Trademark Trial and Appeal Board Electronic Filing System. http://estta.uspto.gov
`ESTTA352387
`ESTTA Tracking number:
`06/11/2010
`
`Filing date:
`IN THE UNITED STATES PATENT AND TRADEMARK OFFICE
`BEFORE THE TRADEMARK TRIAL AND APPEAL BOARD
`92046473
`Defendant
`J. C. Brown
`Matthew J. Elliott
`Beckman Lawson LLP
`200 East Main Street, P.O. Box 800
`Fort Wayne, IN 46801-0800
`UNITED STATES
`Other Motions/Papers
`Brian Heck
`bheck@beckmanlawson.com
`/Brian Heck/
`06/11/2010
`Motion to Dismiss PTO Matter.pdf ( 25 pages )(1184712 bytes )
`
`Proceeding
`Party
`
`Correspondence
`Address
`
`Submission
`Filer's Name
`Filer's e-mail
`Signature
`Date
`Attachments
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`

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`IN THE UNITED STATES PATENT AND TRADEMARK OFFICE
`
`BEFORE THE TRADMARK TRIAL AND APPEAL BOARD
`
`In Re: Trademark Registration No.: 3,028,685
`For the Mark: Amaze-N-Tow
`
`Registered on December 13, 2005; and
`
`Trademark Registration No.: 3,070,520
`For the Mark: ANT
`
`Registered on March 21, 2006
`
`Cancellation No. 92046473
`
`Esler C. Walker, Jr. and
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`Amaze-N-Tow, Inc.,
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`Petitioners,
`
`V.
`
`J .C. Brown,
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`\/\/\y\./\_/\./\/\/g/\/\/
`
`Registrant.
`?________M_____)
`
`MOTION TO DISMISS PETITION FOR CANCELLATION AS A RESULT OF
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`JUDGMENT ENTERED BY THE UNITED STATES DISTRICT COURT FOR THE
`NORTHERN DISTRICT OF INDIANA
`
`The Registrant, J.C. Brown, by counsel, respectfully requests that the Court dismiss the
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`above-captioned Cancellation Proceeding.
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`In support of this Motion, the Registrant states as
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`follows:
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`1.
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`On October 16, 2006, the Petitioners filed Petition for Cancellation for Trademark
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`Registration Numbers 3,028,685 and 3,070,520.
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`2.
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`On February 25, 2007, the Trademark Trial and Appeal Board issued an Order
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`suspending the proceedings in this matter pending the resolution of the case between the
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`Petitioners and the Registrant pending with the United States District Court for the Northern
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`District of Indiana, cause number l:06—cv-218 (“District Court Litigation”). Specifically, in the
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`
`
`
`
`4‘V7O\\\“>‘<\r/ANwzfia-v>qvvxv\V1v,u=m-uc\xw:>»vx\:v'¢Am\2.1(w.1A..,.w.m..m............“.mm.mw.«mtWmw,?.=,,.,,..x;.,.um..mxmm.W.n.M.i.,......m..“WW..,_v.“,..m..m.,4,...W.._m,_,,,,W..y.“...,,...,...........<...a..w.,..,._.,,,,,...9.«.._.N.m...~._..m.._.m,.mwi.....M....m.M.m.....,,..,m..mmm“..wm..",,.W..........,.....,.,....m,..................,...._..,._~.,.,...._V.w
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`

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`Trademark Trial and Appeal Board’s Order, it stated “[b]ecause the ownership of the marks is at
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`issue in both proceedings, the civil action will have a bearing on or be dispositive of this
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`cancellation.”
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`3.
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`The District Court Litigation has been resolved with a favorable outcome to the
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`Registrant.
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`4.
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`On May 25, 2010, Magistrate Judge Cosbey made a Report and Recommendation
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`to the District Court Judge in which he found that J.C. Brown is the registered owner of the
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`trademarks “Amaze-N-Tow” (registration number 3,025,685) and “ANT” (registration number
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`3,070,520. Magistrate Cosbey then went on to recommend that Esler C. Walker, one of the
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`Petitioners in this matter, should be permanently enjoined from using the trademarks “Amaze-N-
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`Tow” and “ANT.” A true and accurate copy of the Report and Recommendationis attached as
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`“Exhibit A.”
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`5.
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`On June 9, 2010, the District Court Judge entered an Order Modifying and
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`Adopting Magistrate Judge’s Report and Recommendation.
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`In the Order, the District Court
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`Judge adopted Magistrate Cosbey’s recommendation that Esler C. Walker be permanently
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`enjoined from using the trademarks “Amaze-N-Tow” and “ANT.” A true and accurate copy of
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`the Order Modifying and Adopting Magistrate Judge’s Report and Recommendation is attached
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`as “Exhibit B.”
