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Marchex Sales, Inc. v. Tecnologia Bancaria, S.A.

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

May 21, 2015

MARCHEX SALES, INC., Plaintiff,
v.
TECNOLOGIA BANCARIA, S.A., Defendant.

PROPOSED FINDINGS OF FACT AND RECOMMENDATIONS

JOHN F. ANDERSON, Magistrate Judge.

This matter is before the court on Marchex Sales, Inc.'s ("Marchex" or "plaintiff") motion for default judgment pursuant to Federal Rule of Civil Procedure 55(b)(2). (Docket no. 11). 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 October 3, 2014, plaintiff filed its complaint ("Compl.") under 15 U.S.C. § 1114(d)(iv)-(v) for reverse domain hijacking, declaratory relief under the Lanham Act, and tortious interference with contract. (Docket no. 1). Prior to effecting formal service, plaintiff provided notice of this action to defendant's "authorized representative" by e-mail at c.weinmann@weinmann-zimmerli.ch. (Compl. ¶ 25). Plaintiff later served the defendant by Federal Express at its last known place of business and provided confirmation of delivery as directed by the court in a prior Order. (Docket nos. 6, 8-3).

Plaintiff filed a request for entry of default on March 20, 2015. (Docket no. 7). Thereafter, the Clerk of Court entered a default against defendant Tecnologia Bancaria S.A. ("Tecnologia") on April 2, 2015 pursuant to Rule 55(a) of the Federal Rules of Civil Procedure. (Docket no. 10).[1] On April 15, 2015, plaintiff filed and served its motion for default judgment, memorandum in support, and notice of hearing for May I, 2015. (Docket nos. 11-13). On May 1, 2015, plaintiff's counsel appeared at the hearing on the motion for default judgment before the undersigned and no one appeared on behalf of the defendant.

Factual Background

The following facts are established by the complaint (Docket no. 1) and the memorandum in support of plaintiff's motion for default judgment (Docket no. 12).

Plaintiff is an online advertising company which maintains a large portfolio of domain names comprised of simple words, phrases, and other common terms for the purpose of providing websites through which businesses corresponding to the domain names are advertised. (Compl. ¶ 8).[2] Two of the domain names used by the plaintiff for advertising purposes form the basis of the dispute currently before this court: and ("subject domain names"). (Compl. ¶ 9).

Plaintiff registered the subject domain names more than seven years ago and has used those domain names to provide websites advertising banks and banking services. ( Id. ). The registrar for both subject domain names is Network Solutions LLC ("Network Solutions"), which maintains its principal place of business in the Eastern District of Virginia. (Compl. ¶ 4). Network Solutions is accredited by the Internet Corporation for Assigned Names and Numbers ("ICANN") and ICANN provides varying degrees of oversight in the domain-name registration market and requires most types of trademark-based domain name disputes to proceed under the Uniform Domain-Name Dispute-Resolution Policy ("UDRP"). For example, "[d]isputes alleged to arise from abusive registrations of domain names (... cybersquatting) may be addressed by expedited administrative proceedings that the holder of trademark rights initiates by filing a complaint with an approved dispute-resolution service provider." Uniform Domain-Name Dispute Resolution Policy: General Information, https://www.icann.org/resources/pages/help/dndr/udrp-en. In accordance with these regulations, the contract issued by Network Solutions-finalizing the registration of the subject domain names-incorporates the UDRP, "under which a third party may request transfer of rights under said contract to such party on the basis of a claim of trade or service mark rights." (Compl. ¶ 14).

On November 21, 2011, Tecnologia "filed U.S. Trademark Registration Application No. 85/478047 for a figurative presentation of 13ANCO24HORAS' for ATM banking services' with the United States Patent and Trademark Office (USPTO)." (Compl. ¶ 10). On March 8, 2012, the USPTO refused Tecnologia's application. ( Id. ). Tecnologia responded to the refusal on September 6, 2012, and a final refusal was issued on October 7, 2012. ( Id. ). Tecnologia failed to appeal the final refusal issued by the USPTO and abandoned the application on May 6, 2013. (Compl. ¶¶ 10, 13).

On May 20, 2014, Tecnologia filed a complaint under the UDRP with the World Intellectual Property Organization ("WIPO") seeking the transfer of the subject domain names. (Compl. ¶ 15). On September 26, 2014, the WIPO panel ordered transfer of the subject domain names to the complainant (Tecnologia). (Compl. ¶ 19). Pursuant to the UDRP, plaintiff filed this complaint which requires Network Solutions to not take any action to implement the WIPO panel decision pending a resolution of the complaint. (Compl. ¶¶ 1, 14, 28).

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 defendant's failure to file a responsive pleading in a timely manner, the Clerk of Court has entered a default as to the defendant, Tecnologia. (Docket no. 10).

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 ...


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