AT&T Mobility LLC et al v. C-Tech Wholesale, Inc. et al, No. 2:2009cv06131 - Document 10 (C.D. Cal. 2009)
Court Description: FINAL JUDGMENT AND PERMANENT INJUNCTION AGAINST DEFENDANTS CTECH WHOLESALE, INC. AND HASSAN CHAALAN by Judge Christina A. Snyder: Upon Stipulation 8 , Final judgment is hereby entered against Defendant C-Tech Wholesale, Inc. and in favor of the Plai ntiffs AT&T Mobility LLC and AT&T Intellectual Property II L.P., on all claims set forth in AT&T's Complaint in the principal amount of $5,000,000.00 (U.S.), which shall bear interest at the legal rate, for which let execution issue forthwi th. C-Tech Wholesale, Inc. and Hassan Chaalan, and each and all of their respective officers, directors, successors, assigns, parents, subsidiaries, affiliates, related companies, predecessors-in-interest, agents, employees, personal representatives, beneficiaries, and all other persons or entities acting or purporting to act for him/it or on his/its behalf, including but not limited to any corporation, partnership, proprietorship or entity of any type that is in any way affiliated or associated with any Defendant or any Defendant's representatives, agents, assigns, parent entities, employees, associates, servants, affiliated entities, and any and all persons and entities in active concert and participation with any Defendant who receive notice of this Order, shall be and hereby are PERMANENTLY ENJOINED re AT&T GoPhone, Activation Materials, marks, etc. See document for details. ( MD JS-6, Case Terminated ) (gk)
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AT&T Mobility LLC et al v. C-Tech Wholesale, Inc. et al 1 2 3 4 5 6 7 Doc. 10 Michele A. Powers (SBN 174779) michele.powers@alston.com ALSTON & BIRD LLP 333 South Hope Street Los Angeles, California 90071 Telephone: (213) 576-1030 Facsimile: (213) 576-1100 JS-6 Attorneys for Plaintiffs AT&T Mobility LLC and AT&T Intellectual Property II, L.P. 8 UNITED STATES DISTRICT COURT 9 CENTRAL DISTRICT OF CALIFORNIA 10 11 12 AT&T MOBILITY LLC and AT&T INTELLECTUAL PROPERTY II, L.P., 13 ) ) ) ) ) ) ) ) ) ) Plaintiffs, 14 v. 15 C-TECH WHOLESALE, INC.; and HASSAN CHAALAN, 16 17 Defendants. Case No. CV09-6131 CAS (CWx) FINAL JUDGMENT AND PERMANENT INJUNCTION AGAINST DEFENDANTS CTECH WHOLESALE, INC. AND HASSAN CHAALAN 18 19 Plaintiffs AT&T Mobility LLC and AT&T Intellectual Property II L.P. 20 (collectively “AT&T”), brought the above-captioned lawsuit against Defendants C- 21 Tech Wholesale, Inc. and Hassan Chaalan (collectively referred to as 22 “Defendants”), alleging that Defendants are engaged in an unlawful enterprise 23 involving the acquisition, sale, and alteration of large quantities of AT&T wireless 24 devices sold for the purpose of use with AT&T’s prepaid service (referred to herein 25 as “GoPhones” or “Phones”) and associated SIM cards and activation kits 26 purchased from retail outlets, the solicitation and payment of others to bulk 27 28 purchase Phones for Defendants’ benefit, computer hacking and erasing or otherwise disabling software installed in the Phones, or selling the Phones to others FINAL JUDGMENT AND PERMANENT INJUNCTION AGAINST DEFENDANTS C-TECH WHOLESALE AND HASSAN CHAALAN 1 Dockets.Justia.com 1 who disable the software, and ultimately selling or facilitating the sale of the altered 2 Phones as new under the AT&T trademarks for unauthorized use outside of the 3 AT&T wireless system for profit and illicitly selling and/or fraudulently activating 4 the SIM cards that come with the prepaid devices for the unlawful acquisition of 5 airtime (the “Illicit Bulk Resale Scheme”). 6 AT&T GoPhones are sold subject to terms and conditions (“Terms and 7 Conditions”) which conspicuously restrict and limit the sale and use of the 8 GoPhones. These Terms and Conditions are set forth in printed inserts that are 9 included in the packaging with every AT&T GoPhone and are posted on AT&T’s 10 website. AT&T alleges that the Terms and Conditions and language on the 11 GoPhone packaging constitute a valid binding contract. 