RAYMOND P. MOORE, District Judge.
This matter is before the Court on the February 15, 2019 Recommendation of United States Magistrate Judge Scott T. Varholak (the "Recommendation") (ECF No. 38) to grant in part and deny in part Plaintiff's Motion for Judgment by Default (the "Motion") (ECF No. 35). The Recommendation is incorporated herein by reference. See 28 U.S.C. § 636(b)(1)(B); FED. R. CIV. P. 72(b).
The Recommendation advised the parties that specific written objections were due within fourteen days after being served with a copy of the Recommendation. (ECF No. 38 at pages 35-36.) Despite this advisement, no objections to the Recommendation have to date been filed by any party and the time to do so has expired. (See generally Dkt.)
"When no timely objection is filed, the court need only satisfy itself that there is no clear error on the face of the record in order to accept the recommendation." FED. R. CIV. P. 72(b) advisory committee's note; see also Summers v. Utah, 927 F.2d 1165, 1167 (10th Cir. 1991) ("In the absence of timely objection, the district court may review a magistrate's report under any standard it deems appropriate."). As shown below, the Court has conducted more than a clear error review of the matter. The Court does so in light of the fact that Defendants are citizens of India and alternate service was allowed. Upon such review, as set forth below, the Court accepts in part and rejects in part the Recommendation.
Plaintiff contends Defendants have engaged in a pattern of registering domain names that include its WEBROOT marks
Plaintiff filed two Uniform Dispute Resolution Procedure ("UDRP") proceedings involving the domain names. The first UDRP proceeding was filed against Defendant Chandresh Singh ("Chandresh") regarding domain name webrootcomsafe.org; the National Arbitration Forum ("NAF") found in favor of Plaintiff and transferred that domain name to Plaintiff.
The second UDRP was filed against Defendants Chitranshu Singh ("Chitranshu") and Polishsys Technologies
The Motion asserts that "Defendants" registered the Remaining Domain (along with the five others in the second UDRP), referring the Court to paragraph 42 of the Amended Complaint. (Motion, p. 5.) Paragraph 42 of the Amended Complaint, however, alleges that "Plaintiff became aware of six additional domains associated with the Defendants." (ECF No. 9, ¶ 42 (emphasis added)). Plaintiff, who bears the burden of showing personal jurisdiction may be had, fails to show that a person "associated" with a domain name that is registered on Name.com would subject that person to personal jurisdiction in Colorado.
Plaintiff also asserts the Six Domain Names were registered by Polishsys and Chitranshu, referring the Court generally to ECF No. 9-10 which consists of Plaintiff's amended complaint with exhibits filed on May 24, 2018 in the second UDRP. The Court's review of these documents, however, shows that, as of May 2, 2018, the Remaining Domain was registered to Polishsys (ECF No. 9-10, p. 81) on GoDaddy.com. The Amended Complaint's allegations, however, show there were changes in the registration. In paragraph 1 of the Amended Complaint, Plaintiff alleges the Remaining Domain was registered by Chitranshu and was then "currently" registered on Name.com. Paragraphs 7 and 8 of the Amended Complaint alleges that on June 25, 2018, the date of the NAF's second decision, the registrant at that time was Polishsys but, at some point in time, the registrant was changed to Chitranshu. Regardless, the NAF's decision stated that Name.com confirmed the Remaining Domain was registered on Name.com. (ECF No. 9-12, p. 3.) Thus, although the dates are not entirely clear, what is alleged is that at some point in time, Chitranshu and Polishsys each registered the Remaining Domain on Name.com. Accordingly, the Court finds the Agreement for Name.com is sufficient to subject Chitranshu and Polishsys to the personal jurisdiction of this court. Chandresh, however, is another matter. To the extent the Recommendation found that personal jurisdiction may be exercised over Chandresh based on the registration of the Remaining Domain, such finding is rejected.
As to Chandresh, Plaintiff presumably relies on its argument that "Defendants, by acting in concert on behalf of Defendant Polishsys Technologies, the original owner of the WEBROOTCOM-SAFE.ORG domain, agreed to personal jurisdiction in this Court by registering the domain names with Name.com." (ECF No. 34, p. 8.) This argument is unclear, and unpersuasive. If Plaintiff is arguing that all Defendants registered the Remaining Domain with Name.com, the Court finds Plaintiff fails to meet its burden of showing Chandresh did so. If Plaintiff is arguing that Chandresh registered other domain names with Name.com and is, thereby, subject to personal jurisdiction here, Plaintiff fails to point to where in the record such registration may be found. Finally, if Plaintiff is asserting that Chandresh acted in concert with the other Defendants and, therefore, is somehow bound by the others' registration, this too is unavailing. Plaintiff fails to provide any facts, factual allegations, or legal authority to support this position. The Court's search shows "concert" or "participation" appears only once in the Amended Complaint — in its prayer for relief for preliminary and permanent injunction. (ECF No. 9, p. 26.) Thus, the Court examines whether Chandresh may be subject to personal jurisdiction on any of the other three bases Plaintiff raises.
