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The Living Legends Awards for Service to Humanity, Inc. v. Human Symphony Foundation, Inc.

United States District Court, D. Maryland

September 5, 2017

THE LIVING LEGENDS AWARDS FOR SERVICE TO HUMANITY, INC., Plaintiff,
v.
HUMAN SYMPHONY FOUNDATION, INC., et al., Defendants.

          MEMORANDUM OPINION

          PAULA XINIS UNITED STATES DISTRICT JUDGE.

         This Order addresses the Motion for Default Judgment, ECF No. 20, filed by Plaintiff The Living Legends Awards For Service to Humanity, Inc. (“Plaintiff”). Defendants Human Symphony Foundation, Inc. and Mark Williams (“Defendants”) have not filed a response, and the time for doing so has passed. See Loc. R. 105.2.a. Pursuant to Local Rule 105.6, a hearing is not necessary. For the reasons stated herein, Plaintiff's Motion for Default Judgment is granted in part and denied in part.

         I. BACKGROUND

         In 2006, Doreen A.K. Hines (“Hines”), while serving as Minister of Music of the Emmanuel Brinklow Seventh-day Adventist Church (“The Church”) hired Defendant Mark Williams (“Williams”) to be the choir director. See ECF No. 1 at 3. Williams helped Hines to start a new Black History month event, marketed as The Living Legends Awards for Service to Humanity. See ECF No. 1 at 3. In 2010, Hines and Williams formed the Human Symphony organization. Id. Human Symphony was the named sponsor of subsequent programs promoted under the title The Living Legends Awards for Service to Humanity. Id.

         Hines served as CEO of Human Symphony until 2015 when she resigned because of internal disagreements regarding the direction of the Human Symphony organization. See ECF No. 1 at 4. Upon her resignation, Hines informed Williams that she would obtain sponsorship for future The Living Legends Awards for Service to Humanity programming through the Church. In November 2015, acting as the Director of The Living Legends Awards for Service to Humanity, Hines incorporated the Plaintiff-organization in the State of Maryland, see ECF No. 2-2, registered the Plaintiff as a 501(c)(3) corporation, see ECF No. 2-3, and became its Director in November 2015, see ECF No. 1 at 4. In August 2016, Plaintiff was issued a certificate granting a trademark designation for the name “The Living Legends Awards for Service to Humanity, Inc.” by the U.S. Patent and Trademark Office (“USPTO”). See ECF No. 1 at 4.

         Plaintiff held its 11th Annual Living Legends Awards for Service to Humanity ceremony on February 27, 2016. In July 2016, Plaintiff learned that Defendants were advertising a September 10, 2016 event named “The Living Legends Awards for Service to Humanity, ” and soliciting funding for this event from shared donors. See ECF No. 1 at 5; ECF No. 2-8. Defendants also used nearly identical artwork, graphics, font style and layout as compared to Plaintiff's promotional material. Accordingly, Plaintiff sent a “cease and desist” letter to the Defendants on July 25, 2016, informing Defendants that The Living Legends Awards for Service for Humanity was a legally protected name, the continued use of which is prohibited. See ECF No. 2-5. Nonetheless, Defendants continued to use the Plaintiff's mark to solicit donors and advertise their event. Id.; ECF No. 2-6; ECF No. 2-8.

         On September 9, 2016, Plaintiff filed its complaint alleging trademark infringement under 15 U.S.C. § 1125(a), section 43(a) of the Lanham Act (Count I), vicarious infringement by Williams (Count II), and unfair or deceptive trade practices under Maryland Commercial Law § 13-301 against all Defendants (Count III). At the same time, Plaintiff also moved ex parte for the issuance of a temporary restraining order (TRO) and preliminary injunction. See ECF No. 8. After a hearing, the Court granted the TRO which required the Defendant to remove immediately all references to The Living Legends Awards for Service to Humanity from Defendants' advertisements and event materials. Id. Thereafter, and in violation of the Court's order, Defendants continued to use The Living Legends Awards for Service to Humanity name. See ECF No. 20 at 2.

         Defendants were properly served on September 8 and 10, 2016. At no point has counsel entered an appearance for Defendant, and no answer or responsive pleading has been filed. On November 16, 2016, the Clerk issued an Order of Default pursuant to Rule 55 of the Federal Rules of Civil Procedure. On May 2, 2017, Plaintiff moved for default judgment. See ECF No. 20 at 2.

