Innovation Ventures, LLC v. Ultimate One Distributing Corp. (176 F. Supp. 3d 137, 2016)

MEMORANDUM AND ORDER

MATSUMOTO, United States District Judge:

Plaintiffs Innovation Ventures, LLC; Living Essentials, LLC; and International IP Holdings, LLC (collectively, “plaintiffs” or “Living Essentials”) commenced this action alleging that defendants have been involved in a widespread scheme to manufacture, distribute, and sell counterfeit 5-hour ENERGY drinks bearing plaintiffs’ trademarks and copyright. Plaintiffs assert claims pursuant to the Lanham Act, 15 U.S.C. § 1051 et seq., and Copyright Act, 17 U.S.C. § 106, and pursuant to New York statutory and common law. (See generally ECF No. 291, Seventh Amended Complaint (“Seventh Am. Compl”) filed 12/28/12.)

Plaintiffs have settled their claims against most of the more than 70 defendants named in this consolidated action. Presently before the court is plaintiffs’ omnibus motion for summary judgment against nine groups of remaining defendants (collectively, “Defendants”). Defendants are comprised of companies alleged to have participated in the counterfeiting scheme and certain owners and/or principals of those companies:

• Midwest Wholesale Distributors, Wal-id Jamil, Raid Jamil, and Justin Shay-ota (collectively, “Midwest Defendants”);

• Dan-Dee Company, Inc., Kevin Attiq, and Fadi Attiq (collectively, “Dan-Dee Defendants”);

• Advanced Nutraceutical Manufacturing LLC, Nutrition Private Label, Inc., and Juan Romero Gutierrez (collectively, “Romero Defendants”);

• Baseline Distribution, Inc. and David Flood (collectively, “Baseline Defendants”);

• Purity Wholesale Grocers (“Purity”);

• Core-Mark International, Inc. (“Core-Mark”);

• Food Distributors, Inc. and Scott Til-brook (collectively, “FDI Defendants”);

• Elegant Trading and Ahmed Bhimani (collectively, “Elegant Defendants”);

• Valero Retail Holdings, Inc. (“Vale-ro”)

Plaintiffs move for summary judgment on their claims for: trademark infringement, false description and false designation of origin, and false advertising pursuant to Sections 32 and 43 of the Lanham Act, 15 U.S.C. §§ 1114, 1125; copyright infringement pursuant to 17 U.S.C. § 106 of the Copyright Act; and unfair competition pursuant to state common law. (See ECF No. 864-1, Plaintiffs’ Corrected Memorandum of Law in Support of Summary Judgment (“Pis. Mem.”).)

With respect to the Midwest Defendants, Romero Defendants, and Core-Mark Defendants, plaintiffs seek enhanced statutory damages for willful infringement under the Lanham Act, enhanced statutory damages for willful infringement under the Copyright Act, punitive damages under state common law, attorneys’ fees and costs, and permanent injunctive relief. With respect to the Baseline Defendants, FDI Defendants, Elegant Defendants, Purity, and Valero, plaintiffs seek actual damages for trademark infringement under the Lanham Act, statutory damages for copyright infringement under the Copyright Act, punitive damages under state common law, attorneys’ fees and costs, and permanent injunctive relief. Except for the Romero Defendants, each of the Defendants has filed an opposition to plaintiffs’ omnibus summary judgment motion.

Also before the court is a cross motions for summary judgment on plaintiffs’ claims filed by individual defendant David Flood (a co-owner of Baseline Distributors, Inc.). For the reasons set forth below, plaintiffs’ motion for summary judgment is granted in part and denied in part. David Flood’s cross-motion for summary judgment is denied.

PROCEDURAL BACKGROUND

On October 25, 2012, Living Essentials commenced this action, captioned Innovation Ventures, et al. v. Ultimate One Distributing Corp., et al. (“Ultimate Action”) in this court. In its initial complaint, plaintiffs, the owners of 5-hour ENERGY, alleged that more than twenty defendants had sold counterfeit 5-hour ENERGY in violation of the Lanham Act, 15 U.S.C. §§ 1114 and 1125, the Copyright Act of 1976, 17 U.S.C. § 106, New York state law and common law. (See U.A. No. 1, Compl. filed 10/25/12.)

On October 26, 2012, plaintiffs filed the action captioned Innovation Ventures, et al. v. Pittsburg Wholesale Grocers Inc., et al. (“Pittsburg Action”), in the United States District Court for the Northern District of California. In its initial complaint in the Pittsburg Action, plaintiffs alleged substantially the same claims as in the Ultimate Action against sixteen defendants based in California. (See P.A. No. 1, Compl. filed 10/26/12.)