First, Plaintiff contends Defendants are also subject to personal jurisdiction based on their interactive websites and because they purposefully directed their actions against Plaintiff, a Colorado company. Citing to Soma Med. Int'l v. Standard Chartered Bank, 196 F.3d 1292, 1296-97 (10th Cir. 1999), Plaintiff alleges Defendants' interactive websites subject them to personal jurisdiction in Colorado. The Court examines this allegation as against Chandresh and finds otherwise.
In Soma, the Tenth Circuit discussed general personal jurisdiction which requires a defendant to conduct "substantial and continuous local activity in the forum state." 196 F.3d at 1295 (quotation marks and citation omitted). Soma argued that defendant's maintenance of a website, accessible from Utah, constitutes such local activity. In analyzing Soma's argument, the Tenth Circuit considered "three general categories along a sliding scale for evaluating jurisdiction." Soma, 196 F.3d at 1296 (quotation marks and citation omitted). Those categories are 1) business websites: when the defendant does business over the Internet, "such as entering into contracts which require the `knowing and repeated transmission of computer files over the Internet.'" Id. (quoting Zippo Mfg. Co. v. Zippo Dot Com, Inc., 952 F.Supp. 1119, 1123-24 (W.D. Pa. 1997)); 2) passive websites: ones that do little more than make information available; and 3) interactive websites: "where a user can exchange information with the host computer." Id. (quoting Zippo, 952 F. Supp. at 1123-24).
Plaintiff contends all seven of the websites Defendants allegedly operated have been commercial and interactive in nature referring the Court generally to the UDRP proceeding papers and specifically to the documents relating to the Remaining Domain. Neither such papers nor Plaintiff's factual allegations are sufficient to show "substantial and continuous local activity in the forum state," Soma, 196 F.3d at 195, i.e., by directing electronic activity at Colorado. Shrader v. Biddinger, 633 F.3d at 1235, 1240 (10th Cir. 2011). Instead, the allegations are, for example, that the websites are interactive as they advertised technical support services for Plaintiff's goods and services, provided contact information for customers to contact Defendants to engage their services, and required customers to supply Defendants with their Webroot product key in order to use Defendants' services. None of these allegations, or supporting papers, however, show any of such activities occurred here in Colorado. Accordingly, the Court finds Plaintiff fails to make a prima facie showing of personal jurisdiction over Chandresh on the basis of any interactive website. See Sharpshooter Spectrum Venture, LLC v. Consentino, No. 09-cv-0150-WDM-KLM, 2011 WL 3159094, at *5 (D. Colo. July 26, 2011) (stating court could not "transform evidence that the website in question is accessible to Colorado residents into evidence that [defendant] has used his site to conduct sustained business with a substantial number of Colorado residents").
Second, Plaintiff asserts Defendants purposefully directed their actions against Webroot, citing to Calder v. Jones, 465 U.S. 783-789-790 (1984). Because Plaintiff asserts Calder is "the key to unlocking the courthouse door," the Court limits its analysis to Calder's requirements. Dudnikov v. Chalk & Vermillion Fine Arts, Inc., 514 F.3d 1063, 1071 (10th Cir. 2008). Under Calder, Plaintiff must show (a) an intentional action that was (b) expressly aimed at the forum state, with (c) knowledge that the brunt of the injury would be felt in the forum state. Dudnikov, 514 F.3d at 1072. Here, Plaintiff argues, Defendants purposefully directed their contacts at Colorado via their website offerings. Even assuming, arguendo, Plaintiff has made the "purposefully directed" showing, such showing, standing alone, is insufficient. In order to satisfy the minimum contacts test for specific jurisdiction, two distinct requirements must be met: "(i) that the defendant must have purposefully directed its activities at residents of the forum state, and (ii) that the plaintiff's injuries must arise out of the defendant's forum-related activities." Old Repub. Ins. Co. v. Continental Motors, Inc., 877 F.3d 895, 904 (10th Cir. 2017) (quotations, brackets, and citation omitted); see also Dudnikov, 514 F.3d at 1071, 1078 (same). Here, Plaintiff fails to address — and thus made no showing concerning — the second requirement. Accordingly, Plaintiff fails to sustain its burden that, under Calder, the Court may exercise specific jurisdiction over Chandresh.
