Alstar Marketing Group LLC. v. Leams babyshop.

Background

On June 30, 2020, the court entered judgment against certain defendants identified as the “Defaulting Defendants.” In that earlier order, the court granted Allstar Marketing Group, LLC statutory damages, a permanent injunction, and permission to continue serving the Defaulting Defendants electronically. This scheduling order explained why the court denied four additional parts of Allstar’s proposed default-judgment relief.

Temporary restraint request

Allstar asked the court to continue restraining the Defaulting Defendants’ assets for 30 days after judgment. Allstar argued that Federal Rule of Civil Procedure 62(a) would otherwise create a 30-day period during which it could not execute the judgment, giving the defendants time to dispose of assets that could satisfy the judgment.

The court denied that request. Instead, it exercised its authority under Rule 62(a) to remove the 30-day stay on enforcement. As a result, Allstar could execute and enforce the default judgment immediately.

Asset freeze and turnover request

Allstar asked the court to continue the prejudgment restraint on the Defaulting Defendants’ assets and require financial institutions holding those assets to transfer them to Allstar. The court concluded that it lacked authority to grant this relief.

The court reasoned that the requested transfer could affect unknown third parties and other creditors who might have superior claims to the assets. Under the procedures governing enforcement of the judgment, those third parties would need notice and an opportunity to be heard before any transfer. The court also concluded that the cited trademark-injunction statute did not govern execution after judgment and that the federal rules cited by Allstar did not authorize the requested freeze and turnover order.

Requests directed at third parties

Allstar sought injunctions against financial institutions and third-party service providers. The court denied those requests because the entities were not parties before the court and the court had not acquired personal jurisdiction over them. The court stated that such relief might be available if Allstar showed that a financial institution or service provider was acting together with the Defaulting Defendants, but found that Allstar had not made that showing.

Alternative service

The court authorized continued electronic service on the Defaulting Defendants. It declined to extend that authorization to financial institutions and third-party service providers because Allstar had not explained why continued electronic service on those entities was necessary.

Disposition and classification

Judge Katherine Polk Failla denied the four additional components of relief described in the order: the temporary restraint, the asset freeze and turnover request, the requests for injunctions against third parties, and continued electronic service on financial institutions and third-party service providers. The order allowed immediate enforcement of the default judgment and continued electronic service on the Defaulting Defendants. This is a procedural order because it addressed post-judgment enforcement, injunctions against nonparties, and service rather than deciding the underlying infringement dispute.