DELTA FAUCET COMPANY v. WATKINS

UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF INDIANA

INDIANAPOLIS DIVISION

DELTA FAUCET COMPANY, )

)

Plaintiff, )

)

vs. ) No. 1:23-cv-00200-JMS-CSW

)

BEN WATKINS and JOHN DOES 1-10, )

)

Defendants. )

ORDER

Plaintiff Delta Faucet Company ("Delta") filed a Complaint against Defendants asserting

claims for trademark infringement and unfair competition under both the Lanham Act and common

law and deception under Indiana law. [Filing No. 1.] On June 24, 2023, the Court granted Delta's

Motion for Clerk's Entry of Default against Defendant Ben Watkins based on Mr. Watkins' failure

to plead or otherwise defend the action. [Filing No. 17.] On September 26, 2023, Delta filed a

Motion for Default Judgment against Mr. Watkins, in which it also asks for a permanent injunction.

[Filing No. 23.] The Motion is now ripe for the Court's decision.

I.

STANDARD OF REVIEW

Rule 55 of the Federal Rules of Civil Procedure sets forth a two-step process for a party

seeking default judgment. McCarthy v. Fuller, 2009 WL 3617740, at *1 (S.D. Ind. Oct. 29,

2009); see also Lowe v. McGraw–Hill Companies, Inc., 361 F.3d 335, 339 (7th Cir. 2004) ("The

Federal Rules of Civil Procedure make a clear distinction between the entry of default and the

entry of a default judgment."). First, the plaintiff must obtain an entry of default from the

Clerk. Fed. R. Civ. P. 55(a). Second, after obtaining an entry of default, the plaintiff may seek an

entry of default judgment. Fed. R. Civ. P. 55(b).

When entry of default has been obtained, "the well-pleaded allegations of a complaint

relating to liability are taken as true," VLM Food Trading Int'l, Inc. v. Illinois Trading Co., 811

F.3d 247, 255 (7th Cir. 2016) (quotation and citation omitted), but "those relating to the amount

of damages suffered ordinarily are not," Wehrs v. Wells, 688 F.3d 886, 892 (7th Cir. 2012). "The

defaulting party cannot contest the fact of his liability unless the entry of default is vacated under

Rule 55(c)." VLM Food Trading Int'l, Inc., 811 F.3d at 255 (citation omitted). The entry of default

does not determine the rights of the parties, however. Id. (citation omitted). "That role is reserved

for a default judgment." Id. "A default judgment establishes, as a matter of law, that a defendant

is liable to the plaintiff for each cause of action alleged in the complaint." Wehrs, 688 F.3d at 892

(quoting e360 Insight v. The Spamhaus Project, 500 F.3d 594, 602 (7th Cir. 2007)). A default

judgment can only be granted as to what is alleged and demanded in the complaint. Fed. R. Civ.

P. 54(c) ("A default judgment must not differ in kind from, or exceed in amount, what is demanded

in the pleadings.") Similarly, the Court will only grant relief that is requested in the motion. GS

Holistic, LLC v. MKE Vapor, Inc. d/b/a MKE Vape, 2023 WL 8238953, at * 5 n.6 (E.D. Wis. Nov.

28, 2023) (the court did not analyze damages that the plaintiff sought in its complaint but did not

mention in its motion for default judgment).

To enter default judgment, the Court must have jurisdiction over the defendant. e360

Insight, 500 F.3d at 598 ("Default judgments rendered without personal jurisdiction are void.");

see also Swaim v. Moltan Co., 73 F.3d 711, 716 (7th Cir. 1996) (instructing that a default judgment

will be set aside "as a per se abuse of discretion if the district court that entered the judgment

lacked jurisdiction."). The failure to answer the complaint does not waive defects in personal

jurisdiction. Swaim, 73 F.3d at 717.

II.

BACKGROUND

Delta has obtained entry of default against Mr. Watkins. [Filing No. 17.] Therefore, in

accordance with the standard above, the Court takes the following well-pleaded allegations in

Delta's Complaint, [Filing No. 1], as true:

Delta sells faucets and related appliances. [Filing No. 1 at 3.] To promote and protect its

brand, Delta has several registered trademarks based on the word "Delta" ("Delta Trademarks")1

and sells its products exclusively through itself and a network of Authorized Sellers. [Filing No.