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`6.
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`That same day, an Amended Judgment was entered in which:
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`Esler C. AWalker, his agents, servant employees, affiliates, successors and assigns,
`and any and all persons acting in concert or participation with them who receive
`actual notice of this Order, are hereby PERMANENTLY ENJOTNED and
`RESTRAINED:
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`from operating under or using, in any facet, the name “Amaze—N-Tow,”
`(1)
`“ANT,” and “Cyc1eTow,” or any name "confusingly similar to “Amaze-N-Tow,”
`
`

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`“ANT,” and “CycleTow” in connection with the description, marketing,
`promotion, advertising, or sale of products or services;
`(2)
`from using, adopting, and displaying colors, shapes, designs, patterns, and
`lettering similar to the trade dress of Spirit of America Corp. and Amaze—N-Tow,
`LLC; and
`(3)
`from operating any websites using the trademarks “Amaze—N-Tow,”
`“ANT,” and “CycleTow,” in whole, or in part, or any name confusingly similar to
`“Amaze—N-Tow,” “ANT,” and “CycleTow.”
`
`A true and accurate copy of the Amended Judgment is attached as “Exhibit C.”
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`7.
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`As a result, of the Amended Judgment, all of the issues involved in this
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`Cancellation Proceeding have been resolved in favor of the Registrantl
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`Therefore,
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`the
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`Registrant is asking the Trademark Trial and Appeal Board to dismiss the Petitioners’ Petition
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`for Cancellation.
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`WHEREFORE, the Registrant, J.C. Brown, by counsel, respectfully requests that the
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`Trademark Trial and Appeal Board dismiss the above—captioned Cancellation Proceeding
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`because the issues raised in the Petitioners’ Petition for Cancellation have been resolved in the
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`Registrant’s favor by the United States District Court for the Northern District of Indiana and
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`that the Trademark Trial and Appeal Board grant the Registrant all other relief that is just and in
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`proper.
`
`Respectfully submitted,
`
`
`
`mail: melliott@beckmanlawson.com
`Brian C. Heck, In. Atty. No. 22389-02
`Email: bheck@beckmanlawson.com
`200 East Main Street
`
`P. O. Box 800
`
`Fort Wayne, Indiana 46801-0800
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`1 Amaze—N-Tow, Inc. is also a Petitioner in this matter. Based on the information set forth in paragraph 5 of the
`Petition for Cancellation, Amaze—N-Tow, Inc. is an affiliate of Mr. Walker.
`
`
`
`
`
`.m»wmwmW,.mnm wwwwmamwmmwm.t mmmm.m...~...«.......m...n‘.».w.uw¢,@..._......w,..,..,=..m.........».m.a..--«in-0..m....,...,......»....m......m.mm»...wmm.,m,..a.M.~.m..m..,...mmmwam.,....mW“_.,m.mm.m"m..,...M_mWmwM.Mwm...mwmwww..«,w.mm.w...wa~m.«mm_.m_a...N_.mW_.._...«w«N«.._wmm
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`

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`CERTIFICATE OF SERVICE
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`I hereby certify that the Motion to Dismiss Petition for Cancellation as a Result of
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`Judgment Entered by the United States District Court for the Northern District of Indiana is
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`being deposited with the United States Postal Service with sufficient hostage as First-class mail
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`in an envelope addressed to:
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`Thomas Kayden, Esq.
`Thomas, Kayden, Horstemeyer
`& Risley, LLP
`600 Galleria Parkway, Suite 1500
`
`Atlanta, Georgia 30339
`
`Dated: June 11 2010
`
`Brian C
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`ec
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`orney fort e Registrant)
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`

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`case 1:06-cv-00218—TLS—RBC document 181
`
`filed 05/25/10 page 1 of 17
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`UNITED STATES DISTRICT COURT
`NORTHERN DISTRICT OF INDIANA
`FORT WAYNE DIVISION
`
`J.C. BROWN, SPIRIT OF
`AMERICA CORPORATION,
`and AMAZE-N-TOW, LLC,
`
`Plaintiffs,
`
`V.
`
`ESLER C. WALKER,
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`Defendant.
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`WWW‘./\é€%%\/\§%
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`Case No. 1:06-cv-218
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`REPORT and RECOMNIENDATION
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`This matter is before the Court on the Plaintiffs’ Motion to Amend Default Judgment.
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`Plaintiffs ask the Court to amend the September 30, 2009, entry of default judgment against the
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`Defendant (Docket # 166) to include an award of damages, attorney fees, costs, and a permanent
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`injunction. (Docket # 167.) The District Court Judge, Theresa L. Springmann, entered an Order
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`pursuant to 28 U.S.C. § 63 6(b)(l)(B), Federal Rule of Civil Procedure 72(b)(l), and Northern
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`District of Indiana Local Rule 72.1, referring this matter to the undersigned Magistrateludge to
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`conduct a hearing on the motion and to prepare a report and recommendation. (Docket # 176.)
