1 Matthew Shayefar (SBN 289685) JS-6 [email protected] 2 Law Office of Matthew Shayefar, PC NOTE CHANGES MADE BY 750 N San Vicente Blvd, 800 West THE COURT 3 West Hollywood, California 90069 Tel: 323-948-8101 | Fax: 323-948-8107 4 Attorney for Plaintiffs 5 6 7 8 UNITED STATES DISTRICT COURT CENTRAL DISTRICT OF CALIFORNIA 9 10 LENA THE PLUG LLC, and Case No.: 2:19-cv-04063-RGK-GJS LENA NERSESIAN, 11 Plaintiffs [PROPOSED] ORDER GRANTING MOTION 12 vs. FOR DEFAULT JUDGMENT 13 BRADLEY CHETCUTI, KNIGHTSBRIDGE PARTNERS, LLC, 14 and DOES 1-10, Defendants 15 16 Plaintiffs Lena the Plug LLC (“LTP”) and Lena Nersesian moved for an 17 entry of default judgment against Defendants Bradley Chetcuti and Knightsbridge 18 Partners, LLC, finding Defendants liable for Plaintiffs’ causes of action set forth in 19 the Complaint – namely, for (I) Breach of Contract; (II) Breach of Covenant of 20 Good Faith and Fair Dealing; (III) Unjust Enrichment; (IV) Quantum Meruit; (V) 1 Fraud; (VI) Trademark Infringement and Unfair Competition and False 2 Designation of Origin (VII) Violation of California Civil Code Section 3344; 3 (VIII) Unlawful and Unfair Business Practices; (IX) Federal Anti-Cybersquatting 4 Consumer Protection Act; (X) Conversion; and (XI) Accounting. 5 The Court, having read and considered Plaintiffs’ motion, pleadings, moving

6 papers, and the other filings in this case, finds as follows: 7 A. Findings of Fact: 8 1. Ms. Nersesian is an accomplished model with millions of followers

9 across social media. She has had over 1.8 million followers on Instagram, 1.4 10 million subscribers on YouTube, hundreds of thousands of followers on Twitter, 11 and tens of thousands of fans and followers on Snapchat and OnlyFans. Since early 12 2016, Ms. Nersesian has been known by her moniker “Lena the Plug.” Ms.

13 Nersesian runs her business through Plaintiff Lena the Plug, LLC (“LTP”). 14 2. LTP has submitted trademark applications to the USPTO for the 15 marks LENA THE PLUG and LENA’S PLUGS. On January 19, 2021, the USPTO

16 issued a trademark for registration of the LENA THE PLUG trademark, 17 Registration Number 6252013. The application for LENA’S PLUGS is still 18 pending as of the date hereof. 19 3. In late 2016, Mr. Chetcuti, knowing the power of Ms. Nersesian and

20 her brand, reached out to Ms. Nersesian and offered to manage Ms. Nersesian’s 1 members-only social media business on Snapchat. They agreed that Mr. Chetcuti 2 would manage a website for Ms. Nersesian’s fans to purchase memberships to 3 access her Snapchat feed. They agreed that Mr. Chetcuti would be responsible for 4 creating, maintaining, and updating that website to make it easy and seamless for 5 fans to purchase (and cancel) memberships. Mr. Chetcuti was also responsible for

6 maintaining the billing for the memberships. All of this was to be for the benefit of 7 Ms. Nersesian and LTP. The parties agreed that as payment for Mr. Chetcuti’s 8 continued services, he would be allowed to retain 20% of the revenue (less

9 payment processing costs) from the Snapchat memberships, and that he would pay 10 the rest to LTP on a bi-weekly basis. 11 4. As part of Mr. Chetcuti’s services, he registered the domain name 12 <lenasplugs.com>, where he hosted the website for users to purchase Snapchat

13 memberships. LTP at the time had already registered <lenatheplug.com> and was 14 using it for other purposes. Mr. Chetcuti also created a CCBill payment processing 15 account in the name of Defendant Knightsbridge Partners, LLC, through which all

16 Ms. Nersesian’s Snapchat membership payments were processed. 17 5. Almost since the beginning of their relationship, Mr. Chetcuti 18 repeatedly failed to correspond with Ms. Nersesian in good faith and failed to 19 implement features for the website that he repeatedly promised her he would

20 implement. His failure to do his work cost Ms. Nersesian tens or hundreds of 1 thousands of dollars in lost revenue. Since the breakdown in their relationship

2 (more below), Ms. Nersesian has moved to a new platform to manage her social 3 media subscriptions .and is now making far more than she ever did while she was 4 working with Mr. Chetcuti. 5 6. It is apparent that Mr. Chetcuti never had any intention of acting in

6 good faith with her. Aside from simply not complying with his obligations, he 7 almost immediately began to steal from Ms. Nersesian. The extent of Mr. 8 Chetcuti’s theft is still hidden, but, at the very least, Ms. Nersesian eventually

9 learned that Mr. Chetcuti was only paying Ms. Nersesian 70% of the revenues, 10 rather than the 80% to which they had agreed. Just The difference between paying 11 70% and 80% comes out to approximately $225,000 in fraudulently withheld 12 payments.

