GS Holistic, LLC v. Plaza Linda

— 1 — — 2 — — 3 — — 4 — — 5 — — 6 — — 7 — 8 UNITED STATES DISTRICT COURT 9 FOR THE EASTERN DISTRICT OF CALIFORNIA — 10 — 11 GS HOLISTIC, LLC, Case No. 2:22-cv-02088-DC-CSK 12 Plaintiff, FINDINGS AND RECOMMENDATIONS DENYING PLAINTIFF’S MOTION FOR 13 v. DEFAULT JUDGMENT 14 SAMIR MOHAMMED ALI SHAREEF, individually and d/b/a STICKY SMOKE 15 SHOP AND VAPE, (ECF No. 56) 16 Defendant. — 17 — 18 Plaintiff GS Holistic, LLC asserts claims for “Federal Trademark Counterfeiting 19 and Infringement, 15 U.S.C. § 1114” and “Federal False Designation of Origin and Unfair 20 Competition, 15 U.S.C. § 1125 (a)” against Defendant Samir Mohammed Ali Shareef 21 iindividually and d/b/a Sticky Smoke Shop and Vape, seeking monetary damages, 22 restitution, an injunction, and other relief. Second Amended Complaint (“SAC”) (ECF No. 23 48). Defendant has not made an appearance in this action, and a Clerk’s Default was 24 entered on January 21, 2025. (ECF No. 51.) Presently pending before the Court is 25 Plaintiff’s motion for default judgment (ECF No. 56), which was taken under submission 26 without argument pursuant to Local Rules 230(c) and (g).1 For the reasons stated below, — 27 — 1 This motion is referred to the undersigned pursuant to Local Rule 302(c)(19) and — 28 — 28 U.S.C. § 636 (b)(1)(A). 1 the Court recommends Plaintiff’s motion for default judgment be DENIED. 2 I. BACKGROUND 3 A. Factual Background 4 The SAC alleges that since 2020, Plaintiff has marketed and sold glass infusers 5 and related accessories using the well-known “Stündenglass” trademark. SAC ¶ 6. 6 Plaintiff is the rightful owner of three federally registered trademarks: (1) U.S. Trademark 7 Registration Number 6,633,884 for “the standard character mark ‘Stündenglass’ in 8 association with goods further identified in registration in international class 011”; 9 (2) U.S. Trademark Registration Number 6,174,292 for “the design plus words mark ‘S’ 10 and its logo in association with goods further identified in the registration in international 11 class 034”; and (3) U.S. Trademark Registration Number 6,174,291 for “the standard 12 character mark ‘Stündenglass’ in association with goods further identified in registration 13 in international class 034.”2 SAC ¶ 10. 14 Plaintiff has used the Stündenglass trademarks in commerce continuously 15 throughout the United States since 2020. SAC ¶ 12. Plaintiff alleges the Stündenglass 16 trademarks are “distinctive to both the consuming public and the Plaintiff’s trade” and 17 that products branded with these trademarks are made from “superior materials” that are 18 “readily apparent to consumers” and “industry professionals.” Id. ¶ 13 . Plaintiff alleges 19 the trademarks are exclusive to it and appear clearly on its products, packaging and 20 advertisements and that it has expended substantial time, money, and other resources 21 in developing, advertising, and otherwise promoting and protecting its trademarks. — 22 — Id. ¶¶ 14, 16 . Plaintiff alleges it has 3,000 authorized stores in the United States, — 23 — 24 2 The Nice Agreement establishes a classification of goods and services for the purposes of registering trademarks and service marks. Class 11 goods include — 25 — “apparatus and installations for lighting, heating, cooling, steam generating, cooking, 26 drying, ventilating, water supply and sanitary purposes.” Class 34 goods include “tobacco and tobacco substitutes; cigarettes and cigars; electronic cigarettes and oral 27 vaporizers for smokers; smokers’ articles; matches.” See List of Goods and Services in Class Order, Nice Classification Index, accessed July 16, 2025, available at 28 https://nclpub.wipo.int/enfr/. 1 including in California, selling its products using the Stündenglass trademarks and 2 reaching a vast array of consumers throughout the country. Id. ¶ 19 . Plaintiff alleges its 3 products using the Stündenglass trademarks have a higher sales value than non4 Stündenglass branded products and because of this, its products are targeted by 5 counterfeiters. Id. ¶¶ 20-21 . 