Opinion
2:24-cv-1586 WBS SCR
11-04-2024
NUTRAMAX LABORATORIES, INC. et al., Plaintiffs, v. CP William LLC, Defendant.
FINDINGS AND RECOMMENDATIONS
SEAN C. RIORDAN UNITED STATES MAGISTRATE JUDGE
Pending before the Court is Plaintiffs' motion for default judgment and permanent injunction against Defendant CP William LLC. ECF No. 13. The motion was referred to the undersigned pursuant to E.D. Cal. R. 302(c)(19). Hearing on the motion was set for September 19, 2024, but the Court took the motion under submission and vacated the hearing pursuant to E.D. Cal. R. 230(g). ECF No. 19. For the reasons set forth below, the undersigned recommends Plaintiff's motion be granted and the Court order permanent injunctive relief.
I. Background Facts and Procedural Posture
Plaintiffs Nutramax Laboratories, Inc. and Nutramax Laboratories Veterinary Sciences, Inc. (collectively Nutramax or Plaintiffs) are headquartered and have their principal place of business in Lancaster, South Carolina. ECF No. 1 at ¶¶ 3-4. Plaintiffs research, develop, and sell animal health supplements and are the registered owners of the following marks:
1. U.S. Trademark Registration Number 2,231,260
(NUTRAMAX LABORATORIES);
2. U.S. Trademark Registration Number 4,077,241 (NUTRAMAX LABORATORIES (Stylized);
3. U.S. Trademark Registration Number 4,654,181 (NUTRAMAX LABORATORIES VETERNARY SCIENCES, INC. (Stylized);
4. U.S. Trademark Registration Number 5,662,197 (COSEQUIN);
5. U.S. Trademark Registration Number 1,791,253 (COSEQUIN); and
6. U.S. Trademark Registration Number 3,481,550 (PROVIABLE).Id. at ¶¶ 13, 23 (collectively Nutramax Marks).
Each Nutramax product bears the Nutramax Laboratories mark in addition to a mark distinguishing the product's specific line, such as Cosequin or Proviable. Id. at ¶ 16. Nutramax Cosequin® supplements, which bear both the Nutramax Laboratories and Cosequin marks, and Nutramax Proviable® supplements, which bear both the Nutramax Laboratories and Proviable marks, are popular digestive animal health products that have generated significant sales nationwide. Id. ¶¶ 16-18.
Nutramax distributes its products through multiple trade channels, including “pure play e-commerce”-a trade channel where resellers only have an online sales outlet. Id. at ¶ 28. In the “pure play e-commerce” channel, as with other trade channels, Nutramax's products are distributed through a network of authorized sellers, in which substantially all resellers enter into Authorized Reseller Agreements (ARAs) with Nutramax. Id. ¶ 29-31. To ensure a high level of product and customer service, the ARAs generally include two relevant provisions. Id. at ¶ 32. First, “[t]he reseller is required to maintain qualified personnel with knowledge of the specification, features, and uses of Nutramax products and provide quality post-sale support to consumers.” Id. Second, “[t]he reseller is required to store Nutramax products in a cool, dry area out of direct sunlight in a controlled room with a temperature between 40 and 70 degrees Fahrenheit.” Id. Unauthorized resellers are not party to ARAs and therefore are not contractually bound by these staffing and storage requirements. Id. ¶¶ 34, 36.
Defendant CP William LLC is a “pure play e-commerce” seller engaging in the unauthorized sale of Nutramax's Cosequin® Joint Health Supplements and Proviable® Disgestive Health Supplements through Amazon.com under the seller account name “CP William LLC.” Id. at ¶¶ 5, 38. “Defendants used the Nutramax Marks in conjunction with this unauthorized sales activity,” id. at ¶ 39, and “the Nutramax products sold by Defendants did not conform to the requirements of the [ARAs].” Id. at ¶ 42. “Defendants obtained the Nutramax products that they sold from one or more of Nutramax's authorized resellers and/or distributors.” Id. at ¶ 46. ARAs specify which entities Nutramax products can be sold to and Nutramax has not permitted an authorized reseller or distributor to sell its products to Defendants. Id. at ¶ 47. “Nutramax has never authorized Defendants to use the Nutramax Marks or sell Nutramax products.” Id. at ¶ 51.