13 7. At first, after learning of Mr. Chetcuti’s actions, Ms. Nersesian 14 offered Mr. Chetcuti the chance to remedy the situation and continue working 15 together. On December 20, 2018, Ms. Nersesian asked Mr. Chetcuti to take some

16 time to speak about putting together a written agreement to control the relationship 17 of the parties going forward. Only in mid-January did Mr. Chetcuti deem it 18 important enough to substantially respond. In early February 2019, Ms. Nersesian 19 sent Mr. Chetcuti a proposed written agreement for the terms of them continuing to

20 work together. The proposed agreement put in writing Mr. Chetcuti’s obligations 1 to LTP for managing memberships, confirmed the revenue splits between the

2 parties going forward, and set forth a procedure to audit all past transactions so that 3 the parties could resolve any prior inconsistencies between what Mr. Chetcuti paid 4 and Ms. Nersesian was owed. 5 8. In the months that followed, Mr. Chetcuti made it clear that he had no

6 intention of ever acting in good faith, and that he had from the beginning 7 intentionally defrauded Ms. Nersesian. First, it took over a month before Mr. 8 Chetcuti even bothered to respond to the draft agreement. And Instead of

9 attempting to negotiate the contract, Mr. Chetcuti issued an ultimatum: either Ms. 10 Nersesian just agree to continue to allow things to go on as they always had, except 11 now with a requirement that Ms. Nersesian generate a minimum revenue per 12 month (as if Mr. Chetcuti’s failure to perform his own obligations weren’t what

13 was holding the business back) or Ms. Nersesian could pay Mr. Chetcuti tens of 14 thousands of dollars just so for Mr. Chetcuti would to release control of the 15 business to her, including the <lenasplugs.com> domain name. Given that it was

16 Mr. Chetcuti that was stealing from Ms. Nersesian, of course neither of these 17 options were acceptable. 18 9. Mr. Chetcuti took his abuse one step further In the beginning of April 19 2019, when he simply stopped paying any portion of the revenues from the

20 Snapchat memberships to Ms. Nersesian. From April 2019 through at least January 1 of 2020, Mr. Chetcuti continued to bill recurring membership charges to Ms. 2 Nersesian’s members, but kept 100% of the money, amounting to up to $217,000. 3 10. As of the filing of the Complaint, Mr. Chetcuti maintained the website 4 premiumsnaps.com, where he sold memberships to Ms. Nersesian’s private 5 Snapchat feed, using LTP’s trademarks and Ms. Nersesian’s likeness, even though

6 he paid no part of the revenues to Ms. Nersesian. 7 B. Procedural History 8 11. Plaintiffs filed the Complaint in this matter on May 9, 2019.

9 12. Plaintiffs served Defendant Knightsbridge on May 29, 2019. 10 13. On June 17, 2019, Plaintiffs and Defendants entered a stipulation with 11 the Court that Defendants’ counsel, Pryor Cashman LLP, accepted service of the 12 summons and complaint on behalf of Mr. Chetcuti as of June 14, 2019.

13 14. Defendants filed their Answer to the Complaint on July 15, 2019. For 14 a short period thereafter, Defendants’ counsel appeared on behalf of Defendants 15 and through them Defendants participated in this case.

16 15. On January 9, 2020, the Parties took part in mediation and entered 17 into a Settlement Term Sheet, setting forth the principal terms of a complete 18 settlement of this matter that was contingent on certain conditions and, a short time 19 later, entered into a definitive settlement agreement.

20 1 16. On April 30, 2020, Plaintiffs filed a motion for this Court to enforce a 2 judgment that was part of the definitive settlement agreement arising from 3 Defendants’ failures to comply with their obligations thereunder, including an 4 obligation for Defendants to transfer a domain name to Plaintiffs and make agreed 5 upon payments to Plaintiffs. Within days afterwards, Defendants’ counsel, Pryor

6 Cashman LLP, filed a Motion to Withdraw as Counsel for Defendants, citing a 7 complete breakdown of the attorney-client relationship because Defendants failed 8 to meaningfully communicate with their counsel and had not paid their counsel for

9 their services in over eight months. The Court ultimately denied Plaintiffs’ motion 10 to enforce the judgment, but did grant the motion for Pryor Cashman to withdraw 11 as counsel for Defendants on July 1, 2020. 12 17. As part of its order granting the motion to withdraw, the Court

13 ordered that the corporation defendant, Knightsbridge, was required to retain new 14 counsel within 25 days. Knightsbridge failed to retain new counsel and, 15 accordingly, the Court struck the answer of Knightsbridge on August 10, 2020.

