DECISION and ORDER Currently before the Court, in this trademark infringement action filed by Car Freshner Corporation and Julius Samann LTD (“Plaintiffs”) against Scented Promotions, LLC, Paulina Slusarczyk, and Slawomir Warzocha (“Defendants”), is Plaintiffs’ motion for default judgment pursuant to Fed. R. Civ. P. 55(b). (Dkt. No. 17.) For the reasons set forth below, Plaintiffs’ motion is granted in part and denied in part. I. RELEVANT BACKGROUND A. Plaintiffs’ Complaint Generally, in their Complaint, Plaintiffs assert the following nine claims: (I) a claim of federal infringement of a registered trademark; (II) a claim of federal trademark infringement and unfair competition; (III) a claim of federal trademark dilution; (IV) a claim of trademark dilution under N.Y. Gen. Bus. L. §360-1; (V) a claim of common law trademark infringement and unfair competition; (VI) a claim that Defendants violated the Court’s 2003 Consent Judgment; (VII) a claim that Defendants violated the Court’s 2013 Consent Judgment; (VIII) a claim of breach of contract related to Defendants’ violation of the 2003 Consent Judgment; and (IX) a claim of breach of contract related to Defendants’ violation of the 2013 Consent Judgment. (Dkt. No. 1 [Pls.' Compl.].) B. Relevant Procedural History On December 5, 2019, the Clerk of Court entered default against Defendants on all claims pursuant to Fed. R. Civ. P. 55(a). (Dkt. No. 11.) On January 11, 2020, Defendants filed a motion to vacate the Clerk’s entry of default. (Dkt. No. 16.) On March 12, 2020, Chief U.S. Magistrate Judge Andrew T. Baxter granted Defendants’ motion in part and denied Defendants’ motion in part, vacating the entry of default as to Claims I through V, but declining to vacate the entry of default as to Claims VI through IX. (Dkt. No. 23.) On April 27, 2020, Defendants appealed Magistrate Judge Baxter’s Decision and Order. (Dkt. No. 26.) On May 28, 2020, this Court denied Defendants’ appeal. (Dkt. No. 34.) C. Parties’ Briefing on Plaintiffs’ Motion 1. Plaintiffs’ Memorandum of Law Generally, in their motion for default judgment pursuant to Fed. R. Civ. P. 55(b), Plaintiffs make seven arguments. (Dkt. No. 17, Attach. 41 [Pls.' Mem. of Law].) First, Plaintiffs argue that they have sufficiently proven liability on Claims I and II because (a) they have federal registrations for the relevant trademarks, (b) Defendants are selling air fresheners using Plaintiffs’ mark “Black Ice” in a way that is likely to cause confusion among consumers, (c) Plaintiffs have presented proof that all Defendants have been involved in the sale of these infringing products, and (d) all of Plaintiffs’ allegations in their Complaint must be accepted as true for the purposes of this motion because Defendants have not provided an Answer to those allegations. (Id. at 17-19.) Plaintiffs additionally argue that the same proof supports a finding of liability on Claim v. (state law trademark infringement) and they have additionally shown that Defendants’ willful use of their trademark was in bad faith. (Id. at 19.) Second, Plaintiffs argue that they have sufficiently proven liability on Claims III and IV because (a) they have claimed ownership of those marks, (b) they alleged that Defendants’ use of those marks is likely to dilute the uniqueness of their marks and impair the marks’ distinctiveness, and (c) Plaintiffs’ marks are famous and widely recognized by the general public. (Id. at 19-20.) Third, Plaintiffs argue that they have sufficiently proven liability on Claims VII and IX1 for breaches of the 2013 Consent Judgment because their Complaint plausibly alleges both that breaches of that Consent Judgment have taken place and that Defendants are each liable for those breaches. (Id. at 20-23.) More specifically, Plaintiffs argue that Defendants are all bound by the Consent Judgment because a mere change in the name of the company since the 2013 Consent Judgment was issued does not allow Defendants to escape from having to comply with the terms of the Consent Judgment when taking actions as the “new” company. (Id.) Fourth, Plaintiffs argue that the Court should enjoin Defendants from infringing and diluting Plaintiffs’ trademarks because Plaintiffs have sufficiently shown that there is a likelihood of confusion and dilution, and because the balance of equities favors Plaintiffs as a result of Defendants’ repeated willful infringement. (Id. at 23-24.) Fifth, Plaintiffs argue that the Court should disgorge Defendants’ profits from the sale of their infringing products and award $68,078.70 in damages (treble the $22,692.90 in sales that Plaintiffs can prove) based on the evidence of willfulness of Defendants’ use of the “Black Ice” trademark. (Id. at 24-26.) Sixth, Plaintiffs argue that the Court should award them $100,000 in liquidated damages related to ten breaches of the 2013 Consent Judgment because (a) the Consent Judgment provides for damages of $10,000 per breach, and (b) the Consent Judgment was based on an offer of settlement and thus typical contract principles apply to it. (Id. at 26-27.) Seventh, Plaintiffs argue that the Court should award $52,473.20 in attorneys’ fees and costs incurred as of the date of the motion (January 24, 2020) because the Consent Judgment specifically requires Defendants to pay costs and attorneys’ fees in the event of a breach and the Lanham Act also allows for the recovery of attorneys’ fees by the prevailing party in exceptional circumstances. (Id. at 27-28.) 