6 The SAC alleges Defendant has, and continues to, offer for sale counterfeit 7 products using the Stündenglass trademarks, including reproductions, counterfeits, 8 copies and/or colorable imitations of one or more of the Stündenglass trademarks, 9 without the consent of Plaintiff. SAC ¶¶ 25-27. Specifically, the SAC alleges that on 10 October 21, 2022, Plaintiff’s investigator “purchased a Glass Infuser with Stündenglass 11 [tradem]arks affixed to it” from Defendant for $350.00 and that “it was a Counterfeit 12 product in that it displayed” the three Stündenglass trademarks. Id. ¶ 30 . Plaintiff alleges 13 Defendant’s “Counterfeit Good contained all three of [Plaintiff’s] [trade]marks” and that 14 Defendant’s use of the “Counterfeit [trademarks] is “substantially indistinguishable” or 15 “identical” to Plaintiff’s trademarks. Id. ¶ 31 . Plaintiff further alleges Defendant Shareef 16 as an individual “authorized, directed, and/or participated in” Defendant’s “offer for sale, 17 in commerce, of the Counterfeit Goods” and that Defendant Shareef’s “acts were a 18 moving, active, and conscious force behind” Defendant’s infringement of the 19 Stündenglass trademarks. Id. ¶ 33 . Plaintiff alleges the use of the counterfeit good 20 “began after the registration of the Stündenglass trademarks” without the consent of 21 Plaintiff. Id. ¶ 34 . 22 Plaintiff contends it has suffered losses and damage to the goodwill and 23 reputation of its trademarks because of Defendant’s acts, which “was, and is, likely to 24 cause confusion or to cause mistake and/or deceive consumers who purchase the 25 Counterfeit Goods.” SAC ¶¶ 36-37, 44-46. Plaintiff prays for statutory and treble 26 damages; costs; an order enjoining Defendant’s sale of any counterfeit product using 27 Plaintiff’s Stündenglass trademarks and an order for destruction of products bearing the 28 Stündenglass trademarks; and an accounting and disgorgement of profits/restitution, 1 among other relief. SAC at 14-16. 2 B. Procedural Posture 3 Plaintiff filed a complaint on November 17, 2022, asserting claims against Plaza 4 Linda d/b/a Sticky Smoke Shop and Vape and Jose A. Sepulveda for Federal Trademark 5 Counterfeiting and Infringement, 15 U.S.C. § 1114 and Federal False Designation of 6 Origin and Unfair Competition, 15 U.S.C. § 1125 (a). Compl. (ECF No. 1.) On February 7 15, 2023, Plaintiff filed a motion for extension of time to perfect service of Plaza Linda 8 d/b/a Sticky Smoke Shop and Vape and Jose A. Sepulveda with the Complaint, which 9 was granted on February 22, 2023. (ECF Nos. 4, 6.) On April 24, 2023, Plaintiff filed a 10 second motion for extension of time to perfect service of Jose A. Sepulveda with the 11 Complaint, which was granted on May 9, 2023. (ECF Nos. 7, 11.) Plaintiff was warned 12 no further extensions would be granted absent a showing of good cause. (ECF No. 11.) 13 On June 12, 2023, Plaintiff requested the entry of default as to Plaza Linda, which the 14 Clerk of the Court entered on June 13, 2023. (ECF Nos. 13, 14.) On June 14, 2023, 15 Plaintiff requested the entry of default as to Jose A. Sepulveda, which the Clerk of the 16 Court entered on June 15, 2023. (ECF Nos. 15, 16.) After being ordered by the district 17 judge to file a motion for default judgment on June 16, 2023, Plaintiff filed its motion for 18 default judgment. (ECF Nos. 18, 19.) On July 6, 2023, the district judge directed Plaintiff 19 to comply with Local Rules 302(c)(19) and 230(a), and re-notice the motion for default 20 judgment before the assigned magistrate judge. (ECF No. 21.) On July 7, 2023, Plaintiff 21 filed a motion for default judgment before the assigned magistrate judge. (ECF No. 22.) 22 On December 22, 2023, Magistrate Judge Kendall J. Newman denied without 23 prejudice Plaintiff’s motion for default judgment, vacated the defaults entered against 24 each Defendant, and granted Plaintiff an opportunity to file an amended complaint. 25 12/22/2023 Order (ECF No. 26.) Specifically, the December 22, 2023 Order denied 26 Plaintiff’s motion for default judgment for failure to satisfy the second and third Eitel 27 factors because the complaint did not sufficiently allege the elements for Defendants’ 28 use of Plaintiff’s trademarks and the likelihood of confusion required to establish claims 1 for trademark infringement and false designation of origin. 12/22/2023 Order at 4-6. On 2 January 15, 2024, Plaintiff filed a First Amended Complaint against Plaza Linda d/b/a 3 Sticky Smoke Shop and Vape and Jose A. Sepulveda alleging the same claims as its 4 initial complaint. (ECF No. 28.) 