Karmagreen, LLC v. Super Chill CBD Products

Background

Karmagreen, LLC brought claims against Super Chill CBD Products and Rajinder S. Singh for patent infringement, trademark infringement, unfair competition under the Lanham Act and New York common law, and copyright infringement. Karmagreen alleged that the defendants sold dietary supplements under the name “TIA POWER” using product packaging, artwork, branding, and chemical compositions that copied Karmagreen’s “Tianaa” products. Karmagreen sought declaratory relief, a permanent injunction, and statutory damages.

Super Chill and Singh did not appear, answer, or otherwise respond. The Clerk entered a certificate of default, and Karmagreen moved for default judgment under Federal Rule of Civil Procedure 55. The court explained that default admitted the complaint’s well-pleaded factual allegations, but the court still had to determine whether those allegations legally established liability.

Liability

The court granted default judgment in Karmagreen’s favor on the trademark-infringement claim. Karmagreen alleged ownership of five registered “TIANAA” marks. Applying the likelihood-of-confusion factors, the court found the marks distinctive, the defendants’ product designs significantly similar, the products competitive, and the defendants’ use likely to confuse consumers. The court also inferred bad faith from the apparent copying of words, fonts, images, and designs.

The court granted default judgment on Karmagreen’s copyright claims involving three registered works covering labels for the Tianaa Green, Tianaa Red, and Tianaa White products. It found that Karmagreen adequately alleged valid copyright ownership, access to the works, actual copying, and substantial similarity. The court concluded that the similar hexagonal designs, lettering, flowers, borders, and other features would cause an ordinary observer to overlook minor differences.

The court also granted default judgment on Karmagreen’s direct patent-infringement claims under 35 U.S.C. § 271(a) for each of six patents. Those patents concerned dietary-supplement compositions and manufacturing methods. The court found that Karmagreen identified its ownership, the defendants, the patents, the alleged means of infringement, and the relevant patent-law provision. Because it found direct infringement, the court did not address Karmagreen’s additional theory of indirect infringement.

The court found the elements of Karmagreen’s Lanham Act and New York common-law unfair-competition claims satisfied as well. It relied on its trademark findings, including the likelihood of consumer confusion and its finding of bad faith.

Damages

Karmagreen requested $450,000 in copyright statutory damages, consisting of the maximum $150,000 for each of the three infringed works. The court found that the infringement was willful because the defendants’ marks were virtually identical to Karmagreen’s protected marks.

The court nevertheless declined to award the maximum amount. Karmagreen submitted no evidence of the defendants’ profits or Karmagreen’s losses and provided little basis for determining the value of the protected works. Considering the relevant damages factors, the court awarded $50,000 for each work, or $150,000 total. The court did not award separate statutory damages for the patent, trademark, or unfair-competition claims.

Permanent Injunction

The court found that all four requirements for a permanent injunction were met: irreparable injury, inadequate legal remedies, a balance of hardships favoring Karmagreen, and consistency with the public interest. It therefore enjoined the defendants and those acting in active concert with them from infringing, contributing to the infringement of, or inducing infringement of the patents; copying, distributing, altering, displaying, or selling the copyrighted works; and using copies or colorable imitations of the TIANAA marks.

Disposition

The court granted Karmagreen’s motion for default judgment and directed the Clerk of Court to close the motion.