As plaintiffs traced the counterfeit products up the chain of distribution, the Ultimate Action grew to include sixty-nine defendants. (See U.A. No. 291, Seventh Am. Compl.) In their Seventh Amended Complaint, plaintiffs alleged that Dan-Dee Company, Inc. (“Dan-Dee”), a defendant in the related Pittsburg Action, was the principal nationwide “distribution hub” for counterfeit 5-hour ENERGY, (Seventh Am. Compl. at 5.) A number of defendants in the Ultimate Action then impleaded Dan-Dee and its.principals as third-party defendants in the Ultimate Action. (See U.A. Nos. 390, 473, 535, 580.) In turn, the Dan-Dee Defendants impleaded a number of defendants from the Ultimate Action' as third-party defendants in the Pittsburg Action. (See P.A. No. 162, Am. Third-Party Compl. filed 1/23/12.)

In April 2013, Capital Sales Company, a defendant in the Ultimate Action and a customer of Dan-Dee, filed suit against the Dan-Dee Defendants in the Eastern District of Michigan. The Eastern District of Michigan transferred venue to this court, and this court consolidated Capital Sales Company’s suit with the Ultimate Action. (Docket 13-cv-3542, ECF No. 28, Order to Consolidate Cases dated 7/31/12.)

On November 12, 2013, plaintiffs moved to transfer venue in the Pittsburg Action from the Northern District of California to this district, on the grounds that all remaining parties in the Pittsburg Action are also parties to the larger, first-filed Ultimate Action, and the issues remaining to be tried are a subset of the- issues in the Ultimate Action. (P.A. No. 508, Mot. for Change of Venue filed 11/12/13, at 1.) No party opposed the motion, and all parties signed a stipulation requesting that the Pittsburg Action “be transferred to the Eastern District of New York for consolidation with” the Ultimate Action. (P.A. No. 509, Stip. filed 11/12/13, at 2.)

On November .15, 2013, the Northern District of California transferred the Pitts-burg Action to this district. (P.A.,No. 530, Order Granting Mot. to Change Venue dated 11/15/13.) On March 3, 2014, the court granted a joint request from plaintiffs and the Dari-Dee Defendants to consolidate the Ultimate Action and the Pitts-burg Action. (ECF No. 680.)

FACTUAL BACKGROUND

The following facts are taken from the parties’ Local Civil Rule 56.1 statements, and have not been specifically or directly disputed with admissible evidence unless otherwise indicated. References to paragraphs of the parties’ Rule 56.1 statements include materials cited therein and annexed thereto. The court has considered whether the parties have proffered admissible evidence in support of their factual statements and has viewed the facts in the light most favorable to the nonmoving parties. See Spiegel v. Schulmann, 604 F.3d 72, 81 (2d Cir.2010) (“It is well established that, in determining the appropriateness of a grant of summary judgment, ... the district court in awarding summary judgment, may rely only on admissible evidence.” (citations and quotation marks omitted)); Scotto v. Brady, 410 Fed.Appx. 355, 361 (2d Cir.2010) (“ ‘[A] district court deciding a summary judgment motion has broad discretion in choosing whether to admit evidence,’ and ‘[t]he principles governing admissibility of evidence do not change on a motion for summary judgment.’ ”) (quoting Presbyterian Church of Sudan v. Talisman Energy, Inc., 582 F.3d 244, 264 (2d Cir.2009)).

I. Living Essentials and 5-hour ENERGY

Plaintiffs own, manufacture, and distribute 5-hour ENERGY, which is sold as a liquid dietary supplement in 1.93-ounce bottles in a variety of flavors and strengths. (Pis. 56.1 ¶ 1.) Plaintiffs Innovation Ventures, LLC, Living Essentials, LLC, and International IP Holdings, LLC all share common ownership and control of plaintiffs’ intellectual property. (Pis. 56.1 ¶2.) Specifically, International IP Holdings, LLC holds title to 5-hour ENERGY trademarks and copyright (and other intellectual property not at issue here). (Pis. 56.1 ¶¶ 21-22.) Innovation Ventures, LLC is the worldwide exclusive licensee of 5-hour ENERGY trademarks and copyright. (Pis. 56.1 ¶24.) Living Essentials, LLC distributes 5-hour ENERGY. (Pis. 56.1 ¶ 30.)

