Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-azd-2_15-cv-00110/USCOURTS-azd-2_15-cv-00110-1/pdf.json

Nature of Suit Code: 830
Nature of Suit: Patent
Cause of Action: 35:271 Patent Infringement

---

1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 

26 

27 

28 

WO 

IN THE UNITED STATES DISTRICT COURT 

FOR THE DISTRICT OF ARIZONA 

Orgami Owl, LLC, a Delaware entity,

Plaintiff, 

v. 

Julie Mayo, a single woman, Ann L. Mayo, 

a single woman, doing business as West 

Coast Charms and 5th Avenue Pets, West 

Coast Charms, LLC, a Nevada entity, 

Defendants.

No. CV15-00110-PHX-DGC

DEFAULT JUDGMENT 

 Pursuant to this Court’s February 11, 2016 order (Doc. 80), Plaintiff filed a motion 

for default judgment against Defendant West Coast Charms LLC pursuant to Rule 

55(b)(2) of the Federal Rules of Civil Procedure. Doc. 82. For the following reasons, the 

Court will grant Plaintiff’s motion in part. 

I. Background.

 This case is an intellectual property infringement case involving customizable 

jewelry. Plaintiff’s amended complaint (Doc. 20) alleges claims for patent infringement 

pursuant to 35 U.S.C. § 271, trademark infringement pursuant to 15 U.S.C. § 1114, 

copyright infringement pursuant to 17 U.S.C. § 501, federal unfair competition pursuant 

to 15 U.S.C. § 1125, and common law unfair competition. On December 18, 2015, the 

Court held a telephonic hearing to discuss Defendants’ then-counsel’s motion to 

withdraw. Docs. 74; 75; 76. During the hearing, the Court warned Defendants Julie 

Mayo and Ann Mayo that their failure to obtain new counsel for Defendant West Coast 

Case 2:15-cv-00110-DGC Document 86 Filed 04/11/16 Page 1 of 7
- 2 - 

1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 

26 

27 

28 

Charms by January 22, 2016 would result in a default judgment being entered against 

West Coast Charms. Defendants failed to obtain new counsel for West Coast Charms as 

ordered by the Court. On February 10, 2016, the Court held a status conference with the 

parties explaining to Defendants that default judgment would be entered against West 

Coast Charms because new counsel had not been retained by the January 22, 2016 

deadline set by the Court. Doc. 78. Following the hearing on February 10, 2016, the 

Court entered an order allowing Plaintiff to file a motion setting forth the specific relief it 

seeks in the default judgment and directing the clerk to enter default judgment as to West 

Coast Charms. Doc. 80. On February 25, 2016, Plaintiff filed its motion for default 

judgment. Doc. 82. No response has been filed. 

II. Legal Standard.

 Once the Clerk has entered default, a plaintiff may request entry of default 

judgment. Fed. R. Civ. P. 55(b)(2). “The district court’s decision whether to enter 

default judgment is a discretionary one.” Aldabe v. Aldabe, 616 F.2d 1089, 1092 

(9th Cir. 1980). Factors the court may consider in deciding whether to grant default 

judgment include: (1) the possibility of prejudice to the plaintiff, (2) the merits of the 

claim, (3) the sufficiency of the complaint, (4) the amount of money at stake, (5) the 

possibility of a dispute concerning material facts, (6) whether default was due to 

excusable neglect, and (7) the policy favoring a decision on the merits. See Eitel v. 

McCool, 782 F.2d 1470, 1471-72 (9th Cir. 1986). In applying the Eitel factors, “the 

factual allegations of the complaint, except those relating to the amount of damages, will 

be taken as true.” Geddes v. United Fin. Group, 559 F.2d 557, 560 (9th Cir. 1977) 

(citations omitted). 

III. Analysis. 

 A. Eitel Factors. 

 The first Eitel factor weighs in favor of granting default judgment. Plaintiff served 

process on Defendant West Coast Charms on March 26, 2015. Doc. 31. West Coast 

Charms filed an answer to Plaintiff’s amended complaint on March 30, 2015. Doc. 26. 

