`
`IN THE UNITED STATES DISTRICT COURT
`FOR THE NORTHERN DISTRICT OF ILLINOIS
`EASTERN DIVISION
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`) No. 24 C 115
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`)))
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`v.
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`Roadget Business Pte. Ltd.,
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` Plaintiff,
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`The Individuals, Corporations,
`Limited Liability Companies,
`Partnerships, and
`Unincorporated Associations
`Identified on Schedule A
`Hereto,
`
` Defendants.
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`
`Memorandum Opinion and Order
`In this suit, plaintiff alleges 17 defendants infringed
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`several of its copyrights. I previously granted plaintiff an ex
`parte temporary restraining order (“TRO”), which includes an asset
`freeze. Several defendants (“Moving Defendants”)1 later appeared
`through counsel and moved to dissolve or modify the TRO, but I
`denied that motion. Moving Defendants now move for reconsideration
`of that denial and to dismiss the complaint and/or sever the Moving
`Defendants into separate cases.
`
`
`1 Moving Defendants include Defendant Nos. 1 (S H Baby), 6 (Free
`Loop), 7 (Be kind), 8 (Livi), 9 (Mi Fashion), 11 (Yeonhee women
`clothing), 13 (SYLP PLUS), 14 (SYLP), 16 (Dchen), and 17 (Huang
`Kangwei).
`
`
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`Case: 1:24-cv-00115 Document #: 84 Filed: 05/30/24 Page 2 of 11 PageID #:864
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`I.
`As explained in my prior order, asset restraints are typically
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`unavailable before judgment where a plaintiff seeks a money
`judgment. See Grupo Mexicano de Desarrollo S.A. v. All. Bond Fund,
`Inc., 527 U.S. 308, 331–33 (1999). But where, as here, a plaintiff
`seeks an equitable remedy like disgorgement, an asset freeze may
`be appropriate. See Banister v. Firestone, No. 17 C 8940, 2018 WL
`4224444, at *9 (N.D. Ill. Sept. 5, 2018) (“[T]he Court can
`permissibly freeze assets to protect a plaintiff’s equitable
`remedies.” (citations omitted)). Even then, “the appropriate scope
`of prejudgment restraint must be limited only to what is reasonably
`necessary to secure the (future) equitable relief.” Deckers
`
`Outdoor Corp. v. P’ships & Unincorporated Ass’ns Identified on
`Schedule A, No. 13 C 07621, 2013 WL 12314399, at *2 (N.D. Ill.
`Oct. 31, 2013). Thus, “if the amount of the profits is known, then
`the asset freeze should apply only to that specific amount, and no
`more.” Id. “To exempt assets from an asset freeze, ‘[t]he burden
`is on the party seeking relief to present documentary proof that
`particular assets [are] not the proceeds of counterfeiting
`activities.’” Monster Energy Co. v. Wensheng, 136 F. Supp. 3d 897,
`910 (N.D. Ill. 2015) (quoting Luxottica USA LLC v. P’ships &
`Unincorporated Ass’ns Identified on Schedule “A”, No. 14 C 9061,
`2015 WL 3818622, at *5 (N.D. Ill. June 18, 2015)).
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`2
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`Case: 1:24-cv-00115 Document #: 84 Filed: 05/30/24 Page 3 of 11 PageID #:865
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`Moving Defendants previously requested that I limit the asset
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`freeze to what they asserted were the profits from the accused
`products. Profits are calculated by subtracting costs from
`revenue. In support of their revenue estimates, they submitted a
`declaration by one of their attorneys stating that Temu (the
`platform on which defendants sold the allegedly infringing
`products) produced a spreadsheet identifying the revenues obtained
`from sales of accused products on the platform. As to costs, Moving
`Defendants supplied declarations from their own business
`representatives providing cost estimates associated with sales of
`accused products. I denied the motion, expressing concern
`primarily with the unreliability of the cost figures. See ECF 58.
`
`It is this order that Moving Defendants wish me to reconsider
`under Rule 59(e). Cf. Fin. Servs. Corp. of Midwest v. Weindruch,
`764 F.2d 197, 198 (7th Cir. 1985) (noting that “an order granting
`a preliminary injunction is a judgment within the meaning of” Rule
`59(e)). “Courts may grant Rule 59(e) motions ‘to alter or amend
`the judgment if the movant presents newly discovered evidence that
`was not available at the time’” of the proceeding. Miller v. Safeco
`Ins. Co. of Am., 683 F.3d 805, 813 (7th Cir. 2012) (quoting In re
`Prince, 85 F.3d 314, 324 (7th Cir. 1996)).