Plaintiffs originally sued both CP William LLC and Christopher William Powell. Defendant Powell was voluntarily dismissed from the case on September 3, 2024. ECF No. 18. The Complaint's reference to the plural “Defendants” was accurate at the time the Complaint was filed.
Plaintiffs commenced this action on June 3, 2024. ECF No. 1. Before filing suit, Plaintiffs attempted to notify former Defendant Christopher William Powell of his unauthorized sale of Nutramax products through mail correspondence and the seller messaging platform on Amazon.com. Id. at ¶ 49. Defendant Powell did not respond and continued to engage in the unauthorized sale of Nutramax products. Id. at ¶¶ 49, 50.
Plaintiffs allege that Defendant Nutramax's actions constitute (1) trademark infringement in violation of Section 32(1) of the Lanham Act, 15 U.S.C. § 1114(1); (2) unfair competition and false designation of origin in violation of Section 43(a) of the Lanham Act, 15 U.S.C. § 1125(a); and (3) tortious interference with a contract under California common law. Id. at ¶ 2. Defendant was served but failed to respond, after which the clerk entered default. ECF Nos. 10-12. Plaintiffs moved for default judgment on July 29, 2024, seeking a permanent injunction and other relief. ECF No. 13-1 at 26-27. Defendant has not appeared in the matter to respond or defend against these claims. See generally Civil Docket for No. 2:24-cv-1586 WBS SCR.
II. Legal Standards
Default may be entered against a party against whom a judgment for affirmative relief is sought who fails to plead or otherwise defend against the action. See Fed.R.Civ.P. 55(a). However, “[a] defendant's default does not automatically entitle the plaintiff to a court-ordered judgment.” PepsiCo, Inc. v. Cal. Sec. Cans, 238 F.Supp.2d 1172, 1174 (C.D. Cal. 2002) (citing Draper v. Coombs, 792 F.2d 915, 924-25 (9th Cir. 1986)). Rather, the decision to grant or deny a request for default judgment lies within the district court's sound discretion. See NewGen, LLC v. Safe Cig, LLC, 840 F.3d 660, 616 (9th Cir. 2016).
In making this determination, a court considers the following seven Eitel factors: (1) the possibility of prejudice to the plaintiff; (2) the merits of plaintiff's substantive claim; (3) the sufficiency of the complaint; (4) the sum of money at stake in the action; (5) the possibility of a dispute concerning material facts; (6) whether the default was due to excusable neglect; and (7) the strong policy underlying the Federal Rules of Civil Procedure favoring decisions on the merits. Eitel v. McCool, 782 F.2d 1470, 1471-72 (9th Cir. 1986).
Generally, once default is entered, well-pleaded factual allegations in the operative complaint are taken as true, except for those allegations relating to damages. NewGen, 840 F.3d at 617 (citing Geddes v. United Fin. Group, 559 F.2d 557, 560 (9th Cir. 1977) (per curiam)). However, “necessary facts not contained in the pleadings, and claims which are legally insufficient, are not established by default.” Cripps v. Life Ins. Co. of N. Am., 980 F.2d 1261, 1267 (9th Cir. 1992) (citation omitted); see also DIRECTV, Inc. v. Huynh, 503 F.3d 847, 854 (9th Cir. 2007) (“a defendant is not held to admit facts that are not well-pleaded or to admit conclusions of law”) (citation and quotation marks omitted).
III. Analysis/Discussion
A. Jurisdiction
“[A] district court has an affirmative duty to look into its jurisdiction over both the subject matter and the parties” before entering default. In Re Tuli, 172 F.3d 707, 712 (9th Cir. 1999). In the present case, the Court has subject matter jurisdiction over this action pursuant to 28 U.S.C. § 1331 because it arises under federal trademark law, 15 U.S.C. §§ 1051, et set. The Court has personal jurisdiction over Defendant because it is alleged that it is incorporated under the laws of California with its registered address in Sacramento, California, ECF No. 1 at ¶ 5; ECF No. 13-1 at 11, and because Defendant was served with process in this case, ECF No. 10.