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`Based on the following, this Report and Recommendation recommends that the motion
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`be GRANTED and the Plaintiffs be awarded monetary damages totaling $230,908.30, attorney
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`fees in the amount of $58,131.25, and costs in the amount of $405.09. It is also recommended
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`that a permanent injunction issue preventing the Defendant fiom using the Plaintiffs’ trademarks
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`or any confusingly similar trademarks.
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`EXHIBIT
`
`5
`
`A
`
`

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`case 1:06—cv-00218-TLS-RBC document 181
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`filed 05/25/10 page 2 of 17
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`I. PROCEDURAL HISTORY
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`On May 30, 2006, Plaintiffs Spirit of America Corporation, Amaze-N-Tow, LLC, and
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`J.C. Brown filed suit against Esler Walker, alleging, in considerable detail, claims for trademark
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`infringement, false designation of origin, unfair competition, conversion, breach of duty of
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`loyalty, and tortious interference. (Docket # 1.) After three and a half years of increasingly
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`vexatious litigation, a default judgment was entered against Walker, who is representing himself,
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`as a sanction for his repeated failure to comply with the Court’s orders.’ (Docket ## 165, 166.)
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`On October 15, 2009, the Plaintiffs filed a Motion to Amend the Default Judgment to
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`award relief including damages, attorney fees, and the issuance of a pennanent injunction.
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`(Docket # 167.) The matter was referred to the Magistrate Judge for all necessary proceedings.
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`(Docket # 176.) Accordingly, a hearing was set for May 17, 2010, at 8:30 a.m. in the E. Ross
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`Adair Federal Courthouse in Fort Wayne, Indiana. On May 13, 2010, Walker filed a Notice of
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`Waiver of Opporttmity to Appear and Contest Damages, indicating that he did not intend to
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`appear at the hearing, in effect, conceding damages? (Docket # 178.)
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`On May 17, 2010, and with Walker absent, a damages hearing was held and concluded.
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`Documents were received into evidence and testimony was heard from J.C. Brown, owner of
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`Spirit of America; Cindy Ralph, an employee of Spirit of America; and, on the issue of attorney
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`fees, Brian Heck, attorney for the Plaintiffs. Based on the following findings of facts and
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`conclusions of law, this Court recommends that the default judgment be amended to include an
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`award of $230,908.30 in monetary damages, $58,131.25 in attorney fees, $405.09 in costs, and
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`1 Judge Sprinmann’s September 30, 2009, Opinion and Order granting the default judgment sets out a
`thorough history of Walker’s obfuscation and intransigence concerning this lawsuit. (Docket # 165.)
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`2 Walker filed another copy of his notice on May 17, 2010. (Docket # 180.)
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`2
`
`

`
`V case 1:06—cv—00218—TLS-RBC document 181
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`filed 05/25/10 page 3 of 17
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`that a permanent injunction issue against Walker, preventing any future use of the Plaintiffs’
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`trademarks.
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`II. FINDINGS OF FACT3
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`On September 30, 2009, a default judgment was entered against Walker as a sanction for
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`his repeated failure to comply with Court orders. (Docket # 165, 166.) As a result, all of the
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`Plaintiffs’ well-pled allegations in their complaint are accepted as true. Robinson v. Doug &
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`Steve C0nst., Inc., No. 2:09-cv-242, 2010 WL 401506, at *2 (N.D. Ind. Jan. 28, 2010).
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`Moreover, “[a] default judgment establishes, as a matter of law, that a defendant is liable to a
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`plaintiff for each cause of action in the complaint.” Id. (citing E3 60 Insight v. The Spamhaus
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`Project, 500 F.3d 594, 602 (7th Cir. 2007)).
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`Accordingly, it has already been established as a matter of law that Walker is liable to the
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`Plaintiffs for each count of their complaint; that is, the well-pled allegations of trademark
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`infringement, unfair competition, conversion, breach of duty of loyalty, and tortious interference
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`are accepted as true. The following findings of fact therefore, principally address the one
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`remaining issue before the Court———the amount of damages sustained by the Plaintiffs as a result
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`of Walker’s misconduct, and to the extent relevant, their request for injunctive relief.
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`1. Spirit of America is an Indiana corporation with its principal place of business in Fort
`Wayne, Indiana. (Compl. ‘H 2.)
`
`2. J .C. Brown is the president of Spirit of America. (Compl. ‘H 3.)
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`3. Amaze-N-Tow is a limited liability company with Spirit of America as its sole
`member. (Compl. 1] 4; Docket # 131.)
