Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

National Collegiate Athletic Association v. Kizzang LLC

United States District Court, S.D. Indiana, Indianapolis Division

January 18, 2018

National Collegiate Athletic Association, Plaintiff,
v.
Kizzang LLC and Robert Alexander, Defendants.

          ORDER

          Hon. Jane Magntts-Stinson, Chief Judge.

         In March 2017, Plaintiff National Collegiate Athletic Association (the “NCAA”) initiated this lawsuit against Defendants Kizzang LLC (“Kizzang”) and Robert Alexander, the founder and owner of Kizzang, for trademark infringement, trademark dilution, and unfair competition related to Defendants' alleged use of the marks “FINAL 3” and “APRIL MADNESS.” On November 7, 2017, the Court denied Defendants' Motion to Dismiss, and granted the NCAA's Request for Entry of Default based on Defendants' failure to timely answer or otherwise plead to the Complaint. [Filing No. 73.] The NCAA has now filed a Motion for Default Judgment, [Filing No. 76], and a Motion for Permanent Injunction, [Filing No. 78], both of which are now ripe for the Court's decision.

         I.

         Background[1]

         On March 8, 2017, the NCAA filed its Complaint in which it alleges that Defendants “are in the business of marketing and providing nationwide Internet-based promotions that award prizes for predicting the results of sporting events, including the results of college basketball games played by and between NCAA member schools, and in particular games played during the NCAA's Division I Men's Basketball Championship.” [Filing No. 1 at 5.] It alleges that Defendants used the marks FINAL 3 and APRIL MADNESS in connection with their Final Four-based contests and “continue offering goods and services using the FINAL 3 and APRIL MADNESS marks via webpages and mobile-telephone applications….” [Filing No. 1 at 6-7.] The NCAA alleges that Kizzang has applied for federal trademark registration for FINAL 3 and APRIL MADNESS with the United States Patent and Trademark Office (“USPTO”). [Filing No. 1 at 7.] The NCAA sets forth claims for: (1) trademark infringement under 15 U.S.C. § 1114; (2) trademark infringement under 15 U.S.C. § 1125(a); (3) trademark dilution under 15 U.S.C. § 1125; and (4) unfair competition. [Filing No. 1 at 8-11.] It requests that the Court enter judgment in its favor; order that the USPTO deny Kizzang's application to register the marks Final 3 and April Madness; and permanently enjoin Defendants from using the NCAA's Final Four and March Madness marks “and any colorable imitation or simulation of [them], ” doing anything likely to induce the belief that Kizzang's products or services are legitimately connected with or sponsored or approved by the NCAA, and doing anything that is likely to dilute the distinctiveness of the NCAA's FINAL FOUR and MARCH MADNESS marks or that is likely to “tarnish the goodwill associated with those marks.” [Filing No. 1 at 11.] The NCAA also requests that the Court order Defendants to recall all products, services, advertising, and promotional materials bearing the NCAA marks and any imitations of them, including FINAL 3 and APRIL MADNESS. [Filing No. 1 at 12.] Additionally, it seeks actual damages, all profits derived by Defendants from the acts complained of, the greater of three times the damages the NCAA has suffered as a result of the acts complained of or three times Defendants' profits, exemplary damages, and attorneys' fees and costs, and requests that Defendants be required to file with the Court a report in writing under oath setting forth the manner and form in which Defendants have complied with the terms of any injunction entered by the Court. [Filing No. 1 at 12.]

         The NCAA filed a Motion for Preliminary Injunction on March 9, 2017, requesting that the Court preliminarily enjoin Defendants from the acts set forth in the request for relief contained in the Complaint. [Filing No. 5.] Seven days later, the Court entered a Stipulated Order, submitted on a motion by all parties, ordering that: (1) “[n]either Kizzang or Alexander, nor any of their officers, agents, servants, employees or attorneys, or anyone acting in concert with any of them, will use the marks FINAL 3 (or THREE) or APRIL MADNESS or any similar marks, in connection with any basketball themed contest, promotion or service in 2017”; (2) the NCAA's Motion for Preliminary Injunction is withdrawn without prejudice; and (3) “Defendants, having been served with the Complaint, shall answer by June 15, 2017.” [Filing No. 20.] The June 15, 2017 answer deadline was later extended to July 15, 2017. [Filing No. 28.]

         The July 15, 2017 deadline came and went without an answer or pleading from Defendants, and on July 21, 2017, the NCAA filed its Request for Entry of Default. [Filing No. 30.] Defendants responded to the Request for Entry of Default on August 10, 2017, [Filing No. 36], and filed a Motion to Dismiss or, in the alternative, to transfer the case to the United States District Court for the District of Nevada on August 31, 2017 - more than six weeks after the July 15, 2017 responsive pleading deadline, [Filing No. 50; Filing No. 51].