12 AT&T alleges that Defendants have violated the Terms and Conditions 13 by, inter alia, purchasing AT&T GoPhones with the intent that such phones will 14 not be activated and used on AT&T’s service, but instead with the intent to 15 16 17 18 19 20 21 22 23 improperly unlock, repackage, or resell the phones, or by otherwise using the GoPhones in violation of the Terms and Conditions. As a result of Defendants’ alleged involvement in the Illicit Bulk Resale Scheme, AT&T asserted claims against Defendants for breach of contract; trademark infringement under 15 U.S.C. § 1114 and 15 U.S.C. § 1125(a); federal trademark dilution under 15 U.S.C. § 1125(c); violation of Cal. Bus & Prof. Code §§ 14200 et seq. and 17200 et seq.; contributory trademark infringement; tortious interference with business relationships and prospective advantage; tortious interference with contract; conspiracy to induce breach of contract; civil conspiracy; and unjust enrichment. 24 25 26 Based on the respective positions advocated by the parties and having reviewed the Complaint and file and being otherwise duly and fully advised in the premises, it is hereby ORDERED, ADJUDGED and DECREED that: 27 28 FINAL JUDGMENT AND PERMANENT INJUNCTION AGAINST DEFENDANTS C-TECH WHOLESALE AND HASSAN CHAALAN -2- 1 2 3 1. This Court has jurisdiction over all the parties and all of the claims set forth in AT&T’s Complaint. 2. The Court finds that AT&T has the right to use and enforce said rights 4 in the stylized AT&T and GOPHONE marks, which are used in connection with 5 telecommunications products and services, as depicted below: 6 7 8 9 10 11 12 13 14 AT&T uses the AT&T Marks on and in connection with its telecommunications products and services. The AT&T and GOPHONE marks are valid, distinctive, protectable, famous, have acquired secondary meaning, and are associated exclusively with AT&T. 3. The Court finds that, if proven, Defendants’ alleged involvement in the 15 Illicit Bulk Resale Scheme would constitute breach of contract; trademark 16 infringement under 15 U.S.C. § 1114 and 15 U.S.C. § 1125(a); federal trademark 17 dilution under 15 U.S.C. § 1125(c); violation of Cal. Bus & Prof. Code §§ 14200 et 18 seq. and 17200 et seq.; contributory trademark infringement; tortious interference 19 with business relationships and prospective advantage; tortious interference with 20 contract; conspiracy to induce breach of contract; civil conspiracy; and unjust 21 enrichment. 22 4. The Court finds that the Terms and Conditions and the language on the 23 GoPhone packaging constitute a valid binding contract enforceable against 24 purchasers of GoPhones. 25 GoPhones in conjunction with service providers other than AT&T, and (b) 26 tampering with or altering, or facilitating or assisting others to tamper with or alter, 27 GoPhones or the GoPhones’ software constitute independent breaches of contract 28 for which AT&T is entitled to relief. The Court finds that (a) facilitating others to use FINAL JUDGMENT AND PERMANENT INJUNCTION AGAINST DEFENDANTS C-TECH WHOLESALE AND HASSAN CHAALAN -3- 5. 1 The Court further finds that, if proven, Defendants’ alleged 2 participation in the Illicit Bulk Resale Scheme, including, inter alia the purchase 3 and sale of GoPhones and activation kits, would cause substantial and irreparable 4 harm to AT&T for which there is no adequate remedy at law, and would continue 5 to cause substantial and irreparable harm to AT&T unless enjoined. 6. 6 7 On review and consideration of all relevant factors, AT&T is entitled to damages and injunctive relief on the claims as set forth in the Complaint. 7. 8 Final judgment is hereby entered against Defendant C-Tech 9 Wholesale, Inc. and in favor of the Plaintiffs AT&T Mobility LLC and AT&T 10 Intellectual Property II L.P., on all claims set forth in AT&T’s Complaint in the 11 principal amount of Five Million Dollars and Zero Cents ($5,000,000.00 (U.S.)), 12 which shall bear interest at the legal rate, for which let execution issue forthwith. 8. 13 14 15 16 17 18 19 20 21 22 23 C-Tech Wholesale, Inc. and Hassan Chaalan, and each and all of their respective officers, directors, successors, assigns, parents, subsidiaries, affiliates, related companies, predecessors-in-interest, agents, employees, personal representatives, beneficiaries, and all other persons or entities acting or purporting to act for him/it or on his/its behalf, including but not limited to any corporation, partnership, proprietorship or entity of any type that is in any way affiliated or associated with any Defendant or any Defendant’s representatives, agents, assigns, parent entities, employees, associates, servants, affiliated entities, and any and all persons