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North Atlantic Operating Company, Inc., v. Juang

United States District Court, E.D. Michigan, Southern Division

May 9, 2017

NORTH ATLANTIC OPERATING COMPANY, INC., and NATIONAL TOBACCO COMPANY, L.P., Plaintiffs,
v.
JINGJING JUANG, et al, Defendants,

          OPINION AND ORDER GRANTING IN PART AND DENYING IN PART PLAINTIFFS' MOTIONS FOR DEFAULT JUDGMENT (DKTS. 244 & 260)

          TERRENCE G. BERG UNITED STATES DISTRICT JUDGE.

         I. INTRODUCTION

         This case concerns counterfeit ZIG-ZAG® rolling papers, a product popular among smoking enthusiasts. Plaintiffs North Atlantic Operating Company, Inc. and National Tobacco Company, L.P. (together, “North Atlantic”) sued Defendants for selling counterfeit rolling papers. Many Defendants ignored the lawsuit. North Atlantic now moves for default judgments against two groups of Defendants.[1] Dkts. 244 & 260. For the reasons outlined below, North Atlantic's motions are GRANTED IN PART AND DENIED IN PART.

         II. BACKGROUND

         North Atlantic sells smoking products, including smoking papers, smoking wraps, and vaporizers. See zigzag.com/products. At issue in this case are the ZIG-ZAG® 1 ¼ Size French Orange products:

         (IMAGE OMITTED)

         Dkt. 244, Pg. ID 1994.[2] All authentic ZIG-ZAG® Orange products display eight trademarks, four that North Atlantic licenses from the registrant, Bolloré S.A:

(1) U.S. TM Reg. No. 610, 530 for ZIG-ZAG (Stylized);
(2) U.S. TM Reg. No. 1, 127, 946 for ZIG-ZAG (Word Mark);
(3) U.S. TM Reg No. 2, 169, 540 for the Smoking Man Design; and
(4) U.S. TM Reg No. 2, 169, 549 for the Smoking Man Design)[3]
and four that North Atlantic owns:
(5) U.S. TM Reg. No. 2, 664, 694 for North Atlantic Operating Company, Inc.;
(6) U.S. TM Reg. No. 2, 664, 695 for Gear Design;
(7) U.S. TM Reg. No. 2, 610, 473 for NORTH ATLANTIC OPERATING COMPANY (Word Mark); and
(8) U.S. TM Reg. No. 2, 635, 446 for NORTH ATLANTIC OPERATING COMPANY (Word Mark)).

Dkt. 244, Pg. ID 1995.

         Authentic ZIG-ZAG® Orange products also display North Atlantic's copyrighted graphic titled “North Atlantic Operating Company, Inc.” (the “NAOC copyright”) Dkt. 244, Pg. ID 1996. And the products include gold-fill lettering, French phrases such as “Qualite Superieure” and “Braunstein Freres France, ” and statements such as “Made in France, ” “Imported French, ” and “Distributed by NORTH ATLANTIC OPERATING COMPANY, INC.” Dkt. 244, Pg. ID 1996.

         The counterfeit products Defendants allegedly sell also contain the trademarks, copyrighted graphic, and other design elements such as gold-fill lettering, French phrases, and statements about product origination and distribution. Dkt. 244, Pg. ID 1997. North Atlantic discovered this information after years of investigation that included controlled buys, inspection, and analysis of certain suspected counterfeit ZIG-ZAG® Orange products listed for sale at below-market prices. Dkt. ...


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