5 On January 30, 2024, the district judge granted Plaintiff’s motion for extension of 6 time to perfect service on Jose A. Sepulveda. (ECF Nos. 31, 34.) On February 28, 2024, 7 the district judge granted Plaintiff’s second motion for extension of time to perfect service 8 on Plaza Linda d/b/a Sticky Smoke Shop and Vape and Jose A. Sepulveda. (ECF Nos. 9 38, 39.) On April 23, 2024, the district judge granted Plaintiff’s third motion for extension 10 of time to perfect service on Jose A. Sepulveda. (ECF Nos. 42, 43.) On June 7, 2024, 11 Plaintiff filed a motion to amend the complaint pursuant to Federal Rules of Civil 12 Procedure 15. (ECF No. 44.) On August 22, 2024, the district judge granted Plaintiff’s 13 motion to amend and ordered Plaintiff to file an amended complaint within seven (7) 14 days of the filed date of the order. (ECF No. 47.) On the same day, Plaintiff filed the 15 operative Second Amended Complaint against Defendant Samir Mohammed Ali Shareef 16 individually and d/b/a Sticky Smoke Shop and Vape, asserting the same claims as the 17 prior complaints. See SAC (ECF No. 48). On January 27, 2025, Plaintiff requested entry 18 of default as to Defendant Shareef, which was entered by the Clerk of the Court on 19 January 28, 2025. (ECF Nos. 52, 53.) 20 On February 4, 2025, Plaintiff filed its second motion for default judgment. (ECF 21 No. 54.) On February 5, 2025, the district judge directed Plaintiff to comply with Local 22 Rules 302(c)(19) and 230(a), and re-notice the motion for default judgment before the 23 undersigned. (ECF No. 55.) On the same day, Plaintiff filed the pending motion for 24 default judgment. Pl. Second Mot. (ECF No. 56). Defendant was served with the motion 25 for default judgment on the same day, on February 5, 2025. Pl. Second Mot. at 22. A 26 hearing was set on the motion before the undersigned and later reset on the Court’s own 27 motion for April 1, 2025. (ECF Nos. 56, 57.) Defendant did not respond to the motion for 28 default judgment. See Docket. On March 20, 2025, the undersigned issued an order 1 taking Plaintiff’s motion under submission; vacating the hearing; ordering a written 2 response from Defendant by April 3, 2025; and directing Plaintiff to serve Defendant with 3 a copy of the order. (ECF No. 58.) Plaintiff did not file a proof of service that Plaintiff had 4 served Defendant with a copy of the 3/20/202 Order. See Docket. Defendant did not 5 respond. Id. 6 II. LEGAL STANDARDS 7 Under Federal Rule of Civil Procedure 55, default may be entered against a party 8 against whom a judgment for affirmative relief is sought who fails to plead or otherwise 9 defend against the action. See Fed. R. Civ. P. 55(a). However, this default does not 10 automatically entitle the plaintiff to a judgment. PepsiCo, Inc. v. Cal. Sec. Cans, 238 F. 11 Supp. 2d 1172, 1174 (C.D. Cal. 2002) (citations omitted). The decision to grant or deny 12 the entry of default judgment is within the district court’s discretion. NewGen, LLC v. 13 Safe Cig, LLC, 840 F.3d 606, 616 (9th Cir. 2016). 14 In determining whether to enter default judgment, courts consider the following 15 factors: 16 1. the possibility of prejudice to the plaintiff; 17 2. the merits of the substantive claim(s); 18 3. the sufficiency of the complaint; 19 4. the amount of money at stake in the lawsuit; 20 5. whether there are any disputes of material fact; 21 6. whether the defendant’s default was due to excusable neglect; and 22 7. the strong policy favoring decisions on the merits. 23 Eitel v. McCool, 782 F.2d 1470, 1471-72 (9th Cir. 1986). The Ninth Circuit has long 24 disfavored default judgments, counseling that cases be decided on the merits “whenever 25 reasonably possible.” Id. at 1472 . 26 Once a default is entered, all well-pled allegations in the complaint regarding 27 liability are deemed true. Fair Hous. of Marin v. Combs, 285 F.3d 899, 906 (9th Cir. 28 2002). “On the other hand, a defendant is not held to admit facts that are not well1 pleaded or to admit conclusions of law.” United States v. Cathcart, 2010 WL 1048829 , at 2 *4 (N.D. Cal. Feb. 12, 2010) (citation omitted). “[I]t follows from this that facts which are 3 not established by the pleadings of the prevailing party, or claims which are not well4 pleaded, are not binding and cannot support the judgment.” Danning v. Lavine, 572 F.2d 5 1386, 1388 (9th Cir. 1978). Necessary facts not contained in the pleadings and claims 6 which are legally insufficient are not established by default. DIRECTV, Inc. v. Hoa 7 Huynh, 503 F.3d 847, 854 (9th Cir. 2007). Further, a plaintiff’s allegations regarding 8 damages are not deemed true at default, and the plaintiff bears the burden to prove 9 damages with evidence. See Fed. R. Civ. P. 55(b)(2)(C); Geddes v. United Fin. Grp., — 10 — 559 F.2d 557 , 560 (9th Cir. 1977). 