1 at 4-5.] Delta contractually requires its Authorized Sellers to abide by numerous quality-control

and customer-service requirements, including requirements relating to product inspections,

storage, and reporting of complaints. [Filing No. 1 at 4; Filing No. 1 at 16-17.] Delta's quality

controls help ensure that consumers receive the quality products and services associated with the

Delta name. [Filing No. 1 at 16-17.] Thus, Delta products purchased from Delta or Authorized

Sellers come with the Delta Limited Warranty. [Filing No. 1 at 25.] Delta products purchased by

unauthorized sellers do not come with the Delta Limited Warranty because Delta cannot ensure

the quality of the products or compliance with quality controls. [Filing No. 1 at 25.] As a result

of having purchased from unauthorized sellers that are not subject to Delta's quality controls,

customers have received poor-quality products and have left negative public reviews of those

products, which hurts the value of the Delta Trademarks and the brand's reputation. [Filing No. 1

11-16.]

1 Delta’s Trademarks include, but are not limited to, DELTA® (Reg. No. 5,273,845); DELTA®

(Reg. No. 2,583,761); DELTA® (Reg. No. 3,062,101); DELTA® (Reg. No. 2,586,604);

DELTA® (Reg. No. 4,518,067); DELTA® (Reg. No. 0,668,880); and DELTA® (Reg. No.

4,638,296). [Filing No. 1 at 5.]

Due to the issues caused by unauthorized sellers, Delta regularly monitors the sale of its

products online. [Filing No. 1 at 23.] Through this monitoring, Delta discovered that the Ben

Watkins Amazon.com storefront, with a Merchant ID number of A2VUGI7D639PP3 (the "Ben

Watkins Amazon Storefront"), owned and operated by Mr. Watkins, was advertising and selling

unauthorized and non-genuine products bearing Delta Trademarks. [Filing No. 1 at 1-2; Filing

No. 1 at 27.] These unauthorized and non-genuine products are different from genuine Delta

products sold by Authorized Sellers because they are not subject to Delta's quality controls, are

not backed by the Delta Limited Warranty, and are more likely to have quality problems. [Filing

No. 1 at 25; Filing No. 1 at 31-35.] The sale of these products is confusing to consumers, as

consumers think that the products are sold by an Authorized Seller and are genuine Delta products

subject to the Delta Limited Warranty and quality control requirements, when in fact, they are not.

[Filing No. 1 at 31-34.]

Delta investigated the Ben Watkins Amazon Storefront and sent Mr. Watkins a cease-and-

desist letter to an Ohio address that was listed as the business address of the Ben Watkins Amazon

Storefront at the time. [Filing No. 1 at 27.] The letter was returned to Delta as undeliverable, with

the carrier stating, "no such person ever at this address." [Filing No. 1 at 27.] A month later, Delta

re-sent the letter to the Ohio address, but it was also returned to Delta as undeliverable. [Filing

No. 1 at 27.] Delta then sent a letter to the Ben Watkins Amazon Storefront through Amazon's

messaging system. [Filing No. 1 at 27.] Delta did not receive a response. [Filing No. 1 at 27.]

Delta later discovered that the Ben Watkins Amazon Storefront published a new business address

in Colorado and sent another cease-and-desist letter there. [Filing No. 1 at 26-27.] This letter was

also returned as undeliverable. [Filing No. 1 at 26.]

Unable to reach Mr. Watkins, Delta subpoenaed Amazon for information related to the Ben

Watkins Amazon Storefront. [Filing No. 1 at 28.] Amazon disclosed that the Ben Watkins

Amazon Storefront is maintained in the name of Mr. Watkins and that he uses a contact address in

South Carolina. [Filing No. 1 at 28.] Amazon also disclosed the email address that Mr. Watkins

uses to maintain his Amazon account. [Filing No. 1 at 28.] After receiving this information, Delta

sent a letter to Mr. Watkins at the South Carolina address and sent a digital copy of the letter via

email to the email address Amazon disclosed. [Filing No. 1 at 28.] Delta did not receive a response

from either communication. [Filing No. 1 at 28.]

Delta later discovered that the Ben Watkins Amazon Storefront again changed its contact

address that was displayed to customers. [Filing No. 1 at 29.] Delta sent a letter to the updated

address, but it was again returned as undeliverable. [Filing No. 1 at 30.]

On February 1, 2023, Delta filed its Complaint, in which it sets forth claim for: (1)

trademark infringement under the Lanham Act, 15 U.S.C. §§ 1114 and 1125(a)(1)(A); (2) unfair

competition under the Lanham Act, 15 U.S.C. § 1125(a); (3) common law trademark infringement

and unfair competition; and (4) deception under Indiana Code § 35-43-5-32, actionable under the

Indiana Crime Victim's Relief Act, Indiana Code § 35-24-3-1. [Filing No. 1 at 38-45.] It requests

that the Court enter judgment in its favor and enter a permanent injunction. [Filing No. 1 at 46-

2 Although Delta's fourth cause of action in its Complaint is deception under Indiana Code § 35-

43-5-3, Delta's Brief in Support of Motion for Default Judgment Against Defendant Ben Watkins

refers to the fourth claim as conversion under Indiana Code § 35-43-4-3. [Filing No. 24 at 2-3.]

"A default judgment must not differ in kind from, or exceed in amount, what is demanded in the

pleadings." Fed. R. Civ. P. 54(c). Because deception—not conversion—was alleged in the

Complaint, Delta's argument regarding conversion is waived. The Court therefore does not

consider conversion in this Order.

47; see also Filing No. 23; Filing No. 24.] Delta also seeks damages, "enhanced damages," and

attorneys' fees under 15 U.S.C. § 1117(a) for its Lanham Act claims.3 [Filing No. 1 at 38-47.]

III.

DISCUSSION

A. Personal Jurisdiction

Before addressing whether the factual allegations, taken as true by virtue of default,

establish liability, the Court addresses its personal jurisdiction over Mr. Watkins.

In its Complaint and Motion for Default Judgment, Delta argues that the Court has personal

jurisdiction over Mr. Watkins because he expressly aimed his tortious activity toward Indiana and

purposefully availed himself of the privilege of doing business in Indiana through regular sales of

infringing products bearing Delta Trademarks to Indiana residents. [Filing No. 24 at 7.] But

neither the Complaint nor the Motion for Default Judgment identifies any specific Indiana sales.

[Filing No. 1; Filing No. 24.] So, on November 1, 2023, the Court ordered Delta to supplement

its argument regarding personal jurisdiction over Mr. Watkins with evidence that established the

necessary minimum contacts with Indiana that would allow the Court to exercise personal

3 While Delta requests "enhanced damages and attorneys' fees under 15 U.S.C. § 1117(a)" in its

Complaint, [Filing No. 1 at 38-47], Delta does not request such relief on default judgment, [Filing

No. 23 at 1; Filing No. 23-4; Filing No. 24 at 1; Filing No. 24 at 14-18 (only requesting relief for

actual damages in the form of Mr. Watkins' gross sales of infringing products)]. The Court does

not address relief that was not sought on default judgment. GS Holistic, LLC, 2023 WL 8238953,

at *5 n.6 (the court did not analyze damages that the plaintiff sought in its complaint but did not

mention in its motion for default judgment); see also Draper v. Martin, 664 F.3d 1110, 1114 (7th

Cir. 2011) ("[I]t is not this court's responsibility to research and construct the parties' arguments.")

(cleaned up); see also Schaefer v. Universal Scaffolding & Equip., LLC, 839 F.3d 599, 607 (7th

Cir. 2016) ("Perfunctory and undeveloped arguments are waived, as are arguments unsupported

by legal authority.").

jurisdiction. [Filing No. 27.] On November 15, 2023, Delta submitted evidence demonstrating

hundreds of specific sales of infringing products in Indiana.4 [Filing No. 28.]

"If jurisdiction is exercised on the basis of a federal statute that does not authorize service

of process, the law requires a federal district court to determine if a court of the state in which it

sits would have personal jurisdiction." Annie Oakley Enters. v. Sunset Tan Corp. & Consulting,

LLC, 703 F. Supp. 2d 881, 886 (N.D. Ind. 2010) (citing United States v. Martinez De Ortiz, 910

F.2d 376, 381 (7th Cir. 1990)). The Lanham Act "does not have a special federal rule for personal

jurisdiction," so the Court looks to the law of Indiana. Id. at 620. Indiana law permits the exercise

of jurisdiction to the full extent permitted by the Fourteenth Amendment's Due Process Clause.

Indiana Trial Rule 4.4(A) (Indiana's long-arm statute); LinkAmerica Corp. v. Albert, 857 N.E.2d

961, 966-67 (Ind. 2006).

4 Before explaining its evidence and how it establishes that this Court has personal jurisdiction

over Mr. Watkins, Delta explained, with some apparent annoyance, that it "did not previously

submit evidence of specific sales into Indiana because, generally speaking under prevailing law,

its allegations regarding personal jurisdiction should be accepted by the Court as true following

[Mr. Watkins'] default." [Filing No. 28 at 2 (citing VLM Food Trading Int'l, 811 F.3d at 255

("[U]pon default, the well-pleaded allegations of a complaint relating to liability are taken as

true.")).] It also argues that the "Seventh Circuit has also held that a district court has no

affirmative duty to 'inquire into the factual bases for jurisdiction or service prior to entering a

default [judgment,]'" citing e360 Insight, 500 F.3d at 598. [Filing No. 28 at 2.] The Court is

confounded by this response. Although the "well-pleaded allegations of a complaint relating to

liability are taken as true," this does not mean that the well-pleaded allegations relating to personal

jurisdiction must be taken as true. Personal jurisdiction is a threshold matter, and federal courts

"have an obligation to make sure that [they] have jurisdiction to decide [a] claim." Collins v.

