Parisienne v. HeyKorean, Inc.

Background

Theodore Parisienne brought one copyright-infringement claim under 17 U.S.C. §§ 106 and 501. He alleged that HeyKorean reproduced and displayed on its website a copyrighted photograph that he owned and had registered.

HeyKorean moved under Federal Rule of Civil Procedure 55(c) to set aside the default. Its authorized representative stated that HeyKorean had not received the summons and complaint and first learned of the case when Parisienne’s counsel emailed him on April 22, 2019. HeyKorean’s attorneys sought Parisienne’s consent to set aside the default and, after consent was not given, filed a motion on May 3, 2019. The Clerk’s Office rejected that filing as incorrectly filed on June 27, 2019; HeyKorean refiled the motion that same day. Parisienne did not oppose the motion and had not sought a default judgment.

Legal standard

Under Rule 55(c), a court may set aside an entry of default for good cause. The court considered whether the default was willful, whether vacating it would prejudice Parisienne, and whether HeyKorean presented a meritorious defense. Courts generally disfavor defaults and prefer resolving disputes on their merits.

Court’s analysis

The court found that HeyKorean’s default was not willful. The sworn statements indicated that HeyKorean acted promptly after learning about the case, and Parisienne filed no opposition.

The court also found no demonstrated prejudice. Delay alone was insufficient, and Parisienne had not shown that the delay would cause loss of evidence, make discovery more difficult, or create a greater opportunity for fraud or collusion.

For the meritorious-defense requirement, HeyKorean only had to present facts that, if proven at trial, would establish a complete defense. HeyKorean asserted that the photograph’s appearance on its website was protected by fair use and by the Digital Millennium Copyright Act’s safe-harbor provisions. The court focused on the safe-harbor defense and did not evaluate the fair-use defense.

HeyKorean alleged that users could post photographs without its input or approval, that it operated a repeat-infringer policy, and that it accommodated standard technical measures used by copyright owners. It also alleged that it lacked actual knowledge of infringement, removed the photograph immediately after being notified, and received no financial benefit from the posting. The court held that these allegations, if proven at trial, could establish a complete safe-harbor defense and were sufficient to satisfy the meritorious-defense requirement.

Disposition

Judge Vernon S. Broderick granted HeyKorean’s unopposed motion to vacate its default. The court directed HeyKorean to answer, move, or otherwise respond to the complaint by November 25, 2019. The order did not decide whether HeyKorean infringed Parisienne’s copyright.