Finally, Plaintiff relies, cursorily, on Fed. R. Civ. P. 4(k)(2). Rule 4(k)(2) "`serves as a federal long-arm statute, which allows a district court to exercise personal jurisdiction over a foreign defendant whose contacts with the United States, but not with the forum state, satisfy due process.'" Archangel Diamond Corp. Liquidating Trust v. OAO Lukoil, 75 F.Supp.3d 1343, 1360-61 (D. Colo. 2014) (quoting Synthes (U.S.A.) v. G.M. Dos Reis Jr. Ind. Com De Equip. Medico, 563 F.3d 1285, 1296 (Fed. Cir. 2009)). Three conditions must be satisfied for this Rule to apply: (1) the plaintiff's claim must arise under federal law; (2) defendant is not subject to jurisdiction in any other state's court of general jurisdiction; and (3) the exercise of jurisdiction comports with the United States Constitution and laws. See Fed. R. Civ. P. 4(k)(2); Pandaw America, Inc. v. Pandaw Cruises India Pvt. Ltd., 842 F.Supp.2d 1301, 1310 (D. Colo. 2012). The Court finds the first two requirements are shown, but not the third. Here, Plaintiff argues that Defendants have minimum contacts with Colorado relying on its previous arguments. But, as stated above, Plaintiff has not shown Chandresh has sufficient minimum contacts with Colorado. Moreover, Rule 4(k)(2) requires an analysis of a defendant's national contacts, rather than just contacts with the forum state. Archangel, 75 F. Supp. 3d at 1364. Plaintiff, however, fails to do so. Accordingly, jurisdiction under Rule 4(k)(2) has not been shown.
Based on the foregoing, the Recommendation's findings and conclusion that personal jurisdiction may be exercised over Chandresh is rejected. As Plaintiff fails to show personal jurisdiction over Chandresh, the Clerk's default as to Chandresh shall be vacated and the Motion as to Chandresh is denied.
As the recommendation correctly stated, to establish the cyberpiracy claim, Plaintiff must demonstrate that: (1) Plaintiff's trademark was distinctive when Defendants registered the domain names; (2) the domain names registered by Defendants are identical or confusingly similar to the trademark; and (3) Defendants used or registered the domain names with a bad faith intent to profit. (ECF No. 38, p. 13, citing Utah Lighthouse Ministry v. Found. for Apologetic Info. & Research, 527 F.3d 1045, 1057 (10th Cir. 2008).) And, as the recommendation found, Plaintiff only demonstrated that its WEBROOT marks were distinctive at the time when two of the seven domain names were registered, webrootcomsafe.org and the Remaining Domain. Thus, Plaintiff has established this claim only as to the webrootcomsafe.org and the Remaining Domain.
In summary, the Court accepts the recommendation here except (1) as it relates to Chandresh, (2) the finding as to who registered webrootcomsafe.org, and (3) the finding that Plaintiff has established the second claim as to installwebroot.org, web—root.org, webroot-support.org, webroot-com-safe.net, and web-root.org.
The Court finds Plaintiff's allegations are sufficient to show irreparable harm. Here, Plaintiff alleges that it has received complaints from consumers about resold product keys and consumer accounts have been deactivated, all of which has created ill will and caused harm to Plaintiff's goodwill. And, if Chitranshu and Polishsys are allowed to continue, Plaintiff's goodwill in its WEBROOT marks will be irreparably harmed. See DTC Energy Grp., Inc. v. Hirschfeld, 912 F.3d 1263, 1271 (10th Cir. 2018) (factors court should consider when in evaluating irreparable harm include loss of customers, loss of goodwill, and erosion plaintiff's competitive position). Thus, while the Court rejects the finding that irreparable harm may be presumed, it nonetheless concludes that irreparable harm has been shown. And, on this basis, the Court accepts the recommendation to grant injunctive relief, but only as against Chitranshu and Polishsys.
The Magistrate Judge recommended the following: (1) base statutory damages award of $5,000 per domain base on the seven infringing domain names; (2) $5,000 in damages per domain name for five of the seven domains, including webrootcomsafe.org and the Remaining Domain, due to Defendants' use of a correctly spelled mark; (3) $5,000 per domain name for Defendants' refusal to participate in this litigation; (4) $5,000 for the Remaining Domain because it was registered less than two months after the NAF proceedings on the webrootcomsafe.org domain name. The resulting total damages are $135,000. The Court accepts such recommendation, but only as to webrootcomsafe.org and the Remaining Domain. Plaintiff only demonstrated that its WEBROOT marks were distinctive at the time when these two domain names were registered and, accordingly, only liability based on such domain names. Accordingly, the Court accepts the recommendation to award statutory damages of $20,000 for webrootcomsafe.org and $25,000 for the Remaining Domain, for a total of $45,000.
In accordance with the foregoing, the Court: