CreeLED, Inc. v. Individuals, Partnerships, and Unincorporated Associations identified on Schedule A

UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF FLORIDA Case No. 23-cv-60780-BLOOM/Valle CREELED, INC., Plaintiff, v. THE INDIVIDUALS, PARTNERSHIPS AND UNINCORPORATED ASSOCIATIONS IDENTIFIED ON SCHEDULE “A,” Defendants. / ORDER ON MOTION FOR ENTRY OF FINAL DEFAULT JUDGMENT THIS CAUSE is before the Court on Plaintiff CreeLED, Inc.’s (“Plaintiff”) Motion for Entry of Final Default Judgment (“Motion”). ECF No. [92]. The Court has reviewed the Motion, the record in this case, and the applicable law. For the foregoing reasons, the Motion is denied without prejudice.

I. BACKGROUND A. Procedural History This action involves 347 Defendants. Accordingly, a brief review of the relevant procedural history is appropriate. See ECF No. [1]; see also ECF No. [6-1] (Defendants identified on Schedule “A” of the Complaint). On June 2, 2023, the Court entered an Order that required the Defendants identified in that Order to file a response to Plaintiff’s Complaint by June 9, 2023. ECF No. [42] at 1-9 (“First Order to Answer”).1 In the First Order to Answer, the Court directed Plaintiff __________________________ To identify which Defendants in this action defaulted, the Court reviewed the record to determine whether any of the Defendants listed on Schedule “A” to the Complaint answered or otherwise responded to the Complaint. Id. at 9. The Court noted that certain defendants were dismissed from the to file a Motion for Entry of Clerk’s Default with respect to those Defendants by June 16, 2023, should those Defendants failed to file a response by June 9, 2023. Id. ¶¶ 1, 2. One day before the deadline for Defendants to respond, a subset of those Defendants, Binwo Smart Home (“Binwo”), CraBow, Phixtonus, and yinghuatiyu (collectively, “Represented Defendants”), filed an unopposed motion for an extension of time to file a response to the Complaint, ECF No. [57]; which the Court granted, requiring the Represented Defendants to respond by June 30, 2023, ECF No. [59]. From June 8, 2023 through June 15, 2023, upon Plaintiff’s Notices of Voluntary Dismissal as to Certain Defendants, ECF Nos. [58], [66], [68], the Court dismissed with prejudice the Defendants identified in three Orders of Dismissal. See ECF Nos. [62], [67], [69]. On June 9, 2023, the Court granted Defendant LG Expro dba Shopstoryfrance (“Shopstoryfrance”) an extension of time in which to respond to the Complaint. ECF No. [63]. On June 9, 2023, and July 5, 2023, the Court granted two extensions of time to Shopstoryfrance, requiring its response to the Complaint by July 14, 2023. ECF Nos. [63], [91].

On June 16, 2023, Plaintiff filed a Motion for Clerk’s Entry of Default. ECF No. [77]. The Clerk thereafter entered default as to certain Defendants (“Clerk-Defaulted Defendants”). ECF No. [78-1]. Those Defendants did not include the Represented Defendants or Shopstoryfrance.

Accordingly, the Court entered an Order, ECF No. [81] at 1-7 (“June 20, 2023 Order”), in which the Court directed Plaintiff to file one of two responses by July 5, 2023: a motion for default final judgment if there are no allegations of joint and several liability and no possibility of inconsistent

__________________________ action upon Plaintiff’s Notices of Voluntary Dismissal as to Certain Defendants, see ECF Nos. [23] and [34], and that other Defendants were granted extensions of time to respond, see ECF Nos. [36] and [41].

Id. liability between Defendants, or a Notice of Joint Liability if there are allegations of joint and several liability or the possibility exists of inconsistent liability. Id. at 7-8.

From June 21, 2023, through June 27, 2023, upon Plaintiff’s Notices of Voluntary Dismissal as to Certain Defendants, ECF Nos. [70], [73], [79], [86], the Court dismissed with prejudice the Defendants identified in four Orders of Dismissal. See ECF Nos. [80], [82], [83], [87]. On June 30, 2023, rather than responding to the Complaint, the Represented Defendants filed a Motion to Dissolve the Preliminary Injunction and the Temporary Restraining Order. ECF No. [88]. On July 5, 2023, Plaintiff filed the instant Motion.