Yellen, 594 U.S. ---, 141 S. Ct. 1761, 1779 (2021); see also Lightfoot v. Cendant Mortg. Corp.,

580 U.S. 82, 95 (2017) (the Court "must have . . . power over the parties before it (personal

jurisdiction) before it can resolve a case."). While there may not be an affirmative duty to inquire

into the factual bases for jurisdiction prior to entering default judgment, the Court's obligation to

ensure it has jurisdiction still stands. This Court is not in the habit of assuming that it has personal

jurisdiction over defendants nor is it in the habit of entering a default judgment that is void. See

e360 Insight, 500 F.3d at 598 ("Default judgments rendered without personal jurisdiction are

void."); see also Swaim, 73 F.3d at 716 (instructing that a default judgment will be set aside "as a

per se abuse of discretion if the district court that entered the judgment lacked jurisdiction.").

Courts across the Seventh Circuit have repeatedly held that the Due Process Clause allows

the exercise of jurisdiction over an out-of-state defendant who sells allegedly infringing products

to forum residents through a website or online storefront. See NBA Props. v. HANWJH, 46 F.4th

614, 617-18, 624 (7th Cir. 2022) (finding jurisdiction over out-of-state defendant for single sale

through its Amazon storefront to plaintiff’s investigator in the forum state), cert denied 142 S. Ct.

577 (2023); Curry v. Revolution Lab'ys, LLC, 949 F.3d 385, 389-402 (7th Cir. 2020) (finding

personal jurisdiction where the defendant sold products through website to residents of the forum

state); Illinois v. Hemi Group LLC, 622 F.3d 754, 757-58 (7th Cir. 2010) (finding jurisdiction over

out-of-state defendant who offered and completed product sales to Illinois residents through

website); Monster Energy Co. v. Chen Wensheng, 136 F. Supp. 3d 897, 906 (N.D. Ill. 2015)

(finding jurisdiction over out-of-state defendant who offered products to Illinois residents through

online marketplace storefront); Delta Faucet Co. v. Iakovlev, 2022 WL 900159, at *1 (S.D. Ind.

Mar. 28, 2022) (finding jurisdiction over out-of-state defendant who sold to Indiana residents

through online marketplace storefront); Ultra Athlete LLC v. Araujo, 2019 WL 1003337, at *2-3

(S.D. Ind. Mar. 1, 2019) (finding jurisdiction over out of-state defendants who sold to Indiana

residents through online marketplace storefront).

As noted, Delta has produced significant evidence that Mr. Watkins has sold products that

bear Delta Trademarks to Indiana residents through the Ben Watkins Amazon Storefront. [Filing

No. 28-2 at 2-75.] Thus, the Court finds that exercising jurisdiction over Mr. Watkins comports

with due process.

B. Liability

The Court now turns to the issue of liability, which is separate and apart from whether

Delta is entitled to certain relief, such as a permanent injunction.

1. Trademark Infringement and Unfair Competition Under the Lanham Act, 15

U.S.C. § 1114 and 15 U.S.C. § 1125(a), and Common Law Trademark

Infringement and Unfair Competition

The Court analyzes Delta's Lanham Act claims for both trademark infringement and unfair

competition together with its claim of common law trademark infringement and unfair competition

because the claims are analyzed under the same standard. CAE, Inc. v. Clean Air Eng'g, Inc., 267

F.3d 660, 673-74 (7th Cir. 2001) (noting that, under the Lanham Act, the elements for trademark

infringement are the same as unfair competition); Fortres Grand Corp. v. Warner Bros. Entm't

Inc., 763 F.3d 696, 700 & n.4 (7th Cir. 2014) ("[A]ll relevant authority we have found analyzes

Indiana unfair competition claims based on trademarks the same as Lanham Act trademark claims,

so we analyze all the claims together.") (emphasis omitted); Dwyer Instruments, Inc. v. Sensocon,

Inc., 873 F. Supp. 2d 1015, 1040 (N.D. Ind. 2012) (“The analysis under the Lanham Act for unfair

competition also applies to claims for unfair competition under Indiana common law.”); Vision

Ctr. Nw., Inc. v. Vision Value, LLC, 673 F. Supp. 2d 679, 683 (N.D. Ind. 2009) (noting the same

with common law trademark infringement).