B. Eitel Factors
1. Eitel Factor One: Possibility of Prejudice to Plaintiffs
The first factor “considers whether a plaintiff will suffer prejudice if default judgment is not entered.” See PepsiCo, Inc. v. Cal. Sec. Cans, 238 F.Supp.2d 1172, 1177 (C.D. Cal. 2002). Here, Plaintiffs would suffer prejudice if the Court did not enter default judgment. Despite Plaintiffs attempts to notify Defendant of its unauthorized sale of Nutramax products, Defendant continued to engage in the unauthorized sale of Plaintiffs' products. ECF NO. 1 at ¶ 50. Absent some recourse, Defendant is likely to continue infringing the Nutramax Marks. This factor favors default judgment.
2. Eitel Factors Two and Three: Merits of Plaintiffs' Substantive Claims and Sufficiency of the Complaint
“The second and third Eitel factors both examine the merits and sufficiency of a plaintiff's complaint, and accordingly, are often analyzed together.” Johnson v. Qolor, LLC, No. 21-cv-8475 RS, 2022 WL 3348589, at *1 (N.D. Cal. Aug. 12, 2022) (internal quotation marks and citations omitted); see also Craigslist, Inc. v. Naturemarket, Inc., 694 F.Supp.2d 1039, 1055 (E.D. Cal. 2010).
a) The Lanham Act Claims
As noted above, Plaintiffs bring claims of trademark infringement and of unfair competition and false designation of origin in violation of Sections 32(1) and 43(a) of the Lanham Act, respectively. 15 U.S.C. §§ 1114(1), 1125(a). Because the analysis “under the two provisions is oftentimes identical,” the Court will evaluate them together. Brookfield Commc'ns, Inc. v. West Coast Ent. Corp., 174 F.3d 1036, 1046 n.8 (9th Cir. 1999). To prevail on a claim for relief under either Lanham Act claim, Plaintiffs must prove that (1) “it has a protectible ownership interest in the mark,” (2) the Defendant used the mark, and (3) the Defendant's use of the mark “is likely to cause consumer confusion.” Dep't of Parks & Recreation for Cal. v. Bazaar Del Mundo Inc., 448 F.3d 1118, 1124 (9th Cir. 2006) (citation omitted).
The “ultimate test” for false designation of origin under § 1125(a), as a type of unfair competition claim, is similar to infringement claims under § 1114: the public's likelihood of confusion. See Jada Toys, Inc. v. Mattel, Inc., 518 F.3d 628, 632 (9th Cir. 2008) (using the same likelihood of confusion test to analyze trademark infringement and false designation of origin claims); GSHolistic, LLC v. Shinwar, No. 2:23-cv-0355 CSK, 2024 WL 3890082 (E.D. Cal. Aug. 20, 2024) (noting that analysis of both types of claims turns on likelihood of confusion).
i. Plaintiffs' Ownership
Federal registration of a trademark “provides ‘prima facie evidence' of the mark's validity and entitles the plaintiff to a ‘strong presumption' that the mark is a protectable mark.” Zobmondo Ent., LLC v. Falls Media, LLC, 602 F.3d 1108, 1113 14 (9th Cir. 2010) (quoting 15 U.S.C. §§ 1057, 1115(a)). Because the Nutramax Marks are registered with the U.S. Patent and Trademark Office, ECF No. 1 at ¶ 23, Plaintiffs have demonstrated prima facie ownership of the infringed trademarks.
ii. Defendant Used the Marks
Defendant was selling, through its Amazon.com account, several products with the Nutramax Marks. ECF No. 1 at ¶ 38; ECF No. 1-3, Exhibit C.