2. Defendants’ Opposition Memorandum of Law Generally, in their opposition memorandum of law, Defendants make four arguments. (Dkt. No. 39 [Defs.' Opp'n Mem. of Law].) First, Defendants argue that the Court is not permitted to consider or grant default judgment on Claims I through v. because the Magistrate Judge vacated the Clerk’s entry of default as to those claims. (Id. at 6.) Second, Defendants argue that, if default judgment is granted on the other claims, Plaintiffs are nonetheless not entitled to the amount of damages claimed. (Id. at 6-14.) More specifically, Defendants argue that the amount of attorneys’ fees requested is not reasonable or proper for three reasons: (a) the request includes compensation for work on claims that are not subject to default judgment and for making arguments that were not successful when Defendants appealed the Magistrate Judge’s decision; (b) the request also charges for unnecessary work, including charging $31,000 for preparation of the memorandum of law related to the current motion for default judgment despite the fact that this Court’s Local Rules do not even require such a memorandum for this type of motion; and (c) the hourly rates sought by Plaintiffs are far in excess of what is reasonable in this district. (Id.) Defendants argue that a more proper amount of attorneys’ fees would be $6,236.50 if the Court finds that granting such fees is appropriate. (Id.) Third, Defendants argue that that Plaintiffs’ claims of violations of the 2013 Consent Judgment have not been substantiated and, in any event, the liquidated damages provision on which Plaintiffs base their recovery request is unenforceable. (Id. at 14-17.) More specifically, Defendants argue that enforcing the liquidated damages provision would result in a recovery that is wildly disproportionate with the harm Plaintiffs actually suffered as the result of the alleged breaches because Plaintiffs have not alleged any real harm (including actual confusion caused by the alleged uses of phrases that Defendants are prohibited from using under the Consent Judgment) or that any infringing product was ever produced or sold. (Id.) Defendants also argue that the Consent Judgment was the not the product of arms-length negotiation between equal persons. (Id.) Defendants additionally argue that, if the Court finds damages to be warranted, it should grant only $10,000 because that amount is more proportionate to the harm alleged. (Id.) Fourth, Defendants argue that the Court should exercise its discretion to not award default judgment because a default judgment would have an unduly harsh effect on Defendants based on (a) the fact that the current COVID-19 pandemic has severely hurt Defendants’ business and having to pay damages on a default judgment would put them out of business, and (b) the fact that they are not as versed in trademark litigation in New York as Plaintiffs are and therefore Plaintiffs have had a distinct advantage in this litigation. (Id. at 17-29.) Defendants also argue that Plaintiffs have not been substantially prejudiced by the delay caused by Defendants’ past failure to answer the Complaint and Defendants now intend to vigorously defend this action. (Id.) Defendants additionally argue that they did not act willfully or in bad faith, but rather were the victims of unfortunate outside circumstances, and that they have meritorious defenses to Claims VI through IX that would render the granting of default judgment particularly harsh. (Id.) 3. Plaintiffs’ Reply Memorandum of Law Generally, in their reply memorandum of law, Plaintiffs make five arguments. (Dkt. No. 41 [Pls.' Reply Mem. of Law].) First, Plaintiffs acknowledge that the Magistrate Judge’s decision invalidated the entry of default on Claims I through v. and thus they are no longer seeking default judgment on those claims. (Id. at 3.) Second, Plaintiffs argue that Defendants are inappropriately attempting to relitigate issues that have already been decided, including willfulness, prejudice, and the absence of a meritorious defense on Claims VI through IX, and that such attempts should be summarily rejected. (Id. at 3-4.) Third, Plaintiffs argue that the Court should award $100,000 in liquidated damages for the ten alleged breaches of the Consent Judgment because the liquidated