`
`3 So as to comply with Fed.R.Civ.P. 52(a) the Court makes the following Findings of Fact which will be set
`out in numbered fashion. Any Finding of Fact deemed to be a Conclusion of Law is hereby incorporated as such and
`any Conclusion of Law deemed to be a Finding of Fact is hereby incorporated as such.
`
`

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`case 1:06-cv-00218-TLS—RBC document 181
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`filed 05/25/10 page 4 of 17
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`4. Spirit of America and Amaze-N-Tow sell uniquely designed trailers capable of easily
`lifting and towing large loads behind a vehicle. These trailers are sold to military and
`commercial customers and are marketed under the names “Amaze-N-Tow,” “ANT,” and
`“CycleTow.” Sales are made directly by Spirit of America and Amaze-N-Tow, or by
`authorized distributors. (Brown Aff. 11 11-13.)
`-
`
`5. J.C. Brown is the registered owner of the trademark “Amaze-N-Tow,” registration
`number 3,028,685, used for material handling and load lifting trailers attached to a
`vehicle. Amaze-N-Tow was registered with the United States Patent and Trademark
`Office (“PTO”) on December 13, 2005. (Brown Aff. 1] 8; Pls.’ Ex. 1, pg. 7.)4
`
`6. J.C. Brown is the registered owner of the trademark “ANT,” registration number
`3,070,520, used for material handling and load lifting trailers attached to a vehicle. ANT
`was registered with the (“PTO”) on March 21, 2006. (Brown Aff. 1} 9; Pls.’ Ex. 1, pg. 9.)
`
`7. CycleTow is not a federally registered trademark, but Spirit of America claims
`ownership of the mark.
`
`8. Esler C. Walker is a former employee of Amaze-N—Tow, LLC. Walker’s duties
`included manufacturing and selling the material handling trailers. Walker’s employment
`was terminated at least by the spring of 2006. (Brown Aff. fil 6.)
`
`9. The retail price of the material handling trailers sold under the names Amaze-N—Tow,
`ANT, and CycleTow varies between $5,590.00 and $9,995.00. (Brown Aff. 1[ 14.)
`
`10. Walker received weekly gross wages of $700.00. (Brown Aff.1] 36.) From December
`9, 2005, to January 6, 2006, the time period during which Plaintiffs allege Walker
`breached his duty of loyalty, he received $3500 in wages. (Brown Aff. 1] 36.)
`
`11. While employed with Amaze-N-Tow, Walker, who handled the manufacture of the
`trailer’s in Georgia, constructed and sold three (3) Amaze-N-Tow trailers but did not turn
`over the proceeds of $15,588.00 to Amaze-N-Tow, LLC, as he was required to do.
`(Brown Aff. 1] 29; Pls.’ Ex. 1, pg. 48.)
`
`12. Amaze-N—Tow, LLC purchased seventy-five (75) hydraulic pumps to be used in the
`construction of the Amaze-N-Tow trailers. The pumps were purchased in multiple orders
`on a revolving basis. The average price of a single pump is $274.71. Each
`Amaze-N-Tow trailer utilizes one pump. (Brown Aff. 11 30; P1s.’Ex. 1, pgs. 49-75; Mot.
`to Am.1l 36.)
`
`13. In April of 2006, Brown discovered that Walker had used only fifty-two (52) of the
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`4All references to the “Plaintiffs Exhibits” refer to the exhibits admitted into evidence during the May 17,
`2010, hearing.
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`

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`case 1:06-cv-00218-TLS-RBC document 181
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`filed 05/25/10 page 5 of 17
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`pumps in constructing Amaze-N-Tow trailers. When Brown questioned Walker about
`the remaining twenty-three (23) pumps, Walker stated that he no longer had them in
`inventory, but provided no further explanation. The Plaintiffs believe, later verified by
`an on-site visit to Walker’s factory, that Walker still had the pumps and apparently used
`the 23 pumps to construct his own trailers, keeping the proceeds for himself. Based on
`the average price per unit, the 23 pumps have a value of $6,318.33. (Brown Aff. 1] 30;
`Pls.’Ex. 1, pgs. 49-75; Mot. to Am. 1] 37.)
`
`14. During Walker’s employment, Amaze-N-Tow, LLC reimbursed him $512.60 for
`what it believed were valid business expenses. Brown later determined that these
`expenses were not legitimate and demanded that Walker return the funds. Walker has
`failed to do so. (Brown Aff. 1] 32; Pls.’ Ex. 1, pgs. 76-93.)
`
`15. On April 12, 2006, Brown discovered that Walker spent $2,457.10 from
`Amaze-N-Tow, LLC’s business account to have repairs made to his personal vehicle.
`Although Brown demanded that Walker return these funds as well, he has failed to do so.
