Pearson Education, Inc. v. Doe 1

Background

Pearson Education, Inc., Cengage Learning, Inc., Elsevier Inc., McGraw Hill LLC, and Bedford, Freeman & Worth Publishing Group, LLC, doing business as Macmillan Learning, sued defendants for copyright and trademark infringement. The publishers alleged that the defendants sold counterfeit copies of their textbooks through Amazon and other online marketplaces.

The remaining defendants for the inquest were Bizzare Crafts Pvt. Ltd., Pradeep Kumar Sahni, Diwakar Kumar, Abhishek Kumar Singh, Irshad Ahmed, Sushil Kumar Sharma, Niya Wood, Gilson Jose Goncalves Filho, Anthem, LLC, and Tracy W. Jernigan. The defendants failed to respond to the amended complaint or otherwise appear. The court entered default against the remaining defendants on November 25, 2020, and referred the case for an inquest, which is the process of determining damages after default.

Liability

Judge Wang concluded that the publishers had shown the required elements of copyright infringement: ownership of valid copyrights and unauthorized copying or distribution of protected works. The publishers submitted copyright registrations and evidence that the defendants sold copies without permission.

The report also concluded that the publishers had established trademark infringement. Their marks were registered and protectable, and the defendants allegedly used those marks to market counterfeit versions of the publishers’ products. Because counterfeit products are likely to confuse consumers about their source or approval, the report found the trademark-infringement element satisfied.

The report treated the defendants’ conduct as willful, in part because they defaulted and, except for Gilson Jose Goncalves Filho, continued selling counterfeit books after the court issued a temporary restraining order. Filho stopped selling the books after the order and had obtained them from a third party, but the report still found his conduct willful because he did not participate in the litigation.

Recommended damages

The report recommended statutory damages rather than damages based on proven profits or losses. Because the defendants did not provide records or discovery, the court could not precisely determine their profits, the publishers’ lost revenue, or the value of the infringing materials. The recommended awards were:

- Anthem, LLC and Tracy W. Jernigan: $4,150,000 to Cengage and Pearson. - Bizzare Crafts defendants: $16,730,000 to all plaintiffs. - Gilson Jose Goncalves Filho: $360,000 to Cengage, McGraw Hill, and Pearson. - Niya Wood: $6,450,000 to Cengage, McGraw Hill, and Pearson.

The total recommended award was $27,690,000, consisting of $3,390,000 for copyright infringement and $24,300,000 for trademark infringement. The report also recommended post-judgment interest calculated under federal law from the date judgment is entered.

Recommended injunction and status of the report

Judge Wang recommended a permanent injunction barring the defendants, their agents, and those acting together with them from further infringing the publishers’ copyrights and trademarks. The report reasoned that continued online sales could cause irreparable harm, money alone would not prevent future infringement, the injunction would impose no proper hardship beyond stopping unlawful conduct, and the injunction would serve the public interest.

This document is a report and recommendation, not the final judgment described in the recommendation. The parties were given fourteen days after receiving it to file objections addressed to United States District Judge Margaret M. Garnett. The opinion states that failing to object within that period would waive objections and prevent appellate review.