Blackrock, Inc. v. Balckrock.Com

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BLACKROCK, INC., Plaintiff, v. BALCKROCK.COM, el al., Defendants.

Civil Action No. 1:22-cv-1002 (TSE/JFA)

United States District Court, E.D. Virginia, Alexandria Division

November 18, 2022

PROPOSED FINDINGS OF FACT AND RECOMMENDATIONS

JOHN F. ANDERSON, UNITED STATES MAGISTRATE JUDGE

This matter is before the court on plaintiffs motion for default judgment against thirty seven (37) defendant domain names pursuant to Federal Rule of Civil Procedure 55(b)(2). (Docket no. 15).^[1] Pursuant to 28 U.S.C. § 636(b)(1)(C) the undersigned magistrate judge is filing with the court his proposed findings of fact and recommendations, a copy of which will be provided to all interested parties.

Procedural Background

On September 6, 2022, plaintiff filed a complaint against thirty-nine (39) defendant domain names pursuant to the in rem provisions of the Anti-Cybersquatting Consumer Protection Act (“ACPA”), 15 U.S.C § 1125(d), and for trademark infringement under the Lanham Act, 15 U.S.C. § 1114(1)(a). (Docket no. 1) (“Compl.”). On September 6 and 7, 2022, plaintiff sent letters to the physical and email addresses provided by the registrant(s) of the defendant domain names notifying them that plaintiff had filed this action, attaching a copy of the complaint, and providing notice of plaintiffs intent to proceed in rem. (Docket no. 5-1, ¶¶ 6-7). Where the registrant(s) did not provide their addresses, plaintiff sent the letter to the registrar. (Id. ¶ 7). Plaintiff also sent separate notices through the online contact portals listed in the Whois records. (Id.).

On September 23, 2022, plaintiff filed a motion for service by publication. (Docket no. 4). The court granted the motion and entered an order requiring plaintiff to publish notice of this action. (Docket no. 8). Plaintiff sent a copy of the order to the email address of the registrant(s) of the defendant domain names, to the extent the registrant(s) made their email contact information available in the Whois records, as well as the online contact portal when identified in the Who is records. (Docket no. 11 ¶ 5). Plaintiff arranged of notice of the action in The Washington Times on September 28, 2022. (Id. at 10; Docket no. 11-1).

On October 20, 2022, plaintiff requested an entry of default against the defendant domain names, which the Clerk of Court entered on October 21, 2022. (Docket nos. 12, 14). On November 2, 2022, plaintiff filed this motion for default judgment, a memorandum in support, and a notice of hearing for Friday, November 18, 2022 at 10:00 a.m. (Docket nos 15-17).^[2]Plaintiff included certificates of service with these pleadings indicating that notices of the filings were sent to the registrant(s) of the defendant domain names using the electronic contact information provided by the registrant(s) to the registrar. (Docket no. 15 at 3; Docket no. 16 at 16; Docket no. 17 at 2). At the hearing on Friday, November 18, 2022, counsel for plaintiff appeared, but no one appeared on behalf of the defendant domain names.

Factual Background

The following facts are established by the complaint and the memorandum in support of plaintiffs' motion for default judgment. (Compl.; Docket no. 16). Plaintiff is a corporation organized and existing under the laws of Delaware with a principal place of business in New York, NY. (Compl. ¶ 5). Plaintiff is currently the largest publicly traded investment management firm, and it has been using the BLACKROCK mark to promote its services since its founding in 1988. (Compl. ¶¶ 51, 53). Since 1997, plaintiff has been the registrant of the domain name BLACKROCK.com, which it has continuously used to promote its asset management services. (Compl. ¶ 58). Plaintiff also has acquired numerous other domain names that incorporate the BLACKROCK mark, some of which redirect to plaintiffs main website or country-specific sites, and others of which are held as a defensive measure to protect consumers by limiting cybersquatting of domain name registrations. (Compl. ¶ 59). Plaintiff also owns the statutory rights to multiple BLACKROCK formative marks by virtue of its U.S. trademark registrations. (Compl. ¶ 64).

The defendant domain names were registered for the purpose of, inter alia, obtaining internet visitors when such visitors were attempting to reach plaintiff s website. (Compl. ¶ 69). The defendant domain names use the BLACKROCK mark combined with descriptive term(s), a typographical error of the BLACKROCK mark, insertion of unnecessary grammar, or a combination of those tactics. (Compl. ¶¶ 7-23, 25-44, 68). Some of the webpages located at the defendant domain names have been configured to display pay-per-click links, redirect visitors to a third-party website for sales solicitation, download malware or bloatware, and/or for email services that could be used to impersonate plaintiff. (Compl. ¶¶ 71-73).

