The opinion of the court was delivered by: Glenn T. Suddaby, United States District Judge
MEMORANDUM-DECISION and ORDER
Currently pending before the Court, in this trademark infringement action filed by CarFreshner Co. and Julius Samann, Ltd. ("Plaintiffs") against Air Freshners, Inc. d/b/a Scent USA and Slawormir M. Warzocha a/k/a Michael Warzocha ("Defendants"), are the following three motions: (1) Plaintiffs' motion for default judgment pursuant to Fed. R. Civ. P. 55(b); (2) Defendants' cross-motion to set aside the Clerk's entry of default against them pursuant to Fed. R. Civ. P. 55(c); and (3) Plaintiffs' motion to strike Defendants' Answer. (Dkt. Nos. 14, 21, 22.) For the reasons stated below, Plaintiffs' motion for entry of default judgment against Defendants is granted in part and denied in part; Defendants' motion to set aside the Clerk's entry of default is granted in part and denied in part; and Plaintiffs' motion to strike Defendants' Answer is granted in part and denied in part.
Liberally construed, Plaintiffs' Complaint asserts the following claims against Defendants: (1) a claim of trademark infringement in violation of 15 U.S.C. § 1114(1); (2) a claim of false designation of origin in violation of 15 U.S.C. § 1125(a); (3) a claim of trademark infringement in violation of the common law of the State of New York; (4) a claim of unfair competition in violation of the common law of the State of New York; (5) a claim of contributory trademark infringement, unfair competition, and dilution; (6) trademark dilution in violation of 15 U.S.C. § 1125(c); (7) a claim of trademark dilution in violation of N.Y. Gen. Bus. Law § 360-l; and (8) a claim of violation of a prior Consent Judgment between the parties. (See generally Dkt. No. 1.)
Generally, in support of those claims, Plaintiffs' Complaint alleges that, despite a Consent Judgment having been filed against Defendants in a prior action for substantially the same conduct as alleged in this action, Defendants have promoted and sold air fresheners after the Consent Judgment that infringe upon Plaintiffs' registered trademarks, in violation of Federal and New York law. (Id.) Familiarity with the specific factual allegations supporting the claims in Plaintiffs' Complaint is assumed in this Decision and Order, which is intended primarily for the review of the parties.
B. Plaintiffs' Service of Their Complaint and Defendants' Failure to Answer
On March 7, 2011, Plaintiffs served their Complaint on Defendant Air Freshners, Inc. (Dkt. No. 8.) Pursuant to Fed. R. Civ. P. 12(a), Defendant Air Freshners, Inc.'s Answer was due on or before March 30, 2011.
On March 19 and 22, 2011, Plaintiffs served their Complaint on Defendant Warzocha pursuant to N.Y. C.P.L.R. § 308(4), as authorized by Fed. R. Civ. P. 4(e)(1). (Dkt. No. 7.) When service is made under N.Y. C.P.L.R. § 308(4), service is complete 10 days after the proof of service is made to the Clerk of the Court. Because Plaintiffs filed their proof of service with the Clerk on March 25, 2011, service on Defendant Warzocha was complete on April 4, 2011, pursuant to N.Y. Gen. Constr. Law § 20. Pursuant to Fed. R. Civ. P. 12(a), Defendant Warzocha's Answer was due on or before April 25, 2011.
C. Clerk's Office's Entry of Default
On May 4, 2011, Plaintiffs filed for entry of default. (Dkt. No. 9.) On May 5, 2011, the Clerk of the Court entered default against Defendants, pursuant to Fed. R. Civ. P. 55(a). (Dkt. Nos. 11, 12.) At that time, the Court directed Plaintiffs to make the appropriate motion for default judgment within 30 days from the date that Clerk entered the default. (See Docket Sheet Entry on May, 5, 2011.)
D. Plaintiffs' Motion for Default Judgment
On May 27, 2011, by means of a letter, Plaintiffs moved for an extension of the Court's deadline to move for default judgment from June 6, 2011, to July 6, 2011. (Dkt. No. 13.) The Court granted Plaintiffs a deadline extension until August, 8, 2011. (See Docket Sheet Entry on May 27, 2011.) On August 3, 2011, Plaintiffs subsequently filed a motion for default judgment against Defendants, pursuant to Fed. R. Civ. P. 55(b). (Dkt. No. 14.) In their motion, Plaintiffs request a permanent injunction enjoining Defendants from further infringing on Plaintiffs' trademarks, damages for contempt for violating the Consent Judgment, damages for violating the Trademark Act, and an award of attorneys' fees and costs. (Id.)