and entities in active concert and participation with any Defendant who receive notice of this Order, shall be and hereby are PERMANENTLY ENJOINED from: a. purchasing, selling, unlocking, reflashing, altering, advertising, 24 25 26 soliciting and/or shipping, directly or indirectly, any AT&T GoPhones as well as related “Activation Materials,” which consist of SIM Cards, GoPhone airtime cards, PIN numbers and/or other mechanism, process 27 28 FINAL JUDGMENT AND PERMANENT INJUNCTION AGAINST DEFENDANTS C-TECH WHOLESALE AND HASSAN CHAALAN -4- 1 or materials used to activate service or acquire airtime in connection 2 with a new activation; 3 b. purchasing, selling, unlocking, reflashing, altering, advertising, 4 soliciting and/or shipping, directly or indirectly, any AT&T wireless 5 handset that Defendants know or should know bears any AT&T or 6 GoPhone Trademark, any other trademark owned or used by AT&T. 7 Unless expressly authorized by AT&T in writing, Defendants are 8 enjoined from purchasing and/or selling, directly or indirectly, all 9 models of phones currently offered for sale by AT&T or that may be 10 offered for sale in the future, as listed and updated from time to time 11 on AT&T’s website: http://www.att.com, regardless of whether such 12 devices are in or out of their original packaging, or whether “locked,” 13 “unlocked,” or otherwise modified in any way by any person; 14 15 16 17 18 19 20 21 22 23 c. accessing, altering, erasing, tampering with, deleting or otherwise disabling the software contained in any GoPhone and/or fraudulently activating Activation Materials; d. facilitating or in any way assisting other persons or entities who Defendants know or should know are engaged in unlocking GoPhones and/or hacking, altering, erasing, tampering with, deleting or otherwise disabling the software installed in GoPhones; e. facilitating or in any way assisting other persons or entities who Defendants know or should know are engaged in any of the acts prohibited under this Permanent Injunction, including, without limitation, the buying and/or selling of unlocked GoPhones and 24 25 26 27 Activation Materials; and f. knowingly using the AT&T or GoPhone Marks or any mark owned or used by AT&T, or that is likely to cause confusion with AT&T’s marks, without AT&T’s prior written authorization. 28 FINAL JUDGMENT AND PERMANENT INJUNCTION AGAINST DEFENDANTS C-TECH WHOLESALE AND HASSAN CHAALAN -5- 1 9. The Court retains jurisdiction over this matter and the parties to this 2 action in order to enforce any violation of the terms of this Permanent Injunction 3 and to enforce the terms of the parties’ settlement agreement (including providing 4 any rights or remedies contained therein). Upon AT&T’s filing of an affidavit or 5 declaration that any one or all of the Defendants have defaulted under the 6 settlement agreement or/or violated the Permanent Injunction, the Court shall find 7 the Defendants in contempt and shall award AT&T compensatory damages in an 8 amount of $5,000 for each AT&T GoPhone or item of Activation Material that 9 Defendants are found to have purchased, sold, or unlocked in violation of this 10 Injunction. The Court finds that these amounts are compensatory and will serve to 11 compensate AT&T for its losses in the event a Defendant violates the terms of this 12 Order. 13 14 15 16 17 18 19 20 21 22 23 24 25 10. The address of C-Tech Wholesale, Inc. is 4141 Ball Road, Cypress, California 90630. 11. The address of Hassan Chaalan is 4122 Elizabeth Court, Cypress, California 90630. 12. The address of Plaintiffs AT&T Mobility LLC and AT&T Intellectual Property II L.P. is 1025 Lenox Park Blvd., Atlanta, GA 30319. 13. The Court retains jurisdiction over this matter to enter a subsequent judgment for damages against Defendant Chaalan in the event of a violation of the terms of this injunction or the settlement agreement. 14. The Court hereby finds, pursuant to Fed. R. Civ. P. 54(b), that there is no just reason for delay and orders that Judgment shall be entered against Defendants as set forth herein. DONE AND ORDERED in Los Angeles, California, this 26th day of August, 2009. 26 ____________________________________ 27 United States District Judge 28 FINAL JUDGMENT AND PERMANENT INJUNCTION AGAINST DEFENDANTS C-TECH WHOLESALE AND HASSAN CHAALAN -6-
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