Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-casd-3_13-cv-01395/USCOURTS-casd-3_13-cv-01395-6/pdf.json

Nature of Suit Code: 840
Nature of Suit: Trademark
Cause of Action: 15:1114 Trademark Infringement (Lanham Act)

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UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF CALIFORNIA

WAHOO INTERNATIONAL, INC,

Plaintiff,

CASE NO. 13cv1395-GPC(BLM)

ORDER GRANTING IN PART

DEFENDANT’S MOTION TO

ALTER OR AMEND 

[Dkt. No. 84.]

vs.

PHIX DOCTOR, INC., a Florida

Corporation; and DOES 1-10,

Defendant.

Before the Court is Defendant’s motion to alter or amend, pursuant to Federal

Rule of Civil Procedure 59(e) and 60(b), the Court’s order, filed on December 2, 2014,

denying Plaintiff’s motion for default judgment and Defendant’s motion to set aside

default as moot, and granting Plaintiff’s request for attorneys’ fees and costs. (Dkt. No.

84.) Plaintiff filed an opposition and Defendant filed a reply. (Dkt. Nos. 91, 92,) 

Based on the briefs, supporting documents, and the applicable law, the Court GRANTS

in part Defendant’s motion to alter or amend the Court’s order. (Dkt. No. 80.) 

Background

Defendant brings a motion to reconsider under Federal Rule of Civil Procedure

(“Rule”) 59(e) and Rule 60(b). Plaintiff opposes. 

Rule 59(e) providesfor the filing of a motion to alter or amend a judgment. Fed.

R. Civ. P. 59(e). Reconsideration of a motion for attorneys’ fees is not proper under

Rule 59(e) because the motion does not seek to alter the final judgment. White v. New

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Hampshire Dept. of Employment Security, 455 U.S. 445, 452 (1982); see also Amar

v. LSREF 2 APEX 2, LLC, No. 12cv969-JCM(RJJ), 2013 WL 1269637, at * 1 (D.

Nev. Mar. 25, 2013). Therefore, Defendant’s motion for reconsideration cannot be

brought pursuant to Rule 59(e). 

Defendant also brings a motion to reconsider under Rule 60(b). It appears

Defendant is bringing the motion for reconsideration pursuant toRule 60(b)(2); (4); (5)

and (6) as it quotes these provision of Rule 60(b). (See Dkt. No. 84 at 4.)

Under Rule 60(b),

the court may relieve a party . . . from a final judgment, order, or

proceeding for the following reasons:

(2) newly discovered evidence that, with reasonable diligence, could

not have been discovered in time to move for a new trial under Rule

59(b); (4) the judgment is void; (5) . . . it is based on an earlier

judgment that has been reversed or vacated; or applying it

prospectively is no longer equitable; or (6) any other reason that

justifies relief. 

Fed. R. Civ. P. 60(b). 

Rule 60(d) provides,

This rule does not limit a court’s power to: (1) entertain an independent

action to relieve a party from a judgment, order, or proceeding; (2)

grant relief under 28 U.S.C. § 1655 to a defendant who was not

personally notified of the action; or (3) set aside a judgment for fraud

on the court. 

Fed. R. Civ. P. 60(d). 

The Court has discretion in granting or denying a motion for reconsideration. 

Fuller v. M.G. Jewelry, 950 F.2d 1437, 1441 (9th Cir. 1991). A motion for

reconsideration should not be granted absent highly unusual circumstances. 389

Orange St. Partners v. Arnold, 179 F.3d 656, 665 (9th Cir. 1999). “A motion for

reconsideration cannot be used to ask the Court to rethink what the Court has already

thought through merely because a party disagrees with the Court’s decision. Collins

v. D.R. Horton, Inc., 252 F. Supp. 2d 936, 938 (D. Az. 2003) (citing United States v.

Rezzonico, 32 F. Supp. 2d 1112, 1116 (D. Az.1998)). 

