# Cox v. Shut Up And Laugh Publishing, LLC

> District Court, N.D. Texas · August 7, 2023

URL: https://www.frixlaw.com/law-library/cases/10671013

## Case

- **Court:** District Court, N.D. Texas
- **Decided:** August 7, 2023
- **Opinion:** 100trialcourt
- **Cited by:** 0 later opinions in the Frix Law Library

## Citator (automated)

- No negative treatment found by the automated citator. That is not the same as a confirmation that the case is good law; read the citing cases.
- Full citator and citing cases: https://www.frixlaw.com/law-library/cases/10671013

## How later opinions describe it (automated extraction)

- recognizing that a pleading complying with Rule 8 is sufficient for default judgment under Rule 55

## Opinion text

UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF TEXAS
FORT WORTH DIVISION

ERNEST JOE COX,

Plaintiff,

v. No. 4:23-cv-0063-P

SHUT UP AND LAUGH PUBLISHING, LLC,
ET AL.,

Defendants.

MEMORANDUM OPINION & ORDER
Before the Court is Plaintiff’s Motion for Default Judgment
(“Motion”). ECF No. 12. Having considered the Motion, relevant docket
entries, supporting documentation, and the applicable law, the Court
concludes that the Motion should be, and it is hereby, GRANTED. The
Court therefore ORDERS that a default judgment be entered against
Defendants.
BACKGROUND
Plaintiff Ernest Joe Cox authored a fictional short story entitled “Cat
Man Do” about the life of an anthropomorphic cat. Plaintiff alleges that
this work consists of original and creative material fixed in a tangible
medium of expression and was, therefore, copyrightable subject matter.
Defendant Shut Up & Laugh Publishing, LLC, (“SULP”) is a publishing
company formed in Texas by Defendant Jennifer Haney, an officer of the
company. Plaintiff contracted with Defendants to publish “Cat Man Do”
in exchange for 50% of the royalties from sales of the work and any
merchandise sold in connection with it. Plaintiff provided the original
paper copy of the work to Defendants to facilitate its publishing.
Defendants prepared, published, distributed, and sold “Cat Man Do” as
well as a derivative work entitled “Katmandoo the Story of Little Buddy
as Told by Little Buddy” (“Infringing Work”) in electronic and paperback
forms. Defendants also sold merchandise connected to the work, such as
“Katmandoo” t-shirts.
Plaintiff alleges that Defendants provided no payments in connection
their sale of the Infringing Work. However, Plaintiff also alleges that
Defendant continues to reproduce and distribute the Infringing Work
for profit and without authorization. Plaintiff sent Defendants a cease-
and-desist letter in November 2022, demanding that they stop selling
the Infringing Work. But Defendants continued to sell it after
acknowledging the letter. In December 2022, Plaintiff demanded the
return of the original paper copy of “Cat Man Do,” but Defendants
refused. Plaintiff alleges that Defendants continue to use, reproduce,
distribute, and sell the Infringing Work with full knowledge of their
infringement.
Plaintiff sued Defendants for breach of contract, theft by conversion,
copyright infringement, and violation of the Texas Theft Liability Act.
On January 27, Defendants were served with the lawsuit and the
deadline for Defendants’ response was February 17, 2023.
On March 13, 2023, Plaintiff requested that the Clerk of the Court
enter a default against Defendants, which the Clerk did the same day.
Plaintiff filed this motion for default judgment against Defendants. The
Court thus considers the motion.
LEGAL STANDARD
A plaintiff may move for default judgment under Federal Rule of
Civil Procedure 55. FED. R. CIV. P. 55(A). Courts use a three-step analysis
to determine whether a party can secure a default judgment. See N.Y.
Life Ins. Co. v. Brown, 84 F.3d 137, 141 (5th Cir. 1996). First, a party
must fail to respond or otherwise defend against an action. Id. Second,
an entry of default must be entered when the default is established by
affidavit or otherwise. Id. Third, a party must apply to the court for a
default judgment after the clerk’s entry of default. Id.
ANALYSIS
Plaintiff meets all three requirements to qualify for a default
judgment. Defendants failed to answer or otherwise respond against
Plaintiff’s Complaint. An entry of default was entered by the Clerk of
the Court, and the request was properly supported by affidavits. ECF
No. 10-2. Plaintiff has applied to the Court for a default judgment after
the Clerk’s entry of default. ECF No. 12. The decision to enter a default
judgement is discretionary, and the Court will resolve any doubt in favor
of the defaulting party. Lindsey v. Prive Corp., 161 F.3d 886, 893 (5th
Cir. 1998).
In exercising its discretion, the Court should consider whether:
(1) default judgment is procedurally warranted; (2) there is a sufficient
factual basis in the complaint that would entitle to the plaintiff to
judgment, and (3) the specific dollar amount of damages can be
determined with mathematical calculation by using information in the