Case 2:15-cv-00110-DGC Document 86 Filed 04/11/16 Page 2 of 7
- 3 - 

1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 

26 

27 

28 

Counsel for Defendants subsequently withdrew from representation. Docs. 72; 73; 74; 

75; 76. The Court permitted the individual Defendants to proceed pro se, but, consistent 

with this Circuit’s precedent, required West Coast Charms to appear through counsel. 

Given that West Coast Charms has failed to secure new counsel, Plaintiff is stymied in its 

ability to prosecute this action against West Coast Charms. If Plaintiff’s motion for 

default judgment is not granted, Plaintiff “will likely be without other recourse for 

recovery.” PepsiCo, Inc. v. Cal. Security Cans, 238 F. Supp. 2d 1172, 1177 (C.D. Cal. 

2002). 

 The second and third Eitel factors favor a default judgment where the complaint 

sufficiently states a claim for relief. See Cal. Security Cans, 238 F. Supp. 2d at 1175-76; 

Danning v. Lavine, 572 F.2d 1386, 1388-89 (9th Cir. 1978). A review of Plaintiff’s 

amended complaint shows that Plaintiff has stated valid causes of action against West 

Coast Charms. See Doc. 20. Because Plaintiff seeks statutory damages solely on the 

basis of its copyright claim, the Court will focus on this claim. Plaintiff is the sole owner 

of a number of copyrights, which it registered with the United States Copyright Office. 

Doc. 20 at 9. Plaintiff owns registered copyrights for eleven separate charm collections, 

which include over 40 separate charms. Docs. 20 at 9-10; 20-1 at 1-3. West Coast 

Charms sells charms that are substantially similar or identical to Plaintiff’s copyrighted 

charms. Doc. 20 at 4. As Plaintiff has released new collections of charms, West Coast 

Charms has mimicked those designs in its charms. Id. West Coast Charms has been put 

on notice of its infringing activity, but has failed to cease this activity. Id. at 4, 9-10. 

Taking Plaintiff’s allegations in its amended complaint as true, Plaintiff has sufficiently 

stated a claim for copyright infringement under 17 U.S.C. § 501. The Court is similarly 

persuaded that Plaintiff has stated valid causes of action for its patent infringement, 

trademark infringement, federal statutory unfair competition, and common law unfair 

competition claims. 

 Under the fourth Eitel factor, the court considers the amount of money at stake in 

relation to the seriousness of the defendant’s conduct. See Cal. Security Cans, 238 F. 

Case 2:15-cv-00110-DGC Document 86 Filed 04/11/16 Page 3 of 7
- 4 - 

1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 

26 

27 

28 

Supp. 2d at 1176-77. Plaintiff seeks $330,000.00 in statutory damages for its copyright 

infringement claim – $30,000 for each of the eleven copyrighted works infringed by 

Defendant West Coast Charms. Plaintiff does not seek monetary damages for its 

trademark, patent infringement, federal statutory unfair competition, and common law 

unfair competition claims. See Doc. 82 at 9-10. The conduct of West Coast Charms 

alleged in the complaint – and admitted by the default – it willful, and has occurred over 

a prolonged period of time even after notice of the infringement. This factor weighs in 

favor of granting Plaintiff’s motion. 

 The fifth Eitel factor weighs in favor of default judgment. Given the sufficiency 

of the complaint and Defendant’s default, after which Plaintiff’s allegations are accepted 

as true, “no genuine dispute of material facts would preclude granting [Plaintiff’s] 

motion.” Cal. Security Cans, 238 F. Supp. 2d at 1177; see Geddes, 559 F.2d at 560. 

 The sixth Eitel factor favors default judgment. West Coast Charms was aware that 

its failure to obtain new counsel by January 22, 2016 would result in default judgment. 