iii. Likelihood of Confusion
Generally, a trademark owner's right under the Lanham Act to control distribution of its own products is limited by the first sale doctrine. See Sebastian International, Inc. v. Longs Drugs Stores Corp., 53 F.3d 1073, 1074 (9th Cir. 1995) (per curiam). “Under the [first sale] doctrine, resale by the first purchaser of the original article under the producer's trademark is neither trademark infringement nor unfair competition.” Enesco Corp. v. Price/Costco Inc., 146 F.3d 1083, 1085 (9th Cir. 1998) (citation omitted). Because “trademark law is designed to prevent sellers from confusing or deceiving consumers about the origin or make of a product,” such “confusion ordinarily does not exist when a genuine article bearing a true mark is sold.” Id. (emphasis added). However, after the first sale, the trademark holder may establish infringement “if he demonstrates that the goods are materially different.” Grateful Palate, Inc. v. Joshua Tree Imports, LLC, 220 Fed.Appx. 635, 637 (9th Cir. 2007) (citing Enesco, 146 F.3d at 1087). If the product is materially different, the product is not genuine and may cause confusion regarding the product's source, quality, or sponsorship. See Enesco, 146 F.3d at 1087.
One way in which goods can be materially different is when they do not meet the trademark holder's quality control standards, which “may result in the devaluation of the mark by tarnishing the image.” Id. at 1087 (quoting Warner-Lambert Co. v. Northside Dev. Corp., 86 F.3d 3, 6 (2d Cir. 1996)). “If this occurs, ‘the nonconforming product is deemed for Lanham Act purposes not to be the genuine product of the holder, and its distribution constitutes trademark infringement.” Id. To qualify for the quality control exception, there must be “some defect (or potential defect) in the product itself that the customer would not be readily able to detect.” Id.
Plaintiff alleges that an unauthorized reseller like Defendant is not contractually obligated to store Plaintiffs' products at conditions required under the ARAs-in a cool, dry area out of direct sunlight in a controlled room with a temperature of 40 to 70 degrees-which are designed to maintain the quality of animal digestive supplements. ECF No. 1 at ¶¶ 32, 34, 35; ECF No. 131 at 17. Without such quality control, the Nutramax products sold by Defendants may have some defect or the potential defect that customers would not be readily able to detect, and a consumer would thereby be confused or deceived. See, e.g., Enesco, 146 F.3d at 1087 (“The oil, shoes, and beer from Shell, El Greco, and Coors all contained or could potentially contain a latent product defect due to the unauthorized distributor's failure to observe the manufacturer and mark owner's rigorous quality control standards. Most importantly, a consumer would not necessarily be aware of the defective condition of the product and would thereby be confused or deceived.”) (quoting Matrix Essentials, Inc. v. Emporium Drug Mart, Inc., 988 F.2d 587, 591 (5th Cir. 1993)); Davidoff & CIE, S.A. v. PLD Int'l Corp., 263 F.3d 1297, 1300 n.4 (11th Cir. 2001) (“[T]he lack of quality control can rise to the level of a material difference from the trademark owner's products and create a likelihood of confusion.”).
Plaintiffs also allege and argue that Nutramax products sold by unauthorized sellers like Defendant are materially different because unauthorized sellers are not subject to the requirement of the ARAs to “employ qualified personnel with knowledge of the specifications, features, and uses of Nutramax products, which ensures that purchasers of Nutramax's products can access product support directly from the retailer from whom they purchase.” ECF No. 13-1 at 17; see ECF No. 1 at ¶¶ 36, 37. Because the material difference based on quality control is sufficient to find a likelihood of confusion, the Court need not address the issue of material difference based on customer support.
b) Tortious Interference with a Contract Under California law, the elements of tortious interference with contractual relations are: “(1) a valid contract between plaintiff and a third party; (2) defendant's knowledge of this contract; (3) defendant's intentional acts designed to induce a breach or disruption of the contractual relationship; (4) actual breach or disruption of the contractual relationship; and (5) resulting damage.” CRST Van Expedited, Inc. v. Werner Enters., Inc., 479 F.3d 1099, 1105 (9th Cir. 2007) (quoting Quelimane Co. v. Stewart Title Guar. Co., 19 Cal.4th 26, 55 (1998)). Plaintiffs have plausibly alleged each element. First, Plaintiffs allege that they contracted with third-party authorized reseller, using ARAs. ECF No. 1 at ¶ 31. Second, Plaintiffs alleged that Defendant knew of the ARAs because Plaintiffs notified Defendant that its sale of Nutramax products was unauthorized on several occasions. Id. at ¶ 49; see Sebastian Int'l, Inc. v. Russolillo, 162 F.Supp.2d 1198, 1205 (C.D. Cal. 2001) (letters a plaintiff sent to the defendants informing them that their sales were unauthorized is evidence of defendant's knowledge that their conduct interfered with a plaintiff's third-party contracts). Third, Plaintiffs have plausibly alleged that Defendant acted intentionally because Plaintiffs notified Defendant of his unauthorized sale of Plaintiffs' products, and Defendant continued to sell the marked products. ECF No. 1 at ¶ 49, 50. From this, it can be reasonably inferred that Defendant is aware that a breach or disruption of the ARAs necessarily results from his conduct. See Quelimane, 19 Cal.4th at 56 (intent can be establish by evidence showing the defendant knew that the contractual interference or breach was a “necessary consequence of his action,” even if not the primary purpose). Fourth, Plaintiffs alleged that Defendant's conduct resulted in “one or more of Nutramax's authorized resellers and/or distributors [breaching] their agreement with Nutramax by offering to buy and/or buying Nutramax products from one or more of them-none of whom are authorized to sell Nutramax products to Defendants for resale,” and “caused those parties to divert their authorized Nutramax products to unauthorized purchasers in breach of their agreements with Nutramax.” ECF No. 1 at ¶¶ 71, 72. Finally, Plaintiffs claim Defendant's conduct has resulted in damage to Plaintiffs because Plaintiffs have been unable to control the distribution and quality of its products, harming the substantial goodwill that Nutramax has accrued. Id. ¶¶ 32, 34, 35, 44.
c) Conclusion on Eitel Factors Two and Three
Because Plaintiffs have adequately alleged and supported each element of its three claims, Eitel factors two and three weigh in favor of default judgment.
3. Eitel Factor Four: Sum of Money at Stake
Because Plaintiffs do not seek monetary damages and only seek injunctive relief, ECF No. 13-1 at 22-27, the fourth Eitel factor categorically weighs in favor of granting default. PepsiCo, 238 F.Supp.2d at 1176-77 (fourth Eitel factor favors granting default when the only relief sought is injunctive relief); SevenFriday AG v. Ancon Watches Inc., No. 14-cv-8612 GHK FFMx, 2016 WL 6246362, at *2 (C.D. Cal. Jan. 4, 2016) (same).
4. Eitel Factor Five: Possibility of Dispute Concerning Material Facts
Plaintiffs made well pleaded factual allegations, ECF No. 1, which after default the Court takes as true, and served Defendant, ECF No. 10, and Defendant failed to defend the action. Under these circumstances, “there is little possible dispute of material fact that would preclude the grant of default judgment.” Stokes v. Amen Corp., 2024 WL 1461955, at *4 (E.D. Cal. Apr. 4, 2024). Accordingly, the fifth Eitel factor weighs in favor of default judgment.
5. Eitel Factor Six: Whether Default is Due to Excusable Neglect
Because Defendant has been properly served with the summons and complaint, the notice of entry of default, and the motion for default judgment and the supporting documents, ECF Nos. 10, 11, 13, and has failed to respond, the sixth Eitel factor weighs in favor of default judgment. See Stokes, 2024 WL 1461955 at *4.
6. Eitel Factor Seven: Policy Favoring Decisions on the Merits
The seventh factor reiterates the general rule disfavoring default judgment. Id. Because Defendant has refused to participate in this action, rendering it impossible for this Court to issue a decision on the merits, the seventh Eitel factor weighs in favor of default judgment. See Id.
7. Eitel Factor Balancing
The undersigned finds that all Eitel factors support default judgment against Defendant.
C. Relief Sought
As noted above, Plaintiffs do not seek monetary damages, only injunctive relief. ECF No. 13-1 at 22-27. The Lanham Act bestows upon the Court “power to grant injunctions according to the principles of equity and upon such terms as the court may deem reasonable, to prevent the violation of any right of [the trademark registrant].” 15 U.S.C. 1116(a); see also Reno Air Racing Ass'n, Inc. v. McCord, 452 F.3d 1126, 1137 (9th Cir. 2006).
1. Permanent Injunction
A party seeking a permanent injunction must demonstrate: “(1) that it has suffered irreparable injury; (2) that remedies available at law, such as monetary damages, are inadequate to compensate for that injury; (3) that considering the balance of the hardships between plaintiff and defendant, a remedy in equity is warranted; and (4) that the public interest would not be disserved by a permanent injunction.” eBay Inc. v. MercExchange, L.L.C., 547 U.S. 388, 391 (2006); see also Y.Y.G.M. SA v. Redbubble, Inc., 75 F.4th 995, 1005 (9th Cir. 2023) (applying the eBay factors in trademark infringement case). Plaintiffs satisfy all four requirements.
First, under the Lanham Act, irreparable harm is presumed when a court has determined that there has been a violation under the Act. Id. (citing 15 U.S.C. § 1116(a)). Because this Court has made such determination, and Defendant has not rebutted Plaintiffs' allegations under the Lanham Act, the Court presumes irreparable harm to Plaintiffs.
Second, because in trademark cases “there is no adequate remedy at law for injury caused by a defendant's continuing infringement,” the remedy of choice is injunctive relief. Century 21 Real Estate Corp. v. Sandlin, 846 F.2d 1175 (9th Cir. 1988). Here, Plaintiffs do not seek monetary damages because they argue damage to their reputation, an intangible injury, is difficult to assess. ECF No. 13-1 at 25. The Court agrees that monetary damages would not make Plaintiffs whole where Defendant's action has put Plaintiffs' product quality and reputation at risk and Defendant continued to infringe on Plaintiffs products despite being notified of its unauthorized sales.
Third, because the only potential harm to Defendant is “financial hardship from ceasing infringing activities,” such harm does not outweigh the irreparable harm of injury to Plaintiffs if Defendant's conduct is not enjoined. Disney Enterprises, Inc. v. VidAngel, Inc., 869 F.3d 848, 867 (9th Cir. 2017); see also Cadence Design Sys., Inc. v. Avant! Corp., 125 F.3d 824, 830 (9th Cir. 1997) (“where the only hardship that the defendant will suffer is lost profits from an activity which has been shown likely to be infringing, such an argument in defense merits little equitable consideration”) (quotation marks and alternations omitted).
And fourth, the public interest would be served because “the public has an interest in the enforcement of federal statutes.” CoxCom, Inc. v. Chaffee, 536 F.3d 101, 112 (1st Cir. 2008); see also Fashioncraft-Excello, LLC v. BG Wholesale Inc., 2024 WL 648680, at *5 (C.D. Cal. Jan. 4. 2024) (“the public interest would be served by enter of a permanent injunction because it has the right of the public not to be deceived or confused”) (citations and quotation marks omitted).
Accordingly, the undersigned finds that Plaintiffs are entitled to a permanent injunction.
2. Scope of Injunction
Injunctive relief should be “tailored to eliminate only the specific harm alleged,” E. & J. Gallo Winery v. Gallo Cattle Co., 967 F.2d 1280, 1297 (9th Cir. 1992), and be “no more burdensome to the defendant than necessary to provide complete relief to the plaintiff,” Calfano v. Yamasaki, 442 U.S. 682, 702 (1979). Plaintiffs have brought similar, if not identical, claims against other defendants in a variety of federal courts. In those cases, the courts have similarly granted permanent injunctions. See Nutramax Laboratories, Inc. v. JT Best Deals, LLC, No. 2:23-cv-1885, 2024 WL 2325198 (W.D. Wash. May 22, 2024); Nutramax Laboratories, Inc. v. Cyberzenn, LLC, No. 2:23-cv-1883 CDS DJA, 2024 WL 2093370 (D. Nev. May 22, 2024); Nutramax Laboratories, Inc. v. Ninja Trading Inc., No. 1:24-cv-1283, ECF No. 21 (N.D. Ill. July 18, 2024); Nutramax Laboratories, Inc. v. Tovar, No. 5:23-cv-2366 MRA SP, 2024 WL 32221731 (C.D. Cal. May 23, 2024). However, two courts limited the scope of injunctive relief sought. See Nutramax Laboratories, Inc. et al. v. Tovar, 2024 WL 32221731 at *9-10 (granting permanent injunction but declining to enjoin Defendant and his privy from “otherwise competing unfairly with Nutramax in any manner[,]” and other third party “online retailers, social media platforms, internet search engines, and email service providers” who receive actual notice but are not in privity with Defendant); Nutramax Laboratories, Inc. v. Ninja Trading Inc., No. 1:24-cv- 1283, ECF No. 21 at 4-5 (same).
