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Sream, Inc. v. Tiger Brothers Food Mart, Inc.

United States District Court, M.D. Louisiana

June 28, 2019

SREAM, INC.
v.
TIGER BROTHERS FOOD MART, INC.

          RULING AND ORDER

          BRIAN A. JACKSON UNITED STATES DISTRICT JUDGE.

         Before the Court is the Motion for Default Judgment (Doc. 21) and the Motion for Default Judgment (Doc. 22) filed by Plaintiff Sream, Inc., in which Plaintiff seeks a default judgment against Defendant Tiger Brothers Food Mart, Inc.[1]Jurisdiction is proper under 28 U.S.C. § 1331. For the following reasons, the Motion for Default Judgment (Doc. 21) and the Motion for Default Judgment (Doc. 22) are GRANTED IN PART AND DENIED IN PART.

         I. BACKGROUND

         Plaintiff is a California corporation that, since at least 2013, has been the exclusive licensee of the trademark "RooR" in the United States. (Doc. 1 at p. 2). RooR is recognized for its ornate glass products including borosilicate jointed-glass water pipes, parts, and accessories. (Doc. 21 at p. 2). RooR products are allegedly superior in the market place and consistently retail higher than those from other brands. (Doc. 21 at p. 3). Defendant is a Louisiana corporation that Plaintiff claims engaged in the unlawful manufacture, retail sale, and/or wholesale sales of counterfeit RooR branded water pipes and related parts. (Doc. 1 at p. 2).

         Plaintiff filed its Complaint on September 20, 2017, asserting violations of the Lanham Act, 15 U.S.C. § 1114. Plaintiff seeks injunctive relief prohibiting Defendant from using the RooR mark and damages. The Clerk of Court entered a default on June 14, 2018 because Defendant failed to file an answer or motion under Federal Rule of Civil Procedure 12. (Doc. 19). Plaintiff then filed the pending Motion for Default Judgment. (Doc. 21).

         II. LEGAL STANDARD

         The United States Court of Appeals for the Fifth Circuit has adopted a three-step process to obtain a default judgment. See New York Life Ins. Co. v. Brown, 84 F.3d 137, 141 (5th Cir. 1996). First, a default occurs when a party "has failed to plead or otherwise defend" against an action. Fed.R.Civ.P. 55(a). Next, an entry of default must be entered by the clerk when the default is shown "by affidavit or otherwise." See id.; New York Life, 84 F.3d at 141. Third, a party may apply to the court for a default judgment after an entry of default. Fed.R.Civ.P. 55(b); New York Life, 84 F.3d at 141.

         After a party files for a default judgment, a court must apply a two-step process to determine whether a default judgment should be entered. First, a court must consider whether the entry of default judgment is appropriate under the circumstances. Lindsey v. Prive Corp., 161 F.3d 886, 893 (5th Cir. 1998). Several factors are relevant to this inquiry, including: (1) whether there are material issues of fact at issue, (2) whether there has been substantial prejudice, (3) whether the grounds for default have been clearly established, (4) whether the default was caused by excusable neglect or good faith mistake, (5) the harshness of the default judgment, and (6) whether the court would think itself obliged to set aside the default on a motion by the defendant. Id.

         Second, a court must assess the merits of the plaintiffs claims and determine whether the plaintiff has a claim for relief. Nishimatsu Constr. Co. v. Houston Nat'l Bank, 515 F.2d 1200, 1206 (5th Cir. 1975); Hamdan v. Tiger Bros. Food Mart, Inc., 2016 WL 1192679, at *2 (M.D. La. Mar. 22, 2016).

         III. DISCUSSION

         A. Default Judgment is Appropriate under the Lindsey Factors

         The Court must first decide whether the entry of default judgment is appropriate under the circumstances, by considering the Lindsey factors. First, there are no material facts in dispute because Defendant failed to file an answer or motion under Rule 12. Second, there has been substantial prejudice because Defendant's failure to appear in this action leaves Plaintiff with no recourse for its alleged injuries. (Doc. 21 at p. 5). Third, the grounds for granting a default judgment against Defendant are clearly established, as evidenced by the action's procedural history and the Clerk's entry of default. (Doc. 19). Fourth, the Court has no basis to find that Defendant's failure to respond was the result of a good faith mistake or excusable neglect because Defendant has failed to respond to Plaintiff or to the Court. Fifth, Defendant's failure to file any responsive pleading or motion mitigates the harshness of a default judgment. Finally, the Court is not aware of any facts that would lead it to set aside the default judgment if challenged by Defendant. The Court therefore finds that the six Lindsey factors weigh in favor of default.

         B. The Sufficiency of the Pleadings

         The Court must also determine whether Plaintiffs pleadings provide a sufficient basis for a default judgment. Plaintiff sued Defendant under the Lanham Act, which provides that a plaintiff must show that (1) it possesses a legally protectable trademark and (2) the defendant's use of the trademark creates a likelihood of confusion as to source, affiliation, or sponsorship. Streamline Prod. Sys. v. Streamline Mfg.,851 F.3d 440, 450 (5th Cir. 2017) (quoting Nola Spice Designs, L.L.C. v. Haydel Enters., Inc.,783 F.3d 527, 536 (5th Cir. 2015)). It is uncontroverted that Plaintiff is the exclusive licensee of the legally protectable trademark RooR. (Doc. 22-2 at p. 2). The United States Court of Appeals for the Fifth Circuit has identified eight factors to determine whether a likelihood of confusion exists: (1) the type of mark allegedly infringed, (2) the similarity between the two marks, (3) the similarity of the products or services, (4) the identity of the retail outlets and purchasers, (5) the identity of the advertising media used, (6) the defendant's ...


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