Indian Motorcycle International, LLC v. Eguia

Case

Indian Motorcycle International, LLC v. Arturo Eguia and Indian Bike Week LLC, No. 24-cv-1958 (LMP/SGE), United States District Court, District of Minnesota

Judge

Laura M. Provinzino, United States District Judge

Date

September 5, 2025

Background and Parties Plaintiff Indian Motorcycle International, LLC ('IMI') is the owner of the INDIAN MOTORCYCLE brand and holds more than sixty federally registered trademarks (collectively, the 'IMI Marks'), including the '612, '330, '922, and '856 Marks covering motorcycles, apparel, accessories, and related goods. IMI has continuously used these marks in U.S. commerce since at least the 1990s. The '612, '330, '922, and '856 Marks have been registered for more than five years, making IMI's exclusive right to use them 'incontestable' under 15 U.S.C. § 1065.

Defendant Arturo Eguia was a former authorized Indian Motorcycle dealer whose Dealer Agreement was terminated on May 29, 2018, following his sale of the dealership. The Dealer Agreement required him to immediately cease all use of the IMI Marks upon termination. Eguia is also the founder and manager of Defendant Indian Bike Week LLC ('IBW'), a Minnesota limited liability company organized in 2022, which was never authorized to use the IMI Marks.

Factual Allegations (Accepted as True for Default Judgment Purposes) Beginning around 2016, while still an authorized dealer, Eguia began organizing 'Indian Bike Week' motorcycle rallies. After IMI terminated the Dealer Agreement in 2018, Eguia—and later IBW—continued hosting these rallies in Minnesota, Wisconsin, and other states. The defendants promoted the rallies through a website and social media using marks identical or nearly identical to the IMI Marks, charged approximately $100 per registrant, and provided attendees with INDIAN MOTORCYCLE branded merchandise. The defendants also sold infringing products through a Shopify catalog and eBay.

IMI sent cease-and-desist letters in October 2018 and June 2019. In pre-litigation discussions, Eguia admitted to infringing the IMI Marks and admitted his use was likely to cause consumer confusion, yet continued the conduct. IMI and Eguia entered a Settlement Agreement on September 17, 2020, under which Eguia agreed to: acknowledge IMI's rights; cease manufacturing infringing goods; add a non-affiliation disclaimer to all marketing materials; remove the IMI Marks from his website and social media; and cease selling existing inventory by September 1, 2022. Despite the Settlement Agreement, Eguia continued the infringing conduct, did not add the required disclaimer on a timely basis, and did not confirm compliance with the sell-off deadline. IMI sent additional demand letters in December 2021 and January 2024 to no avail.

Procedural History IMI filed suit on May 24, 2024. Defendants answered through counsel and filed a counterclaim for breach of the Settlement Agreement. Defendants' counsel moved to withdraw in November 2024, citing nonpayment, and the court granted withdrawal on December 6, 2024. Magistrate Judge Tony N. Leung ordered IBW to obtain new counsel by January 17, 2025 (because a business entity cannot appear without counsel in federal court), and warned that failure to do so could result in default judgment. Neither defendant obtained counsel.

IMI filed an amended complaint on March 10, 2025. Neither defendant answered. IMI served interrogatories in December 2024 and requests for admission on February 26, 2025; defendants failed to respond to both. Because Eguia failed to respond to the requests for admission, those requests were deemed admitted under Federal Rule of Civil Procedure 36(a)(3)—including admissions that more than 600 people registered for each of the 2023 and 2024 Indian Bike Week rallies at $100 per registration.

The Clerk of Court entered default on April 3, 2025. IMI then moved for default judgment. The court issued two orders to show cause (July 2 and July 21, 2025), each requiring defendants to explain why default judgment should not be entered. Eguia responded by email citing a family emergency beginning July 9, 2025, and later added that he was busy planning an event. The court found these responses inadequate: the family emergency post-dated several months of prior non-participation, and Eguia's emails contained no substantive defense to the merits of the motion. The court took the motion under advisement on August 21, 2025, without a hearing.

Legal Analysis

Entry of Default: The court found both defendants in default. IBW had been without counsel for over eight months in violation of the court's order, had not answered the amended complaint, had not complied with discovery, and had not responded to show-cause orders. Eguia, although entitled to self-representation (proceeding pro se), had similarly failed to answer the amended complaint, comply with discovery, or meaningfully respond to show-cause orders. The court found defendants' conduct constituted willful violations of court rules and intentional delays beyond mere 'marginal failure to comply with time requirements,' citing Ackra Direct Marketing Corp. v. Fingerhut Corp., 86 F.3d 852 (8th Cir. 1996).

