Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-azd-2_08-cv-00709/USCOURTS-azd-2_08-cv-00709-0/pdf.json

Nature of Suit Code: 840
Nature of Suit: Trademark
Cause of Action: 15:1121 Trademark Infringement

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WO

IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF ARIZONA

KOI GROUP, INC., a Nevada

Corporation, 

Plaintiff, 

vs.

KOKA, LLC, d/b/a KOI SUSHI BAR &

GRILL, an Arizona limited liability

company, DENNY KANG an individual,

LENA KO, an individual, doing business

as KOI SUSHI BAR & GRILL, and

DOES 1-10, inclusive,

Defendants. 

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No. CV 08-0709-PHX-MHM

ORDER

On April 10, 2008, the KOI GROUP, Inc. (“Plaintiff”) filed a complaint against

KOKA, LLC an Arizona limited liability company, Denny Kang, and Lena Ko, doing

business as Koi Sushi Bar & Grill, asserting claims of federal trademark infringement

(Count I), federal unfair competition (Count II), federal dilution of famous mark (Count

III), Arizona dilution and trademark infringement (Count IV), Arizona and common law

trademark dilution (Count V), cyberpiracy (Count VI), and accounting (Count VII). 

(Complaint, Dkt. #1, pp. 6-10). Defendants KOKA, LLC and Denny Kang (collectively

“Defendants”) failed to respond to the Complaint and on July 14, 2008, the Clerk entered

Case 2:08-cv-00709-MHM Document 19 Filed 12/02/08 Page 1 of 7
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Although Plaintiff’s motion also seeks default against Lena Ko, the Clerk’s July 14, 2008

order of default does not include her. Additionally, the docket shows that Lena Ko was never

served. As such, the Court may not grant default as to Lena Ko. 

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an order of default against them pursuant to Federal Rule of Civil Procedure 55(a). (Dkt.

#15). Plaintiff has now moved for default judgment.1

I. BACKGROUND & PROCEDURAL HISTORY

Plaintiff is the owner of a number of federal and state trademark registrations on the

KOI name for predominately restaurant services. (Dkt. #17, p. 2). Plaintiff’s KOI

trademarks, service marks, and trade names are represented by several registered and

pending marks with the United States Patent and Trademark Office (“USPTO”) including:

United States Registration Nos. 2950303 (restaurant services), 2946808 (restaurant

services), 2961393 (restaurant services), 2976272 (clothing), 2970473 (sake beverages),

and United States Application No. 78455283 (Japanese cuisine). (Dkt. #11, p. 3). In

addition, Plaintiff is the owner of a registered service mark with the State of California, as

well as the registered domain names <koirestaurant.com> and <koilounge.com>

(collectively referred to herein as “KOI Marks”). (Id.). 

Since 2002, Plaintiff has continuously used the KOI Marks in commerce to promote

its restaurant-related goods and services. (Dkt. #17, p. 2). Plaintiff asserts the KOI Marks

have become highly distinctive and famous, both nationally and in the state of California,

attracting locals, tourists, and celebrities alike. (Id.). 

Plaintiff claimed learning of Defendants infringement in July 2007. (Id., p. 3). 

Defendants began to advertise and to promote themselves and their restaurant under the

name “Koi Sushi Bar & Grill,” supposedly only after the KOI Marks became famous

throughout the United States. (Id.). Plaintiff believes that Defendants restaurant

establishment is of substantially inferior quality to Plaintiff’s KOI RESTAURANT, and as

a result, its KOI Marks will be diluted and Plaintiff will suffer negative consequences. 

(Id.). 

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On April 10,2008, Plaintiff filed a complaint against the Defendants. (Dkt. #1). 

Plaintiff argues in its Complaint that Defendants unauthorized used of the KOI Marks

cause great and irreparable damage and injury by (1) depriving Plaintiff of its statutory

rights to use and control use of its trademarks, (2) creating a likelihood of confusion,

mistake and deception among consumers and the trade as to the source of the infringing

products, (3) causing the public falsely to associate Plaintiff with Defendants, (4) causing

irreparable damage to Plaintiff’s goodwill and dilution of the value of its trademark, and

(5) causing Plaintiff to lose sales of its genuine products and services. (Dkt. # 1). 

Following the filing of Plaintiff’s complaint, Defendants KOKA, LLC and Denny

Kang were served, but Defendant Lena Ko was unable to be served. (Dkt. #10, 11, 12). 

Defendants who had been served, then failed to answer the Complaint or otherwise appear

in Court. (Dkt. #17). Accordingly, on July 14, 2008, Plaintiff filed a Motion for Default

Judgement. (Dkt. #15). Plaintiff has asked the Court for injunctive relief, including that

Defendants be enjoined from any further use of the “KOI” designation or any other

colorable variants of the KOI Marks, and that Defendants be directed to destroy any

printed materials bearing the “KOI” designation. (Dkt. #17, p. 2). In addition, Plaintiff

asks the Court to order the institution of a telephone intercept, at Defendants expense, on

all incoming calls to Defendants’ business. (Id.). Lastly, Plaintiff requests the Court to

require a transfer of the infringing domain name or that Defendants entirely cease their use

of the website. (Id.). 

II. DISCUSSION

“Entry of default judgment is governed by FRCP 55 and is left to the trial court’s

sound discretion.” Aldabe v. Aldabe, 616 F.2d 1089, 1092 (9th Cir. 1980). After entry of

default by the Clerk of the Court pursuant to FRCP 55(a), the Court may grant default

judgment pursuant to FRCP 55(b)(2). See Eitel v. McCool, 782 F.2d 1470, 1471 (9th Cir.

1986) (discussing the sequential two-step process under FRCP 55). Factors that a district

court may consider in exercising its discretion include the following: 

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(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. 

Id., 782 F.2d at 1471-72. After default has been entered by the Clerk of the Court, the

factual allegations of the complaint are taken as true, except for those allegations relating

to damages. See TeleVideo Sys., Inc. v. Heidenthal, 826 F.2d 915, 917 (9th Cir. 1987). 

“A party seeking default judgment must state a claim upon which it may recover.” See

Philip Morris USA, 219 F.R.D. at 494, 501 (C.D. Cal. 2003). Furthermore, a plaintiff

must prove all damages sought in the complaint. Philip Morris USA, 219 F.R.D. at 498;

Fed. R. Civ. P. 55 (b)(2) (“In determining damages, a court can rely on the declarations

submitted by the plaintiff.”). 

Plaintiff has satisfied the procedural requirements for default judgment against

Defendants. Plaintiff submitted a declaration and application for entry of default on July

14, 2008 (Dkt. #15), which prompted the Clerk of the Court to enter default against

Defendants on October 15, 2008 (Dkt. #16). Plaintiff’s request for relief differs from, but

does not exceed that prayed for in the complaint. The application for default judgment

complies with the Federal Rules of Civil Procedure. Accordingly, the Court need only

analyze the Eitel factors to determine whether default judgement is appropriate in this

case. 

In considering the Eitel factors, the Court takes all factual allegations in Plaintiff’s

Complaint as true, except for those relating to damages. Heidenthal, 826 F.2d at 917-18.

Under the first factor, Plaintiff will be prejudiced if it is unable to enforce federal

trademark infringement and unfair competition laws merely because Defendants refuse to

defend an action. Absent entry of a default judgment, Plaintiff will be free to continue

advertising under Plaintiff’s trademark designation. (Memorandum in Support of Motion

for Default Judgment, Dkt. #8, p. 5). As to the second Eitel factor, the Complaint sets

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forth with great specificity the nature of the allegations leveled against Defendant. 