`Moving Defendants meet that standard here. First, they have
`come forward with more robust evidence regarding revenue, in the
`form of a custodial declaration produced by counsel for Temu
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`3
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`Case: 1:24-cv-00115 Document #: 84 Filed: 05/30/24 Page 4 of 11 PageID #:866
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`explaining--and attesting to the veracity of--the revenue data
`Moving Defendants submitted. See Casaceli Decl., ECF 62-1. This
`evidence comes directly from the platform from which the sales
`data originates, and it describes how the sales data was obtained,
`rendering it sufficiently reliable. Plaintiff offers no evidence
`in rebuttal, but complains that Moving Defendants could have
`submitted this evidence with their original motion. See Miller,
`683 F.3d at 813 (“[Rule 59(e)] motions are not appropriately used
`to advance arguments or theories that could and should have been
`made before the district court rendered judgment or to present
`evidence that was available earlier.” (citation and internal
`quotation marks omitted)). True enough, but evidence is not really
`“available” where a party did not have sufficient notice that it
`was necessary to achieve its preferred outcome. See In re Prince,
`85 F.3d at 324 (evidence not previously “available” where “the
`parties did not have sufficient indication” it was required and
`thus “were not given an opportunity to collect evidence bearing on
`the question”). In “Schedule A” cases like this one, it is
`exceedingly rare for defendants to appear at all, much less to
`mount a vigorous challenge to the scope of a TRO. That leaves a
`relative dearth of precedent from which Moving Defendants could
`tailor their arguments. Combine that with the wide discretion
`district judges enjoy in fashioning TROs, see Cassell v. Snyders,
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`4
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`Case: 1:24-cv-00115 Document #: 84 Filed: 05/30/24 Page 5 of 11 PageID #:867
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`990 F.3d 539, 545 (7th Cir. 2021), and you have a recipe for
`uncertainty as to what evidence each particular judge will demand.2
`Second, conditions have changed because the assets affected
`by the freeze have increased substantially. Moving Defendants
`point out that because the asset freeze applies to their accounts
`as a whole, and sales of the accused products have stopped since
`issuance of the TRO, the funds that have accumulated since then
`are from the sale of non-accused products. According to Moving
`Defendants’ evidence from Temu, the amount frozen across all
`defendants’ accounts as of February 1, 2024 was about $250,000,
`ballooning to over $1 million by the time Moving Defendants filed
`the present motion in mid-March. Compare Casaceli Decl. Exh. B,
`ECF 62-3 at 3 (identifying funds frozen per defendant as of
`February 1, 2024), with id. Exh. C, ECF 62-4 at 5 (same, as of
`March 13, 2024). Plaintiff does not dispute this. This evidence
`highlights the increasingly disproportionate harm inflicted by the
`asset freeze.
`
`Third, Moving Defendants now request a modification of the
`TRO to the gross sales revenue obtained from the sale of each
`accused product, rather than the profit. That is important because
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`2 There is also good reason to factor in the expedited, preliminary
`nature of the ex parte TRO’s entry and Moving Defendants’ initial
`challenge to it. It would be incongruous to hold a defendant in
`that position to the same standard as a party taking months to
`prepare a summary judgment brief.
`5
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`Case: 1:24-cv-00115 Document #: 84 Filed: 05/30/24 Page 6 of 11 PageID #:868
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`it means there is no need to use the unsupported cost estimates I
`previously found unreliable.3
`The foregoing discussion grounds my decision to modify the
`asset freeze in this case as to Moving Defendants (non-Moving
`Defendants have made no showing, so are not entitled to relief),
`and it is further bolstered by recent decisions by other judges in
`this district granting similar relief on similar evidence in cases
`brought by Roadget. See Order, Roadget, No. 24 CV 607, ECF 77;
`Minute Entry, Roadget Bus. PTE LTD v. Individuals et al. Identified
`on Schedule A Hereto, No. 1:24-cv-02015 (N.D. Ill. May 1, 2024),
`ECF 64. Moving Defendants’ motion is granted.
`II.
`Next, Moving Defendants argue they were improperly joined in
`
`this action. Joinder of defendants is appropriate if “any right to
`relief is asserted against them . . . with respect to or arising
`out of the same transaction, occurrence, or series of transactions
`or occurrences” and “any question of law or fact common to all
`defendants will arise in the action.” Fed. R. Civ. P. 20(a)(2).