`(Brown Aff 1] 33; Pls.’ Ex. 1, pgs. 94-125.)
`
`16. Following his termination, Walker began using the trademarks Amaze-N-Tow, ANT,
`and CycleTow to describe, market, promote, advertise, and sell his own, but confusingly
`similar, material handling and load lifting trailers. (Brown Aff. 1] 17.)
`
`17. Walker also used the trademarks Amaze-N-Tow, ANT, and CycleTow to describe,
`market, promote, advertise, and sell his products on various websites, including:
`- www.amazentowusa.com
`
`- WWW.geocities.corn/arnazentowusa
`- www.geocities.corn/creativebuildingproductsgeorgia
`
`18. Walker used the trademarks Amaze-N-Tow, ANT, and CycleTow to describe,
`market, promote, advertise, and sell his products in videos he made and uploaded to
`Google Videos and YouTube.com, including:
`- http://www.youtube.corn/user/butchwalkeramazentow
`- http://www.youtube.com/watch?v=K4kR4XvL0hw
`- http://www.youtube.corn/watch?v=3CyBin6-db8
`- http2//www.youtube.com/watch?v=VHQi1vGGWyg
`- http://wWw.youtube.com/watch?v=dYvzdIGPwTE
`- http://wwW.youtube.com/watch?v=f9xyqhnzfuc
`- http://www.youtube.com/watch?v=Adz76sidssA
`° http://video.google.com/videoplay?docid=610875974477879797&ei=
`a98eStKMNIyEqQP1tZmBDQ&q=amaze—n—toW
`- http://video.google.com/videoplay?docid=4684835946638793093&ei=298e
`Sr7THpKkqQ ONvrS5DQ&q=amaze—n—tow
`
`19. According to the YouTube website and testimony at the hearing, the videos have
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`

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`case 1:06-cv-00218-TLS-RBC document 181
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`filed 05/25/10 page 6 of 17
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`received over 100,000 combined views as of mid—May, 2010. (Brown Aff. 11 21.)
`
`20. On March 29, 2006, Walker sold a trailer under the Amaze-N-Tow name (although it
`was not a true Amaze-N-Tow) to KD Properties through an entity named Walker &
`Associates. (Brown Aff. 1] 27; Pls.’ Ex. 1, pgs. 41-47.)
`
`21. On April 20, 2006, Walker issued a Certificate of Origin for another so—called
`Amaze-N-Tow trailer to Donald C. Bennett through an entity named Amaze-N-Tow, Inc.
`Amaze-N-Tow, Inc. is not affiliated in any way with Spirit of America Corporation or
`Amaze-N-Tow, LLC. (Brown Aff. 1] 27; Pls.’ Ex. 1, pgs. 41-47.)
`
`22. On June 1, 2006, Walker issued a Certificate of Origin for a Vehicle for an
`Amaze-N-Tow trailer to Home Heating Headquarters through an entity named
`, Amaze-N-Tow, Inc. At that time, Amaze-N-Tow, LLC had a Distributor Agreement
`with Home Heating Headquarters for the sale of Amaze-N-Tow trailers. (Brown Aff. 11
`26; Pls.’ Ex. 1, pgs. 37-40.)
`
`23. Walker was never given authorization to use the trademarks Amaze—N—Tow, ANT, or
`CycleTow. (Brown Aff. 11 18.)
`
`24. On April 12, 2006, Brown sent Walker a letter informing him of his improper use of
`the ANT and Amaze-N-Tow trademarks and ordering him to immediately cease all use of
`the trademarks. (Brown Aff. 11 23; Pls.’ Ex. 1, pg. 36.)
`
`25. In 2005, Amaze-N-Tow, LLC sold fifty-two (52) material handling trailers. (Brown
`Aff.11 15.)
`
`26. From 2006 through 2008, Amaze-N-Tow, LLC sold only ten (10) material handling
`trailers. (Brown Aff. 1] 16.) The sharp decrease is attributable in material part to Walker
`selling inferior knock-offs at a cheaper price and confusingly trading on the Plaintiffs’
`name and reputation. If Walker was not marketing and selling such copies, it is likely
`that Amaze-N-Tow would be selling units at the 2005 level. Moreover, Walker is
`marketing a CycleTow product that appears identical to the Plaintiffs’ product and
`likewise trades on the Plaintiffs’ name and goodwill, creating a false designation of
`origin.
`
`27. Brown, Spirit, of America, and Amaze-N-Tow, LLC filed suit against Walker on May
`30, 2006. (Docket # 1.)
`
`28. On February 5, 2008, Walker failed to appear at a scheduled mediation. (Docket #
`69.) As a result, Walker was sanctioned and ordered to pay the Plaintiffs $2803.44 for
`the fees and expenses incurred by the Plaintiffs as a result of the aborted mediation.
