No. 12-cv-5251 (KAM) (SMG), 2014 WL 4437294, at *2 (Aug. 6, 2014) (finding defendant liable for infringement of plaintiff's patented “Telephone Answering Service Linking Displayed Data with Recorded Audio Message” by manufacturing, using, selling, offering for sale, or using the patented method), report and recommendation adopted, 2014 WL 4437307 (E.D.N.Y. Sept. 9, 2014). Plaintiff has also specified that Defendants' infringement violated 35 U.S.C. § 271. Compl. ¶¶ 55-60. The Court therefore finds that the Defaulting Defendants are liable for patent infringement.
III. Damages
Once liability is established, the sole remaining issue before the court is whether the plaintiff has provided adequate support for the relief it seeks. Transatlantic Marine Claims Agency, Inc. v. Ace Shipping Corp., Div. of Ace Young Inc., 109 F.3d 105, 111 (2d Cir. 1997); see also Greyhound Exhibitgroup, Inc. v. E.L.U.L. Realty Corp., 973 F.2d, 155, 158 (2d Cir. 1992) (“While a party's default is deemed to constitute a concession of all well pleaded allegations of liability, it is not considered an admission of damages.”)
On an inquest for damages, the plaintiff bears the burden of proof and must introduce sufficient evidence to establish the amount of damages with “reasonable certainty.” Transatlantic Marine, 109 F.3d at 111; see also Lenard v. Design Studio, 889 F.Supp.2d 518, 538 (S.D.N.Y. 2012) (awarding no damages because plaintiff failed to demonstrate the amount of fines incurred that were attributable to defendant). A court may determine the appropriate damages based on affidavits and other documentary evidence “as long as [the court has] ensured that there [is] a basis for the damages specified in the default judgment.” Transatlantic Marine, 109 F.3d at 111 (quoting Fustok v. ContiCommodity Servs., Inc., 873 F.2d 38, 40 (2d. Cir. 1989)); see also Action S.A. v. Marc Rich & Co., 951 F.2d 504, 508 (2d Cir. 1991) (leaving the decision of whether a hearing is necessary for determining damages to the discretion of the district court); Fed.R.Civ.P. 55(b)(2).
A. Trademark Damages
Plaintiff does not seek actual damages under the Lanham Act; rather, Plaintiff seeks statutory damages for willful infringement. Statutory damages are particularly appropriate where actual damages are difficult to calculate. See Bus. Trends Analysts, Inc. v. Freedonia Grp., Inc., 887 F.2d 399, 406 (2d Cir. 1989); Chanel, Inc. v. Gardner, No. 07-cv-6679 (GBD)(MHD), 2011 WL 204911, at *1 (S.D.N.Y. Jan. 21, 2011) (stating that statutory damages are appropriate under the Lanham Act “when actual damages are difficult to calculate”). Indeed, the rationale underlying the Lanham Act's statutory damages framework “is the practical inability to determine profits or sales made by counterfeiters.” All-Star Mktg. Grp., LLC v. Media Brands Co., Ltd., 775 F.Supp.2d 613, 620 (S.D.N.Y. 2011) (citing Bus. Trends Analysts, Inc., 887 F.2d at 406); see also Sara Lee Corp. v. Bags of New York, Inc., 36 F.Supp.2d 161, 165 (S.D.N.Y. 1999) (“Statutory damages are most appropriate when infringer nondisclosure during fact finding leaves damages uncertain. This problem motivated the enactment of § 1117(c)....”).
A court may award statutory trademark damages in the amount of not less than $1,000 or more than $200,000 per counterfeit mark, as the court considers just. 15 U.S.C. § 1117(c). “District courts have wide discretion in awarding statutory damages.” Malletier v. Artex Creative Int'l Corp., 687 F.Supp.2d 347, 355 (S.D.N.Y. 2010).
1. Finding of Willfulness
The Lanham Act provide for increased maximum statutory damages when the defendants are deemed to have infringed willfully. When determining willfulness, courts consider “‘whether the defendant had knowledge that [his] conduct represented infringement or perhaps recklessly disregarded the possibility.'” Kepner-Tregoe, Inc. v. Vroom, 186 F.3d 283, 288 (2d Cir. 1999) (quoting Twin Peaks Prods., Inc. v. Publications Int'l, Ltd., 996 F.2d 1366, 1382 (2d Cir. 1993)); see also Yurman Studio, Inc. v. Castaneda, 591 F.Supp.2d 471, 503 (S.D.N.Y. 2008) (quoting NFL v. PrimeTime 24 Joint Venture, 131 F.Supp.2d 458, 475 (S.D.N.Y. 2001)) (stating that willfulness can be measured by a defendant's “‘reckless disregard of the high probability' that it was infringing”). Plaintiff seeks $100,000 in statutory damages per Defaulting Defendant for willful trademark counterfeiting and infringement.