(Complaint, Dkt. #1, pp. 5-10). The complaint is sufficient, both legally and factually; and

as such, the Court finds that Plaintiff has demonstrated the merits of the claims. As to the

third factor, Defendants failure to answer constitutes an admission to the averments

contained in the complaint under FRCP 8(d), the Court must accept these allegations as

true. As such, the first three Eitel factors favor entry of default judgment against

Defendants. 

Pursuant to the fourth Eitel factor, the Court considers the amount of money at

stake in relation to the seriousness of Defendants’ conduct. Eitel, 782 F.2d at 1471-72. 

Plaintiff has waived all claims to damages, lost profits, attorney fees and cost. 

(Memorandum in Support of Motion for Default Judgment, Dkt. #8, p. 2, 5). As such, the

Court finds that this factor favors granting default judgment against Defendants.

As to the fifth factor, on entry of default all well-pleaded facts in the complaint are

taken as true, except those relating to damages. TeleVideo Sys., Inc., 826 F.2d at 917-18. 

Defendants have been given a great deal of time to answer Plaintiff’s complaint and deny

the averments contained therein. However, Defendants have failed to do so. Essentially,

no dispute has been raised regarding material averments of the complaint and Plaintiff

asserts there are none. (Dkt. #8, p. 5). Thus, this factor also favors the entry of default

against Defendants. 

The sixth Eitel factor considers the possibility that default resulted from excusable

neglect. On May 20, 2008, Defendants, with the exception of Lena Ko, were served. 

(Dkt. #10, 11, 12). Defendants have failed to answer or otherwise plead in response to the

complaint, and the period provided for filing such a response under 12(a), as set forth in

Rule 4 of the Federal Rules of Civil Procedure, has expired. As such, the possibility that

default resulted from excusable neglect appears to be remote. Accordingly, this factor

favors granting default judgment against Defendants. 

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“Defendant[s’] failure to answer [Plaintiff’s] Complaint makes a decision on the

merits impractical, if not impossible. Under FRCP 55(a), termination of a case before

hearing the merits is allowed whenever a defendant fails to defend an action.” Cal. Sec.

Cans., 238 F.Supp.2d at 1177. This is what has occurred in the instant case since

Defendants refusal to acknowledge this action renders adjudication on the merits before

this Court impracticable. Thus, the seventh Eitel factor does not preclude the Court from

entering default judgment against Defendants. Accordingly, in light of all Eitel factors,

the Court finds that default judgment against Defendants is appropriate. 

Accordingly, 

IT IS HEREBY ORDERED that Plaintiff’s Motion for Default Judgment (Dkt.

#17) is granted in part. Default is granted as to Defendants KOKA, LLC and Denny

Kang. 

IT IS FURTHER ORDERED that Defendants are permanently restrained and

enjoined from: 

(a) Selling, offering for sale distributing, advertising, or promoting any goods

or services that display and words or symbols that so resembles the KOI

Marks as likely to cause confusion, mistake or deception;

(b) Using any word, term, name, symbol, device or combination thereof that

causes or is likely to cause confusion, mistake or deception, as to the

affiliation or association of Defendant or its goods with Plaintiff or as to

the origin of Defendants’ goods and services, or any false designation of

origin, false or misleading description or representation;

(c) Further infringing the rights of Plaintiff in and to any of its trademarks in

its KOI Marks products and services or otherwise damaging Plaintiff’s

goodwill or business reputation;

(d) Using the “KOI” designation or any colorable variants of the KOI Marks; 

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IT IS FURTHER ORDERED denying the imposition of a telephone intercept.

IT IS FURTHER ORDERED that Defendants entirely cease the use of the

domain name <koisushigrill.com>.

IT IS FURTHER ORDERED denying Plaintiff’s request to force a transfer of the

allegedly infringing domain name.

IT IS FURTHER ORDERED directing Plaintiff to file a status with regards to

Lena Ko within 10 business days of this Order, otherwise the Court will dismiss the

Complaint against her. 

DATED this 24th day of November, 2008.

Case 2:08-cv-00709-MHM Document 19 Filed 12/02/08 Page 7 of 7