On July 6, 2023, the Court entered an Order that directed the Represented Defendants to file a response to the Complaint by July 13, 2023. ECF No. [93] (“Second Order to Answer”). On July 13, 2023, the Represented Defendants filed their Answers to the Complaint. ECF Nos. [99] – [102]. That same day, the Court entered an Order on Consent Motion to Effectuate Settlement, ECF No. [105], between Plaintiff and perfumedynasty-24*7. ECF No. [105].

On July 14, 2023 and July 19, 2023, upon Plaintiff’s Notices of Voluntary Dismissal as to Certain Defendants, ECF Nos. [104], [110], the Court issued further Orders of Dismissal as to certain Defendants. ECF Nos. [106], [111]. On July 17, 2023, the Court entered an Order that requires Shopstoryfrance to respond to the Complaint by July 24, 2023. ECF No. [109] (“Third Order to Answer”). On July 20, 2023, on Defendant ZStoneUS’s unopposed motion for an extension of time to respond to the Complaint, ECF No. [112], the Court granted Defendant ZStoneUS leave to file a motion to set aside the Clerk’s entry of default. See ECF Nos. [113], [114]. On July 21, 2023, Plaintiff filed a Notice of Voluntary Dismissal as to certain Defendants, including Shopstoryfrance, ECF No. [116], and the Court approved the Notice of Voluntary Dismissal. ECF No. [117].

