Background
Imagination Products claims trade-dress rights in the orange color used on its hand-operated plumbing snakes. It sued several online sellers, including China-based Omont, alleging that their competing drain-cleaning tools infringed that trade dress. The court permitted service on Omont by email. Omont did not appear, and the court entered a default judgment that imposed $13,335,764.46 in damages against it.
Omont said it first learned about the lawsuit when Amazon removed three product listings under the judgment. It then found the service email in its spam folder, retained U.S. counsel, and moved within a month to vacate the judgment under Federal Rule of Civil Procedure 60(b)(1). That rule allows relief from a final judgment for mistake, inadvertence, surprise, or excusable neglect.
The Court’s Holding
Judge Robert W. Gettleman granted Omont’s motion and vacated the final default judgment as to that defendant. The court applied the familiar considerations of a valid reason for the default, prompt action to correct it, and a potentially meritorious defense.
First, Omont had not willfully ignored the case. The court found it unsurprising that a message from an unfamiliar foreign lawyer landed in a spam folder. Because no preliminary injunction or marketplace freeze had alerted Omont to the litigation, the company had no practical notice before judgment beyond monitoring its spam folder. Those circumstances qualified as inadvertence, surprise, or excusable neglect.
The court also found a formal service defect. After the default judgment, the Seventh Circuit explained in Kangol LLC v. Hangzhou Chuanyue Silk Import & Export Co. that, when the Hague Service Convention applies, it prohibits service by email in China. The district court concluded it could not sustain the large judgment against a defendant that had not been properly served. Omont acted quickly after Amazon’s delisting alerted it to the case, especially given the need to retain foreign counsel.
Finally, Omont presented a potentially meritorious defense to the trade-dress claim. Protecting a product color requires proof that the claimed trade dress is distinctive or has acquired secondary meaning, is likely to cause confusion when copied, and is nonfunctional. Omont’s challenge to whether the orange color was distinctive or had acquired secondary meaning raised a serious question about the default judgment. The court ordered Omont to answer the complaint, leaving the merits for adversarial litigation.
Key Takeaways
- Email delivery is not the same as meaningful notice, especially when a message to a foreign defendant is filtered as spam and no asset restraint independently signals the lawsuit.
- A default judgment can be reopened when the defendant shows excusable neglect, acts promptly, and identifies a developed defense that could change the result.
- Service on a defendant in China must account for the Hague Service Convention; a court-authorized email alone may be legally insufficient.
- A supplemental registration or allegation of rights in a product color does not eliminate the need to prove distinctiveness, likely confusion, and nonfunctionality.
Why It Matters
The decision is a warning about the due-process risks of building a multimillion-dollar judgment on email service that never provided practical notice. Courts and brand owners must separately consider whether a service method is authorized and whether the circumstances support confidence that a foreign defendant had a fair opportunity to respond.
For trademark owners, the ruling also highlights the vulnerability of color-based trade dress when a defendant appears and tests the evidence. Default can temporarily hide weaknesses that adversarial briefing exposes. Vacating this judgment does not decide whether Imagination Products owns enforceable rights in orange plumbing snakes; it restores the ordinary process for answering that question.
The opinion text could not be fetched through the publication server after both the ordinary and alternate public-source routes failed.
Surfaced via Eric Goldman’s Technology & Marketing Law Blog.