See Doc. 75. The Court clearly explained this in two separate telephonic hearings with 

Julie Mayo and Ann Mayo, the owners. Docs. 76; 78. To date, over two months after the 

Court’s deadline, West Coast Charms has not obtained new counsel. Defendant’s failure 

to obtain counsel is not due to “excusable neglect.” Gemmel v. Systemhouse, Inc., No. 

CV 04-187-TUC-CKJ, 2008 WL 65604, at *5 (D. Ariz. Jan. 3, 2008) (citation omitted). 

 As for the seventh factor, it is true that “[c]ases should be decided upon their 

merits whenever reasonably possible,” Eitel, 782 F.2d at 1472, but the mere existence of 

Rule 55(b) “indicates that this preference, standing alone, is not dispositive,” California 

Security Cans, 238 F. Supp. at 1177 (quotation marks and citation omitted). Defendant’s 

failure to obtain new counsel as directed by the Court to allow this lawsuit to proceed 

“makes a decision on the merits impractical, if not impossible.” Id. This factor also 

favors granting Plaintiff’s motion. 

 Considering the Eitel factors as a whole, the Court concludes that the entry of 

default judgment against West Coast Charms is appropriate. Plaintiff requested two 

Case 2:15-cv-00110-DGC Document 86 Filed 04/11/16 Page 4 of 7
- 5 - 

1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 

26 

27 

28 

forms of relief: damages and injunctive relief. 

 B. Damages. 

 With respect to damages, Plaintiff requests statutory damages, costs, and 

attorneys’ fees. “It is well settled that a default judgment for money may not be entered 

without a hearing unless the amount claimed is a liquidated sum or capable of 

mathematical calculation.” Davis v. Fendler, 650 F.2d 1154, 1161 (9th Cir. 1981). A 

district court has “wide latitude” in granting damages under Rule 55 of the Federal Rules 

of Civil Procedure. Elektra Entm’t Grp. Inc. v. Crawford, 226 F.R.D. 388, 394 (C.D. 

Cal. 2005) (citing In re Frame, 6 F.3d 307, 310 (9th Cir. 1993)). The Court has reviewed 

Plaintiff’s motion and supporting documentation, and awards the following damages. 

 The Court finds that Plaintiff is entitled to $330,000.00 in statutory damages under 

17 U.S.C. § 504(c)(1). Statutory damages are an example of damages that may be 

awarded without a hearing for a default judgment. McComb v. Vejar, No. 2:14-CV00941-RSWL-E, 2014 WL 5494017, at *8 (C.D. Cal. Oct. 28, 2014) (citing Davis, 650 

F.2d at 1161). Statutory damages serve both compensatory and punitive purposes with 

the aim of discouraging infringement. L.A. News Serv. v. Reuters Television Int’l, Ltd., 

149 F.3d 987, 996 (9th Cir. 1998). District courts have “wide discretion in determining 

the amount of statutory damages to be awarded, constrained only by the specified 

maxima and minima.” Id. (quotation marks and citation omitted). By statute, the owner 

of an infringed copyrighted work may recover, in lieu of actual damages, up to $30,000 

per infringed work, “as the court considers just.” 17 U.S.C. § 504(c)(1). In the case of 

willful infringement, the owner may recover up to $150,000 per infringed work. 17 

U.S.C. § 504(c)(2). Although Plaintiff is seeking the maximum allowable amount under 

section 504(c)(1), Plaintiff has elected not to pursue the higher amount of damages 

reserved for cases of willful infringement. As discussed above, Plaintiff alleges willful 

copyright infringement on the part of West Coast Charms, and those allegations have 

been admitted by default. The Court is particularly troubled by what appears to be a 

pattern of intentional infringement by West Coast Charms. The Court finds that 

Case 2:15-cv-00110-DGC Document 86 Filed 04/11/16 Page 5 of 7
- 6 - 

1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 

26 

27 

28 

awarding the maximum amount of statutory damages under 17 U.S.C. § 504(c)(1) is 

appropriate to punish West Coast Charms and deter future infringement. 

