Strike 3 Holdings, LLC v. Doe

STRIKE 3 HOLDINGS, LLC, Plaintiff, v. JOHN DOE subscriber assigned IP address 173.63.123.216 Defendant.

Civil No. 2:21-cv-15651 (KSH) (LDW)

United States District Court, D. New Jersey

December 29, 2022

NOT FOR PUBLICATION

OPINION

Katharine S. Hayden, U.S.D.J.

I. Introduction

Presently before the Court is one of several lawsuits filed by plaintiff Strike 3 Holdings, LLC (“Strike 3”) alleging copyright infringement of its adult films. The instant lawsuit alleges that defendant John Doe, subscriber assigned IP address 173.63.123.216 (“defendant”) infringed 25 of Strike 3's copyrighted films in violation of the Copyright Act, 17 U.S.C. §§ 106 and 501. Defendant did not answer the complaint or otherwise respond in this matter, and Strike 3 has now moved (D.E. 17) for entry of a permanent injunction and final judgment by default pursuant to Fed.R.Civ.P. 55(b). Strike 3 has also asked the Court to unseal any documents filed under temporary seal in this matter and to remove defendant's pseudonym identifier.

II. Background

Strike 3 is the owner of “award-winning, critically acclaimed adult motion pictures” that are registered with the United States Copyright Office. (D.E. 8, FAC ¶¶ 2, 45.) Because its works are often pirated, Strike 3 developed an infringement detection system called “VXN Scan.” (Id. ¶¶ 16, 27.) Strike 3 alleges that VXN Scan established a direct connection with defendant's IP address and determined that he had used a peer-to-peer sharing network called BitTorrent to illegally download and distribute 25 of Strike 3's copyrighted works. (Id. ¶¶ 2831, 37.)

On August 18, 2021, armed only with defendant's IP address, Strike 3 filed a one-count complaint alleging copyright infringement in violation of the Copyright Act. (D.E. 1.) Soon after, Strike 3 was granted leave to file a third-party subpoena on defendant's internet service provider to obtain his name and address. (D.E. 3, 5.) Strike 3 filed an amended complaint that identified defendant by name and address on January 12, 2022 and effectuated service the next day. (D.E. 8, 12.) Defendant did not answer the amended complaint or otherwise respond, and the clerk entered default against him on April 21, 2022. (See D.E. 14, 15.)

Strike 3 now moves for entry of a permanent injunction and final judgment by default pursuant to Fed.R.Civ.P. 55(b).^[1]In its motion, Strike 3 seeks an injunction permanently enjoining defendant from to continuing to infringe its works and requiring him to delete any works in his possession, custody, or control, as well as statutory damages and costs. (See D.E. 17-1, Mov. Br.) Strike 3 also asks the Court to unseal any documents filed under temporary seal in this matter, and to identify defendant by name and address so that Strike 3 may enforce the judgment. (See id.)

III. Discussion

A. Legal Standard

The Court may enter default judgment under Fed.R.Civ.P. 55(b)(2) against a properly served defendant who does not file a timely responsive pleading. The “entry of a default judgment is left primarily to the discretion of the district court.” Hritz v. Woma Corp., 732 F.2d 1178, 1180 (3d Cir. 1984). However, that discretion is not without limits; rather, it is preferred that “cases be disposed of on the merits whenever practicable.” Id. at 1181.

“[B]efore entering default judgment, the Court must determine whether the ‘unchallenged facts constitute a legitimate cause of action.'” Days Inn Worldwide, Inc. v. Jai Shree Jalaram, Inc., 2022 WL 310205, at *2 (D.N.J. Feb. 1, 2022) (McNulty, J.) (quoting DirecTV, Inc. v. Asher, 2006 WL 680533, at *1 (D.N.J. Mar. 14, 2006) (Rodriguez, J.)). It must also be satisfied that it has subject matter and personal jurisdiction, and that the defendant was properly served. See Baymont Franchise Sys., Inc. v. Shree Hanuman, Inc., 2015 WL 1472334, at *2, 3 (D.N.J. Mar. 30, 2015) (McNulty, J.). If those threshold requirements are satisfied, the Court must then “make explicit factual findings as to: (1) whether the party subject to default has a meritorious defense, (2) the prejudice suffered by the party seeking default, and (3) the culpability of the party subject to default.” Doug Brady, Inc. v. N.J. Bldg. Laborers Statewide Funds, 250 F.R.D. 171, 177 (D.N.J. 2008) (Ackerman, J.) (citing Emcasco Ins. Co. v. Sambrick, 834 F.2d 71, 74 (3d Cir. 1987)).

B. Default Judgment Analysis

a. Threshold Requirements

Strike 3 has met the threshold requirements for entry of default judgment.

First, Strike 3 has provided the Court with a certificate of service which demonstrates that defendant was served personally at his residence in New Jersey in compliance with Federal Rule of Civil Procedure 4(e) and New Jersey Court Rule 4:4-4(a)(1). (See D.E. 12.)