The defendant domain names do not reflect the legal name of the registrant(s), and the registrant(s) have not engaged in bona fide noncommercial or fair use of the BLACKROCK marks in a website accessible under the defendant domain names. (Compl. ¶¶ 75-76). Many of the registrants also provided material and misleading false contact information when applying for and maintaining the registration for the defendant domain names in that the person or entity identified as the registrant is not the actual registrant of the domain names. (Compl. ¶ 79). Some of the registrants used services such as Domains by Proxy, LLC or the Withheld for Privacy ehf privacy service to conceal their identity. (Compl. ¶¶ 8-12, 14-23, 25-26, 30, 33-34, 37-38,42, 44, 80). Other records contain no registrant name field, thereby concealing the identity of the registrants of the domain names. (Compl. ¶¶ 13, 27-29, 31-32, 35-36, 39-41, 43, 80). Only one of the registrants was identified by plaintiff-Guojianguang located in Beijing, China. (Compl. ¶ 7). Plaintiff alleges if the defendant domain names were registered by different people or entities, the registrants acted in concert given that groups of the defendant domain names were registered on the same date, have been registered with the same registrar, and/or resolve to reflect similar unlawful content. (Compl. ¶ 81).

Proposed Findings and Recommendations

Rule 55 of the Federal Rules of Civil Procedure provides for the entry of a default judgment when “a party against whom a judgment for affirmative relief is sought has failed to plead or otherwise defend.” Based on the failure to plead or otherwise defend against this action, the Clerk of Court has entered a default as to the 37 defendant domain names. (Docket no. 14).

A defendant in default admits the factual allegations in the complaint. See Fed.R.Civ.P. 8(b)(6) (“An allegation-other than one relating to the amount of damages-is admitted if a responsive pleading is required and the allegation is not denied.”); see also GlobalSantaFe Corp. v. Globalsantafe.com, 250 F.Supp.2d 610, 612 n.3 (E.D. Va. 2003) (“Upon default, facts alleged in the complaint are deemed admitted and the appropriate inquiry is whether the facts as alleged state a claim.”). Rule 55(b)(2) of the Federal Rules of Civil Procedure provides that a court may conduct a hearing to determine the amount of damages, establish the truth of any allegation by evidence, or investigate any other matter when necessary to enter or effectuate judgment.

Joinder Under Federal Rule of Civil Procedure 20

As an initial matter, this proposed findings of fact and recommendations will address whether the 37 defendant domain names were joined properly as defendants in this action. Federal Rule of Civil Procedure 20(a)(2) directs that multiple defendants may be joined in one action if “(A) any right to relief is asserted against them jointly, severally, or in the alternative with respect to or arising out of the same transaction, occurrence, or series of transactions or occurrences; and (B) any question of law or fact common to all defendants will arise in the action.” Fed.R.Civ.P. 20(a)(2)(A)-(B). Thus, there are two tests that must be satisfied for a finding of proper joinder under Rule 20: first, a right to relief must be asserted against each defendant that relates to or arises out of the same transaction, occurrence, or series of transactions or occurrences; and second, a question of law or fact common to all defendants must arise in the suit. The Supreme Court has generally encouraged joinder of claims, parties, and remedies in order to “entertain[] the broadest possible scope of action consistent with fairness to the parties.” United Mine Workers of Am. v. Gibbs, 383 U.S. 715, 724 (1966).

To satisfy the transaction or occurrence test under Rule 20(a)(2), there must be a logical relationship between the events giving rise to the cause of action against each defendant. Though this case is brought as an in rem action against 37 individual defendant domain names plaintiff alleges that the claims set forth in the complaint arise out of the same series of transactions. Specifically, plaintiff alleges the defendant domain names were all registered or reregistered in the same series of registration transactions, which occurred in the same general time period, using the same methods of cybersquatting on the BLACKROCK mark, to unidentified and/or foreign registrant(s). (Compl. ¶¶ 7-23, 25-44; Docket no. 16 at 8). Given these uncontested allegations, sufficient support has been presented to establish that this ACPA claim against the 37 defendant domain names satisfies Rule 20's “transaction or occurrence” test as articulated by the Supreme Court and the courts of this Circuit. As to the common question of fact or law, in this case, there is no question that the claims asserted by plaintiff against the 37 d...