         II. DISCUSSION

         Federal Rule of Civil Procedure 55(b) governs the entry of default judgments. A default judgment may be entered “[i]f the plaintiff's claim is for a sum certain or a sum that can be made certain by computation, ” and the defendant is in default for failing to appear. Fed.R.Civ.P. 55(b)(1). For “all other cases, ” in which the sum is neither certain nor ascertainable through computation, Rule 55(b)(2) provides: “[T]he party must apply to the court for a default judgment . . . . The court may conduct hearings or make referrals-preserving any federal statutory right to a jury trial-when, to enter or effectuate judgment, it needs to: (A) conduct an accounting; (B) determine the amount of damages; (C) establish the truth of any allegation by evidence; or (D) investigate any other matter.” The entry of default judgment is a matter within the discretion of the Court. SEC v. Lawbaugh, 359 F.Supp.2d 418, 421 (D. Md. 2005) (citing Dow v. Jones, 232 F.Supp.2d 491, 494 (D. Md. 2002)). Although “the Fourth Circuit has a ‘strong policy that cases be decided on the merits, '” Disney Enters. v. Delane, 446 F.Supp.2d 402, 405 (D. Md. 2006) (quoting United States v. Shaffer Equip. Co., 11 F.3d 450, 453 (4th Cir. 1993)), “default judgment is available when the ‘adversary process has been halted because of an essentially unresponsive party.' ” Id. (quoting Lawbaugh, 359 F.Supp. at 421). It is within the Court's discretion to grant default judgment when a defendant is unresponsive. See Park Corp. v. Lexington Ins. Co., 812 F.2d 894, 896 (4th Cir. 1987) (upholding a default judgment awarded where the defendant lost its summons and did not respond within the proper period); Disney Enters., 446 F.Supp.2d at 405-06 (finding appropriate the entry of default judgment where the defendant had been properly served with the complaint and did not respond, despite repeated attempts to contact him).

         When considering a motion for default judgment, the Court takes as true the well-pleaded factual allegations in the complaint, other than those pertaining to damages. Fed.R.Civ.P. 8(b)(6); Ryan v. Homecomings Fin. Network, 253 F.3d 778, 780 (4th Cir. 2001) (“The defendant, by his default, admits the plaintiff's well-pleaded allegations of fact, is concluded on those facts by the judgment, and is barred from contesting on appeal the facts thus established.” (citation and internal quotation marks omitted)); see Fed. R. Civ. P. 8(b)(6) (“An allegation-other than one relating to the amount of damages-is admitted if a responsive pleading is required and the allegation is not denied.”). It remains, however, “for the court to determine whether these unchallenged factual allegations constitute a legitimate cause of action.” Agora Fin., LLC v. Samler, 725 F.Supp.2d 491, 494 (D. Md. 2010); 10A Charles Alan Wright et al., Fed. Prac. and Proc. Civ. § 2688.1 (4th ed. 2017) (“[L]iability is not deemed established simply because of the default and the court, in its discretion, may require some proof of the facts that must be established in order to determine liability.”).

         If the Court finds “liability is established, [it] must then determine the appropriate amount of damages.” Agora Fin., 725 F.Supp.2d at 484 (citing Ryan, 253 F.3d at 780-81). This is so because “an allegation ‘relating to the amount of damages' is not deemed admitted based on a defendant's failure to deny in a required responsive pleading.” Hartford Fin. Servs. Grp. Inc. v. Carl J. Meil, Jr., Inc., No. WDQ-10-2720, 2011 WL 1743177, at *7 (D. Md. May 5, 2011) (quoting Fed.R.Civ.P. 8(b)(6)); Trs. of the Elec. Welfare Trust Fund v. MH Passa Elec. Contracting, LLC, No. DKC-08-2805, 2009 WL 2982951, at *1 (D. Md. Sept.14, 2009) (“Upon default, the well-plead allegations in a complaint as to liability are taken as true, although the allegations as to damages are not.”); Int'l Painters & Allied Trades Indus. Pension Fund v. Metro Glass & Mirror, Inc., No. ELH-11-2389, 2012 WL 893262, at *2 (D. Md. Mar.14, 2012) (“The court does not accept factual allegations regarding damages as true, but rather must make an independent determination regarding such allegations.”). Simply put, the Court must make two determinations. First, the Court must decide “whether the unchallenged facts in plaintiff[‘s] complaint constitute a legitimate cause of action.” Agora Fin., LLC v. Samler, 725 F.Supp.2d 49, 494 (D. Md. 2010). Second, if the Court finds liability is established, it must “make an independent determination regarding the appropriate amount of damages.” Id.

         A. Liability

         1. Count I: Lanham Act, 15 ...


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