11 III. DISCUSSION 12 A. Jurisdiction 13 When default judgment is sought, the “district court has an affirmative duty to look 14 into its jurisdiction over both the subject matter and the parties.” In re Tuli, 172 F.3d 707 , 15 712 (9th Cir. 1999) (citations omitted). The Court has subject matter jurisdiction over this 16 action pursuant to 28 U.S.C. § 1331 because it arises under federal trademark law, — 17 — 15 U.S.C. § 1051 , et seq. In addition, the Court has personal jurisdiction over Defendant 18 Shareef, who is alleged to be a California resident (SAC ¶ 5). The Court’s jurisdiction 19 analysis is not a finding that the claims are sufficiently pled. 20 B. Default Judgment 21 1. Service of Complaint 22 In reviewing a motion for default judgment, the Court must determine whether 23 Defendant Shareef was properly served with the summons and complaint. Fed. R. Civ. 24 P. 4 (c). Rule 4(e) of the Federal Rules of Civil Procedures allows for service of an 25 individual by “delivering a copy of the summons and of the complaint to the individual 26 personally.” Fed. R. Civ. P. 4(e)(2)(A). On October 30, 2024, a third-party process server 27 personally served Defendant Shareef with the SAC and summons. (ECF No. 51.) 28 / / / 1 2. Eitel Factors 2 For the following reasons, the Court finds that the Eitel factors weigh against 3 granting default judgment against Defendant. Specifically, the Court finds the SAC is 4 deficient in several respects and fails to state a claim under the second and third Eitel 5 factors. Moreover, Plaintiff has failed to cure the deficiencies identified in the December 6 22, 2023 Order wherein Plaintiff failed to sufficiently establish Defendants’ use of 7 Plaintiff’s trademarks and the likelihood of confusion elements required to establish 8 claims for trademark infringement and false designation of origin. 12/22/2023 Order at 49 6. 10 The second and third Eitel factors, which are often analyzed together, consider 11 the substantive merits of a plaintiff's claim and the sufficiency of its pleadings. PepsiCo, 12 Inc., 238 F. Supp. 2d at 1175. The issue on default judgment is “whether the allegations 13 in the complaint are sufficient to state a claim on which the [plaintiff] may recover.” 14 Danning, 572 F.2d at 1388 . In reviewing a default judgment, a court must take the well15 pleaded factual allegations of the complaint as true. Cripps v. Life Ins. Co. of N. Am., 980 16 F.2d 1261 , 1267 (9th Cir. 1992). “However, necessary facts not contained in the 17 pleadings, and claims which are legally insufficient, are not established by default.” Id. 18 Plaintiff asserts two claims in this action: (1) trademark counterfeiting and 19 infringement under 15 U.S.C. § 1114 , and (2) false designation of origin and unfair 20 competition under 15 U.S.C. § 1125 (a). SAC at 12-14. The Court addresses each in 21 turn. 22 a) Trademark Infringement and Counterfeiting 23 To state a claim for trademark infringement, a plaintiff must adequately allege it is 24 the owner of a valid, protectable mark, and the alleged infringer is using a similar mark 25 that is likely to confuse. See Grocery Outlet Inc. v. Albertson’s Inc., 497 F.3d 949 , 951 26 (9th Cir. 2007). Courts determine the likelihood of confusion by considering: (1) the 27 strength of the mark; (2) the proximity of the goods; (3) the similarity of the marks; (4) the 28 evidence of actual confusion; (5) the marketing channels used; (6) the type of goods and 1 degree of care consumers are likely to exercise in purchasing them; (7) the intent of the 2 defendant in selecting the mark; and (8) the likelihood that the parties will expand their 3 product lines. Lodestar Anstalt v. Bacardi & Co. Ltd., 31 F.4th 1228, 1252 (9th Cir. 2022) 4 (citing AMF Incorporated v. Sleekcraft Boats, 599 F.2d 341, 348-54 (9th Cir. 1979), 5 abrogated on other grounds by Mattel, Inc. v. Walking Mountain Prods., 353 F.3d 792 6 (9th Cir. 2003)). When analyzing a claim brought under a counterfeiting theory, courts 7 need not engage in a likelihood of confusion analysis because a