Accordingly, of the 347 Defendants listed on Schedule “A” of the Complaint, the Represented Defendants are actively litigating this action, Defendant perfumedynasty-24*7 is in the process of reaching a settlement with Plaintiff, Defendant ZStoneUS has not yet responded to the Court’s leave to file a motion to set aside the Clerk’s entry of default, 127 Defendants have been dismissed from this action, and the following 214 Defendants are—based on the Court’s review of the record—the Clerk-Defaulted Defendants: D. No. Seller Name ALARICK HOLDINGS INC. AMZMK-UK AMZQIANG AuKvi CGB123 12 cuteoo 13 Dirace Inc 14 DragTrade 17 GaiGaiMall 19 gifts for women ldgr ✿✿ ✿✿ 25 JH E-Commerce Ltd 26 jinyexf 29 LIAOSHAN life 30 Litwod 31 LUNCONE 32 LXMbeimei 33 Matresh 35 Menghong 36 Miular 38 Moveski Direct 40 QSseven 43 SGMOER(7~15 days delivery) 45 SmilePink Shop 46 SouyosDirect 47 T.A2Z Store 49 TVMXQ-PRO Lighting equipment store 50 US HOME 51 ustopfire 54 woroom101 58 yuyezhuanye 59 zeasun 61 ZstoneUS 63 神筠 64 2021leduk 65 ahsy-5677 66 alesslondon 67 apasamar-0 68 bakigun0 69 bakisuar0 70 barethe 72 baybeblue1 74 budgam65 75 cellosales 76 chasa_3104 78 dafri2924 79 danstore2019 80 dctrading21 82 diycarserviceparts 83 dobrivecel 84 doris_kj 85 eastco-eng 88 egotool8 89 enerpower4u 95 erivari-2530 96 esell_25 97 expertsincrediblestore 99 feev-51 101 fukluksaufr 102 galha-220 103 gifts2smile 106 hazan2824 108 hiquality_shop 109 hmd_shop 110 homeshopfamily 112 jerbe_99 114 kemo6209 116 komuhy_0 117 kvp_bargin 120 lithuaniadeals 121 lufar_6389 124 mimsy9 127 muhair1264 130 niame-1050 131 nicahu-41 132 nuryul_59 133 opticfireuk 134 orlya80 135 oz-onestop 136 pa_272166 137 pace.ramon 138 patkor1 139 Perfurmedynasty-24*7 141 powertoolsdirectonline 143 rama7746 146 rhine.retail 147 rjhomestore 148 robo2019 150 sahpo_69 151 sanarad0 152 sarayousef89 153 sd-fashion 154 setiyap-14 155 shale-1812 156 slender19 157 sobreruedas-spain 159 thanavar_2 160 the_uk_shop 162 tikhair-44 164 tools..warehouse 165 totaldiy 166 tpam56 167 tshir_97 168 warfian-0 169 weston_global 176 yuemx-69 179 beauty-steps 180 fashionmall2020 183 579 184 563601870 186 91sky E-commerce Co.Ltd. 187 aaaccc 189 ACE Lighting Co.,LTD 191 aga88 192 A-KISONG 193 All kinds of Screen Protertor and Phone Case 194 AL-Memory 195 aonaite 197 baba_store 198 better you want 199 Binzhuoultraelectronictechnology 200 Blibibibi111 201 changjieshouyi 202 CHAOSWOD 203 charlie.hu 204 chenbinstore 205 chengfen 207 Compilation 208 CongYuan trade co., LTD ShenZhen 209 Cositaschava 211 cyd&dyc 212 daebagtem 214 dazzlcat 215 dianjunshopstate 216 ellismorley1 218 Fashion Made Factory 219 fashion321 220 fashionhoho 221 fashionstore8 222 Fei_XXXX 223 feiangkl 226 Freeman Diamond Painting1 229 gaoying852 230 Genwiss Technology Limited 231 gfnxgfn 233 Guest clothing trade 234 hanchao123 237 Hongfa co., LTD 238 huaihuaxinda 241 Japusoon 244 jialicaicaicai88 247 jvfyad 248 kakakaa 249 KYM international trade 250 langligel 251 langrenhuwai168 252 ledflashlightHKHK 254 Liangbanghong 255 Lifmao Yunyishang 256 Lighthearth 258 Liibotlight 261 Lisa lixia 262 liuhuijuan2358 263 liuqiaoyun6364 266 LordOf Light 268 lvjuyan 269 lyq fashion life 272 MAGAZACILIK SANAYI VE TICARET 274 maikolerfeng 275 mamade 276 meiridianzikejigongsi 277 mengtingzeng 279 meris888 280 minminaa 283 My Lighting 284 New Road Jewelry 285 NortonMorgantRiYbC 286 PanAmei 289 Professional_Lighting 290 Qlee tech 292 RC Car Model Store 293 RC Lovers 294 RC Model Lovers 296 RodneyAdonisoZmFf 297 Roytops Co.Ltd 298 Ruilai life Museum 300 SCOTTHEAVY 301 shasha1996 302 SHEHDS Stage Lighting 303 shenzhenxiwangmaoyiyouxiangongsi 305 Simple encounter 308 STC Stores 309 Su-mall 310 SUN god god 311 Sweethapy Watchtoy 312 TacBlades 313 Tang Wu 888 Shop 314 tanyod 315 taoqian Internet technology 316 The shop for sport 319 tu zapato ideal 320 tyqoioqaiiq 321 vngfjngfn 323 Wan fa 326 wangshihua02064 327 WENJIA113 328 WinniSamuelkViC 329 wsongLtd 330 WUQ9527 331 wzchunlai 335 y1995hong 339 yinhuijuan 341 YUKU3 342 yxubiao 344 ZLLH 345 ZQLXL2020 346 zxiang40 B. The Motion The Plaintiff contends that default judgment is appropriate because the allegations in the Complaint establish the liability of the Clerk-Defaulted Defendants and the Represented Defendants (which Plaintiff refers to as the “Defaulting Defendants”). ECF No. [92] at 6. The Plaintiff further argues that the Complaint’s factual allegations establish the Defaulting Defendants’ liability, entry of a permanent injunction is appropriate, and Plaintiff is entitled to damages as to Counts I, II, III and IV of the Complaint. Id. at 6-17.

II. LEGAL STANDARD Pursuant to Federal Rule of Civil Procedure 55(b)(2), the Court is authorized to enter a final judgment of default against a party who has failed to plead in response to a complaint. “‘[A] defendant’s default does not in itself warrant the court entering a default judgment.’” DirecTV, Inc. v. Huynh, 318 F. Supp. 2d 1122, 1127 (M.D. Ala. 2004) (quoting Nishimatsu Constr. Co., Ltd. v. Houston Nat’l Bank, 515 F.2d 1200, 1206 (5th Cir. 1975)). Granting a motion for default judgment is within the trial court’s discretion. Adolph Coors Co. v. Movement Against Racism and the Klan, 777 F.2d 1538, 1542 (11th Cir. 1985). Because the defendant is not held to admit facts that are not well pleaded or to admit conclusions of law, the court must first determine whether there is a sufficient basis in the pleading for the judgment to be entered. See Buchanan v. Bowman, 820 F.2d 359, 361 (11th Cir. 1987) (“[L]iability is well-pled in the complaint, and is therefore established by the entry of default . . . .”).