16 18. Knightsbridge never retained new counsel and never filed a new 17 answer to the Complaint. 18 19. On February 24, 2021, the Court scheduled the Pretrial Conference for 19 this case for July 12, 2021, at 9:00am. In advance of this hearing, Defendants did

20 not file their memoranda of contentions of facts and law, witness list, or exhibit 1 list. Nor did Defendants respond to Plaintiffs’ request to file a joint status report as 2 required by the Court on January 27, 2021. Nor did Defendants respond when 3 Plaintiffs’ counsel sent them a draft Final Pretrial Conference order in accordance 4 with F.R.Civ.P. 16 and L.R. 16. 5 20. On July 12, 2021, Plaintiffs’ counsel appeared in Court for the Pretrial

6 Conference as ordered by the Court. Defendants did not appear. Accordingly, the 7 Court ordered that the answers filed by all defendants be stricken and that Plaintiffs 8 move for default against them.

9 21. On September 3, 2021, Plaintiffs applied to the clerk to enter default 10 against Defendants and the Clerk entered Default against the Defendants on 11 September 9, 2021. 12 22. Default having been entered, default judgment is now appropriate in

13 accordance with Rule 55(b)(2) of the Federal Rules of Civil Procedure. 14 C. Conclusions of Law 15 23. Federal Rule of Civil Procedure 55(b) authorizes a district court to

16 grant default judgment after the Clerk enters default under Rule 55(a). “The 17 general rule of law is that upon default the factual allegations of the complaint, 18 except those relating to the amount of damages, will be taken as true.” (Geddes v. 19 United Financial Group,

(9th Cir. 1977)).

20 1 24. Plaintiffs’ Motion for Default Judgment is further supported by 2 declarations, which the Court find sufficient for compliance with FRCP 54 and 55, 3 and Local Rules 55-1, 55-2, and 55-3 as further set forth in the Motion itself. 4 25. Plaintiffs have furthermore satisfied the factors for entry of default as 5 set forth in Eitel v. McCool,

(9th Cir. 1986). Namely: (1)

6 Plaintiffs will suffer prejudice if default judgment is not entered because they have 7 no way to obtain recovery against Defendants for their actions and omissions; (2) 8 the substantive merits and sufficiency of the Complaint and Plaintiffs’ causes of

9 action have been shown, as detailed in Plaintiffs’ motion; (3) the monetary 10 damages sought are balanced with the seriousness of Defendants’ conduct, which 11 includes taking advantage of a young woman and intentionally withholding funds 12 from her from a position of trust; (4) Defendants’ refusal to engage in the litigation

13 process despite numerous opportunities results in a finding that there are no 14 material facts in dispute and that there is no excusable neglect; and (5) the policy 15 favoring decisions on the merits does not preclude default judgment because

16 Defendants have refused to participate in this case. 17 26. On the basis of the foregoing, this Courts that there is proper 18 jurisdiction and basis to award default judgment against Defendants as follows: 19

20 1 FINAL JUDGMENT, INJUNCTION, AND ORDER FOR RELIEF 2 27. THIS COURT HEREBY FINDS that Defendants are liable for (I) 3 Breach of Contract; (II) Breach of Covenant of Good Faith and Fair Dealing; (III) 4 Unjust Enrichment; (IV) Quantum Meruit; (V) Fraud; (VI) Trademark 5 Infringement and Unfair Competition and False Designation of Origin (VII)

6 Violation of California Civil Code Section 3344; (VIII) Unlawful and Unfair 7 Business Practices; (IX) Federal Anti-Cybersquatting Consumer Protection Act; 8 (X) Conversion; and (XI) Accounting.