Second, the Court is satisfied that it has subject matter jurisdiction over this action pursuant to 28 U.S.C. §§ 1331 and 1338 because the complaint asserts federal copyright claims. (See FAC ¶¶ 8, 56-61.) The Court also has personal jurisdiction over defendant because his IP address was traced to a physical address in New Jersey and, as explained supra, service was effectuated pursuant to New Jersey Court Rule 4:4-4(a)(1). See Chanel, Inc. v. Matos, 133 F.Supp.3d 678, 684 (D.N.J. Aug. 13, 2015) (Simandle, J.) (an individual's “domicile, or home, constitutes the paradigmatic forum for the exercise of general jurisdiction (internal citations and quotations omitted)); see also Strike 3 Holdings, LLC v. Doe, 2022 WL 16744122, at *2 (D.N.J. Nov. 7, 2022) (Martini, J.) (court had personal jurisdiction over John Doe defendant where service was effectuated pursuant to New Jersey Court Rule 4:4-4(a)(1)).

b. Legitimacy of Copyright Infringement Claim

Strike 3 alleges one count of copyright infringement in violation of 17 U.S.C. §§ 106 and 501. To state a copyright infringement claim, “a plaintiff must establish: (1) ownership of a valid copyright; and (2) unauthorized copying of original elements of the plaintiff's work.” In re McGraw-Hill Glob. Educ. Holdings LLC, 909 F.3d 48, 67 (3d Cir. 2018) (quoting Dun & Bradstreet Software Servs., Inc. v. Grace Consulting, Inc., 307 F.3d 197, 206 (3d Cir. 2002)); accord Douglas v. Osteen, 317 Fed.Appx. 97, 99 (3d Cir. 2009). Furthermore, a plaintiff must present evidence “to confirm that [the] [d]efendant is indeed the infringer” because “it is not enough for a plaintiff in a copyright infringement case to simply tie a defendant to an IP address.” Strike 3 Holdings, LLC v. Vokoun, 2022 WL 310201, at *3 (D.N.J. Feb. 2, 2022) (Hillman, J.).

Here, Strike 3 alleges that it owns valid, registered copyrights for the works at issue. (See FAC ¶¶ 4, 57.) It further alleges that defendant illegally downloaded, copied, and distributed Strike 3's copyrighted works through BitTorrent, and describes the process by which it discovered the infringement-namely, its piracy detection software VXN Scan connected with defendant's IP address, downloaded pieces of several media files, and identified those pieces as portions of Strike 3's works. (See id. ¶¶ 28-43, Ex. A.) Finally, Strike 3 alleges facts that tie defendant to the infringing conduct, including that: (i) the infringing IP address was assigned to defendant's residence during the period of infringement; and (ii) Strike 3's investigations confirmed that defendant's other BitTorrent network activity is consistent with the interests displayed on his publicly available social media profiles. (See id. ¶¶ 47-55.) Accordingly, Strike 3 has alleged a legitimate cause of action for infringement against defendant.

c. Analysis of Emcasco Factors

Turning to the Emcasco factors-i.e., (i) the existence of a meritorious defense; (ii) the prejudice that Strike 3 will suffer if default judgment is not entered; and (iii) defendant's culpability in the default-the Court finds that all three factors weigh in favor of granting default judgment. First, in light of defendant's failure to answer or otherwise respond in this matter, “no meritorious defense presently exists with respect to deciding this motion for default judgment.” United States v. Vo, 2016 WL 475313, at *3 (D.N.J. Feb. 8, 2016) (Hillman, J.). Second, failure to enter default judgment would result in prejudice to Strike 3, which has “no other means to vindicate [its] claims.” Id.; see Vokoun, 2022 WL 310201, at *3 (“Not entering default judgment would simply result in an interminable delay during which Defendant continues to violate Plaintiff's rights.”). Third, there is nothing in the record “to suggest that anything other than [defendant's] willful negligence caused [its] failure to file an answer. Prudential Ins. Co. of Am. v. Taylor, 2009 WL 536403, at *1 (D.N.J. Feb. 27, 2009) (Arleo, M.J.). Accordingly, defendant's “failure to answer, without providing any reasonable explanation, permits the [C]ourt to draw an inference of culpability.” Audi AG v. Posh Clothing, LLC, 2019 WL 1951166, at *7 (D.N.J. May 2, 2019) (Vazquez, J.).

C. Remedies

Having determined that default judgment is appropriate, the Court next assesses the remedies sought by Strike 3, mindful of the fact that its damages allegations need not be accepted as true. See Radius Bank v. Revilla & Co., 2021 WL 794558, at *4 (D.N.J. Mar.2, 2021) (Shipp, J.) (“Although the Court should accept as true the well-pleaded factual allegations of the Complaint, the Court need not accept the moving party's legal conclusions or allegations relating to the amount of damages.” (quoting Chanel, Inc. v. Gordashevsky, 558 F.Supp.2d 532, 535-36 (D.N.J. 2008) (Kugler, J.))).

a. Injunctive Relief

Strike 3 seeks a permanent injunction barring defendant from continuing to infringe upon its copyrighted works, and further requiring him to delete and permanently remove any of Strike 3's...