pleadings and supporting documents. James v. Frame, 6 F.3d 307, 310
(5th Cir. 1993). The Court addresses each in turn.
A. Procedural Requirements
In determining whether a default is procedurally warranted, the
Court considers whether: (1) there is an issue of material fact;
(2) substantial prejudice is present; (3) proper grounds for default are
clearly established; (4) the defaulting party made a good faith mistake
or committed excusable neglect; (5) default judgment would be a harsh
remedial measure; and (6) the Court would feel obligated to set aside
default upon a defendant’s motion. Davis v. Parkhill-Goodloe Co., Inc.,
302 F.2d 489, 495 (5th Cir. 1962).
First, Plaintiff filed a well-pleaded complaint alleging facts that raise
a right to relief. Because Defendants have failed to answer or otherwise
respond, they admit Plaintiff’s non-conclusory allegations, except those
relating to the amount of damages. See Jackson v. FIE Corp., 302 F.3d
515, 525 n. 29 (5th. 2002). Second, Defendants’ failure to answer or
otherwise respond to the complaint brought the adversarial process to a
halt, causing substantial prejudice to Plaintiff and his claims.
Defendants have had ample opportunity to answer or otherwise respond
and, in fact, have indicated their intent to not answer. There is no
substantial prejudice present. Third, Defendants’ continued failure to
participate in this litigation establishes the requisite grounds for
default. Fourth, there is no reason to believe that Defendants are acting
under a good-faith mistake or excusable neglect. This is particularly
true because they have indicated that they are not willing to engage with
the lawsuit. Fifth, a default judgment is not harsh because it is the exact
procedural device that is necessary for the Court to maintain the
efficiency of its docket. See Merrill Lynch Mortg. Corp. v. Narayan, 908
F.2d 246, 253 (7th Cir. 1990). Plaintiff properly served Defendants,
Defendants have failed to appear, and Defendants are in default. Such
circumstances warrant a default judgment under Rule 55(b)(2). Sixth,
nothing in the record suggests that Court would set aside its putative
default against Defendants if they were to move for such relief.
Based on these factors, the Court concludes that a default judgment
is procedurally warranted.
B. Entitlement to Judgement
The Court next assesses whether the factual content of the pleadings
provide a sufficient basis for default judgment. See Lindsey, 161 F.3d at
886. Although defendants in default are considered to have conceded the
allegations stated in the plaintiff’s complaint upon entry of default, the
Court must evaluate the pleadings to ensure the sufficiency of the
complaint. Nishimatsu Const. Co. v. Hous. Nat. Bank, 515 F.2d 1200,
1201 (5th Cir. 1975).
In the Fifth Circuit, district courts refer to Federal Rule of Civil
Procedure 8 to determine the adequacy of pleadings. Wooten v.
McDonald Transit Assocs., Inc., 788 F.3d 490, 498 (5th Cir. 2015)
(recognizing that a pleading complying with Rule 8 is sufficient for
default judgment under Rule 55). Under Rule 8(a)(2), a pleading must
provide a short and plain statement of the claim showing that the
pleader is entitled to relief. FED. R. CIV. P. 8(A)(2). The pleadings must
ultimately give Defendants sufficient notice of the claims alleged
against them and their underlying bases. Wooten, 788 F.3d at 498. While
the factual allegations need not be exhaustive, they must raise a right
to relief beyond mere speculation and offer more than unsubstantiated
accusations. Id.
Plaintiff contends he is entitled to relief because of Defendants’
infringement of his copyrighted original work “Cat Man Do.” A
defendant may be held liable for copyright infringement either directly
or secondarily. UMG Recordings, Inc. v. Grande Commc’ns Networks,
LLC, No. A-17-CA-365-LY, 2018 WL 1096871, at *2 (W.D. Tex. Feb. 28,
2018). Plaintiff only alleges Defendants directly infringed his work. To
establish direct infringement, a plaintiff must demonstrate: (1) legal
ownership of a valid copyright; and (2) copying of the copyrighted
material that contains substantial similarity between the copyrighted
work and the alleged infringing work. Batiste v. Lewis, 976 F.3d 493,
502 (5th Cir. 2020).
As to the first element, Plaintiff owns a valid copyright in “Cat Man
Do.” Valid Copyright ownership exists when the work is original, a work
of authorship, and is fixed in any tangible medium of expression. See 17
U.S.C. § 102(a). Plaintiff authored the fictional story “Cat Man Do,”
depicting a tale of an anthropomorphic cat. It contains original and
creative content that has been fixed in a tangible medium of expression
(i.e., a novel). Plaintiff has thus satisfied the first prong of copyright
infringement by proving his ownership of a copyright for “Cat Man Do.”
To establish copying, Plaintiff must allege that Defendants had
access to the material and that there is a substantial similarity between