9 28. IT IS ORDERED THAT actual damages shall be awarded to Plaintiffs 10 in the amount of Four Hundred Forty-Two Thousand Dollars ($442,000), payable 11 by Defendants jointly and severally. 12 29. IT IS FURTHER ORDERED that, because of Defendants’ willful and

13 fraudulent actions, and other actions as set forth above, that treble damages and/or 14 punitive damages in the amount of Eight Hundred Eighty-Four Thousand Dollars 15 ($884,000) are warranted under, inter alia,

(a),

1117(d), and California Civil Code Section 3344. 17 30. IT IS FURTHER ORDERED that Plaintiffs are entitled to further 18 damages in the form of attorneys’ fees and costs. The Court finds, in this context, 19 fixing of reasonable actual fees is warranted in the amount of $26,500 and

20 $2,822.90 in costs and expenses, payable by Defendants jointly and severally. 1 31. ACCORDINGLY, the total monetary damages awarded to Plaintiffs, 2 and payable by Defendants, jointly and severally, is One Million Three Hundred 3 Fifty-Five Thousand Three Hundred Twenty-Two Dollars and Ninety Cents 4 ($1,355,322.90). 5 32. IT IS FURTHER ORDERED, that post-judgment interest shall accrue

6 in accordance with the statutory maximum on judgments until the monetary 7 judgment is satisfied. 8 33. IT IS FURTHER ORDERED, that Plaintiffs shall be entitled to any

9 further attorneys’ fees and costs incurred in connection with collecting upon and 10 exercising their rights in accordance with this Judgment. 11 34. IT IS FURTHER ORDERED that Defendants shall also immediately 12 transfer the ownership, registration and control of the domain name

13 lenasplugs.com to Lena the Plug LLC. Any and all domain name registrars and 14 registries, hosting providers and other service providers of the domain name are 15 hereby ordered to transfer ownership, registration, and control of the domain name

16 to Lena the Plug LLC. 17 35. IT IS FURTHER ORDERED that Plaintiffs are granted the following 18 injunctive relief that Defendants are permanently enjoined and restrained from: 19 a. Using any of Plaintiffs’ marks, names, brands, likenesses or

20 other assets; 1 b. Using any name, mark, or domain name that wholly 2 incorporates Plaintiffs’ marks, names, or brands, or any name, 3 mark or domain name that is confusingly similar to Plaintiffs’ 4 marks, names, or brands; 5 c. Registering, transferring, selling, owning or exercising control

6 over any domain name that incorporates, in whole or in part, 7 Plaintiffs’ marks, names, or brands, or anything confusingly 8 similar thereto;

9 d. Retaining any monies arising from the sale of memberships to 10 access any content, streams, or social media accounts of 11 Plaintiffs; and 12 e. Otherwise infringing upon any rights of Plaintiffs.

13 ENFORCEMENT AND JURISDICTION 14 36. IT IS FURTHER ORDERED that monies currently held in various 15 Defendants’ accounts held by banks, savings and loan associations, payment

16 processors or other financial institutions or merchant providers, payment providers, 17 third-party processors, credit card associations (e.g., MasterCard and VISA), which 18 receive payments or hold assets on Defendants’ behalf, are hereby released to 19 Plaintiffs as partial payment of the above mentioned damages.

20 1 37. IT IS FURTHER ORDERED that in accordance with this Court’s 2 inherent equitable powers and its power to coerce compliance with its lawful 3 orders, until Plaintiffs have recovered the full payment of monies owed to them by 4 any Defendants under this Judgment, in the event Plaintiffs discover new monies 5 or accounts belonging to or controlled by any Defendants, Plaintiffs shall have the

6 ongoing authority to serve this Judgment on any party controlling or otherwise 7 holding such accounts or other merchant account providers, payment providers, or 8 third party processors, and that all such persons shall immediately locate and

9 restrain all accounts belonging to or controlled by Defendants from transferring or 10 disposing of any money, stocks or other of such Defendants’ assets, not allowing 11 such funds to be transferred or withdrawn by such Defendant and shall provide 12 Plaintiffs with information relating to those accounts.

13 38. IT IS FURTHER ORDERED that within thirty (30) days following 14 the service of this Judgment on Defendants or any of the other parties subject to the 15 orders above, such parties shall transfer all monies in restrained accounts to

16 Plaintiffs, unless Defendants or any such parties have filed with the Court and 17 served upon Plaintiffs’ counsel a written request that such monies be exempted 18 from this Judgment, with the basis therefor. 19 39. IT IS FURTHER ORDERED that any third-party referenced above

20 shall, within fourteen (14) days of receipt of this Judgment, provide copies of all 1 ||documents and records in such party’s possession or control relating to the location 2 ||of Defendants and any financial accounts owned or controlled by Defendants. 3 40. ITIS FURTHER ORDERED that this Court shall retain jurisdiction 4 || over the parties and the subject matter of this litigation for the purpose of 5 |/interpretation and enforcement of this Judgment. 6 7 IT IS SO ORDERED

J KRecropas 9 || Dated: November 19, 2021 “0 _ United States District Judge 10 11 12 13 14 15 16 17 18 19 20 21 14 Order on Motion for Default Judgment