Generally, in support of their motion for default judgment, Plaintiffs argue that Defendants' failure to answer their Complaint entitles Plaintiffs to the entry of a default judgment and request as relief both a permanent injunction and damages. (Dkt. No. 14.) Familiarity with the particular grounds for Plaintiffs' motion for default judgment against Defendants is assumed in this Decision and Order, which is intended primarily for review of the parties.
After Defendants filed their Answer (see, infra, Part I.E. of this Decision and Order), Plaintiffs served a copy of their motion for default judgment on Defendants' attorney. (Dkt. No. 20.) As part of their cross-motion to set aside the default, Defendants responded to Plaintiffs' motion on August 22, 2011, by arguing that (1) Plaintiffs have not made out a case for injunctive relief, and (2) Plaintiffs are not entitled to monetary damages because damages are not an appropriate remedy for contempt, nor have the Plaintiffs followed the correct procedures for filing a motion for contempt. (Dkt. No. 21 [Defs.' Memo. of Law].)
Generally, in their reply to Defendants' response to their motion for default judgment, Plaintiffs argue that (1) Defendants' argument against injunctive relief based on legal authority governing preliminary injunctions, not permanent injunctions, and is therefore irrelevant; (2) damages are a proper remedy for contempt; and (3) the clear language of the Consent Judgment in the prior proceedings compels the award of damages. (Dkt. No. 24, Attach. 22 [Plfs.' Reply Memo. of Law].)
E. Defendants' Answer and Cross-Motion to Set Aside the Default
On August 4, 2011, Defendants' filed a notice of appearance and an Answer to Plaintiffs' Complaint. (Dkt. No. 19.) On August 22, 2011, Defendants' filed a memorandum of law opposing Plaintiffs' motion for default judgment and cross-moving to set aside the default.*fn1
(Dkt. No. 21 [Defs.' Memo. of Law].)
Generally, in support of their motion to set aside the default, Defendants argue as follows:*fn2 (1) Defendants have a meritorious defense to the Complaint because the Consent Judgment in the prior proceeding is invalid for several reasons, including the fact that Defendants agreed to it without first securing counsel; (2) Defendants acted promptly to correct the default; (3) Defendants are not at fault for the dely in filing an Answer, and (4) Plaintiffs would not be prejudiced by setting aside the default and allowing this action to proceed on the merits. (Dkt. No. 21 [Defs.' Memo. of Law].)
Generally, in response to Defendants' motion, Plaintiffs argue as follows: (1) Defendants default was willful; (2) Defendants failed to present a meritorious defense, because Defendants intentionally evaded representation by counsel when the Consent Judgment was entered; (3) Plaintiffs do not have to prove prejudice under current Second Circuit precedent; and (4) although they do not have to prove it, Plaintiffs would, in fact, be prejudiced by setting aside the default. (Dkt. No. 24, Attach. 22 [Plfs.' Reply Memo. of Law].)
F. Plaintiffs' Motion to Strike Defendants' Answer
On August 22, 2011, Plaintiffs filed a motion to strike Defendants' Answer as untimely. (Dkt. No. 22.) Generally, in support of their motion, Plaintiffs argue as follows: (1) Defendants failed to file a timely Answer or request an extension of time in which to do so, and (2) Defendants' motion to set aside the default has no merit. (Dkt. No. 22, Attach. 13.)
Defendants did not respond to this motion. (See generally Docket Sheet.)
II. RELEVANT LEGAL STANDARDS
A. Legal Standard Governing a Motion for Default Judgment
"Federal Rule of Civil Procedure 55 provides a two-step process that the Court must follow before it may enter a default judgment against a defendant." Robertson v. Doe, 05-CV-7046, 2008 WL 2519894, at *3 (S.D.N.Y. June 19, 2008). "First, under Rule 55(a), when a party fails to 'plead or otherwise defend . . . the clerk must enter the party's default.'" Robertson, 2008 WL 2519894, at *3 (quoting Fed. R. Civ. P. 55[a]). "Second, pursuant to Rule 55(b)(2), the party seeking default judgment is required to present its application for entry of judgment to the court." Id. "Notice of the application must be sent to the defaulting party so that it has an opportunity to show cause why the court should not enter a default judgment." Id. (citing Fed. R. Civ. P. 55[b]). "When an action presents more than one claim for relief . . . ...