First, by virtue of their default and subsequent failure to participate in this inquest, the Defaulting Defendants are deemed to have acted willfully. Stokes v. MilkChocolateNYC LLC, No. 22-cv-6786 (PAE) (RWL), 2023 WL 447073 at *6 (S.D.N.Y. July 11, 2023) (collecting cases); See Malletier, 648 F.Supp.2d. at 504 (citing Cotton, 4 F.3d at 181) (“Here, by virtue of its default, [the defendant] has admitted [the plaintiff's] allegation that it acted knowingly and intentionally or with reckless disregard or willful blindness to [the plaintiff's] rights.”); All-Star Mktg. Grp., 775 F.Supp.2d at 621-22 (citing various cases) (“Defendants have defaulted . . . and by virtue of their default are deemed to be willful infringers.”).
Trademark infringement is further presumed willful if the violator “knowingly provided . . . materially false contact information to a domain name registrar, domain name registry, or other domain name registration authority ....” 15 U.S.C. § 1117(e). Here, “[m]any of the
Defaulting Defendants' names and physical addresses used to register the Defaulting Defendant Domain Names are incomplete, contain randomly typed letters, or fail to include cities or states.” FFCL ¶ 66. The Defaulting Defendants also had reason to know that their activities infringed on Plaintiff's trademarks because they were under permanent injunction to cease infringing use of the Outward Hound Trademarks, for which the Plaintiff holds ownership.
A finding of willful trademark infringement is bolstered by the Defaulting Defendants' use of Outward Hound IP trademarks within the Outward Hound Products descriptions sold and/or advertised by the Defaulting Defendants. See Compl. ¶¶ 49-50 see also Coach, Inc. v. Melendez, No. 10-cv-6178 (BSJ) (HBP), 2011 WL 4542971, at *5 (Sept. 2, 2011), report and recommendation adopted by 2011 WL 4542717 (S.D.N.Y. Sept. 30, 2011) (“Because the marks used by defendants on their products are virtually identical to the Coach Registered Trademarks, the conclusion is inescapable that defendants' infringement and counterfeiting is intentional.”). This is precisely the sort of willful conduct that Congress sought to deter when it enacted the statutory damages provision of the Lanham Act. That is, “Congress took into account that oftentimes, counterfeiters' records are nonexistent, inadequate or deceptively kept in order to willfully deflate the level of counterfeiting activity actually engaged in, making proving actual damages in these cases extremely difficult if not impossible.” Kenneth Jay Lane, Inc. v. Heavenly Apparel, Inc., No. 03-cv-2132 (GBD) (KNF), 2006 WL 728407 at *6 (S.D.N.Y. Mar. 21, 2006) (quoting Polo Ralph Lauren, L.P. v. 3M Trading Co., Inc., No. 97-cv-4824 (JSM)(MH), 1999 WL 33740332 at *4 (S.D.N.Y. April 19, 1999)).
Thus, the Defaulting Defendants' failure to defend this lawsuit combined with false contact information provided and use of identical trademarks, demonstrates a willfulness to infringe upon Plaintiff's trademarks. Accordingly, the Court finds that enhancement for willful infringement under the Lanham Act is properly applied.
2. Analysis of Award
Section 1117(c)(2) of the Lanham Act instructs courts to award a “just” amount and establishes a cap on the award; it provides no further guidance on determining damages. See All-Star Mktg. Grp., 775 F.Supp.2d at 621-22 (citing Malletier, 648 F.Supp.2d. at 504). Courts in this district have sought guidance from the analogous statutory damages provision in the Copyright Act, 17 U.S.C. § 504(c), which contemplates that a finding of willfulness should result in damages that are both compensatory and, as a deterrent, punitive. See Id. at 622, n.5 (citing various cases); Sara Lee Corp., 36 F.Supp.2d at 167 (“The Copyright Act is not only similar in principle to the Trademark Act but identical in much of its statutory damages language.... [I]n interpreting Copyright Act language parallel to that in . . . 15 U.S.C. § 1117(c), the Second Circuit has held that uncapped statutory damages . . . may be punitive as necessary to deter the defendants, to deter others, and to redress wrongful litigation conduct.”). “Although the Lanham Act does not provide guidelines for courts to consider in awarding statutory damages, courts look to the analogous provision of the Copyright Act, which gives the court wide discretion to determine what amount of damages should be awarded within the minimum and maximum bounds proscribed under the Lanham Act.” Coach, Inc. v. Allen, No. 11-cv-3590 (CM), 2012 WL 2952890, at *9 (S.D.N.Y. July 19, 2012) (citing Union of Orthodox Jewish Congregations of America v. Royal Food Distribs. LLC., 665 F.Supp.2d 434, 436-37 (S.D.N.Y. 2009); Fitzgerald Publ'g. Co., Inc. v. Baylor Publ'g. Co., Inc., 807 F.2d 1110, 1116 (2d Cir. 1986)).
