Koninklijke Philips Elecs. N.V. v. KXD Tech., Inc.
Koninklijke Philips Elecs. N.V. v. KXD Tech., Inc.
347 F. App'x 275 (9th Cir. 2009)
September 24, 2009
Summary
Appellate court upheld default judgment that trial court granted in Koninklijke Philips Elec., N.V. v. KXD Tech., Inc., 2008 WL 2699701 (D. Nev. July 2, 2008) due to defendant’s willful destruction of its
computer server.
Defendant had previously been warned by the court that its failure to comply with previous discovery orders might subject itself to sanctions in the form of default judgment. Plaintiff brought the action alleging defendant was selling counterfeit goods in violation of the Lanham Act. Plaintiff requested electronic records from the defendant’s computer server. The trial court found that the defendant intentionally destroyed its computer server thereby preventing the plaintiff access to the requested electronic records. The destruction of the records prejudiced the defendant, and so the appellate court held that the trial court did not abuse its discretion when it imposed the severe sanction of default judgment.
Additional Decisions
Note: This is an unpublished decision. Check your jurisdiction’s rules about citing unpublished decisions before citing this case to a court.
KONINKLIJKE PHILIPS ELECTRONICS N.V., Plaintiff–Appellee,
v.
KXD TECHNOLOGY, INC.; et al., Defendants,
and
Sungale Group, Inc.; et al., Defendants–Appellants
v.
KXD TECHNOLOGY, INC.; et al., Defendants,
and
Sungale Group, Inc.; et al., Defendants–Appellants
No. 08–16794
United States Court of Appeals, Ninth Circuit
Submitted
September 16, 2009
Decided On September 24, 2009
Appeal from the United States District Court for the District of Nevada, Roger L. Hunt, Chief District Judge, Presiding. D.C. No. 2:05–cv–01532–RLH–GWF.
Counsel
Samuel L. Alberstadt, Keats McFarland & Wilson LLP, Los Angeles, CA, Todd L. Bice, Brownstein Hyatt Farber Schreck LLP, Las Vegas, NV, David Koss Caplan, Anthony Michael Keats, Esquire, Larry W. McFarland, Keats McFarland & Wilson, Beverly Hills, CA, for Plaintiff–Appellee.Anton N. Handal, Esquire, Gabriel Hedrick, Handal & Associates, San Diego, CA, Joshua L. Harmon, Esquire, Law Office of Joshua L. Harmon, P.C., Noah G. Allison, Esquire, Martin & Allison Ltd., Las Vegas, NV, for Defendants.
Pamela Carol Chalk, Handal & Associates, San Diego, CA, for Defendants–Appellants.
Panel members:
Reinhardt, Stephen Roy,
Bea, Carlos T.,
Larson, Stephen G.**
MEMORANDUM***
This case was not selected for publication in the Federal Reporter.
Not for Publication in West's Federal Reporter See Fed. Rule of Appellate Procedure 32.1 generally governing citation of judicial decisions issued on or after Jan. 1, 2007. See also Ninth Circuit Rule 36-3.
**1 Sungale Group, Inc., Sungale Electronics, Ltd., and Amoisonic Electronics, Inc. (collectively Sungale) appeal the district court's entry of default judgment against them and award of $1,000,000 in statutory damages to Koninklijke Philips Electronics N.V. (Philips). We have jurisdiction pursuant to 28 U.S.C. § 1291, and we affirm.
The district court did not abuse its discretion when it ordered case dispositive sanctions against Sungale. See Conn. Gen. Life Ins. Co. v. New Images of Beverly Hills, 482 F.3d 1091, 1096 (9th Cir.2007). The district court found that Sungale deliberately destroyed its computer server, and with it electronic records Philips requested; this destruction demonstrated the “willfulness, bad faith, and fault” required to support terminating sanctions. Id. Sungale's failure to produce requested documents prejudiced Philips, and this failure was not excused by the fact that Philips possessed some of the requested documents by virtue of the U.S. Marshals' seizure of Sungale's business records. See Computer Task Group, Inc. v. Brotby, 364 F.3d 1112, 1116–17 (9th Cir.2004). Finally, the district court initially considered and awarded less severe sanctions and warned Sungale of the possibility of severe sanctions before entering the default judgment against Sungale. See Conn. Gen. Life Ins. Co., 482 F.3d at 1096.
Neither did the district court abuse its discretion when it awarded $1,000,000 in statutory damages to Philips. See Derek Andrew, Inc. v. Poof Apparel Corp., 528 F.3d 696, 699 (9th Cir.2008). Philips elected statutory damages, as permitted by the Lanham Act. 15 U.S.C. § 1117(c). The default judgment against Sungale was warranted by Sungale's willfulness in offering for sale counterfeit goods bearing Philips's trademark and by Sungale's ongoing failure to comply with discovery requests, which made proof of actual damages difficult or impossible. See F.W. Woolworth Co. v. Contemporary Arts, 344 U.S. 228, 231, 73 S.Ct. 222, 97 L.Ed. 276 (1952).
AFFIRMED.
Footnotes
The panel unanimously finds this case suitable for decision without oral argument. See Fed. R.App. P. 34(a)(2).
The Honorable Stephen G. Larson, United States District Court for the Northern District of California, sitting by designation.
This disposition is not appropriate for publication and is not precedent except as provided by 9th Cir. R. 36–3.