/ / / /

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Discussion

The motion seeks the Court to “alter, amend, or reconsider its decision on

December 2, 2014 granting attorney fees and setting aside the default.” (Dkt. No. 84-1

at 1-2.) However, it is not entirely clear what relief Defendant seeks in its motion and

Defendant appears to believe that the Court granted Defendant’s motion to set aside

default and that such an order is void. (Dkt. No. 84 at 4.) Defendant argues that the

Court lacked jurisdiction of the case when the issue of default became moot when

Plaintiff filed its amended complaint. (Dkt. No. 84 at 4-5.) Therefore, the Court was

without jurisdiction to rule on the motion for attorney’s fees. (Dkt. No. 84 at 6.)1

However, contrary to Defendant’s argument, the Court did not grant Defendant’s

motion to set aside default. Instead, in line with Defendant’s argument, the Court

denied Defendant’s motion to set aside default as moot. (Dkt. No. 80.) The Court does

not disagree with Defendant that the amended complaint rendered the default moot.2

However, Defendant provides no authority that as a result of denying the motion to set

aside default as moot, the Court lacked jurisdiction to consider the request for

attorney’s fees.

As to the award of attorneys’ fees and costs of $9,749.50, Defendant summarily

contendsthat the amount issubstantially unreasonable in light ofthe parties’ individual

circumstances and will force Defendant into bankruptcy which will only create more

problems. 

On December 2, 2014, the Court issued an order denying Plaintiff’s motion for

default judgment and Defendant’s motion to set aside default as moot and granting

Plaintiff’s request for attorneys’ fees and costs. In granting sanctions of attorneys’ fees

Defendant argues that its “request to set aside a default became moot when the

1

amended complaint extinguished the default making relief impossible and a grant of

the motion or attorneys fee void.” (Dkt. No. 84 at 6.) 

Defendant also raises an argument that it was properly served with the amended

2

complaint; however, it is not clear how it concerns or affects the instant motion. The

Court concluded Plaintiff was not required to serve Defendant with the amended

complaint pursuant to Federal Rule of Civil Procedure 5(a)(2). 

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and cost, the Court explained:

In the Court’s prior order setting aside default against Defendant, filed

on March 17, 2014, the Court denied Plaintiff’s request to condition a

motion to set aside default on an award of attorney’s fees and costs

against Phix Doctor. (Dkt. No. 34.) In that order the Court noted that

Defendant’s conduct was not egregious but appeared to be

“administrative mishaps.” (Id. at 8.) But, in that order, the Court

warned defense counsel that “if he continues to miss court deadlines

withoutseeking relief from the Court, the Court may impose sanctions

in the future.” (Id.) In this instance, while the Court did not set aside

the default due to the filing of the amended complaint, the Court finds

it appropriate to issue sanctions against defense counsel for his

continued dilatory conduct in missing deadlines and failing to comply

with Court orders.

Since the prior order setting aside default, the “administrativemishaps”

have continued with late and missed filing deadlines and another

default entered against Phix Doctor causing many months of delay.

Defense counsel has continued his dilatory conduct and failed to

comply with court orders setting filing deadlines. In fact, defense

counsel has acknowledged that the default was due to his conduct and

not Defendant. (See Dkt. No. 71-1 at 5.) As a result of the continued

conduct, another default was entered against Defendant, a subsequent

motion to set aside default and a motion for default judgment had to be

unnecessarily filed expending valuable and costly attorney resources

of Plaintiff. Based on the continued conduct of defense counsel in

failing to comply with court orders and deadlines, the Court now finds

that sanctions are warranted.

(Dkt. No. 80 at 7-8.) Defendant argues that the Court lacked jurisdiction to make an

award of sanctions under its inherent powers because it did not make a finding of “bad

faith.” However, the Court did not issue sanctions under its inherent powers, but

pursuant to Nilsson, where the Ninth Circuit held that sanctions can be issued as a

condition to setting aside a default and a finding of bad faith is not required. Nilsson

v. Louisiana Hydrolec, 854 F.2d 1538, 1546-47 (9th Cir. 1988); see also Na Pali

Haweo Comm. Ass’n v. Grande, 252 F.R.D. 672, 675 (D. Hawaii 2008) (Nilsson

allows a court to condition the setting aside of a default on payment of a sanction

absent a showing of bad faith). 

