United States District Court, W.D. North Carolina, Asheville Division
ORDER AND DEFAULT JUDGMENT
Reidinger, United States District Judge.
MATTER is before the Court on the Plaintiff's
Motion for Default Judgment [Doc. 49].
September 1, 2015, the Plaintiff Agio International Company,
Ltd. (“Agio”) filed its original complaint
against the Defendant JMH Trading International Management
LLC d/b/a World Source (“JMH”),  asserting a claim
of infringement of U.S. Patent No. 6, 585, 323 (“the
‘323 Patent”). [Doc. 1]. On December 29, 2015,
Agio filed an Amended Complaint, adding Zhejiang Longda Force
Co. Ltd. (“Longda”), a Chinese company, as a
defendant and amending its patent infringement claim to
include U.S. Patent 6, 293, 624 (“the ‘624
Patent”). [Doc. 5].
refused to waive service of process under Federal Rule of
Civil Procedure 4(d). Accordingly, Agio initiated formal
service of process of the Summons and the Amended Complaint
pursuant to the Hague Convention, to which the People's
Republic of China is a signatory. [See Doc. 26-1].
Despite Agio's extensive and repeated efforts to
effectuate service, Longda failed to file a responsive
pleading or otherwise participate in the above-captioned
February 15, 2017, Agio moved for the entry of default
against Longda for failure to answer or otherwise plead in
response to Agio's Amended Complaint. [Doc. 26]. On
February 16, 2017, pursuant to Federal Rule of Civil
Procedure 55(a), the Clerk entered default against Longda.
claim having been resolved against all other parties, Agio
now moves pursuant to Rule 55(b)(2) of the Federal Rules of
Civil Procedure for default judgment against Longda, seeking
the following relief: (1) a finding that Longda is liable for
patent infringement; (2) an award of compensatory damages
based on Agio's lost profits; (3) an award of treble
damages based on Longda's egregious and willful
infringement; (4) an award of attorney fees on the grounds
that this case is “exceptional”; and (5) an award
of costs, prejudgment interest, and post-judgment interest.
STANDARD OF REVIEW
of the Federal Rules of Civil Procedure provides for the
entry of a default when “a party against whom a
judgment for affirmative relief is sought has failed to plead
or otherwise defend.” Fed.R.Civ.P. 55(a). Once a
defendant has been defaulted, the plaintiff may then seek a
default judgment. If the plaintiff's claim is for a sum
certain or can be made certain by computation, the Clerk of
Court may enter the default judgment. Fed.R.Civ.P. 55(b)(1).
In all other cases, the plaintiff must apply to the Court for
a default judgment. Fed.R.Civ.P. 55(b)(2).
defendant, by his default, admits the plaintiff's
well-pleaded allegations of fact....” Ryan v.
Homecomings Fin. Network, 253 F.3d 778, 780 (4th Cir.
2001) (quoting Nishimatsu Constr. Co., Ltd. v. Houston
Nat'l Bank, 515 F.2d 1200, 1206 (5th Cir. 1975)). A
defendant, however, “is not held . . . to admit
conclusions of law.” Ryan, 253 F.3d at 780
(quoting Nishimatsu, 515 F.2d at 1206). The Court
therefore must determine whether the facts as alleged state a
claim for relief. GlobalSantaFe Corp. v.
Globalsantafe.com, 250 F.Supp.2d 610, 612 n.3 (E.D. Va.
PLAINTIFF'S FACTUAL ALLEGATIONS
well-pleaded factual allegations of Agio's Amended
Complaint having been deemed admitted by virtue of
Longda's default, the following is a summary of the
an industry-leading designer, manufacturer, and distributor
of outdoor furniture items, including chairs, tables, and
other usable products. [Doc. 5 at ¶ 2]. Agio is the
assignee of the '624 Patent and the '323 Patent
(collectively, “the patents-in-suit” or
“Agio's patents”). [Id. at ¶
3]. Agio owns all rights, title, and interest in and to the
patents-in-suit, including the right to sue for infringement.
[Id. at ¶¶ 21-22].
is also a manufacturer and distributor of outdoor garden
furniture, considerable amounts of which are exported to the
United States, including to North Carolina. [Doc. 5 at
¶¶ 4-5, 7-8]. For more than fifteen years, Longda
has manufactured and distributed sling chairs that infringe
Agio's patents. Since May of 2003, Longda has had actual
notice of Agio's '624 Patent and has known its sling
chairs infringed the '624 Patent but has continued to
sell and distribute its infringing sling chairs despite this
knowledge. [Id. at ¶¶ 31-33].
2002, Agio filed a complaint in the United States District
Court for the Northern District of Illinois for infringement
of the '624 Patent. See Agio Int'l Co. v. Hansen
Int'l Inc., No. 1:02-cv-06242 (N.D. Ill. Aug. 30,
2002). On April 22, 2003, the Northern District of Illinois
issued a Permanent Injunction Order (hereinafter, “the
Hansen Permanent Injunction”), enjoining the
defendants in that action “from manufacturing, using,
selling, offering for sale, promoting, distributing,
displaying in any medium or otherwise disposing of” any
sling chair “with the same accused structure”
that infringes Agio's patent. [Doc. 5-3 at 5]. The
Hansen Permanent Injunction also enjoined
“those persons in active concert or participation with
[the defendants] who receive actual notice of the Permanent
Injunction Order….” [Doc. 5 at ¶ 31; Doc.
5-3 at 5].
not a named defendant in the Hansen litigation,
Longda supplied the infringing furniture at issue in
Hansen. [Doc. 5 at ¶ 32]. Agio provided notice
of the Hansen Permanent Injunction to Longda in May
2003. [Id.]. Longda nevertheless began selling and
supplying infringing chairs to JMH at its facility in
Candler, North Carolina. [Id. at ¶ 33;
Declaration of John Mark Hudson (“JMH Aff.”),
Doc. 50-1 at ¶ 3]. Specifically, between 2011 and 2014,
Longda profited by selling to JMH 22, 478 infringing chairs,
as well as 1, 626 tables, which tables were sold together
with the chairs in question as functional units.
[See JMH Aff., Doc. 50-1 at ¶¶ 5, 6].
Agio initiated the above-captioned action, Longda has
repeatedly refused to participate in this litigation despite
Agio's repeated efforts to put them on notice of the
action and prompt Longda to participate. [See
Declaration of Craig L. Mytelka (“Mytelka
Decl.”), Doc. 51-1]. In February 2016, working with a
law firm in China, counsel for Agio provided Longda with
translated copies of the Summons, Amended Complaint, and
Exhibits, as well as a Waiver of Service Form. [Id.
at ¶ 6]. Longda responded that it was not willing to
sign the waiver but wished to nonetheless receive any
documents related to the case. [Id. at ¶ 7].
Agio made every effort to obtain service under the Hague
Convention, and the Chinese law firm later sent a letter
warning Longda that Agio would soon commence default
proceedings. [Id. at ¶ 10]. Longda's
refusal to participate in this litigation continues to the