Defendants failed to appear in trademark infringement suit filed by adult entertainment company against web site. Court entered default judgment, ordered a permanent injunction to bar defendants from continuing to use plaintiff’s trademarks, and referred the case for an inquest regarding damages and injunctive relief pertaining to the defendants’ domain name.
Regarding damages, plaintiff proposed maximum statutory damages allowable under the Lanham Act – $1,000,000 for willful use of each counterfeit mark. Court said that defendants’ willful conduct of using plaintiff’s trademarks to attract customers and compete with plaintiff was established by virtue of their failure to appear and contest plaintiff’s allegations of willfulness, but court wrote that plaintiff failed to provide any rationale for awarding the maximum statutory amount. Specifically, plaintiff did not provide information about nature of defendants’ infringement, estimates of the defendants’ earnings, or possible losses to plaintiff arising from the defendants’ conduct. The court, relying upon earlier cases awarding similar amounts where there was little information regarding the defendant’s activities, held that $250,000 per mark was sufficient to compensate plaintiff for its losses and to deter defendants and others from infringing plaintiff’s marks in the future.
The court also issued a requested permanent injunction requiring the defendants to transfer the registration for an offending domain name to plaintiff. However, the court refused to extend the injunction to require non-party domain name registrars to “freeze” the registration or reveal the “private registration” for the domain name because plaintiff failed to submit evidence of these non-parties’ activities.