Wowwee Group Limited v. Meirly

Background

WowWee Group Ltd., WowWee Canada, Inc., and WowWee USA, Inc. brought a trademark infringement action against 83 defendants. In a March 27, 2019 order, the court entered final default judgment on the plaintiffs’ federal claims and one New York state claim against 45 defendants who had defaulted. The court found liability on claims involving trademark counterfeiting, trademark infringement, false designation of origin, copyright infringement, and New York unfair competition.

As remedies, the court issued permanent injunctive relief and awarded statutory damages. It also ordered an asset freeze under Federal Rule of Civil Procedure 69 and New York Civil Practice Law and Rules § 5222. But it denied the plaintiffs’ request for a broader post-judgment asset freeze or asset transfer under Rule 65, the Lanham Act, and the court’s inherent equitable powers.

The plaintiffs moved for reconsideration of the denial of the broader asset freeze and asset transfer. Reconsideration is an extraordinary remedy generally limited to an intervening change in controlling law, new evidence, or the need to correct a clear error or prevent manifest injustice. It cannot ordinarily be used to relitigate an issue or present a new theory that was not raised earlier.

Asset Freeze

The court first clarified that it had already granted an asset freeze under Rule 69 and New York law. The plaintiffs’ remaining request concerned a broader freeze under Rule 65, the Lanham Act, and the court’s equitable powers.

The court denied reconsideration of that broader freeze. The plaintiffs cited cases in which other courts had ordered asset freezes under Rule 65, but they did not explain the legal reasoning in those decisions or identify controlling decisions or data that the court had overlooked. The court therefore adhered to its earlier conclusion that the requested broader freeze was inconsistent with the logic of Grupo Mexicano and the post-judgment enforcement procedures in the Federal Rules.

Asset Transfer

The court also denied reconsideration of the plaintiffs’ original request for an asset-transfer order. The plaintiffs again cited cases granting transfer orders but did not provide the legal reasoning needed to satisfy the strict standard for reconsideration. The court maintained that the plaintiffs’ available post-judgment remedies were those provided by Rule 69 and state law.

The plaintiffs alternatively sought an asset-transfer order under New York Civil Practice Law and Rules § 5225. The court treated that request as a new motion and denied it without prejudice. The plaintiffs had not shown that they provided the required notice to the judgment debtors. They also had not identified specific money or other personal property in the judgment debtors’ possession or custody. Section 5225 does not authorize a general transfer of all frozen assets; it requires identification of particular property.

Disposition

The court DENIED the plaintiffs’ motion for reconsideration of the March 27, 2019 Opinion and Order. The alternative § 5225 transfer request was denied without prejudice. The court directed the Clerk of Court to close the case and stated that the order resolved Docket Number 90.