Breach of Contract (Count I, against Eguia only): Under Minnesota law, IMI established: (1) a valid contract—the Settlement Agreement of September 17, 2020, the validity of which Eguia himself acknowledged by asserting a counterclaim for breach of that same agreement; (2) no unfulfilled conditions precedent to IMI's right to demand performance; and (3) multiple breaches by Eguia, including continued manufacture of infringing goods, failure to post the non-affiliation disclaimer, failure to remove IMI Marks from his website, and failure to cease selling inventory by September 1, 2022. Default judgment granted on Count I.

Trademark Infringement and Unfair Competition Under the Lanham Act (Counts II & III, against both defendants): To prevail, IMI needed to show (1) valid, protectable marks and (2) likelihood of consumer confusion. The court applied the Eighth Circuit's six-factor test from H&R Block, Inc. v. Block, Inc., 58 F.4th 939 (8th Cir. 2023): - Strength of the marks: Strongly favored IMI. Marks are federally registered (presumptively valid and distinctive), in use since at least the 1990s, and the four primary marks are incontestable. - Similarity of marks: Strongly favored IMI. Defendants' marks were nearly identical in appearance, sound, and meaning to the IMI Marks. - Degree of competition: Strongly favored IMI. Both parties offered overlapping goods (motorcycles, apparel, patches, accessories) in the same geographic markets and through the same channels of trade. - Intent to pass off goods: Strongly favored IMI. Eguia launched the rallies as an authorized dealer, continued using the same name after termination, admitted infringement and likely confusion in 2018 discussions, yet persisted. - Actual confusion: Favored defendants. IMI did not allege specific incidents of actual consumer confusion. - Type of product and purchasing conditions: Neutral. No specific allegations about purchaser care; the court inferred from Eguia's own admission that even careful consumers could be confused.

Four factors weighed heavily for IMI, one for defendants, one neutral. The court found a likelihood of confusion established. Default judgment granted on Counts II and III.

Dilution by Blurring (also Count III): Under 15 U.S.C. § 1125(c), the court found IMI established: (1) the IMI Marks are famous—America's oldest motorcycle brand, in commerce since 1901 and through the 1990s to present, marketed worldwide through an extensive dealer network, and federally registered; (2) the marks are distinctive; (3) defendants used the IMI Marks in commerce; (4) defendants' use began after the marks became famous; and (5) defendants' conduct caused dilution of the distinctive quality of the IMI Marks. The court noted that Defendants' use was willful (a precondition for a profits award based on a dilution claim). Default judgment granted.

State Law Claims—Minnesota Deceptive Trade Practices Act ('MDTPA') and Common Law Unfair Competition (Counts IV & V): These claims are analyzed coextensively with the Lanham Act claims under Eighth Circuit precedent. Because IMI established its Lanham Act claims, the court also granted default judgment on the MDTPA and common law unfair competition claims.

Relief

Permanent Injunction: The court applied the four-factor test: (1) success on the merits—established through the default judgment findings; (2) irreparable harm—presumed under trademark law once likelihood of confusion is established; Eguia also contractually acknowledged IMI would suffer irreparable harm from his breach of the Settlement Agreement; (3) balance of harms—defendants did not appear to contest, and the court declined to excuse plainly infringing activities; (4) public interest—trademark infringement is inherently contrary to the public interest. All four factors favored IMI.

The court permanently enjoined both defendants (and all those acting in concert with them) from: (a) any use of the IMI Marks or confusingly similar marks in connection with motorcycle rallies, apparel, merchandise, or related goods and services (including on social media, websites, and promotional materials); (b) any conduct causing consumers to believe defendants' products or services are authorized, approved, or affiliated with IMI; and (c) manufacturing, distributing, or otherwise handling any unauthorized products bearing the IMI Marks or confusingly similar marks. Defendants must destroy all infringing goods and remove or destroy all infringing promotional materials within 30 days, and submit a sworn affidavit of compliance within 45 days.

Disgorgement of Profits ($120,000): The Lanham Act (15 U.S.C. § 1117(a)) authorizes recovery of a defendant's profits. Disgorgement may be based on unjust enrichment, as a measure of damages, or as deterrence for willful infringement. Under the Lanham Act, the defendant's revenue is presumed to equal profit unless the defendant proves deductible expenses—which defendants failed to do by not participating in discovery or responding to the motion.

Because Eguia failed to respond to IMI's requests for admission, the court deemed admitted that there were more than 600 registrants for each of the 2023 and 2024 Indian Bike Week rallies (at least 1,200 total) at $100 each, yielding at least $120,000 in revenue. The court noted this was a conservative estimate, as it did not include revenue from earlier rallies, the 2025 rally held August 8–18, 2025, or sales of infringing merchandise. The court found disgorgement necessary because injunctive relief alone was insufficient to deter Eguia—who, as of the date of the order, was already promoting a 2026 Indian Bike Week rally on his website. The $120,000 award is joint and several as between Eguia and IBW.

Attorneys' Fees: IMI waived its claim for attorneys' fees (estimated at $240,000) to avoid undue hardship on Eguia as an individual, so the court did not analyze that issue.