`(Docket # 104.) Walker has yet to pay the Plaintiffs these funds. (Mot. to Am. 11 45.)
`
`

`
`case 1:06—cv—00218-TLS-RBC document 181
`
`filed 05/25/10 page 7 of 17
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`29. From April 1, 2006 through April 30, 2010, the Plaintiffs incurred $68,501.00 in
`attorney’s fees, of which they claim $58,131.25 is directly attributable to this litigation,
`and $552.47 in expenses, of which they claim $542.36 stems from this litigation. (First
`Heck Aff. 1] 3, 5; Second Heck Aff. 1] 6, 7.)
`
`II. CONCLUSIONS OF LAW5
`
`The Plaintiffs first ask that they be awarded monetary damages for Walker’s conversion
`
`of their property, breach of the duty of loyalty, and for failing to appear at a scheduled
`
`mediation. The Plaintiffs also request that a permanent injunction issue against Walker
`
`concerning his use of the Amaze-N—Tow, ANT, and CycleTow trademarks, and that they be
`
`awarded $58,131.25 in attorney fees and $542.36 in costs. The Court will address each request
`
`in turn.
`
`A. Damages for Conversion and Breach of the Duty ofLoyalty.
`
`The Plaintiffs first ask for damages for Walker’s conversion of their property and funds,
`
`totaling $24,876.03. Specifically, the Plaintiffs are seeking $15,588.00 as the proceeds of trailer
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`sales withheld by Walker; $6,318.33 for the hydraulic pumps misappropriated by Walker;
`
`$512.60 for money reimbursed to Walker that he improperly submitted as business expenses;
`
`and $2,457.10 for company funds that Walker improperly used to repair his personal vehicle.
`
`The Plaintiffs then ask that pursuant to Indiana Code § 34-24-3-1, these amounts, totaling
`
`$24,876.03, be trebled to $74,628.09. Treble damages are available to any party that suffers a
`
`pecuniary loss under Indiana Code § 35-43 —4—3. A plaintiff seeking to recover treble damages
`
`must show by a preponderance of the evidence that the defendant committed the underlying
`
`criminal offense. Ecker v. Rochester Ford New Holland, Inc., 694 N.E.2d 289, 291 (Ind. Ct.
`
`5 Fn. 3, supra, is incorporated here by this reference.
`
`
`
`
`
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`
`

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`case 1:06-cv—00218-TLS-RBC document 181
`
`filed 05/25/10 page 8 of 17
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`App. 1998). However, the defendant need not have been convicted of the offense. Americar
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`Leasing, Inc. v. Maple, 406 N.E.2d 333, 335 (Ind. Ct. App. 1980). The decision to award treble
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`damages lies in the discretion of the court. Ballard v. Harman, 737 N.E.2d 411, 418 n. 5 (Ind. Ct.
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`App. 2000).
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`The Plaintiffs have established each component of their damages claim. For the
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`$15,588.00 in Withheld proceeds fiom the three trailer sales, the Plaintiffs have offered cancelled
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`checks and correspondence from customers who purchased the three trailers. (Pls.’ Ex. 1, pgs.
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`41-48.) The Plaintiffs have also submitted invoices and receipts for each hydraulic pump order
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`to establish the average price per pump of $274.71, with total losses for 23 pumps in the amount
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`of $6,318.33. (Pls.’ Ex. 1, pgs. 49-75.) Similarly, the Plaintiffs have convincingly established
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`that Walker sought, and was improperly reimbursed, $512.60 for repairs to his personal backhoe,
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`and that he misappropriated $2,457.10 from Amaze-N-Tow, LLC’s business account for repairs
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`to his personal vehicle.
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`(P1s.’ Ex. 1, pgs. 76-126.) Altogether, these damages total $24,876.03.
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`Furthermore, Walker clearly committed Conversion, a Class A Misdemeanor, by
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`intentionally exercising unauthorized control over the Plaintiffs’ property in violation of Indiana
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`Code § 35-43-4-3. Accordingly, the Court recommends that the $24,876.03 in damages for
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`Walker’s conversion of their property be trebled to $74,628.09. Such an award does not amount
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`to a windfall, but rather is appropriate to fairly compensate the Plaintiffs for Walker’s extensive
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`acts of conversion, as well as his repeated disregard of his fiduciary duties. See Thor Industries,
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`Inc. v. Schwartzhofif, No. 3:07—cv-465, 2008 WL 4724007 (N.D. Ind. Oct. 24, 2008) (“[G]iven
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`the extensive bad acts at issue, and defendant’s repeated betrayal of his fiduciary duties, the
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`court believes that some exemplary damages under Indiana Code § 34—24~3—1 are appropriate”).