When determining damages under the Lanham Act, courts consider: (1) “the expenses saved and the profits reaped”; (2) “the revenues lost by the plaintiff”; (3) “the value of the copyright”; (4) “the deterrent effect on others besides the defendant”; (5) “whether the defendant's conduct was innocent or willful”; (6) “whether a defendant has cooperated in providing particular records from which to assess the value of the infringing material produced”; and (7) “the potential for discouraging the defendant.” (the “Fitzgerald factors”). Union of Orthodox Jewish Congregations of Am. v. Royal Food Distributors Liab. Co., 665 F.Supp.2d 434, 436 (S.D.N.Y. 2009) (quoting Fitzgerald Pub., 807 F.2d at 1117).
Due to the Defaulting Defendants' default, the Plaintiff was unable to meaningfully engage in discovery and obtain documents related to their sales. While the Plaintiff has some information regarding the frequency of counterfeit sales from Amazon, eBay, Walmart, and Wish (ContextLogic), the total number of sales made by Defaulting Defendants is incomplete. Therefore, it is impossible to ascertain the profits reaped by the Defaulting Defendants and the revenues lost by the Plaintiff. “[D]efaulting Defendant's failure to appear in this action prevents the Court from ascertaining their profits or the full extent of Plaintiff's losses, although as a general matter ‘[c]ourts have supported an inference of a broad scope of operations in cases dealing specifically with websites that ship and sell to a wide geographic range.'” Mattel, Inc. v. 1622758984, No. 18-cv-8821 (AJN), 2020 WL 2832812, at *7 (S.D.N.Y. May 31, 2020) (citing Spin Master Ltd. v. Alan Yuan's Store, 325 F.Supp.3d 413, 426 (S.D.N.Y. 2018)).
Factors (3) through (7) weigh in favor of a heightened award. Plaintiff's trademarks have high value because Plaintiff is established as “a leading manufacturer and distributor in the pet products industry whose substantial promotional efforts have earned it an international reputation for quality, reliability, and value.” FFCL ¶ 52.
As the Court already discussed, the Defaulting Defendants engaged in willful infringement and failed to cooperate in this litigation and damages inquest.
Lastly, the maximum statutory award will serve as a deterrent for the Defaulting Defendants and counterfeiters generally, who have built businesses around illicit websites that enable the sale of infringing materials in virtual anonymity and with impunity. The Defaulting Defendants' willful trademark infringement favor a heightened award under the Lanham Act. Therefore, the Court recommends that Plaintiff is awarded $100,000 per Defaulting Defendant for willful trademark counterfeiting and infringement under the Lanham Act.
B. Patent Damages
Under the Patent Act, “[u]pon finding for the claimant the court shall award the claimant damages adequate to compensate for the infringement, but in no event less than a reasonable royalty for the use made of the invention by the infringer, together with interest and costs as fixed by the court.” 35 U.S.C. § 284. The Act also provides for additional remedy: “Whoever during the term of a patent for a design, without license of the owner, (1) applies the patented design, or any colorable imitation thereof, to any article of manufacture for the purpose of sale, or (2) sells or exposes for sale any article of manufacture to which such design or colorable imitation has been applied shall be liable to the owner to the extent of his total profit, but not less than $250, recoverable in any United States district court having jurisdiction of the parties.” 35 U.S.C. § 289. In cases of design patent infringement, patentee can recover damages under 35 U.S.C. § 284 or U.S.C. § 289, but not both. 35 U.S.C. § 289 (“Nothing in this section shall prevent, lessen, or impeach any other remedy which an owner of an infringed patent has under the provisions of this title, but he shall not twice recover the profit made from the infringement.”)