For the reasons provided in Nutramax Laboratories, Inc. et al. v. Tovar, 2024 WL 32221731 at *7-9, the undersigned also recommends that the injunction here exclude the following language proposed by Plaintiffs: “otherwise competing unfairly with Nutramax in any manner” and “those with actual notice of this Order-including any online retailer, social media platforms, internet search engines, and email services providers.” See ECF No. 1 at 14-15; ECF No. 13-1 at 27; ECF No 13-2 at 5. As to the first phrase, enjoining “any” other hypothetical “unfair[]” competition with Nutramax “is overly broad and not specific to Plaintiffs' injur[ies]” under the Lanham Act and for tortious interference with contract. Nutramax Laboratories, Inc. et al. v. Tovar, 2024 WL 32221731 at *8. As for the second phrase, “a court may not issue injunctive relief ‘so broad as to make punishable the conduct' of any third party simply because it was given actual notice of the injunction but is otherwise ‘act[ing] independently and whose rights have not been adjudged according to law.'” Id. (quoting Regal Knitwear Co. v. N.L.R.B., 324 U.S. 9, 14 (1945)).
IV. Conclusion
Accordingly, it is RECOMMENDED that:
1. Plaintiffs' Motion for Default Judgment and Permanent Injunction (ECF No. 13) be GRANTED.
2. The Court issue the following permanent injunctive relief:
a) Defendant CP William LLC and his respective agents, servants, employees, and/or all persons acting in concert or participation with Defendant who have actual notice of this Order be enjoined and restrained from:
i. using Nutramax's trademarks (including, but not limited to, the NUTRAMAX LABORATORIES, CONSEQUIN, and PROVIABLE marks) or colorable imitations thereof in connection with the distribution, marketing, advertising, or sale of any Nutramax product that Nutramax has not
authorized to be sold to or by Defendant;
ii. passing off, inducing, or enabling others to sell or pass off any product as a genuine Nutramax product that has not been produced under the authorization, control, or supervision of Nutramax and approved by Nutramax for sale to or by Defendant; and iii. shipping, delivering, transferring, moving, storing, distributing, returning, or otherwise disposing of, in any manner, products or inventory not authorized by Nutramax to be sold to or by Defendant.
b) Additionally, Defendant CP William LLC and his respective agents, servants, and employees be required to:
i. permanently remove all of Defendant's product listings for any Nutramax products (including, but not limited to, Consequin® or Proviable® products), and thereafter prohibit Defendant from ever relisting or offering for sale any Nutramax products;
ii. permanently remove any and all advertisements used by or associated with Defendant in connection with the sale of any Nutramax products; and
iii. deliver to Nutramax or destroy, at Nutramax's discretion, all Nutramax products in Defendant's possession or held on behalf of Defendant.
These findings and recommendations are submitted to the United States District Judge assigned to the case, pursuant to the provisions of 28 U.S.C. § 636(b)(1). Within fourteen days after being served with these findings and recommendations, any party may file written objections with the court and serve a copy on all parties. Id.; see also Local Rule 304(b). Such a document should be captioned “Objections to Magistrate Judge's Findings and Recommendations.” Any response to the objections shall be filed with the court and served on all parties within fourteen days after service of the objections. Local Rule 304(d). Failure to file objections within the specified time may waive the right to appeal the District Court's order. Turner v. Duncan, 158 F.3d 449, 455 (9th Cir. 1998); Martinez v. Ylst, 951 F.2d 1153, 1156-57 (9th Cir. 1991).