To succeed on these claims, Delta must establish that "it owns a valid, protectable

trademark and that there is a likelihood of confusion caused by the alleged infringer's use of the

disputed mark." Grubhub Inc. v. Relish Labs LLC, 80 F.4th 835, 844 (7th Cir. 2023); Fortres

Grand Corp., 763 F.3d at 700; Dwyer Instrs., Inc., 873 F. Supp. 2d at 1040; Vision Ctr. Nw., Inc.,

673 F. Supp. 2d at 683. "The ultimate question underlying trademark infringement is whether

consumers are likely to be confused about the origin of products or services based on the

promotion of those products or services using a particular mark." Grubhub Inc., 80 F.4th at 844

(emphasis in original). In order to determine whether a likelihood of confusion exists, courts

"consider seven factors, none of which is dispositive: (1) similarity of the marks in appearance and

suggestion; (2) similarity of the products; (3) the area and manner of concurrent use; (4) the degree

of care likely to be exercised by consumers; (5) the strength of the senior user's mark; (6) existence

of actual confusion; and (7) the intent of the defendant to 'palm off' its product as that of another."

Grubhub Inc., 80 F.4th at 847.

Delta has established Mr. Watkins' liability through the allegations of its Complaint. First,

Delta owns valid and protectable trademarks. [Filing No. 1 at 5.] See 15 U.S.C. § 1115(a)

(registration is prima facie evidence of validity). Second, Delta's Complaint demonstrates a

likelihood of confusion under the seven factors.5 Mr. Watkins' goods used Delta Trademarks.

[Filing No. 1 at 26.] The area and manner of concurrent use of the Delta Trademarks is the same—

individuals shopping online for Delta products. Delta Trademarks are valuable and have

5 Delta does not apply the seven-factor likelihood-of-confusion test in its brief. [Filing No. 24.]

Instead, it argues that there is a likelihood of confusion under the material-differences rule. [Filing

No. 24 at 8-9.] This argument is misplaced. The material-differences rule applies in "gray goods"

cases, which involve "trademarked goods manufactured abroad under a valid license but brought

into this country in derogation of arrangements lawfully made by the trademark holder to ensure

territorial exclusivity." Societe Des Produits Nestle, S.A. v. Casa Helvetica, Inc., 982 F.2d 633,

635 (1st Cir. 1992); see 5 J. Thomas McCarthy, McCarthy on Trademarks and Unfair Competition

§ 29:46 (5th ed. Dec. 2023 update) (explaining that the material-differences rule applies in "gray

goods" cases). Yet there are no allegations here showing that Mr. Watkins sold gray goods as

opposed to counterfeit goods. Delta cites cases, including Societe Des Produits Nestle, S.A., to

support its argument that the material-differences rule can be applied outside of "gray goods"

cases. [Filing No. 24 at 9.] However, Societe Des Produits Nestle, S.A. was a "gray goods" case,

and therefore does not stand for the proposition that Delta asserts. Societe Des Produits Nestle,

S.A., 982 F.2d 633. Additionally, El Greco Leather Prods. Co., Inc. v. Shoe World, Inc., 806 F.2d

392 (2d Cir. 1986), is arguably a "gray goods" case because the items at issue were manufactured

under a valid license and then sold elsewhere, and Otter Prods., LLC v. Triplenet Pricing Inc., 572

F. Supp. 3d 1066 (D. Colo. 2021), discusses the "material difference exception" to the first sale

doctrine, which is a defense used by a party alleged to have committed trademark infringement.

The Court is not convinced that the material-differences rule applies outside of "gray goods" cases

or is the correct approach to analyze whether there is a likelihood of confusion when the first sale

doctrine has not been raised as a defense. Therefore, the Court applies the standard seven-factor

likelihood of confusion test. In any event, the outcome would be the same under the material-

differences rule since Mr. Watkins' goods do not qualify for the Delta Limited Warranty and are

not subject to Delta's quality controls. [Filing No. 1 at 25; Filing No. 1 at 31-35.]

considerable strength. [Filing No. 1 at 5.] Actual confusion exists because customers who

purchase products from the Ben Watkins Amazon Storefront believe that they are purchasing

genuine Delta products that come with the Delta Limited Warranty when, in fact, they are not.

[Filing No. 1 at 34.] And Mr. Watkins' fictitious addresses on the Ben Watkins Amazon Storefront

and his failure to respond to this action create an inference that he intended to pass his goods off

as Delta's. [Filing No. 1 at 26-30.] Taken together, these factors establish that there is a likelihood

of confusion caused by Mr. Watkins' use of Delta Trademarks. Thus, Delta has established Mr.

Watkins' liability for trademark infringement and unfair competition under both the Lanham Act

and under Indiana common law.

Delta's Motion for Default Judgment is GRANTED as to its claims for trademark

infringement and unfair competition under the Lanham Act and under Indiana common law

(Counts I-III).

2. Deception Under Indiana Code § 35-43-5-3

Delta does not move for or address its claim for deception under Indiana Code § 35-43-5-

3 in its Brief in Support of Motion for Default Judgment Against Defendant Ben Watkins. [Filing

No. 24.] This omission results in waiver. See Draper, 664 F.3d at 1114 ("[I]t is not this court's

responsibility to research and construct the parties' arguments.") (cleaned up); see also Schaefer,

LLC, 839 F.3d at 607 ("Perfunctory and undeveloped arguments are waived, as are arguments

unsupported by legal authority."). Accordingly, Delta has not established Mr. Watkins' liability

for deception under Indiana law.

Delta's Motion for Default Judgment is DENIED as to its deception claim, and that claim

is DISMISSED for failure to state a claim (Count IV).6

C. Requested Relief

Having found that Delta has established that Mr. Watkins is liable for trademark

infringement and unfair competition, the Court now considers whether Delta has demonstrated

entitlement to the relief that it seeks.

"Once the default is established, and thus liability, the plaintiff still must establish his

entitlement to the relief he seeks." In re Catt, 368 F.3d 789, 793 (7th Cir. 2004). "'Even when a

default judgment is warranted based on a party's failure to defend, the allegations in the complaint

with respect to the amount of damages are not deemed true. The district court must instead conduct

an inquiry in order to ascertain the amount of damages with reasonable certainty.'" Id. (quoting

Credit Lyonnais Securities (USA), Inc. v. Alcantara, 183 F.3d 151, 155 (2d Cir. 1999)); see also

e360 Insight, 500 F.3d at 604 ("[A]lthough a default judgment establishes liability, it does not

answer whether any particular remedy is appropriate."). Delta requests a permanent injunction

and damages in the form of Mr. Watkins' gross sales of infringing products. [Filing No. 23; Filing

No. 24.] The Court addresses each in turn.

1. Permanent Injunction

To obtain a permanent injunction, Delta must show:

(1) that it has suffered an irreparable injury; (2) that remedies available at law, such

as monetary damages, are inadequate to compensate for that injury; (3) that,

considering the balance of hardships between the plaintiff and defendant, a remedy

6 Instead of arguing its allegations support its claim for deception, Delta argues its allegations

support a claim for conversion under a different statute, Indiana Code § 35-43-4-3. [Filing No. 24

at 2-3.] But because "[a] default judgment must not differ in kind from, or exceed in amount, what

is demanded in the pleadings," Fed. R. Civ. P. 54(c), the Court does not consider Delta's unpled

claim for conversion in this Order.

in equity is warranted; and (4) that the public interest would not be disserved by a

permanent injunction.

e360 Insight, 500 F.3d at 604 (quoting eBay Inc. v. MercExchange, L.L.C., 547 U.S. 388, 391

(2006)). "[I]t is not uncommon for courts to issue injunctions as part of default judgments." Virgin

Records Am., Inc. v. Johnson, 441 F. Supp. 2d 963, 965 (N.D. Ind. 2006) (citing Johnson v.

Kakvand, 192 F.3d 656 (7th Cir. 1999)). Fed. R. Civ. P. 65(d) requires that an order granting an

injunction must include the reasons why it issued, state the specific terms, and "describe in

reasonable detail—and not by referring to the complaint or other document—the act or acts

restrained or required."

a. Irreparable Harm

"Irreparable harm is generally presumed in cases of trademark infringement . . . ." Eli Lilly

& Co. v. Natural Answers, Inc., 233 F.3d 456, 469 (7th Cir. 2000) (citing Abbott Lab'ys v. Mead

Johnson & Co., 971 F.2d 6, 16 (7th Cir. 1992) and American Dairy Queen Corp. v. New Line

Prod., Inc., 35 F. Supp. 2d 727, 729 (D. Minn. 1998)); see also Kraft Foods Grp. Brands LLC v.

Cracker Barrel Old Country Store, Inc., 735 F.3d 735, 741 (7th Cir. 2013) ("[I]rreparable harm is

especially likely in a trademark case because of the difficulty of quantifying the likely effect [of

consumer confusion] on a brand."). Moreover, "[t]he Seventh Circuit has 'clearly and repeatedly

held that damage to a trademark holder's goodwill can constitute irreparable injury for which the

trademark owner has no adequate legal remedy.'" American Taxi Dispatch, Inc. v. American Metro

Taxi & Limo, Co., 582 F. Supp. 2d 999, 1005 (N.D. Ill. 2008) (quoting Re/Max North Cent., Inc.

v. Cook, 272 F.3d 242, 432 (7th Cir. 2001)). And "the inability of the victim to control the nature

and quality of the defendant's goods" in a trademark infringement case has been held to be the

"most corrosive and irreparable harm." Processed Plastic Co. v. Warner Commc'ns, Inc., 674 F.2d

852, 858 (7th Cir. 1982) (quotations and citation omitted).

Delta has proven, by virtue of default, that its goodwill has been damaged through Mr.

Watkins' sales of infringing products. [Filing No. 1 at 11-16; Filing No. 1 at 25-26; Filing No. 1

at 31-34.] Delta has also proven that Mr. Watkins is not an Authorized Seller of Delta products,

and therefore, Delta is unable to control the nature and quality of Mr. Watkins' sales of products

bearing Delta Trademarks. Thus, the Court finds that Delta has shown irreparable harm in

connection with Mr. Watkins' actions.

b. Inadequate Remedy at Law

As discussed above, the Seventh Circuit has held "that damage to a trademark holder's

goodwill can constitute irreparable injury for which the trademark owner has no adequate legal

remedy," Re/Max North Cent., Inc., 272 F.3d at 432, and has recognized that there is a "difficulty

of quantifying the likely effect [of consumer confusion] on a brand," Kraft Foods Grp. Brands

LLC, 735 F.3d at 741. Further, without a permanent injunction, Delta would be forced to

repeatedly file suit any time Mr. Watkins, who has shown a complete disregard for his legal

obligations and the jurisdiction of this Court, infringes on Delta's trademark rights in the future.

See MetroPCS v. Devor, 215 F. Supp. 3d 626, 639-40 (N.D. Ill. 2016) (finding that no adequate

remedy at law other than a permanent injunction exists because the defendant will likely continue

its infringing conduct). Because of the difficulty of quantifying concrete harm in trademark cases,

the likelihood that Mr. Watkins' infringing conduct will continue, and the harm to Delta's goodwill

by Mr. Watkins' infringing conduct, the Court finds that Delta has shown that it does not have an

adequate remedy at law.

c. Balance of Hardships

Following the law is not a hardship. MetroPCS, 215 F. Supp. 3d at 640 (noting that an

injunction requiring compliance with the law posed no burden on a defendant). Here, any hardship

imposed on Mr. Watkins stems from following the law, which is greatly outweighed by the

hardships that Delta faces, including damage to its goodwill. The Court finds that the harm that

Delta faces absent an injunction outweighs any harm that Mr. Watkins might face if an injunction

issues.

d. Public Interest

The Seventh Circuit has found that the public interest is served by an injunction enjoining

the use of infringing trademarks because "enforcement of the trademark laws prevents consumer

confusion." Eli Lilly & Co., 233 F.3d at 469 (citing Abbott Lab'ys, 971 F.2d at 19; International

Kennel Club of Chicago, Inc. v. Mighty Star, Inc., 846 F.2d 1079, 1092 n.8 (7th Cir. 1988)); see

also The American Automobile Association, Inc. v. Waller, 2017 WL 6387315, at *6 (S.D. Ind.

2017) (finding issuing permanent injunction was in the public interest because it would "protect[

] [the public] from being misled into believing that [defendant's] business has been given a stamp

of approval from the Plaintiff"). Delta has shown that there is a likelihood of confusion from Mr.

Watkins' sale of products bearing Delta Trademarks, and the Court finds that the public interest is

served by an injunction to prevent such confusion.

In sum, the Court finds that Delta has shown that it will suffer irreparable injury in the

absence of an injunction, that it does not have an adequate remedy at law, that the balance of

hardships weighs in favor of issuing an injunction, and that issuing an injunction would serve the

public interest. Accordingly, the court GRANTS IN PART Delta's Motion for Default Judgment,

[Filing No. 23], to the extent it finds that Delta is entitled to a permanent injunction as follows:

Mr. Watkins, any aliases connected with that name, any aliases operating the Amazon

Storefront with a Merchant ID number of A2VUGI7D639PP3, the Amazon Storefront with a

Merchant ID number of A2VUGI7D639PP3, their employees, agents, servants, officers,

representatives, directors, attorneys, and all others in active concert or participation with any of

them (the "Enjoined Parties") are permanently enjoined from:

• advertising or selling all Delta products or any products bearing the Delta

Trademarks through any storefront on Amazon, including, but not limited to, the

Amazon Storefront known as the Ben Watkins Amazon Storefront (with Merchant

ID number A2VUGI7D639PP3);

• advertising or selling, through any medium (including all Internet and non-Internet

channels), all Delta products or any products bearing the Delta Trademarks; and

• importing, exporting, manufacturing, producing, distributing, circulating, selling,

offering to sell, advertising, promoting, or displaying any Delta products or

products bearing any of the Delta Trademarks.

Further, the Enjoined Parties shall destroy or return to Delta all Delta products or products bearing

Delta Trademarks in the Enjoined Parties’ possession, custody, or control, including but not

limited to those housed in Amazon’s warehouses by February 7, 2024.

Consistent with Seventh Circuit's holding in MillerCoors LLC v. Anheuser-Busch

Companies, LLC, 940 F.3d 922, 922-923 (7th Cir. 2019), this injunction shall be set forth in a

separate Order without reference to any other document. Id. (explaining that Fed. R. Civ. P.

65(d)(1)(C) "requires a separate document setting forth the terms of such an injunction" and the

injunction "to be set forth without referring to any other document") (citations and quotations

omitted); id. at 924-30 (Hamilton, J., dissenting) (describing the Court's holding as a "separate-

document requirement").

2. Damages

Delta also seeks damages in the form of Mr. Watkins' gross sales of infringing products.

[Filing No. 1; Filing No. 24.] In connection with a Lanham Act default judgment, the plaintiff is

entitled to the infringer's gross sales. WMS Gaming Inc. v. WPC Prods. Ltd., 542 F.3d 601, 609

(7th Cir. 2008) (citations omitted). If the amount is capable of ascertainment through definite

figures contained in the documentary evidence or in detailed affidavits, a hearing on damages is

not necessary. e360 Insight, 500 F.3d at 602 (quoting Dundee Cement Co. v. Howard Pipe &

Concrete Prods., Inc., 722 F.2d 1319, 1323 (7th Cir. 1983)).

Here, the amount of Mr. Watkins' gross sales of infringing products is capable of

ascertainment through definite figures in documentary evidence. Delta's filings carefully explain

how Delta calculated Mr. Watkins' gross sales. [Filing No. 23-1 at 1-5; Filing No. 23-2; Filing

No. 24 at 16-18.] Using sales data subpoenaed from Amazon, Delta identified (1) each infringing

item sold between February 1, 2021, and July 20, 2023; and (2) each infringing product's

"item_price," which represents the gross revenue Mr. Watkins received for selling one unit of that

item. [Filing No. 23-1 at 1-3; Filing No. 24 at 16.] Delta then multiplied the number of units sold

for each infringing item in a given sale by the item's "item_price." [Filing No. 23-1 at 3-4; Filing

No. 24 at 16.] Delta added each of these totals together, and the total sum of the 20,164 infringing

products that Mr. Watkins sold was $5,402,245.73. [Filing No. 23-1 at 4; Filing No. 24 at 17.]

This methodology shows that damages are capable of ascertainment from documentary evidence

and, thus, no hearing is required. Since $5,402,245.73 represents Mr. Watkins' gross revenue from

the sale of infringing products, and since Mr. Watkins has not rebutted that amount, Delta is

entitled to that sum. WMS Gaming Inc., 542 F.3d at 609.

The Court GRANTS IN PART Delta's Motion for Default Judgment to the extent it finds

that Delta is entitled to damages against Mr. Watkins in the amount of $5,402,245.73.

D. John Doe Defendants

Lastly, the Court DISMISSES the John Doe Defendants with prejudice for failure to state

aclaim. See Wudtke v. Davel, 128 F.3d 1057, 1060 (7th Cir. 1997) (noting that stating claims

against anonymous defendants is pointless). Since no outstanding defendants or claims remain,

final judgment shall enter.

IV.

CONCLUSION

The Court, having considered the above action, makes the following rulings:

e The Court GRANTS IN PART Delta's Motion for Default Judgment, [23], to the

extent that Delta has established that Mr. Watkins has violated the Lanham Act, 15

U.S.C. §§ 1114 and 1125 by engaging in trademark infringement and unfair

competition, and has violated the common law by engaging in trademark infringement

and unfair competition.

e The Court DENIES IN PART Delta's Motion for Default Judgment, [23], to the extent

that Delta failed to establish that Mr. Watkins has violated Indiana Code § 35-43-5-3

and DISMISSES that clam WITH PREJUDICE.

e The Court GRANTS IN PART Delta's Motion for Default Judgment, [23], to the

extent it finds that Delta is entitled to a permanent injunction as set forth in the separate

Permanent Injunction issued this date.

e The Court GRANTS IN PART Delta's Motion for Default Judgment, [23], to the

extent it finds that Delta is entitled to a damages award of $5,402,245.73 against Mr.

Watkins.

e The John Doe Defendants are DISMISSED WITH PREJUDICE.

Final judgment and a permanent injunction shall enter by separate orders.

Date: 12/8/2023

Hon. Jane Magnus-Stinson, Judge

18 ‘United States District Court

Southern District of Indiana

Distribution via ECF to all counsel of record

Distribution via U.S. Mail to:

Ben Watkins

1459 Belle Meade Dr.

Akron, OH 44321

Ben Watkins

17 Heritage Oak Way

Simpsonville, SC 29681