Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-3_06-cv-06572/USCOURTS-cand-3_06-cv-06572-8/pdf.json

Nature of Suit Code: 840
Nature of Suit: Trademark
Cause of Action: 15:1114 Trademark Infringement

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United States District Court

For the Northern District of California

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1 It appears from the record that WSI served some of the Defendants with its

motion after the Report and Recommendation was issued on December 6, 2007. 

Notwithstanding that fact, the Court has not received objections from any Defendants.

IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF CALIFORNIA

WILLIAMS-SONOMA, INC., 

Plaintiff,

 v.

ONLINE MARKETING SERVICES, LTD., et

al.

Defendants.

 /

No. C 06-06572 JSW

ORDER ADOPTING IN PART

AND MODIFYING IN PART

REPORT AND

RECOMMENDATION ON

PLAINTIFF’S MOTION FOR

DEFAULT JUDGMENT AND

ENTRY OF INJUNCTION

This matter comes before the Court upon consideration of the Report and

Recommendation issued by Magistrate Judge James regarding the motion for default judgment

filed by Plaintiff Williams-Sonoma, Inc. (“WSI”).1 On January 4, 2008, the Court ordered

supplemental briefing on the issue of personal jurisdiction. Having considered that briefing, the

Report, and the record in this case, the Court finds the Report correct, well-reasoned and

thorough, and adopts it in almost every respect. Although the Court concurs with the

conclusion that personal jurisdiction exists over the Defaulting Defendants, it does so for

different reasons, which the Court sets forth herein.

WSI contends the Court can exercise specific jurisdiction over the Defaulting

Defendants. The Report sets forth the correct test, and the Court concurs with the Magistrate

Judge’s reasoning as to the second and third prongs of this test. The Court disagrees with the

Magistrate Judge’s analysis of the purposeful availment prong because, contrary to the findings

Case 3:06-cv-06572-JSW Document 70 Filed 03/04/08 Page 1 of 5
United States District Court

For the Northern District of California

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2 In light of the Defendants’ absence, the Court concludes WSI need only make

a prima facie showing that personal jurisdiction exists. See, e.g., Mwani v. Bin Laden, 417

F.3d 1, 7 (D.C. Cir. 2005); Data Disc, Inc. v. System Tech. Assocs., Inc., 557 F.2d 1280,

1285 (9th Cir. 1987) (noting that while a plaintiff bears the burden of establishing that

personal jurisdiction exists, “quantum of proof required to meet that burden may vary,

depending upon the nature of the proceeding and the type of evidence which the plaintiff is

permitted to present”).

3 OMS owns, operates, and hosts a variety of websites with the extension

“filthserver.com.” Unimaster and Korchev owned, operated and managed a variety of

websites with the extension “just-a-porn.com.” YetisCash, Techl, and Lexico, owned,

operated, and managed a variety of websites with the extension “sexcountry.net.”

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of the Report, Mr. Cahn’s declaration does not establish that “the Defaulting Defendants

engaged in business with California consumers who accessed adult images and videos, and paid

Defendants for them through linked credit card processing sites.” (Report at 6:5-8, citing

Declaration of Timothy Cahn (“Cahn Decl.”) ¶¶ 3-7.) Rather, Mr. Cahn’s Declaration

establishes that it would be possible for California residents to do so. The Court concludes this

factual discrepancy does not preclude a finding of personal jurisdiction.2

With respect to Defaulting Defendants Online Marketing Services, Ltd. (“OMS),

Unimaster, Korchev, YetisCash, Techl, Lexico, Ballesteros, and Tevdt3 Mr. Cahn’s declaration

establishes that the websites they host are, for all intents and purposes, “active,” in that they

enable consumers to purchase and pay for pornographic images and movies. (Cahn Decl., ¶¶ 3-

6. Although there is every indication that a majority of the Defaulting Defendants host highly

commercial websites, given the lack of actual transactions with California consumers, the Court

is reluctant to base its finding of jurisdiction solely on the fact that these websites could qualify

as “active.” See, e.g., Tech Heads, Inc. v. Desktop Serv. Center, Inc., 105 F. Supp. 2d 1142,

1149 (D. Or. 2000). It is clear, however, that the websites are not merely “passive.” See, e.g.,

Pebble Beach Co. v. Caddy, 453 F.3d 1151, 1158 (9th Cir. 2006) (concluding that specific

jurisdiction did not exist where defendant held “non-interactive passive website” using

plaintiff’s trademark). 

In addition to the commercial nature of most of the websites, Mr. Cahn’s declaration

establishes that, with the exception of Defendants Tvedt and Ballesteros, these Defaulting

Defendant entered into agreements with California companies. Although Defendant Morgan's

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United States District Court

For the Northern District of California

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website is characterized as more passive in nature, Morgan also contracted with a California

company. For example, OMS registered its domain name with Online NIC, a San Francisco

based company. Further, OMS, Unimaster, Korchev, YetisCash, Techl, Lexico, and Morgan

appear to have been affiliated with former defendant Friend Finder, Inc., and these Defendants

used WSI’s marks to direct traffic to Friend Finder and were paid for such services. (Cahn

Decl. ¶¶ 3-5.) The Court finds that these contacts, in conjunction with the operation of the

websites, is sufficient to establish specific jurisdiction. 

