Reported / Citable
Background
Not A Real Holding Company Inc., which owns registered trademarks and copyrights connected to Schitt’s Creek, sued 102 online sellers identified on Schedule A. It alleged that the sellers offered goods infringing its intellectual-property rights, including trademark infringement, false designation of origin, and copyright infringement.
After the court authorized electronic service and the defendants did not respond, the clerk entered default. The plaintiff sought default judgment against all defendants. The magistrate judge also considered whether the defendants had been properly joined in one action.
The Court’s Holding
Magistrate Judge Susan Hightower recommended severing every Schedule A defendant except Doe 1, identified as CURTAIN Store on AliExpress. Allegations that the sellers shared website features, payment methods, images, grammar, and purported online communications did not plausibly establish that their allegedly infringing conduct arose from the same transaction or that they acted in concert, as Rule 20 requires.
As to CURTAIN Store, the magistrate judge recommended granting default judgment on the registered-mark infringement and counterfeiting claim. The seller’s listing of an “EW DAVID” shirt sufficiently supported that claim, but the pleadings did not support false-designation liability because no unregistered mark was alleged, or copyright liability because the depicted product was not substantially similar to either registered work. The recommendation called for $40,000 in statutory damages and a permanent injunction.
Key Takeaways
- Common features among online storefronts do not, without more, justify joining numerous alleged counterfeiters in one case.
- A default admits well-pleaded liability facts, but not conclusory allegations or damages.
- The recommendation limits relief to CURTAIN Store and leaves the remaining defendants to be severed.
Why It Matters
The recommendation reinforces that Schedule A trademark cases must satisfy ordinary joinder requirements. A plaintiff cannot consolidate independent online sellers merely because they allegedly sell similar infringing goods through similarly designed stores.
It also illustrates claim-specific scrutiny at the default-judgment stage: a viable counterfeiting allegation did not automatically establish false-designation or copyright claims.