damages provision is not unenforceable. (Id. at 4-7.) More specifically, Plaintiffs argue as follows: (a) Defendants’ argument that the Consent Judgment was somehow unfair to them in its making is baseless because it was the result of an offer of judgment made by Defendant Warzocha in the previous litigation with the aid of counsel and thus it was Defendants who drafted the provision they now claim is unenforceable; (b) Defendants never sought relief from the Consent Judgment through an appropriate motion and they should have raised their current argument that the amount under the liquidated damages is an impermissible “penalty” when they previously moved to vacate the entry of default; and (c) even if Defendants’ argument has not been waived by their failure to raise it previously, that argument is nonetheless meritless because similar damages have been upheld in trademark cases specifically and the Lanham Act allows for statutory damages up to $2 million (which signals that $10,000 per violation is not unenforceable). (Id.) Plaintiffs also argue that Defendants’ attempt to have all the alleged violations construed as a single violation is baseless and the Consent Judgment specifically allows for recovery for each separate violation. (Id.) Fourth, Plaintiffs argue that the Court should award the full requested attorneys’ fees and costs, with the exception of making a four-ninths reduction in the amount of fees sought for pre-default actions (resulting in a reduction of pre-default fees from $14,461.25 to $6,427.22). (Id. at 7-11.) Plaintiffs argue that they have incurred, as of the date of the reply (June 18, 2020), and are thus entitled to recover, $90,285.30 in post-default fees regardless of whether those some of those fees related to claims that are not subject to default judgment because (a) a court can condition vacating an entry of default on the defaulting party being required to pay attorneys’ fees, (b) it was Defendants’ own delay in filing their motion to vacate the entry of default until just a few days before Plaintiffs’ deadline to file a motion for default judgment that caused Plaintiffs’ attorneys to engage in work that later proved to be unnecessary as a result of the Court’s findings on the motion to vacate the entry of default, and (c) the hourly rates requested are reasonable given the highly specialized nature of trademark law and litigation. (Id.) Fifth, Plaintiffs argue that the Defendants’ self-serving assertions of financial hardship and inability to pay a judgment are not grounds to deny a motion for default judgment, and in fact shows that such a judgment should be granted as soon as possible to allow reasonable recovery before Defendants’ assets disappear. (Id. at 11.) II. GOVERNING LEGAL STANDARDS “Federal Rule of Civil Procedure 55 provides a two-step process that the Court must follow before it may enter a default judgment against a defendant.” Robertson v. Doe, 05-CV-7046, 2008 WL 2519894, at *3 (S.D.N.Y. June 19, 2008). “First, under Rule 55(a), when a party fails to ‘plead or otherwise defend…the clerk must enter the party’s default.’” Robertson, 2008 WL 2519894, at *3 (quoting Fed. R. Civ. P. 55[a]). “Second, pursuant to Rule 55(b)(2), the party seeking default judgment is required to present its application for entry of judgment to the court.” Id. “Notice of the application must be sent to the defaulting party so that it has an opportunity to show cause why the court should not enter a default judgment.” Id. (citing Fed. R. Civ. P. 55[b][2]). “When an action presents more than one claim for relief…, the court may direct entry of a final judgment as to one or more, but fewer than all, claims or parties…if the court expressly determines that there is no just reason for delay.” Fed. R. Civ. P. 54(b). Pursuant to Second Circuit law, when determining whether to grant a default judgment, the Court must consider three factors: (1) whether the defendant’s default was willful; (2) whether the defendant has a meritorious defense to the Plaintiffs’ claims; and (3) the level of prejudice the non-defaulting party would suffer as a result of the denial of the motion for default judgment. Pecarksy v. Galaxiworld.com, Ltd., 249 F.3d 167, 170-71 (2d Cir. 2001); Enron Oil Corp. v. Diakuhara, 10 F.3d 90, 96 (2d Cir. 1993). “An unexcused or unexplained failure to provide an answer to the Complaint will itself demonstrate willfulness,” as does failing to respond to both a complaint and a subsequent motion for default judgment. United States v. Silverman, 15-CV-0022, 2017 WL 745732, at *3 (E.D.N.Y. Feb. 3, 2017) (citing S.E.C. v. McNulty, 137 F.3d 732, 738-39 [2d Cir. 1998]; Indymac Bank v. Nat’l Settlement Agency, Inc., 07-CV-6865, 2007 WL 4468652, at *1 [S.D.N.Y. Dec. 20, 2007]). When a court considers a motion for the entry of a default judgment, it must “accept[ ] as true all of the factual