         On November 7, 2017, the Court denied Defendants' Motion to Dismiss as to Defendants' personal jurisdiction argument, denied as moot the remainder of the Motion to Dismiss, and granted the NCAA's Request for Entry of Default. [Filing No. 73.] Shortly thereafter, the NCAA filed a Motion for Default Judgment, [Filing No. 76], and a Motion for Permanent Injunction, [Filing No. 78], which are discussed below.[2]

         II.

         Standard of Review

         Rule 55 of the Federal Rules of Civil Procedure sets forth a two-step process for a party seeking default judgment. McCarthy v. Fuller, 2009 WL 3617740, *1 (S.D. Ind. 2009); see also Lowe v. McGraw-Hill Companies, Inc., 361 F.3d 335, 339 (7th Cir. 2004) (“The Federal Rules of Civil Procedure make a clear distinction between the entry of default and the entry of a default judgment”). First, the plaintiff must obtain an entry of default from the Clerk. Fed.R.Civ.P. 55(a). Second, after obtaining that entry, the plaintiff may seek an entry of default judgment. Fed.R.Civ.P. 55(b).

         “A default judgment establishes, as a matter of law, that a defendant is liable to the plaintiff for each cause of action in the complaint.” Coach, Inc. v. Tom's Treasure Chest, 2011 WL 4399355, *2 (N.D. Ind. 2011) (finding assertions of Complaint “taken as true” in determining willful infringement in connection with selling knockoff handbags containing Coach marks) (citing O'Brien v. R.J. O'Brien & Assocs., Inc., 998 F.2d 1394, 1404 (7th Cir. 1993)). “When a court determines that a defendant is in default, all well-pleaded allegations in the complaint will be taken as true.” Coach, Inc., 2011 WL 4399355 at *2 (citing Black v. Lane, 22 F.3d 1395, 1399 (7th Cir. 1994)).

         III.

         Discussion

         In its Motion for Default Judgment, the NCAA argues that it is entitled to default judgment on liability because, as a result of the Clerk's entry of default, all factual allegations of the complaint are taken as true. [Filing No. 77 at 4.] It sets forth the allegations in the Complaint that it contends support its claims. [Filing No. 77 at 4-15.]

         In their response, Defendants reiterate many of the same arguments they made in opposition to the NCAA's Request for Entry of Default. [Filing No. 83.] Specifically, they argue that good cause existed for the default, that they acted quickly to correct the default, and that they have asserted a meritorious defense to the Complaint. [Filing No. 83 at 4-12.] Defendants also argue that they have “demonstrated their ongoing commitment to defending this case, ” [Filing No. 83 at 12-13], and that the NCAA is not entitled to a finding that this is an exceptional case such that it would be entitled to an award of attorneys' fees. [Filing No. 83 at 12-14.]

         In reply, the NCAA argues that “Defendants seek to reargue, without justification or leave, the settled issue of whether they should be held in default, ” and “[t]he Court should give those arguments no consideration.” [Filing No. 85 at 2.] It again asserts that it has shown that the factual allegations in the Complaint, which are deemed true for purposes of establishing liability, state claims for relief under the Lanham Act and Indiana common law. [Filing No. 85 at 2.]

         At the outset, the Court notes that the issue of whether Defendants are liable is separate and apart from whether the NCAA is entitled to certain relief, such as a permanent injunction. The Court first addresses whether Defendants are liable for trademark infringement, trademark dilution, and unfair competition.

         A. Liability

         In connection with liability, Defendants reassert the arguments they set forth in response to the NCAA's Request for Entry of Default. [SeeFiling No. 83 at 4-12.] The Court considered those arguments thoroughly in connection with the NCAA's Request for Entry of Default, [Filing No. 73], and will not do so again here. Because Defendants did not show good cause for default, [3]that they acted timely to remedy default, [4] or that they have meritorious defenses - as discussed in the Court's November 7, 2017 Order - Clerk's entry of default was appropriate.

         “The basic effect of an entry of default…is that ‘[u]pon default, the well-pleaded allegations of a complaint relating to liability are taken as true.' The defaulting party cannot contest the fact of his liability unless the entry of default is vacated under Rule 55(c).” VLM Food Trading Intern., Inc. v. Illinois Trading Co., 811 F.3d 247, 255 (7th Cir. 2016) (citations omitted); 10 James W.M. Moore et al., Moore's Federal Practice § 55.32[1][a] (3d ed. 2013) (“The effect of an entry of default, if not set aside, is to establish the liability of the defaulting party as a basis for default judgment. After defaulting, a party has no right to dispute the issue of liability”).