Next, Defendant contends that Plaintiff was the reason for the delay in

proceedings because it refused to stipulate to setting aside the default. Defendant

argues the facts of the case are akin to Na Pali Haweo Comm. Ass’n v. Grande where

the district court held that sanctions were not warranted as a condition of setting aside

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default because the defendants’ conduct did not rise to the requisite level of

egregiousness found under Nilsson. 252 F.R.D. at 675. In Grande, the defendants

asked for a voluntary extension of time to file an answer from the plaintiff who did not

respond and the defendants did not file a timely answer in order to avoid a Rule 11(b)

infraction. Id. at 673. The following day, July 16, Plaintiffs entered default, and on

July 19, defendants filed their answer and counterclaim. Id. Then on August 9, the

plaintiff filed a motion to strike the defendants’ answer. Id. On August 11, 20 and

September 13, the defendants requested to plaintiff’s counsel to voluntarily set aside

the default but the plaintiff’s counsel declined. Id. On September 27, the defendants

filed a motion to set aside the default which was granted by the court after briefing. Id. 

In declining to issue sanctions, the court explained that the plaintiff isthe party that can

be seen as complicating the proceedingssurrounding the initial granting of the default,

which caused both partiesto incur unnecessary costs. Id. at 675. “Plaintiff obtained the

default on the first day the Federal Rules allowed and continually refused to respond

to the [defendants’] requests for a continuance and to voluntarily set aside the default.

Furthermore, Plaintiff challenged the [defendants’] Motion to Set Aside, in spite of

having almost no possibility of defeating the motion.” Id. 

Similarly, in this case, Defendant argues that Plaintiff has complicated the

proceedings and refused to set aside the default even while it was attempting to amend

its complaint which would have made the default moot. While Plaintiff could have

stipulated to a joint motion to set aside default, it is not responsible for the numerous

late filings and failure to comply with court orders. In the motion to set aside default,

3

Since the Court’s order denying Plaintiff’s initial request for attorneys’ fees 3

filed on March 17, 2014, Defendant filed a late motion to dismiss on April 3, 2014

when the Court directed Defendant to file a responsive pleading by March 31, 2014. 

(Dkt. Nos. 34, 36.) Defendant filed a late reply to its motion to dismiss on May 20,

2014 when it should have been filed by May 16, 2014. (Dkt. Nos. 37, 45.) Then,

Defendant failed to file an answer pursuant to Rule 12 when the Court denied

Defendant’s motion to dismiss. (Dkt. No. 49.) As a result, default was entered. (Dkt.

No. 54.) Then, Defendant failed to timely file an opposition to Plaintiff’s motion to

amend on September 12, 2014 but instead filed an opposition on September 17, 2014. 

(Dkt. Nos. 60, 64.) As to Plaintiff’s motion for default judgment, Defendant filed a late

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defense counsel acknowledged that the default was due to his conduct and not

Defendant. (See Dkt. No. 71-1 at 5.) 

While the plaintiff in Grande was diligent in pursuing its case and the defendants

created some of the problems in complicating the procedures, in this case, Defendant

has not been diligent. The second default was entered on July 18, 2014, (Dkt. No. 54);

however, a motion to set aside was not filed until three months later on October 15,

2014. (Dkt. No. 71.) During those three months, the Court set an OSC hearing on

September 2, 2014 for Plaintiff’s failure to move for default judgment. (Dkt. No. 62.) 

The OSC hearing was held on September 26, 2014, where the Court allowed Plaintiff

to file its motion for default judgment by October 10, 2014. Plaintiff filed a motion for

default judgment on October 10, 2014. (Dkt. No. 68.) The round of filings on the

motion for default judgment could have been avoided if a motion to set aside default

had been filed shortly after default was entered in July 2014. While Defendant argues

that plaintiff should have known that an amended complaint would make a default

moot, Plaintiff had a legal argument that a default would not be mooted, despite the fact

the Court ruled against Plaintiff. 