`Courts enjoy “considerable flexibility” in deciding whether
`
`
`3 In reducing the asset freeze to estimated revenue in a similar
`case brought by Roadget, another judge in this district commented
`that she would not have granted a reduction to estimated profits
`because, as I previously found, the evidence of costs submitted by
`defendants’ representatives amounted to “an untested, one-sided
`account of a party.” Order at 3 n.4, Roadget Bus. Pte. Ltd. v. The
`Individuals et al. Identified on Schedule A Hereto, No. 24 CV 607
`(N.D. Ill. Apr. 16, 2024), ECF 77.
`6
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`Case: 1:24-cv-00115 Document #: 84 Filed: 05/30/24 Page 7 of 11 PageID #:869
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`multiple defendants may be joined in a single action. UWM Student
`Ass’n v. Lovell, 888 F.3d 854, 863 (7th Cir. 2018); see also Fed.
`R. Civ. P. 21 (“On motion or on its own, the court may at any time,
`on just terms, add or drop a party.”). Whether joinder is
`appropriate is therefore highly case-specific.
`
`Plaintiff calls this case one of “mass infringement”
`concerning the same platform (Temu) and the same harm (copyright
`infringement) inflicted upon the same entity (plaintiff). But
`these connections suggest nothing more than separate instances of
`infringement attributable to different defendants, not events
`arising out of the same transaction or occurrence. See AF Holdings,
`LLC v. Does 1–1058, 752 F.3d 990, 998 (D.C. Cir. 2014)
`(“[C]omitting the same type of violation in the same way does not
`link defendants together for the purpose of joinder.” (citation
`and internal quotation marks omitted)). Cf. Ilustrata Servicos
`
`Design, Ltda. v. P’ships & Unincorporated Ass’ns Identified on
`Schedule “A”, No. 21-CV-05993, 2021 WL 5396690, at *2 (N.D. Ill.
`Nov. 18, 2021) (“Courts in this District have held that plaintiffs
`cannot satisfy Rule 20’s requirements by merely alleging that
`multiple defendants have infringed the same patent or trademark.”
`(collecting cases)). Though evidence against multiple defendants
`will come from Temu, the evidence itself--from the infringing
`product listings to the sales and profit data--will be largely
`unique to each defendant.
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`7
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`Case: 1:24-cv-00115 Document #: 84 Filed: 05/30/24 Page 8 of 11 PageID #:870
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`Plaintiff insists that findings of misjoinder are typically
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`confined to cases with many more defendants than the 17 sued here.
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`See Art Ask Agency v. Individuals et al. Identified on Schedule
`“A”, No. 21-CV-06197, 2021 WL 5493226, at *1 (N.D. Ill. Nov. 23,
`2021) (finding misjoinder in case with 216 defendants); NFL Props.
`LLC v. P’ships & Unincorporated Ass’ns Identified on Schedule “A”,
`No. 21-cv-05522, 2021 WL 4963600, at *1 (N.D. Ill. Oct. 26, 2021)
`(same for 228 defendants). While the number of defendants may be
`relevant to determining whether joinder would promote or hinder
`judicial economy, see Art Ask Agency, 2021 WL 5493226, at *3,
`neither the Federal Rules nor the caselaw announce a numerical
`threshold.
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`Plaintiff also appeals to the reasoning in Bose Corp. v.
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`Partnerships & Unincorporated Associations Identified on Schedule
`“A”, 334 F.R.D. 511 (N.D. Ill. 2020). There, the court allowed
`joinder where defendants were alleged to have infringed on the
`plaintiff’s trademark by selling counterfeit products. The court
`found sufficient overlap to permit joinder because it was the
`“swarm of attacks” plaintiff faced “that [was] the defining aspect
`of the harm” it claimed to have suffered. Id. at 517. But Bose is
`distinguishable from the circumstances here where the claims are
`of distinct infringement of various copyrights, not a single, well-
`known trademark. Indeed, the same judge who authored Bose found it
`inapplicable to a later case which, like this one, dealt with
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`8
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`Case: 1:24-cv-00115 Document #: 84 Filed: 05/30/24 Page 9 of 11 PageID #:871
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`“instances of infringement by distinct competitors.” Tang v.
`P’ships & Unincorporated Ass’ns Identified on Schedule A, No. 23
`C 4587, 2024 WL 68332, at *3 (N.D. Ill. Jan. 4, 2024). The court
`in Bose was also guided by the “practical consideration[]” that no
`defendant had yet appeared and that default judgment as to all of
`them was likely. Bose, 334 F.R.D. at 517. As discussed below, that
`impacts my consideration of the non-Moving Defendants, but it
`distinguishes Bose’s reasoning as to Moving Defendants.
