Mattel Inc. v. The Entities Doing Business as Goodmenow at the URL Goodmenow.com
1:20-cv-11075
| S.D.N.Y. | Feb 13, 2021Background
- Mattel sued Yokawa Network Ltd. and several e‑commerce websites for trademark counterfeiting/infringement and copyright infringement for selling "Day of the Dead" dolls using Mattel’s registered BARBIE marks and two copyrighted Mattel photographs.
- Mattel alleges defendants sold 3,149 Day of the Dead dolls during the relevant period, generating ~$131,764 in revenue and an estimated gross profit of $13,176.44; Yokawa is a Hong Kong company that sold products through sites Goodmenow, MeetGoodTimes, and FeelItNice.
- Mattel obtained an ex parte TRO/order of attachment directed to PayPal, which led PayPal to freeze eleven accounts holding over $5 million; the Court later limited the initially unrestricted attachment to $2.8 million by a proposed amended order.
- The Court found a prima facie basis for specific personal jurisdiction over defendants under N.Y. C.P.L.R. § 302(a)(1) (multiple shipments to New York) and concluded Mattel is likely to succeed on its trademark claim (and likely on the copyright claim) for purposes of an attachment motion.
- Despite satisfying the statutory prerequisites for prejudgment attachment under N.Y. C.P.L.R. § 6212, the Court exercised its discretion to vacate the attachment because Mattel showed no need (judgment could be enforced in Hong Kong) and defendants did not present a risk of insolvency or asset flight.
- The Court nevertheless entered a narrow preliminary injunction (asset freeze) barring defendants from withdrawing PayPal funds that would reduce their combined account balances below $13,176.44 (the estimated disgorgement/profit figure).
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether plaintiff met requirements for a prejudgment attachment under NY CPLR §6212 | Mattel: statutory grounds exist (foreign nondomiciliary), cause of action, probable success on merits, no counterclaims | Yokawa: merits fail ("Barbie" is generic), attachment overbroad | Court: Statutory prerequisites met; plaintiff likely to succeed on trademark (and likely copyright) claims |
| Whether court should exercise its discretion to grant attachment even if statutory elements met | Mattel: need for security; no practical way to satisfy a judgment absent attachment | Yokawa: no risk of non‑payment; judgments enforceable in Hong Kong; attachment unnecessary and harms business | Court: Vacated attachment in its discretion because plaintiff failed to show need or risk of judgment evasion; enforcement in Hong Kong available |
| Whether the Court had jurisdiction/situs to attach funds held through PayPal Hong Kong via an order served on PayPal Inc. in California | Mattel: PayPal complied with order; New York precedent often issues attachments to PayPal | Yokawa: accounts opened with PayPal Hong Kong; PayPal Hong Kong not subject to NY jurisdiction; service on PayPal Inc. doesn’t confer jurisdiction over HK accounts | Court: Expressed serious doubts about jurisdictional basis to reach PayPal Hong Kong accounts and declined to rest the attachment on that theory |
| Whether preliminary equitable asset freeze is available and its permissible scope | Mattel: seeks freeze as ancillary relief to obtain accounting/disgorgement of profits | Yokawa: opposes broad freeze that disrupts business and exceeds disgorgement need | Court: Because plaintiff seeks an accounting of profits, a limited preliminary injunction freezing assets down to the estimated profit amount ($13,176.44) is appropriate; broader attachment vacated |
Key Cases Cited
- Chloe v. Queen Bee of Beverly Hills, LLC, 616 F.3d 158 (2d Cir. 2010) (New York’s long‑arm single‑act test supports specific jurisdiction where defendant purposefully shipped infringing goods to the forum)
- Capital Ventures Int’l v. Republic of Argentina, 443 F.3d 214 (2d Cir. 2006) (court discretion in attachment context considered where statutory requisites are met)
- Gucci Am., Inc. v. Weixing Li, 768 F.3d 122 (2d Cir. 2014) (district courts may issue asset freezes ancillary to equitable relief seeking disgorgement of profits)
- Hotel 71 Mezz Lender LLC v. Falor, 14 N.Y.3d 303 (N.Y. 2010) (location/situs of intangible debts and attachment rules where garnishee submits to jurisdiction)
- Reebok Int’l, Ltd. v. Marnatech Enters., Inc., 970 F.2d 552 (9th Cir. 1992) (discusses scope of preliminary injunctions ancillary to equitable relief)
- United States v. First Nat’l City Bank, 379 U.S. 378 (U.S. 1965) (federal courts may order parties to freeze or turn over assets under their control located outside the U.S.)
- NML Capital, Ltd. v. Republic of Argentina, 727 F.3d 230 (2d Cir. 2013) (nonparties who assist in violating injunctions can be bound under Rule 65)