If there are multiple defendants, plaintiff must state in a motion for default judgment that there are no allegations of joint and several liability and set forth the basis why there is no possibility of inconsistent liability. Adidas AG v. Adidasjeremyscottitalia.eu, No. 13-CV-62712, 2014 WL 11722017, at *2 (S.D. Fla. Aug. 14, 2014). Generally, if one defendant who is alleged to be jointly and severally liable with other defendants, judgment should not be entered against that defendant until the matter is adjudicated against the remaining defendants. See 10A Charles Alan Wright and Arthur R. Miller, Federal Practice and Procedure § 2690 (3d ed. 1998) (citing Frow v. De La Vega, 82 U.S. 552, 554 (1872) (“[A] final decree on the merits against the defaulting defendant alone, pending the continuance of the cause, would be incongruous and illegal.”)).

“Even when defendants are similarly situated, but not jointly liable, judgment should not be entered against a defaulting defendant if the other defendant prevails on the merits.” Gulf Coast Fans, Inc. v. Midwest Elecs. Imp., Inc., 740 F.2d 1499, 1512 (11th Cir. 1984).

III. DISCUSSION The Motion is premature as to certain Defendants against whom Plaintiff seeks default judgment. First, in its June 20, 2023 Order, the Court explained that Plaintiff must file either a motion for default judgment or a notice of joint liability as to the Clerk-Defaulted Defendants. See ECF No. [81] at 7-9. The Represented Defendants are not subject to the Court’s June 20, 2023 Order. The Court ordered the Represented Defendants to respond to the Complaint by July 13, 2023. ECF No. [93]. The Represented Defendants have done so. ECF No. [99] – [102]. Thus, the Represented Defendants have not defaulted in this action. Second, the Court entered an Order to complete Plaintiff and Defendant perfumedynasty-24*7’s settlement agreement. ECF No. [105].

Third, the Court granted leave to ZStoneUS to file a motion to set aside the Clerk’s default. See ECF Nos. [113], [114]. Therefore, a motion for default judgment is not yet ripe as to those Defendants.

Relatedly, the Motion is insufficient. As the Court required in its June 20, 2023 Order, Plaintiff must state in a motion for default judgment that there are no allegations of joint and several liability and set forth the basis why there is no possibility of inconsistent liability. Plaintiff has not done so. Indeed, the Court cannot discern how Plaintiff can meet the former condition when the Complaint contains allegations that suggest joint and several liability. See ECF No. [1] ¶ 48 (“Defendants’ unlawful actions have individually and jointly caused and are continuing to cause unquantifiable damage to Plaintiff and are unjustly enriching Defendants with profits at Plaintiff’s expense.”), ¶ 56 (“Defendants are using counterfeits and infringements of the CreeLED Marks in order to unfairly compete with Plaintiff and others for space within search engine organic results, thereby jointly depriving Plaintiff of a valuable marketing and educational tool . . . .”).

Moreover, given that the Represented Defendants are actively litigating this action, which is at an early stage, the Court cannot predict the action’s outcome. Accordingly, the possibility of inconsistent liability is evident, so default judgment is presently inappropriate. See Gulf Coast Fans, Inc., 740 F.2d at 1512. Thus, the Motion should be denied without prejudice until the matter is adjudicated against all Defendants.

IV. CONCLUSION Accordingly, it is ORDERED AND ADJUDGED that Plaintiff’s Motion, ECF No. [92], is DENIED WITHOUT PREJUDICE.

Case No. 23-cv-60780-BLOOM/Valle DONE AND ORDERED in Chambers at Miami, Florida, on July 24, 2023.

4 BLOOM UNITED STATES DISTRICT JUDGE Copies to: Counsel of Record