Furthermore, the Court also concludes that WSI has established personal jurisdiction

over the above Defaulting Defendants, as well as Defaulting Defendants Tvedt, Ballesteros and

Morgan, using the “effects” test set forth in Calder v. Jones, 465 U.S. 783 (1984). Under that

test, the purposeful availment prong can “be satisfied if the defendant is alleged to have (1)

committed an intentional act; (2) expressly aimed at the forum state; (3) causing harm, the brunt

of which is suffered – and which the defendant knows is likely to be suffered - in the forum

state.” Harris Rutsky & Co. Ins. Servs., Inc. v. Bell & Clements, Ltd., 328 F.3d 1122, 1131 (9th

Cir. 2003) (citing Core-Vent Corp. v. Nobel Industries, AB, 11 F.3d 1482, 1486 (9th Cir. 1993)). 

As the Ninth Circuit has stated, however, a plaintiff must establish “something more” than

foreseeable effects in the forum arising from foreign acts. See Caddy, 453 F.3d at 1159-59;

Bancroft & Masters, Inc. v. Augusta National Inc., 223 F.3d 1082, 1087 (9th Cir. 2000). The

Bancroft & Masters court thus determined that a plaintiff must show that a defendant “engaged

in wrongful conduct targeted at a plaintiff whom the defendant knows to be a resident of the

forum state.” Id. 

Here, WSI alleges that the Defaulting Defendants infringed its trademarks, thus showing

the Defendants committed an intentional act. Further, by either contracting with Friend Finder

and using WSI’s trademarks to direct customers both to their own sites or to Friend Finder, the

Court concludes that there is sufficient evidence to show the Defaulting Defendants targeted

WSI, which has its principal place of business in California, and that the Defaulting

Defendants’ contacts with California were not merely fortuitous. Further, WSI has established

that it has suffered harm as a result of the Defaulting Defendants’ actions.

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United States District Court

For the Northern District of California

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For these reasons, the Court concludes that Plaintiff have established personal

jurisdiction over the Defaulting Defendants.

Accordingly, it is HEREBY ORDERED that:

1. WSI’s motion for default judgment is GRANTED, and judgment shall be entered

for WSI and against Defaulting Defendants Online Marketing Services, Ltd., Unimaster, Ltd.,

Andrej Korchev, YetisCash, Ales Lexico, Vladimir Techl, Sweethelda Ballesteros, Stein Tvedt,

and Eddie Morgan.

2. Defaulting Defendants, their agents, employees, successors, and all persons

acting in concert with them who receive notice of this Order, are permanently enjoined from

infringing or diluting in an manner WSI’s POTTERY BARN family of marks. They are

permanently enjoined from any commercial use of the marks POTTERY BARN®, pottery barn

kids®, PBteen®, P.B.Kids®, or any colorable imitation or variations of these marks.

3. Defaulting Defendants shall provide an accounting of their profits related to their

infringement of the POTTERY BARN trademarks, for the purpose of awarding WSI monetary

damages based on Defendants’ profits. To facilitate accounting of profits, each Defaulting

Defendant shall produce documents substantiating their revenues and relevant costs from their

operation of the following domain names: <www.filthserver.com>,

<www.onlinemarketingservices.biz>, <www.slutty-teens.net>, <www.just-a-porn.com>, and

<www.sexcountry.net>. Further, each Defaulting Defendant shall produce records of payments

by Adult Friend Finder, or other web site businesses, for web traffic directed from the

aforementioned web sites that unlawfully used WSI’s marks. Defaulting Defendants shall

produce records covering the entire period of their use of the POTTERY BARN trademarks,

including the months of September 2006 through June 30, 2007. Defaulting Defendants shall

produce such financial statements or records within 60 days of the entry of this Order.

4. Defaulting Defendants, their agents, employees, successors, and all persons

acting in concert with them who receive notice of this Order, are enjoined temporarily from

selling, assigning, encumbering, or transferring in any manner the domain names that

Defaulting Defendants used to infringe and/or dilute WSI’s trademarks as alleged in the First

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United States District Court

For the Northern District of California

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Amended Complaint, including the following domain names: <www.filthserver.com>,

<www.onlinemarketingservices.biz>, <www.slutty-teens.net>, <www.just-a-porn.com>, and

<www.sexcountry.net>. Notice of this Order shall be delivered to the relevant domain name

registries, registrars, and other authorities with control over the disposition of these domain

names. This temporary injunction shall expire as to each domain name upon the respective

Defaulting Defendants’ full compliance with this Court’s Order, accounting of profits, and

satisfaction of the final relief ordered by the Court or joint stipulation by the parties of

settlement of dispute and dismissal.

5. WSI shall recover as damages from the Defaulting Defendants, jointly and

severally, its reasonable attorneys’ fees and costs. WSI shall submit a supplemental submission

detailing the amount of attorneys’ fees and costs they have expended by no later than March 21,

2008.

The Court shall reserve entering Judgment pending submission of WSI’s attorneys’ fees

and costs and pending completion of the accounting.

IT IS SO ORDERED.

Dated: March 4, 2008 

JEFFREY S. WHITE

UNITED STATES DISTRICT JUDGE

Case 3:06-cv-06572-JSW Document 70 Filed 03/04/08 Page 5 of 5