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Mitchell Group USA LLC v. Udeh

United States District Court, E.D. New York

February 17, 2015

MITCHELL GROUP USA LLC; and GAPARDIS HEALTH AND BEAUTY, INC., Plaintiffs,
v.
NKEM UDEH, individually and d/b/a

ORDER FOR A PRELIMINARY INJUNCTION AND EXPEDITED DISCOVERY

DORA L. IRIZARRY, District Judge.

Plaintiffs in the above-captioned action, Mitchell Group USA LLC ("MITCHELL GROUP") and Gapardis Health and Beauty, Inc. ("GAPARDIS") (collectively referred to herein as "Plaintiffs"), commenced this action on October 1, 2014, seeking temporary, preliminary and permanent injunctive relief, compensatory and statutory damages, and other equitable relief for Nkem Udeh, individually and d/b/a "Beauty Resource" ("Udeh Defendant") acts in violation of §§ 32, 34, and 43 of the Lanham Act, 15 U.S.C. §§ 1114 and 1116, 15 U.S.C. § 1125(a). On motion by the Plaintiffs, on October 1, 2014, the Court granted an ex parte Temporary Restraining Order, an Order to Show Cause for a Preliminary Injunction, Expedited Discovery and Order of Seizure of Inventory and Business Records ("TRO") against Udeh Defendant (D.E. #8). On October 7, 2014, after a hearing on an order to show cause, the Court converted the TRO into a Consent Preliminary Injunction ("PI") against Udeh Defendant (D.E. #9).

On January 23, 2015, the Plaintiffs filed their amended complaint adding as defendants Timite & Son Beauty Supplies, Inc. and World Beauty Distributor, Inc. (together "Timite Defendants") and African & Caribbean Market, Inc. ("African & Caribbean Defendant") (collectively "Amended Defendants") (D.E. #22). On February 4, 2015, the Court granted the request of Plaintiffs' for a Temporary Restraining Order and an Order to Show Cause why the Court's prior order of Preliminary Injunction should not be extended to the Amended Defendants, an Accounting, and Expedited Discovery, upon Plaintiffs' sworn allegations that Amended Defendants were unlawfully infringing upon their trademark rights by selling counterfeit goods and other products bearing Plaintiffs' trademarks. The February 4, 2015 Order also directed Amended Defendants to show cause at a hearing to be held before the Court on February 17, 2015 why a preliminary injunction should not issue and why the Court should not grant Plaintiffs the additional relief they requested.

On February 17, 2015, the Court held at hearing, at which Plaintiffs' counsel and Defendant Nkem Udeh appeared pro se. None of the Amended Defendants appeared at the hearing on otherwise complied with this court's Feb. 4th Order. They have failed to provide good caused why this court should not convert the Temporary Restraining Order into a Preliminary Injunction. Date 2/17/15.

Having duly considered the arguments and authority presented by Plaintiffs in their moving papers and all other subsequent filings pertaining to this matter, Plaintiffs' motion for a preliminary injunction and expedited discovery is GRANTED.

The Court makes the following

FINDINGS OF FACT AND CONCLUSIONS OF LAW:
1. Trademark infringement is defined as follows:
"Any Person who shall, without the consent of the registrant use in commerce any reproduction, counterfeit, copy or colorable imitation of a registered mark in connection with the sale, offering for sale, distribution, or advertising of any goods or services on or in connection with which such use is likely to cause confusion, or to cause mistake, or to deceive: or reproduce, counterfeit, copy, or colorably imitate a registered mark and apply such reproduction, counterfeit, copy, or colorable imitation to labels, signs, prints, packages, wrappers, receptacles or advertisements intended to be used in commerce upon or in connection with the sale, offering for sale, distribution, or advertising of goods or services on or in connection with which such use is likely to cause confusion, or to cause mistake, or to deceive, shall be liable in a civil action by the registrant for the remedies hereinafter provided."
15 U.S.C. § 1114(1)(a).

The test for determining whether a mark is a counterfeit is essentially the same as whether a suspect mark infringes a registered mark. See Chauvin International Ltd. v. Goldwitz, 832 F.Supp. 35 (D. Conn. 1993). The standard for determining whether a suspect mark infringes a registered mark is whether "numerous ordinary prudent purchasers are likely to be misled or confused as to the source of the product in question because of the entrance in the marketplace of defendant's mark." Playtex Prods. v. Georgia-Pacific Corp., 390 F.3d 158, 161 (2d Cir. 2004). In order to determine whether a likelihood of confusion exists, courts in the Second Circuit apply the eight factor test set forth in Polaroid Corp. v. Polarad Electronics Corp., 287 F.2d 492, 495 (2d Cir. 1961). Playtex Prods., 390 F.3d at 162. These factors include: (1) the strength of the plaintiff's mark; (2) the similarity of the parties' marks; (3) the proximity of the parties' products in the marketplace; (4) the likelihood that the plaintiff will "bridge the gap" between the products; (5) actual consumer confusion between the two marks; (6) the defendant's intent in adopting its mark; (7) the quality of the defendant's product; and (8) the sophistication of the relevant consumer group. Id. Where items are counterfeit, however, "the Court need not undertake a factor-by-factor analysis under Polaroid because counterfeits, by their very nature, cause confusion." Gucci Am., Inc. v. DutyFree Apparel, Ltd., 286 F.Supp.2d 284, 287 (S.D.N.Y.2003). The Lanham Act defines "counterfeit" as "a spurious mark which is identical with, or substantially indistinguishable from, a registered mark." 15 U.S.C. § 1127.

2. To obtain a preliminary injunction in a trademark case a movant must demonstrate a likelihood of success on the merits, and that: (1) they are likely to suffer irreparable injury in the absence of an injunction; (2) remedies at law, such as monetary damages, are inadequate to compensate plaintiffs for that injury; (3) the balance of hardships tips in plaintiffs' favor; and (4) the public interest would not be disserved by the issuance of a preliminary injunction. See Salinger v. Colting, 607 F.3d 68, 80 (2d Cir.2010) (citing eBay Inc. v. MercExchange, LLC, 547 U.S. 388, 391, 126 S.Ct. 1837, 164 L.Ed.2d 641 (2006)).

3. Plaintiffs presented sworn allegations of facts, supplemented by photographs, demonstrating that their investigator, Bradford Cole, visited Udeh Defendant's store and purchased unauthorized counterfeit products bearing the Plaintiffs' registered trademarks.

4. Following entry of the temporary restraining order ("TRO") on October 1, 2014, Plaintiffs, along with the U.S. Marshals Service, conducted seizures and served Defendants Nkem Udeh and Beauty Resource with the ...


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