Plaintiff is entitled to damages for patent infringement because the court found liability and the District Court granted default judgment for the claim against the Defaulting Defendants. See Display Techs., LLC v. Leantegra, Inc., No. 20-cv-7816 (LJL), 2022 WL 354667, at *4 (S.D.N.Y. Feb. 7, 2022) (“Because the Court has granted default judgment for Plaintiff's claim of patent infringement, Plaintiff is entitled to damages for the infringement.”)
In the complaint, Plaintiff seeks damages adequate to compensate Plaintiff for Defaulting Defendants' infringement, but in no event less than a reasonable royalty for the use made of the invention pursuant to 35 U.S.C. § 284, increased by three times the amount thereof. Compl. p.26, ¶¶ 3-4. In the alternative, the complaint asks the Plaintiff to be awarded all profits realized by the Defaulting Defendants from their infringement pursuant to 35 U.S.C. § 289. Id. at ¶ 5. In its Findings of Fact and Conclusions of Law, Plaintiff seeks only $250.00 per each Defaulting Defendant that has engaged in design patent infringement pursuant to 35 U.S.C. § 289.
“Article of manufacture” “encompasses both a product sold to a consumer and a component of that product” and simply refers to an item made by hand or machine. Samsung Elecs. Co. v. Apple Inc., 580 U.S. 53, 59 (2016). “In the case of a design for a single-component product, such as a dinner plate, the product is the ‘article of manufacture' to which the design has been applied.” Id. Here, the designs are for a single-component product, and the relevant article of manufacture is each infringing product sold by the Defaulting Defendants. The Court finds that the Defaulting Defendants applied the patented design to the articles of manufacture for the purpose of sale under 35 U.S.C. § 289.
In every case, “[t]he patent owner bears the burden of proving the amount of damages.” Evriholder Prod. LLC v. Simply LBS Ltd. Co., No. 17-cv-4329 (RA) (BCM), 2020 WL 7060336, at *5 (S.D.N.Y. Apr. 21, 2020) (citing ALAN Sportartikel GmbH v. Ultra Fitness Equip., Inc., No. 09-cv-4909 (ADS) (ARL), 2011 WL 13305254, at *2 (E.D.N.Y. Feb. 10, 2011)). Although the Defaulting Defendants are in default and have not produced documents demonstrating profits, Plaintiff does not provide the Court with any evidence of approximation of revenue or profits earned by Defaulting Defendants through their patent infringement. Therefore, Plaintiff is entitled to the statutory minimum of $250.00 for patent design infringement.
The Court recommends that Plaintiff is awarded $250.00 for each Defaulting Defendant that has engaged in design patent infringement only under the Patent Act, as identified in the Fourth Amended Schedule A to the FFCL.
IV. Post-Judgment Interest
Federal law permits a plaintiff to receive post judgment interest “on any money judgment in a civil case recovered in a district court. . . [to] be calculated from the date of the entry of the judgment, at a rate equal to the weekly average 1-year constant maturity Treasury yield, as published by the Board of Governors of the Federal Reserve System, for the calendar week preceding the date of the judgment.” 28 U.S.C. § 1961(a). Accordingly, the Plaintiff should be awarded post-judgment interest.
CONCLUSION
The Court recommends that the Plaintiff be awarded $100,000.00 in statutory damages per Defaulting Defendant under the Lanham Act and $250.00 for each Defaulting Defendant that has engaged in design patent infringement under the Patent Act, plus applicable post-judgment interest, as identified in the Fourth Amended Schedule A to the FFCL.
NOTICE OF PROCEDURE FOR FILING OBJECTIONS TO THIS REPORT AND RECOMMENDATION
The parties shall have 14 days from the service of this Report and Recommendation to file written objections under 28 U.S.C. § 636(b)(1) and Rule 72(b) of the Federal Rules of Civil Procedure. See Fed.R.Civ.P. 6(a), 6(d). A party may respond to another party's objections within 14 days after being served with a copy. Fed.R.Civ.P. 72(b)(2); see Fed.R.Civ.P. 6(a), 6(d). These objections shall be filed with the Court and served on any opposing parties. See Fed.R.Civ.P. 72(b)(2). Courtesy copies shall be delivered to the Honorable Jennifer H. Rearden if required by that judge's Individual Rules and Practices. Any requests for an extension of time for filing objections must be addressed to Judge Rearden. See Fed.R.Civ.P. 6(b). The failure to file timely objections will waive those objections for purposes of appeal. See Thomas v. Arn, 474 U.S. 140 (1985); United States v. James, 712 F.3d 79, 105 (2d Cir. 2013).