defendant who 8 “deliberately copies the dress of his competitors already in the field…raises a 9 presumption that customers will be deceived.” Louis Vuitton Malletier, S.A. v. Akanoc 10 Sols., Inc., 658 F.3d 936, 946 (9th Cir. 2011) (citations omitted). Instead, courts examine 11 whether the defendant used a non-genuine mark identical to or substantially 12 indistinguishable from the plaintiff’s registered, genuine mark, and the genuine mark was 13 registered for use on the same goods to which the infringer applied the non-genuine 14 mark. Id. 15 First, the SAC adequately alleges the existence of one or more valid trademarks 16 to support Plaintiff’s claim for trademark infringement and counterfeiting. The SAC 17 alleges Plaintiff owns the following three registered trademarks: (1) U.S. Trademark 18 Registration Number 6,633,884 for “the standard character mark ‘Stündenglass’ in 19 association with goods further identified in registration in international class 011”; 20 (2) U.S. Trademark Registration Number 6,174,292 for “the design plus words mark ‘S’ 21 and its logo in association with goods further identified in the registration in international 22 class 034”; and (3) U.S. Trademark Registration Number 6,174,291 for “the standard 23 character mark ‘Stündenglass’ in association with goods further identified in registration 24 in international class 034.” SAC ¶ 10. Registration of a mark on the Principal Register in 25 the Patent and Trademark Office constitutes prima facie evidence of the validity of the 26 registered mark. Applied Info. Scis. Corp. v. eBAY, Inc., 511 F.3d 966, 970 (9th Cir. 27 2007). However, even accepting all well-pled factual allegations as true as required for 28 default judgment motions, the SAC does not allege sufficient facts to support plausible 1 allegations that Defendant used Plaintiff’s trademarks in an infringing or counterfeiting 2 manner. 3 Second, despite being expressly warned that its prior complaint was deficient, the 4 SAC continues to be deficient and lacks sufficient factual allegations to plausibly 5 conclude Defendants used Plaintiff’s trademarks. See 12/22/2023 Order; see also GS 6 Holistic, LLC v. J’s Smoke Shop, 2024 WL 1054899 , at *2 (E.D. Cal. Mar. 11, 2024) 7 (denying motion for default judgment where, among other things, plaintiff failed to specify 8 which of its three trademarks was used); GS Holistic, LLC v. Pudasaini, 2024 WL 9 710890, at *4 (N.D. Cal. Feb. 21, 2024) (same); GS Holistic, LLC v. Bubbles Smoke 10 Shop, 2023 WL 6787773 , at *3 (C.D. Cal. Sept. 5, 2023) (same). The SAC states that on 11 October 21, 2022, Plaintiff’s investigator “observed that [Defendant’s location] had an 12 excess of Glass Infusers which displayed the Stündenglass Trademarks” and that the 13 “investigator purchased a Glass Infuser with a Stündenglass Marks affixed to it, from 14 [Defendant Shareef], for a cost of $350.00[.]” SAC ¶ 30. Although Plaintiff alleges that all 15 three trademarks were applied to the glass infuser purchased at Defendant’s store, and 16 includes photographs of these trademarks, Plaintiff fails to address how one single 17 product could infringe on two different international classes of goods. While Plaintiff’s 18 motion provides that Defendant’s glass infuser includes all three trademarks and that 19 “Plaintiff’s products are both glass infusers” that can be “used either for smoking 20 purposes or infusing foods and drinks” this does not adequately address how all three 21 trademarks are on Defendant’s single product. Pl. Second Mot. at 11. In addition, review 22 of the photographs attached to the SAC indicates Defendant’s product is utilized for 23 smoking and does not indicate it can be used as a food and beverage infuser. See SAC 24 (ECF No. 48-2). Plaintiff also does not address this discrepancy, which is problematic 25 given Plaintiff seeks damages for infringement as to all three trademarks. Thus, the SAC 26 is deficient for lack of necessary facts. See DIRECTV, 503 F.3d at 854 ; see also GS 27 Holistic, LLC v. J’s Smoke Shop, 2024 WL 1054899 , at *2 (denying motion for default 28 judgment where, among other things, plaintiff failed to specify which of its three 1 trademarks was used); GS Holistic, LLC v. Pudasaini, 2024 WL 710890 , at *4 (same); 2 GS Holistic, LLC v. Bubbles Smoke Shop, 2023 WL 6787773 , at *3 (same). 