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`case 1:06-cv—OO218-TLS-RBC document 181
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`filed 05/25/10 page 9 of 17
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`Additionally, the Plaintiffs are entitled to recover the $3,500 in wages paid to Walker
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`from December 9, 2005, to January 6, 2006, since at the same time he was being paid by them,
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`he was also acting on his own behalf, manufacturing and marketing a competing line of knock-
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`offs, thus violating his duty of loyalty. (Pls.’ Ex. 1, pg. 127; Brown Aff. 111] 29, 30, 32, 36.) See
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`RESTATEMENT (SECOND) OF AGENCY § 469 (“An agent is entitled to no compensation for
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`conduct which is disobedient or which is a breach of his duty of loyalty. . .”); Wenzel v. Hopper
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`& Galliher, P.C., 830 N.E.2d 996, 1001-3 (Ind. Ct. App. 2005).
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`B. Damages for Failure to Appear at the Scheduled Mediation.
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`The Plaintiffs next ask for damages incurred as a result of Walker’s failure to appear at
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`the February 5, 2008, mediation. (Pls.’ Mot. 1] 44-46.) On October 31, 2008, Walker was
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`sanctioned and ordered to pay the Plaintiffs $2803.44 for the fees and expenses incurred as a
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`result of his non-appearance. (Docket # 104.) Walker has yet to pay the Plaintiffs these funds.
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`(Mot. to Am. 1] 45.) The default judgment should therefore be amended to reduce this amount to
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`a judgment.
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`C. Statutory Damages for Trademark Infringement.
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`The Plaintiffs also ask in their motion for an award of statutory damages to compensate
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`them for Walker’s trademark infringement and false designation of origin. The applicable
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`statute, 15 U.S.C. § lll7(c), provides that “in cases involving the use of a counterfeit mark .
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`.
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`.
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`the plaintiff may elect, at any time beforefinaljudgment is rendered .
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`.
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`. to recover, instead of
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`actual damages and profits .
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`.
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`. an award of statutory damages” of at least $1,000, but not more
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`than $200,000, per counterfeit mark. (Emphasis added.) And if the Court finds that the
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`infringement was wilful, the Plaintiff may recover up to $2,000,000 per counterfeit mark.
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`

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`case 1:O6—cv-00218-TLS—RBC document 181
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`filed 05/25/10 page 10 of 17
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`Similarly, 15 U.S.C. § 11l7(d) provides for statutory damages of up to $100,000 in cases of
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`trademark cyber-squatting and cyber-piracy.
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`As an aside, the request for statutory damages is timely, because as 15 U.S.C. lll7(c)
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`notes, the Plaintiffs can elect to receive such damages “before final judgment.” And although a
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`default judgment was entered on September 30, 2009, it was not a “final” judgment. “A final
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`judgment is one which ends the litigation on the merits and leaves nothing for the court to do but
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`execute the judgment.” Riley v. Kennedy, 128 S.Ct. 1970, 1981 (2008) (internal quotations and
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`citations omitted). On the other hand, “an order resolving liability without addressing a
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`plaintiff’ s requests for relief is not final.” Id. Accordingly, the default judgment entry, (Docket #
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`166), which made no mention of damages, or any other type of relief, was not a “final
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`judgment.”
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`Indeed, the point is illustrated here by the fact that the Seventh Circuit Court of Appeals
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`rejected Wa1ker’s appeal of the default judgment precisely because no final judgment had yet
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`been entered. Accordingly, the Plaintiffs are not barred from seeking statutory damages against
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`Walker. See Perry Ellis Intern, Inc. v. URI C0rp., N0. 06-22020-CIV, 2007 WL 3047143, at *1
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`(S.D. Fla.‘ Oct. 18, 2007) (conducting damage inquiry after default judgment entered); PetMed
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`Express, Inc. v. MedPets.com, Inc., 336 F. Supp. 2d 1213, 1217 (S.D. Fla. 2004) (same).
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`The Plaintiffs propose an award of $50,000.00 in statutory damages for Walker’s wilful
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`use of the counterfeit Amaze-N-Tow trademark, $50,000.00 in statutory damages for Walker’s
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`wilful use of the counterfeit ANT trademark, and $25,000.00 in statutory damages for each of
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`the two domain names used by Walker that included a counterfeit trademark.“ They argue that,
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`6 The Plaintiffs are not seeking any statutory damages for the CycleTow mark.
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`10
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`E E23si2 5
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` ‘i
`EU
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`case 1:06-cv-00218-TLS-RBC document 181
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`filed 05/25/10 page 11 of 17
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`given Walker’s willful infringement of their trademarks, a total award of $150,000 in statutory
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`damages is just.
