Flava Works, Inc. v. Wyche d/b/a DGSource.com, No. 10 C 748, Slip Op. (N.D. Ill. Jun. 28, 2010) (Gottschall, J.).
Judge Gottschall denied plaintiff Flava Works’ motion for default judgment based upon Flava Works’ proof of damages. Flava Works accused defendants (collectively "DGSource") of copyright infringement and Lanham Act false designation of origin based upon a series of websites that allegedly used and sold Flava Works’ copyrighted content. DGSource never answered the complaint, and the Court entered a default order. In response, Flava Works submitted a proof of damages seeking approximately $1.3M. As an initial matter, the Court held that because both claims stem from the same operative facts, Flava Works was required to choose either copyright or Lanham Act damages. Flava Works also had to choose actual or statutory damages to the extent it chose copyright damages.
With respect to actual damages, the difference between the copyright and Lanham Act claims was that the Lanham Act provided for trebling damages. Regardless of the calculation, Flava Works’ estimates of its losses and DGSource’s profits were "conclusory" and provided without context. For example, Flava Works did not set out how much of DGSource’s website content was infringing and, therefore, would be relevant to a damages calculation.
Flava Works was not required to present evidence if it chose statutory damages, but without evidence the Court was required to adjust the award down, and the Court noted that it would benefit from additional evidence. The Court also noted that Flava Works was only entitled to statutory damages as to the two registered copyrights.
Finally, Flava Works did not prove the elements necessary for a permanent injunction. And Flava Works offered no authority for its requested remedy of transferring DGSource’s domain names to Flava Works.