the two works. Lakedreams v. Taylor, 932 F.2d 1103, 1107 (5th Cir.
1991). Plaintiff shows that Defendants accessed, copied, and publicly
sold their derivative work “Katmandoo” on their website. ECF No. 13 at
17. Further, Plaintiff also proves that substantial similarity exists
through Defendants’ copying of Plaintiff’s story with a slightly altered
title of the book. Thus, Plaintiff has sufficiently pled ownership and
copying.
Since Plaintiff has proven these two elements, the Court determines
that he has pled enough factual content to determine that he is entitled
to a default judgment as to Defendants’ liability for copyright
infringement.
C. Entitlement to Damages
The Copyright Act confers broad discretion to district courts in
determining which form of recovery is more equitable—one based on
actual damages and profits, or one based on a reasonable estimate of
damages within the boundaries of the statute. F.W. Woolworth Co. v.
Contemporary Arts, 344 U.S. 228, 224–25 (1952). In other words, the
district court’s conception of what is fair given the totality of
circumstances serves as a framework for the damages awarded. L.A.
Westermann Co. v. Dispatch Printing Co., 249 U.S. 100, 106–07 (1919).
1. Statutory Damages
Plaintiff has chosen to pursue statutory damages rather than actual
damages. As authorized by 17 U.S.C. § 504(c)(1), the Court has the
power to award statutory damages of “not less than $750 or more than
$30,000 as the court considers just” for each infringed work. Mason v.
Montgomery Data, Inc., 967 F.2d 135, 143 (5th Cir. 1992).
Furthermore, the Court may increase this amount up to $150,000 per
infringed work if it determines that a defendant acted willfully. See 17
U.S.C. § 504(c)(2). A defendant has acted willfully if it knowingly
engaged in the infringing conduct. Id.
Although a district court has the discretion to decide whether to hold
an evidentiary hearing to determine damages, it is not necessary when
the amount claimed is a liquidated sum or is capable of mathematical
calculation. James v. Frame, 6 F.3d 307, 310 (5th Cir. 1993). Statutory
damages are intended to compensate for profits or injuries and
discourage wrongful conduct. Mouse On Tha Track LLC v. Parg Mgmt,
LLC, No. 3:18-CV-2980-S-BH, 2019 WL 6970946, at *7 (N.D. Tex. Nov.
13, 2019) (Ramirez, Mag. J.), report and recommendation adopted, 2019
WL 6915726 (N.D. Tex. Dec. 18, 2019) (Scholer, J.).
Plaintiff seeks the maximum statutory damages of $150,000. ECF
No. at 17–18. Plaintiff bases this on the fact that Defendants have not
appeared in this action and asks the Court to grant the maximum relief
available without holding a hearing. But an award of the cap on
statutory damages available is excessive given the facts here. Thus, the
Court concludes that Plaintiff is entitled to $10,000 of total relief. This
amount is representative of Plaintiff’s statutory damages award, but not
his requested attorneys’ fees since he did not provide proper
documentation supporting his request in his Motion. Id. at 20. The
amount is sufficient but not greater than necessary to discourage
Defendants’ infringing conduct while providing Plaintiff with sufficient
compensation for his injuries. Also, because it provides sufficient relief,
the Court chooses not to award statutory damages under the Texas
Theft Liability Act, or his additional request for attorneys’ fees.
2. Injunctive Relief
To obtain injunctive relief, the movant must prove four elements: (1)
likelihood of success on the merits; (2) irreparable injury absent the
injunction; (3) the harm suffered outweighs any harm the opposing
party may experience from the injunction; and (4) the injunction will not
impair public interest. Enrique Bernat F., S.A. v. Guadalajara, Inc., 210
F.3d 439, 442 (5th Cir. 2000).
Plaintiff proves his case on all four factors: (1) enough factual content
is present to infer that Plaintiff would succeed on the merits; (2) Plaintiff
would continue to suffer financial harm if his copyrightable material
continues to be sold, along with harm to his interest in his intellectual
property; (3) Defendants will suffer no harm because the copyrightable
material was never their own; (4) an injunction would further the
public’s interest in the integrity and security of copyrighted material.
CONCLUSION
For all these reasons, the Court GRANTS Plaintiff’s Motion for
Default (ECF No. 12) and awards $10,000 of statutory damages to
Plaintiff.
The Court further ORDERS that Defendants are permanently
enjoined from continuing their infringing use of “Cat Man Do,”
“Katmandoo,” or any material associated with Plaintiff’s intellectual
property. The Court also ORDERS Defendants to return Plaintiff’s
original paper copy of “Cat Man Do” to him within thirty days of the
entry date of this Order.
SO ORDERED on this 7th day of August 2023.

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Source: Frix Law Library, https://www.frixlaw.com/law-library/cases/10671013. Public record. Not legal advice.