         1. Trademark Infringement Under 15 U.S.C. § 1114 and 15 U.S.C. § 1125(a), and Common Law Unfair Competition

         “To prevail on [a § 1114 and § 1125 claim], a plaintiff must establish that (1) its mark is protectable and (2) the defendant's use of the mark is likely to cause confusion among consumers.” CAE, Inc. v. Clean Air Engineering, Inc., 267 F.3d 660, 673-74 (7th Cir. 2001); see also AutoZone, Inc. v. Strick, 543 F.3d 923, 929 (7th Cir. 2008) (applying same standard to trademark infringement and common law unfair competition claims). In order to determine whether a likelihood of confusion exists, courts consider “(1) ‘the similarity between the marks in appearance and suggestion'; (2) the similarity between the parties' products; ‘(3) the area and manner of concurrent use'; (4) the level of care a consumer would be expected to exercise in discerning the products; (5) the strength of the plaintiff's trademark; (6) actual confusion; and (7) the defendant's intent to pass his product off as the product of another.” Allison Transmission, Inc. v. Fleetpride, Inc., 2017 WL 1282994, *3 (S.D. Ind. 2017) (quoting Sorenson v. WD-40 Co., 792 F.3d 712, 726 (7th Cir. 2015)). “[T]he test of liability for infringement is whether the infringer's ‘use is likely to cause confusion, or to cause mistake, or to deceive….'” Helene Curtis Industries, Inc. v. Church & Dwight Co., Inc., 560 F.2d 1325, 1330 (7th Cir. 1977) (quoting 15 U.S.C. § 1114(1)).

         The NCAA has alleged that it has the protectable trademarks “FINAL FOUR” and “MARCH MADNESS, ” and that the tournaments the NCAA puts on bearing those names “are among the nation's premiere sporting events.” [Filing No. 1 at 2.] Further, the NCAA alleges that Defendants have branded Kizzang's NCAA-based services using the marks FINAL 3 and APRIL MADNESS and that Defendants had planned to use the mark FINAL 3 for a 2017 NCAA Division I Men's Basketball Championship FINAL FOUR-based contest. [Filing No. 1 at 7.] The NCAA also alleges that Kizzang has adopted the mark APRIL MADNESS for the same services as FINAL 3, including the Division I Men's Basketball Championship. [Filing No. 1 at 7.] The NCAA alleges that Defendants' use of the marks FINAL 3 and APRIL MADNESS are “likely to cause confusion or mistake, or to deceive as to Defendants' affiliation, connection, or associate with the NCAA, or as to the origin, sponsorship, or approval of Defendants' services.” [Filing No. 1 at 8.]

         The Court finds that the NCAA has adequately alleged violations of § 1114 and § 1125 and common law unfair competition, and that Defendants have admitted the allegations in connection with those claims through default. The marks FINAL 3 and APRIL MADNESS are obviously similar to FINAL FOUR and MARCH MADNESS, and the NCAA has alleged that Defendants offer similar contests through the use of the marks FINAL 3 and APRIL MADNESS as the NCAA offers through FINAL FOUR and MARCH MADNESS. The confusion that could result from Defendants' use of the marks FINAL 3 and APRIL MADNESS is also obvious due to their significant similarity to the NCAA's marks. Further, the NCAA has alleged that Defendants have used the marks FINAL 3 and APRIL MADNESS “with the intention of exploiting the goodwill associated with the NCAA Marks.”[5] [Filing No. 1 at 8.] The similarity of the marks also leads to the conclusion that Defendants intended to pass their products off as the NCAA's. Accordingly, the NCAA has established liability on its § 1114 and § 1125 Lanham Act claims and its common law unfair competition claim through its allegations, which Defendants have admitted by virtue of the default.

         2. Trademark Dilution Under 15 U.S.C. § 1125(c)

         15 U.S.C. § 1125(c) provides that:

[T]he owner of a famous mark that is distinctive inherently or through acquired distinctiveness, shall be entitled to an injunction against another person who at any time after the owner's mark has become famous, commences use of a mark or trade name in commerce that is likely to cause dilution by blurring or dilution by tarnishment of the famous mark, regardless of the presence or absence of actual or likely confusion, or competition, or of actual economic injury.

15 U.S.C. § 1125(c)(1). In order to show a violation of § 1125(c), the NCAA must prove that: (1) the FINAL FOUR and MARCH MADNESS marks are famous; (2) Defendants adopted their FINAL 3 and APRIL MADNESS marks after the NCAA marks became famous; (3) use of the FINAL 3 and APRIL MADNESS marks causes dilution of the FINAL FOUR and MARCH MADNESS marks; and (4) Defendants' use of the FINAL 3 and APRIL MADNESS marks is commercial and in commerce. Eli Lilly & Co. v. Natural Answers, Inc., 233 F.3d 456, 466 (7th Cir. 2000). The Seventh Circuit Court of Appeals has recognized two types of trademark dilution: tarnishing and blurring. Id. “Dilution by tarnishing occurs when a junior mark's similarity to a famous mark causes consumers mistakenly to associate the famous mark with the defendant's inferior or offensive product. Dilution by blurring…occurs when consumers see the plaintiff's mark ...


Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.