Electronic Creations v. Gigahertz

Citation
Electronic Creations Corp. v. Gigahertz, Inc., 2013 WL 3229125 (N.D.N.Y. June 25, 2013).

Factual Background
Plaintiff is an internet development company providing electronic services including building, leasing, and managing websites. Plaintiff authors and owns some copyright-protected websites containing creative and original expressions related to providing useful information to clients.

Defendant is a website design and holding company and has two registered domain names that operate as one. Defendant's sites copy, alter, and republish sites located on the Internet, including copyrighted material owned by plaintiff. Defendant uses a "spider" to surf the internet and copy, store, and alter websites through its computer. The copied websites stay on the server until they are identified and indexed by Google. A search on Google's search engine may bring results of the altered versions of the copyrighted material stored on defendant's server in addition or instead of the original site. Sites containing duplicate content get penalized by Google by not getting a high ranking, which results in devaluation of domain names and websites.

Defendant obtained no authorization from plaintiff to copy, distribute, or alter its copyrighted work. The purpose behind defendant's activities is to copy, publish and display the copyrighted materials on defendant's sites and submit them to Google. Defendant blocked Plaintiff's copyrighted notices making them unviewable.

Plaintiff brought suit alleging copyright infringement, trademark infringement, and unfair competition.

District Court Proceedings:

Plaintiff served defendant with the complaint but defendant filed no answer to the complaint. Plaintiff filed a motion to enter default against defendant. The default was entered but defendants had not appeared nor attempted to cure the entry of default. The court noted that when a default judgment is entered, the defendant’s failure to respond constitutes an admission of the factual allegations in the complaint except the claims for damages.

The court held that defendant has satisfied the burden of showing its entitlement to default judgment. It found that even plaintiff’s motion would survive even a heightened scrutiny that is appropriate on a contested motion. Furthermore, the court held that the factual allegations were sufficient to state a claim upon which relief could be granted. Therefore, the court granted plaintiff’s motion for the issuance of default judgment.

Furthermore, the court held that, under the circumstances, plaintiff has met its burden establishing a valid basis to be granted a permanent injunction. It explained that plaintiff established that it suffered irreparable harm and, without a permanent injunction, defendant would continue its illegal conduct of infringing plaintiff’s copyright and trademarks. Thus, the court concluded that plaintiff did sustain and would likely continue to sustain irreparable injury, and remedies available at law would be an inadequate compensation. Furthermore, the court reasoned that defendant would suffer no harm if required to comply with the law and obtain a valid license to plaintiff’s copyrighted work. The court also awarded plaintiff statutory and attorney fees and costs.

For the following reasons, the court ordered plaintiff’s motion for entry of default judgment is granted and further it granted plaintiff a permanent