Moreover, while Defendant attempts to point the blame to Plaintiff asthe reason

why sanctions should not be issued, Defendant’s conduct goes beyond just the motion

to set aside default. Default has been entered two times in this case. Defendant has

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failed to comply with deadlines issued by the Court and as required under the Federal

Rule of Civil Procedure, and Civil Local Rules. In a prior order setting aside default,

opposition on November 10, 2014, instead of October 31, 2014. (Dkt. Nos. 70, 77.) 

Even the reply to the instant motion to alter judgment wasfiled one day late on January

24, 2015 instead of January 23, 2014 as required by the Civil Local Rules. (Dkt. No. 

92.) These were all filed late without requesting leave of Court. 

In fact, request for entry of default has been filed three times in this case. The 4

first time it wasrequested, Defendant, a corporation, appeared without counsel, and the

Court set an order to show cause why Defendant shall not be default for failing to have

counsel appear for the corporation. (Dkt. No. 10.) At the order to show cause hearing,

Defendant appeared with counsel and the Court denied Plaintiff’s request for default. 

(Dkt. No. 15.) This request for default was not due to the lack of diligence by defense

counsel. 

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the Court denied Plaintiff’s motion for attorney’s fees stating that the errors were

“administrative mishaps.” However, since then, defense counsel has continually

violated court orders, withoutseeking relief fromthe Court. More recently, on January

9, 2015, the Court held an OSC hearing for Defendant’s failure to file a timely answer. 

(Dkt. Nos. 82, 87.)

Lastly, Defendant contends that the attorney’s fee award violates the equal

protection clause because it has been “irrationally singled out as a so-called ‘class of

one.’” (Dkt. No. 84 at 12.) “To succeed on his ‘class of one’ claim, [Defendant] must

demonstrate that the [Court]: (1) intentionally (2) treated [Defendant] differently than

other similarly situated [defendants], (3) without a rational basis.” Gerhart v. Lake

County, Montana, 637 F.3d 1013, 1022 (9th Cir. 2011) (citing Willowbrook v. Olech,

528 U.S. 562, 564 (2000)). Besides a conclusory allegation of an equal protection

violation, Defendant fails to demonstrate that the Court intentionally treated

Defendant’s case different than others and without a rational basis.

Despite citing to Rule 60(b)(2), (4), (5), (6) and 60(d), Defendant has not

presented any legal argument or presented additional facts that reconsideration is

warranted. Accordingly, the Court DENIES Defendant’s motion to alter or amend

judgment on these provisions. 

However, the Court has carefully reviewed its order granting attorneys’ fees and

reconsidersthe amount awarded. The Court declinesto award fees asto attorney hours

spent responding and attending the hearing regarding dismissal for failure to file for

default judgment. While Plaintiff states that defense counsel had represented that he

would be moving to set aside default, Plaintiff did not move for default judgment any

time after the deadline of August 17, 2014. Based on past history, Plaintiff could have

recognized that Defendant was not going to file its motion to set aside default or file

it timely. On September 2, 2014, the Court set an OSC for September 26, 2014 and

Plaintiff filed its motion for default judgment on October 10, 2014. While Defendant’s

default and failure to file a motion to set aside default caused the delay and unnecessary

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work by Plaintiff, Plaintiff was partly responsible for the OSC proceedings. 

Accordingly, the Court declines to award attorneys’ fee for work done in responding

to the OSC and attending the hearing. In her brief, Plaintiff’s counsel only provides

a lump sump of the attorneys’ fees without identifying what portions of the fees are

attributed to specific work. Without such information, the Court reduces the amount

of attorneys’ fees by $4000.00. Accordingly, the Court GRANTS in part Defendant’s

motion to alter or amend judgment. 

Conclusion

Based on the above, the Court GRANTS in part Defendant’s motion to alter or

amend judgment and reduces the amount of attorneys’ fees and cost award to

$5,749.50. Defendant is hereby ORDERED to comply with the Court’s order and pay

Plaintiff $5,749.50 within three months of this Order. 

IT IS SO ORDERED.

DATED: January 29, 2015

HON. GONZALO P. CURIEL

United States District Judge

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