3 Third, the SAC alleges Plaintiff’s investigator purchased a glass infuser with 4 Stündenglass trademarks “affixed to it” from Defendant and that “it was a Counterfeit 5 product in that it displayed the Infringing Marks [].” SAC ¶ 30. As pled, the SAC is vague 6 and conclusory as to the process Plaintiff’s investigator undertook to confirm the 7 similarities in the trademarks and does not clarify, as other courts have noted, whether 8 Defendant is merely reselling Plaintiff’s products and therefore not a counterfeit product, 9 which would not constitute an infringement. See GS Holistic, LLC v. Ravens Smoke 10 Shop, Inc., 2023 WL 5504964 , at *5 (citing NEC Electronics v. CAL Circuit Abco, 810 11 F.2d 1506 , 1509 (9th Cir. 1987) (noting that the sale of a genuine trademarked product 12 by an unauthorized seller is not a violation of the Lanham Act)); see also GS Holistic, 13 LLC v. Bubbles Smoke Shop, 2023 WL 6787773 , at *5 (same). Further, mere assertions 14 that the glass infuser sold by Defendant is “a Counterfeit product in that it displayed the 15 Infringing Marks” are conclusory and not taken as true. See Paulsen v. CNF Inc., 559 16 F.3d 1061, 1071 (9th Cir. 2009) (the court is not required to accept as true legal 17 conclusions in a complaint “merely because they are cast in the form of factual 18 allegations”); see also GS Holistic, LLC v. Cigarette Outlet Smoke Shop, 2024 WL 19 519783, at *2 (E.D. Cal. Feb. 9, 2024) (denying plaintiff’s motion for default judgment for, 20 among other reasons, the complaint’s reliance on conclusory statements that “the Glass 21 Infuser [defendant] sold to Plaintiff’s investigator was a Counterfeit Good with an 22 Infringing Mark affixed to it”). 23 Fourth, although the SAC alleges Defendant’s “use of the counterfeit 24 Stündenglass Trademarks began after the registration of the Stündenglass Trademarks” 25 (SAC ¶ 34), it does not allege when this use allegedly began—much less provide any 26 other details about Defendant’s allegedly infringing actions. The Court cannot supply 27 necessary facts that are omitted from the SAC. See DIRECTV, 503 F.3d at 854 ; see also 28 GS Holistic, LLC v. Puff+ LLC, 2024 WL 659362 , at *3 (E.D. Cal. Feb. 16, 2024) 1 (rejecting plaintiff’s default judgment motion where the complaint lacked details regarding 2 the defendant’s alleged use where only one instance was alleged); GS Holistic, LLC v. 3 Ashes Plus Nine, 2023 WL 5993055 , at *4 (N.D. Cal. Aug. 25, 2023) (same). 4 Fifth, the SAC does not allege sufficient facts to support a plausible claim for 5 infringement as to a consumer’s likelihood of confusion. The SAC makes conclusory 6 allegations stating that Defendant “used images and names identical to or confusingly 7 similar to the Stündenglass Marks, to confuse customers and aid in the promotion and 8 sales of Counterfeit Goods”, the “Infringing Goods travel in identical channels of trade 9 and are sold to identical consumers as Stündenglass genuine goods”, and that the 10 “Infringing Marks affixed to the Counterfeit Goods that [Defendant] has distributed, 11 provided, marketed, advertised, promoted, offered for sale, and/or sold, is confusingly 12 identical or similar to the Stündenglass Marks that [Plaintiff] affixes to its Glass Infusers.” 13 SAC ¶¶ 38-40. Such conclusory allegations lacking in factual support are insufficient for 14 purposes of default judgment. See Paulsen, 559 F.3d at 1071; DIRECTV, 503 F.3d at 15 854; see also GS Holistic, LLC v. Bubbles Smoke Shop, 2023 WL 6787773 , at *4 16 (denying default judgment because the complaint failed to allege facts supporting a 17 Sleekcraft analysis and relied on conclusory statements about the likelihood of 18 confusion). While Plaintiff’s motion makes passing reference to the Sleekcraft factors 19 and provides photographs (see Pl. Second Mot. at 10 and ECF No. 56-8), like many 20 other cases that have been brought by Plaintiff, there is no effort to apply the applicable 21 legal standards to this case. 22 Finally, as to the alleged sale of a counterfeit good, the SAC fails to state a claim 23 because it does not adequately allege that Defendant sold a counterfeit product. Instead, 24 the SAC relies on wholly conclusory allegations, such as allegations that Defendant’s 25 glass diffuser “was a Counterfeit product in that it displayed the Infringing Marks.” SAC 26 ¶ 30. Nor does the SAC explain the types of goods Defendant has sold in the past, other 27 than one glass infuser sold to Plaintiff’s investigator on October 21, 2022. Id. Thus, the 28 SAC is deficient on Plaintiff’s counterfeit theory as well. See GS Holistic, LLC v. J’s 1 Smoke Shop, 2024 WL 1054899 , at *2 (rejecting counterfeit theory on default judgment 2 motion because of the complaint’s failure to allege facts supporting the claim and 3 otherwise reliance on conclusory assertions that defendant’s goods were counterfeit). 