allegations of the complaint….” Au Bon Pain Corp. v. Artect, Inc., 653 F.2d 61, 65 (2d Cir. 1981) (citations omitted). “However, the court cannot construe the damages alleged in the complaint as true.” Eng’rs Joint Welfare, Pension, Supplemental Unemployment Benefit and Training Funds v. Catone Constr. Co., Inc., 08-CV-1048, 2009 WL 4730700, at *2 (N.D.N.Y. Dec. 4, 2009) (Scullin, J.) (citing Credit Lyonnais Sec. (USA), Inc. v. Alcantara, 183 F.3d 151, 155 [2d Cir. 1999] [citations omitted]). “Rather, the court must ‘conduct an inquiry in order to ascertain the amount of damages with reasonable certainty.’” Eng’rs Joint Welfare, Pension, Supplemental Unemployment Benefit and Training Funds, 2009 WL 4730700, at *2 (quoting Alcantara, 183 F.3d at 155 [citation omitted]). This inquiry “involves two tasks: [1] determining the proper rule for calculating damages on such a claim, and [2] assessing plaintiff’s evidence supporting the damages to be determined under this rule.” Alcantara, 183 F.3d at 155. Finally, in calculating damages, the court “need not agree that the alleged facts constitute a valid cause of action….” Au Bon Pain, 653 F.2d at 65 (citation omitted). Under N.D.N.Y. L.R. 55.2(a), when requesting an entry of default judgment from the Clerk of the Court, the moving party must submit (a) the Clerk’s certificate of entry of default, (b) a statement showing the principal amount due (not to exceed the amount demanded in the Complaint and giving credit for any payments with the dates of payments), (c) a computation of the interest to the day of judgment, (d) a per diem rate of interest, (e) the costs and taxable disbursements claimed, and (f) an affidavit of the moving party or the party’s attorney. N.D.N.Y. L.R. 55.2(a). The appended affidavit must show that (a) the party against whom judgment is sought is not an infant or incompetent person, (b) the party against whom judgment is sought is not in military service, (c) the party against whom judgment is sought has defaulted in appearance in the action, (d) service was properly effected under Fed. R. Civ. P. 4, (e) the amount shown in the statement is justly due and owing and no part has been paid except as set forth in the party’s other statement, and (f) disbursements sought to be taxed have been made in the action or will necessarily be made or incurred. Id. Under N.D.N.Y. L.R. 55.2(b), when moving for an entry of default judgment from the Court, the moving party must submit (a) the Clerk’s certificate of entry of default, (b) a proposed form of default judgment, (c) a copy of the pleading to which no response has been made, and (d) an affidavit of the moving party or its attorney setting forth the facts required by N.D.N.Y. L.R. 55.2(a). N.D.N.Y. L.R. 55.2(b). III. ANALYSIS After careful consideration, the Court grants Plaintiffs’ motion for default judgment on Claims VII and IX for the reasons stated in their memoranda of law. See, supra, Part I.C. of this Decision and Order. To those reasons, the Court adds the following analysis. As an initial matter, the Court finds that the only claims that are subject to this motion for default judgment are Claims VI through IX because those are the only claims for which an entry of default by the Clerk of Court remains in effect. See City of New York v. Mickalis Pawn Shop, LLC, 645 F.3d 114, 128 (2d Cir. 2011) (noting that Fed. R. Civ. P. 55 requires a two-step process, the first step of which is an entry of default from the clerk that constitutes a judicial recognition that the defendant has admitted liability through its failure to defend the action, and the second step of which converts the admission of liability into a final judgment); N.D.N.Y. L. R. 55.2 (noting that, to have either the Clerk or the Court enter a default judgment, the party seeking default judgment must present the Clerk’s certificate of entry of default as part of its motion). Indeed, Plaintiffs have recognized that they cannot obtain default judgment on Claims I through v. due to the fact that the entry of default as to those claims was vacated. (Dkt. No. 41, at 3 n.1 [Pls.' Reply Mem. of Law].) As a result, the Court will consider only Claims VI through IX on this motion. A. Liability As to whether Defendants’ default was willful, the Court notes that Magistrate Judge Baxter and the undersigned both previously found that Defendants’ conduct established willfulness. (Dkt. No. 34, at 3-4,) Specifically, Defendants argued as part of their appeal from Magistrate Judge Baxter’s decision that their default was the result of external circumstances, including the death of Defendant Warzocha’s brother in Poland, Defendant Slusarczyk’s pregnancy, and difficulty finding New York counsel to represent them, arguments that the Court discussed and rejected in detail when denying that appeal. (Dkt. No. 34, at 5, 8-10 [Decision and Order filed May 28, 2020].) Defendants