 The Court concludes that Plaintiff is entitled to recover costs and attorneys’ fees, 

but finds that Plaintiff is entitled to only $27,768.00 in fees and $101.67 in costs. Under 

Rule 54(d) of the Federal Rules of Civil Procedure, a district court has discretion to 

award a prevailing party its costs and attorneys’ fees. Similarly, by statute, a district 

court has discretion to award a prevailing party in a copyright infringement case its costs 

and attorneys’ fees by statute. 17 U.S.C. § 505. Plaintiff requested $83,304.00 in 

attorneys’ fees and $305.01 in costs for its “affirmative claims against defendants.” 

Docs. 82 at 19-22; 82-6 at 2, ¶¶ 3-4. These fees and costs were incurred in prosecuting 

its claims against all three Defendants in this matter, not just West Coast Charms. Some 

of the requested attorneys’ fees and costs were incurred to prosecute Plaintiff’s claims 

against the individual Defendants, not West Coast Charms. See, e.g., Doc. 82-6 at 17 

(“Review of written discovery to access remaining discovery needs for affirmative case 

against Julie and Ann Mayo.”). Plaintiff has obtained a judgment against West Coast 

Charms, but its claims against Julie Mayo and Ann Mayo remain pending. Because 

Plaintiff has obtained a judgment against only one of the three Defendants in this lawsuit, 

the Court concludes that it should recover one-third of its requested attorneys’ fees and 

costs. The Court therefore awards Plaintiff $27,768.00 in fees and $101.67 in costs. This 

is consistent with the Court’s wide latitude in awarding damages for a default judgment. 

Elektra Entm’t Grp., 226 F.R.D. at 394.

 The Court finds that no hearing is necessary to determine the amount of damages 

Plaintiff is entitled to recover. Davis, 650 F.2d at 1161. The Court will award Plaintiff 

$357,869.67, consisting of $330,000.00 in statutory damages for copyright infringement, 

$27,768.00 in attorneys’ fees, and $101.67 in fees. 

 C. Permanent Injunction. 

 Plaintiff also requested a permanent injunction. An injunction is “an extraordinary 

remedy never awarded as of right.” Winter v. Natural Res. Defense Council, Inc., 555 

Case 2:15-cv-00110-DGC Document 86 Filed 04/11/16 Page 6 of 7
- 7 - 

1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 

26 

27 

28 

U.S. 7, 24 (2008). A plaintiff seeking a permanent injunction must show: “(1) that it has 

suffered an 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 hardships between the 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, LLC, 547 U.S. 388, 391 (2006). “While ‘[t]he decision to grant or deny 

permanent injunctive relief is an act of equitable discretion by the district court,’ the 

‘traditional principles of equity’ demand a fair weighing of the factors listed above, 

taking into account the unique circumstances of each case.” La Quinta Worldwide LLC 

v. Q.R.T.M., S.A. de C.V., 762 F.3d 867, 880 (9th Cir. 2014) (quoting eBay, 547 U.S. at 

391, 394). 

 Plaintiff’s requested permanent injunction covers not only West Coast Charms, 

but also its officers, employees, agents, and those acting in concert with it. The 

injunction therefore would apply to Defendants Julie and Ann Mayo, who have not been 

found liable in this case. For this reason, the Court declines to enter the injunction 

proposed by Plaintiffs. 

IT IS ORDERED:

 1. Plaintiff’s motion for default judgment (Doc. 82) is granted in part and 

denied in part. 

2. Default judgment is entered in favor of Plaintiff and against Defendant 

West Coast Charms on all claims. 

3. Plaintiff is awarded $357,869.67 against West Coast Charms. 

4. Plaintiff’s request for injunctive relief is denied. 

Dated this 11th day of April, 2016. 

Case 2:15-cv-00110-DGC Document 86 Filed 04/11/16 Page 7 of 7