4 b) False Designation of Origin and Unfair Competition 5 To establish a claim for false designation of origin under 15 U.S.C. § 1125 (a), a 6 plaintiff must show the defendant used a false designation of origin in interstate 7 commerce that is likely to cause confusion, mistake, or deception as to the origin, 8 sponsorship, or approval of defendants’ goods or services. Freecycle Network, Inc. v. 9 Oey, 505 F.3d 898, 902 (9th Cir. 2007). Claims for false designation of origin, as a type 10 of unfair competition claim, are analyzed similarly to infringement claims because the 11 “ultimate test” for these claims are the same: the public’s likelihood of confusion. Jada 12 Toys, Inc. v. Mattel, Inc., 518 F.3d 628, 632 (9th Cir. 2008) (using the same likelihood of 13 confusion test to analyze trademark infringement and false designation of origin claims); 14 see also Brookfield Commc’ns, Inc. v. W. Coast Ent. Corp., 174 F.3d 1036, 1046 (9th 15 Cir. 1999) (considering false designation of origin claim as one of “unfair competition”); 16 Champions Golf Club, Inc. v. The Champions Golf Club, Inc., 78 F.3d 1111 , 1122-23 17 (6th Cir. 1996) (“[F]alse designation is simply a species of unfair competition.”) (citing 18 McCoy v. Mitsuboshi Cutlery, Inc., 67 F.3d 917, 923 (Fed. Cir. 1995)). 19 Here, the Court has already determined the SAC is deficient on the likelihood of 20 confusion element for the infringement claim. Plaintiff relies on the exact same 21 allegations for its false designation of origin claim. Pl. Second Mot. at 10-11. Thus, the 22 result is the same for the false designation of origin claim brought under 15 U.S.C. 23 § 1125(a). See Jada, 518 F.3d at 632 ; see also GS Holistic, LLC v. J’s Smoke Shop, — 24 — 2024 WL 1054899 , at *3 (denying default judgment motion on plaintiff’s false designation 25 claim on the same grounds as on the infringement claim—for failure of the complaint to 26 state sufficient claims and failure on the merits); GS Holistic, LLC v. Puff N Go Gift Shop 27 LLC, 2023 WL 4146232 , at *5 (N.D. Cal. June 22, 2023) (same). 28 For the foregoing reasons, Plaintiff has failed to establish the second and third 1 Eitel Factors and its motion for default judgment should be denied for failure to state a 2 claim under 15 U.S.C. §§ 1114 and 1125(a). 3 C. Federal Actions Related to Plaintiff’s Stündenglass Trademarks 4 Plaintiff has brought many similar, if not identical, claims about its Stündenglass 5 trademarks against other defendants. See GS Holistic, LLC v. Mr Vape Smoke Shop, — 6 — 2024 WL 4545885 , at *3 (E.D. Cal. Oct. 22, 2024) (collecting cases). Numerous courts in 7 the Ninth Circuit have found vague and conclusory allegations made by Plaintiff to be 8 insufficient to grant default judgment. See GS Holistic, LLC v. Puff+ LLC, 2024 WL 9 659362, at *3 (collecting cases where motion for default judgment was denied due to GS 10 Holistic’s wholly insufficient pleadings and motion); GS Holistic, LLC v. Kings 11 Smokeshop, 2024 WL 150217 , at *2 (E.D. Cal. Jan. 12, 2024) (denying motion for 12 default judgment because the complaint “has not satisfied the second and third Eitel 13 factors; i.e., the merits of plaintiff’s substantive claim and the sufficiency of the 14 complaint”); GS Holistic, LLC v. Ashes Plus Nine, 2023 WL 5993055 , at *5 (“[T]his Court 15 and other district courts in this Circuit have found similar (if not almost identical) 16 allegations by GS Holistic equally insufficient”); GS Holistic, LLC v. Ravens Smoke 17 Shop, Inc., 2023 WL 5504964 , at *4 (C.D. Cal. July 10, 2023) (“As currently pled, these 18 factual allegations are vague and conclusory, and need not be accepted as true.”); GS 19 Holistic, LLC v. Alien Smoke Shop, 2023 WL 3402589 , at *1 (C.D. Cal. Mar. 17, 2023) 20 (“Plaintiff’s allegations of infringement here are insufficient to support a finding that 21 defendants willfully infringed plaintiff’s trademarks”). 