OFF-WHITE LLC v. ANOGAR-32

Background

Off-White LLC sued online merchants operating through eBay storefronts. Off-White alleged that the merchants advertised, offered for sale, sold, and shipped products using its registered and unregistered trademarks, including designs involving diagonal lines, arrows, and other logo elements. The court stated that the defendants targeted New York customers through their online storefronts and that some products were sold and shipped to New York purchasers.

The court had previously issued a temporary restraining order and a preliminary injunction barring the defendants from infringing Off-White’s marks and freezing certain assets. The defendants covered by this opinion did not formally appear or respond. The Clerk later entered a certificate of default, and Off-White moved for default judgment, a permanent injunction, statutory damages, and post-judgment restrictions or transfers involving the defendants’ assets.

Default Judgment and Trademark Infringement

A default judgment is a judgment entered when a defendant fails to respond or participate in the case. The court found that the defendants’ failures to respond indicated willful conduct, that the court was unaware of any meritorious defense, and that Off-White would be prejudiced without a judgment.

The court found that Off-White had established ownership of valid registered marks through trademark-registration certificates. It also accepted Off-White’s allegations that its unregistered marks were distinctive and had acquired secondary meaning, meaning consumers had come to associate them with Off-White.

The court divided the defendants into counterfeiting defendants and non-counterfeiting defendants. It found that most of the defendants had offered products bearing marks identical or substantially indistinguishable from Off-White’s registered marks. Because such products were counterfeits, the court did not need to conduct the usual detailed likelihood-of-confusion analysis for those defendants.

For the non-counterfeiting defendants, the court applied the eight-factor test commonly used to determine whether consumers are likely to be confused. Five factors favored Off-White, including the strength and similarity of the marks, the overlap between the products and markets, the fact that the parties competed in the same online market, and the defendants’ alleged intent to benefit from Off-White’s reputation. Three factors were neutral because the record lacked evidence of actual consumer confusion, comparative product quality, and consumer sophistication. The court therefore found likely consumer confusion and held all remaining defaulting defendants liable for trademark infringement.

Permanent Injunction

The court granted Off-White a permanent injunction. It found that continued infringement could cause irreparable harm by depriving Off-White of control over the reputation and goodwill associated with its trademarks, that money damages would not adequately remedy that harm, that the balance of hardships favored Off-White, and that an injunction served the public interest.

The injunction bars the defaulting defendants and persons acting with them who receive actual notice from manufacturing, importing, advertising, distributing, offering for sale, selling, or otherwise dealing in infringing products. It also bars use of Off-White’s marks or confusingly similar marks, false designations of origin, conduct likely to confuse consumers, concealment or disposal of infringing products and related records, and efforts to evade the order through new entities, platforms, or accounts.

The court further ordered the defendants to deliver infringing products and related packaging, labels, advertising, and promotional materials for destruction.

Statutory Damages

The court granted Off-White’s request for statutory damages against the counterfeiting defendants. It awarded $75,000 against each counterfeiting defendant, concluding that the defendants’ defaults and willful conduct supported the award and that Off-White could not adequately calculate alternative damages because the defendants had not provided relevant financial information.

The court denied statutory damages as to the other remaining defendants. It explained that statutory damages under the relevant provision are available for use of a counterfeit registered mark, while the non-counterfeiting defendants had either infringed an unregistered mark or had not used a mark identical or substantially indistinguishable from a registered mark.

Post-Judgment Asset Relief

The court denied Off-White’s request to continue the pre-judgment asset restraint and transfer the defendants’ assets under the cited federal rules and trademark statute. Federal Rule of Civil Procedure 69 generally requires enforcement of a money judgment to follow the procedure of the state where the federal court sits unless federal law provides otherwise, and the court found no applicable federal exception.

The court denied the requested execution against third parties without prejudice because Off-White had not brought the required proceeding under New York law. The ruling left Off-White free to issue restraining notices under New York law and pursue later applications using the required state procedures. The court also relieved Off-White from the usual 30-day stay on enforcing the judgment, allowing immediate execution.

Disposition

The court’s conclusion states that Off-White’s motion for default judgment was granted in part and denied in part. The permanent-injunction request was granted to the stated extent; statutory damages were granted at $75,000 per counterfeiting defendant and denied as to the other remaining defendants; and the post-judgment asset-restriction and transfer request was denied without prejudice to state-law procedures. The Clerk was directed to enter judgment and close the case.