merely recycle these arguments without adding any further compelling explanation. Because Defendants have not presented any new arguments or information that would cause the Court to doubt its previous finding, the Court finds it appropriate to rely on that previous finding here. See Ali v. Mukasey, 529 F.3d 478, 490 (2d Cir. 2008) (“The law of the case doctrine, while not binding, counsels a court against revisiting its prior rulings in subsequent stages of the same case absent ‘cogent’ and ‘compelling’ reasons such as ‘an intervening change of controlling law, the availability of new evidence, or the need to correct a clear error or prevent manifest injustice.”); Oneida Indian Nation of New York v. Cnty of Oneida, 214 F.R.D. 83, 91 (N.D.N.Y. 2003) (McCurn, J.) (noting that, “when a court has ruled on an issue, that decision should generally be adhered to by that court in subsequent stages in the same case,…unless cogent and compelling reasons militate otherwise”). As to Defendants’ assertion that they have shown the existence of a meritorious defense on Claims VI through IX, the Court rejects Defendants’ argument that the 2013 Consent Judgment was ambiguous, which was already raised in their motion to vacate the entry of default and rejected by both Magistrate Judge Baxter and the undersigned. In particular, Defendants’ arguments presented on this issue in their opposition memorandum of law are essentially a verbatim repetition of the arguments they made on their previous motion, arguments that the undersigned rejected in detail when denying Defendants’ appeal from Magistrate Judge Baxter’s findings. Thus, the Court finds that these are arguments provide no basis for denying Plaintiffs’ motion for default judgment on the relevant claims.2 As to whether Plaintiffs would suffer any prejudice in the absence of default judgment, it is well recognized that “delay alone is not a sufficient basis for establishing prejudice,” but rather “‘something more is needed’ such as when a delay ‘thwarts plaintiff’s recovery or remedy…results in the loss of evidence, creates increased difficulties of discovery, or provides greater opportunity for fraud and collusion.’” Gunnels v. Teutul, 19-CV-5331, 2020 WL 3498454, at *3 (S.D.N.Y. June 29, 2020) (quoting New York v. Green, 420 F.3d 99, 110 [2d Cir. 2005]). Plaintiffs have argued, based on Defendants’ own arguments and evidence about their worsening financial situations, that a delay in granting a proper default judgment could very well in this case severely undermine Plaintiffs’ ability to recover damages. (Dkt. No. 41, at 11 [Pls.' Reply Mem. of Law].) See Green, 420 F.3d 99, 110 (2d Cir. 2005) (finding that it was not clear error for the district court to find prejudice where the state showed that the delay put at risk the state’s ability to obtain funds necessary to proceed with its plan for remediating the contaminated site); First Technology Capital, Inc. v. Airborne, Inc., 378 F. Supp. 3d 212, 218 (W.D.N.Y. 2019) (finding that the defendant’s apparent insolvency would cause plaintiff to be substantially prejudiced if the motion for default judgment were denied because “without the entry of a default, Plaintiff would be unable to recover for the claims adequately set forth in the Complaint”); In re FKF 3, LLC, 501 B.R. 491, 507 (S.D.N.Y. 2013) (finding that prejudice existed based on the fact that the plaintiff’s financial situation made it unlikely that plaintiff could satisfy the default judgment itself, much less the interest that would continue to accrue the longer recovery was delayed). The Court agrees that a further delay would pose a real risk of thwarting Plaintiffs’ ability to recover damages from Defendants on the relevant claims. In any event, the fact that the Court has found that Defendants’ default was willful and that they have no meritorious defense to Plaintiffs’ claims related to the breaches of the 2013 Consent Judgment merits default judgment on the relevant claims even if little prejudice has been shown. See Kulwa v. Obiakor OB/GYN P.C., 12-CV-1868, 2013 WL 504383, at *7 (E.D.N.Y. Feb. 8, 2013) (“A finding of willfulness can, on its own, support a finding of good cause [to] support entry of default judgment.”). As already discussed, the Court has already found that Defendants’ conduct was willful and that Defendants lack any meritorious defense to Claims VI through IX; and thus the Court finds that the strength of those two factors makes up for any weakness in the showing of prejudice in this case. Lastly, the Court finds that Plaintiffs have sufficiently alleged facts that, if taken as true, show that they are entitled to relief on their claims related to the ten alleged breaches of the 2013 Consent Judgment for all the reasons stated in Plaintiffs’ memorandum of law. (Dkt. No. 17, Attach. 41, at 20-23 [Pls.' Mem. of Law]; Dkt. No. 17, Attach. 26, at