22 The undersigned is aware that other courts—including those in this district—have 23 granted motions for default judgment on substantially similar complaints and motions 24 filed by this Plaintiff. See GS Holistic, LLC v. AA 110, 2024 WL 2848455 , at *7 (E.D. Cal. 25 June 5, 2024) (granting motion for default judgment in part, but limiting damages to 26 $5,000), report and recommendation adopted sub nom. 2024 WL 3396380 (E.D. Cal. 27 July 12, 2024); GS Holistic, LLC v. Nasher, 2024 WL 1994702 , at *1 (E.D. Cal. May 6, 28 2024) (same); GS Holistic, LLC v. Habib’s Disc., 2023 WL 8644103 , at *7 (E.D. Cal. Dec. 1 14, 2023) (granting motion for default and awarding $75,000 in damages), report and 2 recommendation adopted sub nom. 2024 WL 495139 (E.D. Cal. Feb. 8, 2024). The 3 undersigned respectfully disagrees, and follows the approach of the many courts that 4 have denied similar motions for default judgment brought by GS Holistic. See, e.g., GS 5 Holistic, LLC v. Puff+ LLC, 2024 WL 659362 , at *3; GS Holistic, LLC v. Kings 6 Smokeshop, 2024 WL 150217 , at *2; GS Holistic, LLC v. Ashes Plus Nine, 2023 WL 7 5993055, at *5; GS Holistic, LLC v. Ravens Smoke Shop, Inc., 2023 WL 5504964 , at *4; 8 GS Holistic, LLC v. Alien Smoke Shop, 2023 WL 3402589 , at *1. 9 D. Failure to State a Claim 10 District courts have discretion whether to enter a default judgment. Aldabe v. 11 Aldabe, 616 F.2d 1089, 1092 (9th Cir. 1980). Where a complaint fails to state a claim, 12 default judgment may not be entered. See Aldabe, 616 F.2d at 1092 (affirming the 13 district court’s denial of default judgment where plaintiff’s claims lacked merit); DirecTV, 14 Inc., 503 F.3d at 854-56 (holding “[t]he district court properly refused to grant default 15 judgment” where a plaintiff’s complaint was not well-pleaded and instead provided only 16 “legal conclusions” that were “not held to have admitted through default.”). Accordingly, 17 because Plaintiff has failed to state a claim as to trademark counterfeiting and 18 infringement under 15 U.S.C. § 1114 , and false designation of origin and unfair 19 competition under 15 U.S.C. § 1125 (a), the Court recommends default judgment be 20 DENIED. 21 E. Dismissal without Leave to Amend 22 Plaintiff has failed to cure the deficiencies of its claims despite being informed of 23 the deficiencies and being provided ample opportunity to do so. See 12/22/2023 Order. 24 Accordingly, the Court finds further amendment would be futile. See Zucco Partners, 25 LLC v. Digimarc Corp., 552 F.3d 981, 1007 (9th Cir. 2009) (affirming district court’s 26 dismissal with prejudice “where the plaintiff has previously been granted leave to amend 27 and has subsequently failed to add the requisite particularity to its claims, ‘the district 28 court’s discretion to deny leave to amend is particularly broad.’“). Here, Plaintiff’s SAC 1 | continues to rely on conclusory allegations that are insufficient to state a claim despite 2 || awareness of the applicable legal standards and deficiencies in its prior pleading. 3 || Therefore, the Court recommends Plaintiffs SAC be DISMISSED without leave to 4 | amend. 5 | IV. CONCLUSION 6 For the reasons set forth above, it is HEREBY RECOMMENDED that: 7 1. Plaintiff's motion for default judgment (ECF No. 56) be DENIED; 8 2. The Second Amended Complaint (ECF No. 48) be DISMISSED without leave 9 to amend; and 10 3. The Clerk of the Court be directed to close this action. 11 These findings and recommendations are submitted to the United States District 12 | Judge assigned to the case, pursuant to the provisions of 28 U.S.C. § 636 (b)(1). Within 13 | 14 days after being served with these findings and recommendations, any party may file 14 | written objections with the Court and serve a copy on all parties. This document should 15 | be captioned “Objections to Magistrate Judge’s Findings and Recommendations.” Any 16 || reply to the objections shall be served on all parties and filed with the Court within 14 17 || days after service of the objections. Failure to file objections within the specified time 18 || may waive the right to appeal the District Court’s order. Turner v. Duncan, 158 F.3d 449 , 19 | 455 (9th Cir. 1998); Martinez v. Yist, 951 F.2d 1153, 1156-57 (9th Cir. 1991). — 20 — 34 Dated: July 21, 2025 (i s \C 99 GHI 500 KIM UNITED STATES MAGISTRATE JUDGE 23 || 4, gsho2088.22 — 24 — — 25 — — 26 — — 27 — — 28 — — 16 —