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`- Although 15 U.S.C. § 1117(c) sets the parameters for statutory damages, it does not
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`indicate how to determine a damage figure within that range. Rather, “[c]ourts interpreting
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`section 1117(c) have looked by analogy to case law applying the statutory damage provision of
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`the Copyright Act contained in 17 U.S.C. § 504(c).” Lorillard Tobacco Co. v. S & M Cem‘.
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`Service Corp., No. 03—c-4986, 2004 WL 2534378, at *4 (N.D.Ill. Nov. 8, 2004) (quoting Sara
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`Lee v. Bags ofNew York, Inc., 36 F. Supp. 2d 161, 166 (S.D.N.Y. 1999) (“Cases decided under
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`the Copyright Act, which deals with a similar problem and a similar legislative grant to
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`discretion, afford guidance here.”)). Accord Louis Vuitton Malletier v. Veit, 211 F. Supp. 2d 567,
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`583 (E.D. Pa. 2002); Microsoft Corp. v. Logical Choice Computers, Inc., No. 99 C 1300, 2001
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`WL 58950, at *11 (N.D. Ill. Jan. 22, 2001).
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`The Seventh Circuit Court of Appeals set forth the standard for awarding statutory
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`damages under the Copyright Act in Clzi—B0y Music v. Charlie Club, 930 F.2d 1224, 1229 (7th
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`Cir. 1991). Under the Clzi—Boy framework, the court is “not required to follow any rigid formula
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`but instead enjoys wide discretion” in awarding statutory damages. Id. The court may consider
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`factors such as “the difficulty or impossibility of proving actual damages, the circumstances of
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`the infringement, and the efficacy of the damages as a deterrent.” Id. Furthermore, statutory
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`damages may be necessary to “penalize the infringer and deter future violations” when the
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`_
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`infringement was willful. Id. at 1230. Courts have adopted a similar View with respect to
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`determining the amount of statutory damages under 15 U.S.C. § l117(d), and primarily consider
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`the bad faith intent of a party to profit by registering a domain name with a confusingly similar
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`11
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`case 1:06-cv-00218-TLS—RBC document 181
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`filed 05/25/10 page 12 of 17
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`mark. Automobili Lamborghini, S.p.A. v. Lamboshop, Inc., No. 2:07—cV-266, 2008 WL 2743647,
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`at *7-8 (M.D. Fla. June 5, 2008).
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`It is recommended that under the circumstances of this case, the Plaintiffs be awarded
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`$150,000 in statutory damages; that is, the Plaintiffs should receive $50,000.00 for Walker’s use
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`of the counterfeit Amaze—N—Tow trademark, $50,000.00 for use of the counterfeit ANT
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`trademark, and $25,000.00 for the two domain names that included a counterfeit trademark.
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`Walker’s infringement of the Amaze-N-Tow and ANT trademarks was done willfully (and
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`indeed, continues) after he was repeatedly ordered to cease such activity. (Pls.’ Ex. 1, pg. 36.)
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`See Tony Jones Apparel, Inc. v. Indigo USA, LLC, No. 03 c 0280, 2005 WL 1667789, at *8-9
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`(N.D. Ill. July 11, 2005) (finding wilful infringement and awarding statutory damages after
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`plaintiff sent multiple cease and desists). Furthermore, Walker’s online use of the Plaintiffs’
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`marks, and wholesale copying, was done with the bad faith intent of profiting from the
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`infringement. Finally, because the infringement took place largely on the intemet—~the Video
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`advertisements have been Viewed at least 100,000 tirnes—it is difficult to assess or calculate the
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`actual losses suffered. Accordingly, statutory damages totaling $150,000 are therefore
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`reasonable and necessary to penalize Walker for his continued and willful misconduct and to
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`deter any future infringement.
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`D. The Plaintzfifs ’ Requestfor a Permanent Injunction.
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`The Plaintiffs next ask that the Default Judgment be amended to include an injunction
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`permanently enjoining Walker under 15 U.S.C. § lll6(a) from using the Amaze—N—Tow, ANT,
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`l2
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`

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`case 1:06-cv—0O218-TLS-RBC document 181
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`filed 05/25/10 page 13 of 17
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`and CycleTow trademarks.7 (Mot. to Am. 1] 13.) To obtain injunctive relief, the Plaintiffs must
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`demonstrate that: “(D that [they have] suffered an irreparable injury; (2) that remedies available
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`at law, such as monetary damages, are inadequate to compensate for that injury; (3) that,
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`considering the balance of hardships between the plaintiff and defendant, a remedy in equity is
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`warranted; and (4) that the public interest would not be disserved by a permanent injunction.”
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`American Taxi Dispatch v. American Metro Taxi & Limo Co., 582 F. Supp. 2d 999, 1004-5
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`(N .D. Ill. 2008) (citing e360 Insight v. The Spamhaus Project, 500 F.3d 594, 604 (7th C