`
`Plaintiff also argues that severing the cases will come with
`efficiency costs. Even so, I must also be mindful that “presenting
`dozens or hundreds of defendants in one lawsuit actually undermines
`judicial economy, because this Court must evaluate the evidence
`submitted in support of liability and, eventually, damages.” Estée
`
`Lauder Cosmetics Ltd. v. P’ships & Unincorporated Ass’ns
`Identified on Schedule A, 334 F.R.D. 182, 189 (N.D. Ill. 2020).
`Where, as here, unrelated defendants are alleged to have infringed
`various copyrights, it is difficult to see how judicial economy
`would be promoted by litigating the cases together. It would
`prejudice Moving Defendants to litigate this case collectively,
`given that the infringement inquiry will vary for each asserted
`copyright, and that they may differ in their preferred scheduling
`timelines, defense strategies, or motion practice.
`
`It is plaintiff’s burden to show joinder is appropriate, id.
`at 185, and for the foregoing reasons it has failed to do so. I
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`9
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`Case: 1:24-cv-00115 Document #: 84 Filed: 05/30/24 Page 10 of 11 PageID #:872
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`stress, however, that the outcome might be different in other
`Schedule A cases, depending on the particular facts of those cases
`and the arguments in play.
`“The proper remedy” for improper joinder of defendants “is
`severance or dismissal without prejudice.” UWM Student Ass’n, 888
`F.3d at 864 (citation omitted). Severance is the better course
`here because dismissal would lift the TRO and open the possibility
`that the affected defendants would move the funds subject to the
`asset freeze out of plaintiff’s reach. See Mansoori v. Patel, No.
`17-cv-08846, 2022 WL 683667, at *2 (N.D. Ill. Mar. 8, 2022) (“Even
`dismissal without prejudice is an improper remedy if it would
`result in gratuitous injury to the plaintiff.” (citing Elmore v.
`Henderson, 227 F.3d 1009, 1012 (7th Cir. 2000))). In severing the
`cases, three pairs of Moving Defendants will be kept together4;
`the non-Moving Defendants will all remain joined in this action.5
`
`
`4 Moving Defendants acknowledge that Defendant Nos. 6 and 7, as
`well as Defendant Nos. 13 and 14, are owned by the same companies,
`respectively. Additionally, plaintiff observes that the same
`person--Zhong Mingjie--is “in charge” of the two companies that
`respectively operate Defendant Nos. 8 and 9, see Mingjie Decl.,
`ECF 31-11 ¶ 3, and that the two list the same address on Temu, see
`ECF 31-3 at 5–6. These connections are sufficient for these pairs
`of defendants to be joined together.
` The non-Moving Defendants will not be severed because they cannot
`be said to have suffered any prejudice by misjoinder. See Pink
`Floyd (1987) Ltd. v. P’ships & Unincorporated Ass’ns Identified on
`Schedule “A”, No. 21-cv-04406, 2021 WL 7179622, at *1 (N.D. Ill.
`Oct. 21, 2021) (finding severance or dismissal inappropriate in
`part because defendants had not appeared and were therefore not
`prejudiced). Nor would severing them advance judicial economy,
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`Case: 1:24-cv-00115 Document #: 84 Filed: 05/30/24 Page 11 of 11 PageID #:873
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`III.
`Accordingly, Moving Defendants’ motion to reconsider and
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`modify the TRO is granted. The parties shall submit to the court’s
`proposed order inbox a modified TRO consistent with this order no
`later than two days after its entry. Moving Defendants’ motion to
`dismiss and/or sever is granted in part. The non-Moving Defendants
`will remain joined in this action, and Moving Defendants will be
`severed, after modification of the TRO, into seven separate actions
`grouped as follows: Defendant No. 1; Defendant Nos. 6 and 7;
`Defendant Nos. 8 and 9; Defendant No. 11; Defendant Nos. 13 and
`14; Defendant No. 16; and Defendant No. 17. The remainder of Moving
`Defendants’ motion to dismiss is denied as moot; they may raise
`the arguments that pertain to each of them once they have been
`severed into new actions.
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`Dated: May 30, 2024
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`
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`ENTER ORDER:
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`_____________________________
` Elaine E. Bucklo
` United States District Judge
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`
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`given the prevalence of default in Schedule A cases. See Bose, 334
`F.R.D. at 512 (“Probably none of the Defendants will ever make an
`appearance in this case and the default judgment process will
`determine the case’s outcome in its entirety.”).
`11
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