Living Essentials has registered and owns five trademarks and one copyright that appear on the packaging of 5-hour ENERGY bottles. The trademarks at issue (the “5-hour ENERGY Marks”) are registered on the Principal Register of the U.S. Patent and Trademark Office as follows:

• 4,004,225: The “5-HOUR ENERGY’ trademark was registered on August 2, 2011;

• 4,104,670: The “5-HOUR ENERGY’ trademark depicting the word “5-HOUR” above the word “ENERGY” was registered on February 28, 2012;

• 4,116,951: The “5-HOUR ENERGY’ trademark depicting the words “5-HOUR ENERGY” in black outlined in yellow, below which are the words “EXTRA STRENGTH” along with a person in black silhouette was registered on March 27,2012;

• 3,698,044: The “Running Man” trademark was registered on October 20, 2009; and

• 4,120,360: The “5-HOUR ENERGY’ trademark depicting the words “5-HOUR ENERGY” in black outlined in yellow along with a person in black silhouette was registered on September 17, 2010.

(Pls. 56.1 ¶ 18.)

The copyright at issue (the “5-hour ENERGY Copyright”), Registration No. TX 6-833-514, applies to the “Caution” label on 5-hour ENERGY bottles. (Pis. 56.1 ¶ 19.) The copyrighted material on the label reads as follows:

CAUTION: Contains about as much caffeine as a cup of coffee. Limit caffeine products to avoid nervousness, sleeplessness, and occasionally rapid heartbeat. You may experience a Niacin Flush (hot feeling, skin redness) that lasts a few minutes. This is caused by Niacin (Vitamin B3) increasing blood flow near the skin.

(Pls. 56.1 ¶ 18.) The 5-hour ENERGY Copyright, as well as Trademark Nos. 4,004,225; 4,104,670; and 3,698,044, appear on every bottle of 5-Hour Energy. (Pis. 56.1 ¶ 20.) Trademark No. 4,116,951 appears only on extra-strength bottles of 5-hour ENERGY. Trademark No. 4,120,360 appears on only regular-strength bottles. (Id.) Neither the validity of the 5-hour ENERGY Marks and 5-hour ENERGY Copyright nor their ownership by Living Essentials is disputed by Defendants.

Since 2011, all authentic 5-hour ENERGY has been manufactured by Living Essentials “under strict quality control” standards at two factories owned and operated by Living Essentials in Wabash, Indiana. (Pls. 56.1 ¶ 5.) Living Essentials distributes 5-hour ENERGY in a variety of configurations, each with a unique “stock keeping unit” (“SKU”) number. (Pls. 56.1 ¶ 13.) A typical configuration used for wholesale and retail distribution is twelve loose bottles arranged in 4x3 rows in a point-of-sale display box. (Id.) Eighteen display boxes are packed together into a master case containing 216 bottles, and forty-two master cases are placed on a pallet. (Id.) Living Essentials sells 5-hour ENERGY directly or through a network of independent brokers across the United States that sell product on its behalf. (Pls. 56.1 ¶30.) On average, more than nine million bottles of 5-hour ENERGY are sold each week. (Pis. 56.1 ¶ 3.) Living Essentials maintains over a 90% market share of the energy shot market through its sales of 5-hour ENERGY. (Pls. 56.1 ¶ 28.)

II. Manufacture, Distribution, and Sale of Counterfeit 5-Hour Energy

A. Diversion of Mexican-Label 5-hour ENERGY into the United States

By late 2009, defendants Tradeway International, Inc. d/b/a Baja Exporting (“Baja”); Joe Shayota (a principal of Baja); and Adrianna Shayota (a principal and owner of Baja) (collectively, the “Baja Defendants”) had become Living Essentials’ authorized distributor of authentic 5-hour ENERGY in Mexico. (Pls. 56.1 ¶40.) Living Essentials developed Spanish-language labels and packaging for 5-hour ENERGY that were intended for distribution exclusively in Mexico. (Pls. 56.1 ¶ 41.) The Baja Defendants were not authorized to sell Spanish-label 5-hour ENERGY in the United States. (Pls. 56.1 ¶ 43.)

In January 2010, the Baja Defendants began ordering hundreds of thousands of bottles of Spanish-label 5-hour ENERGY. (Pls. 56.1 ¶44.) Living Essentials sold these bottles to Baja at a discount from the price it charged U.S. distributors for English-labeled product. (Pls. 56.1 ¶45.) Baja then attempted to sell its Spanish-label 5-hour ENERGY in the United States to Dan-Dee. (Pls. 56.1 ¶ 49; JA 1, 10/11/2013 Deposition of Kevin Attiq (“K. Attiq Dep”) Tr. 370:5-20.) Dan-Dee offered the Spanish-label product to some of its regular U.S. customers but was unable to find a buyer. (Pls. 56.1 ¶ 49.)

In May 2011, having been unable to sell its Spanish-label 5-hour ENERGY to U.S. distributors, Baja reached an agreement with Walid Jamil, a principal of defendant Midwest Wholesale Distributors, to “swap” the Spanish-language labels and packages with English-language labels and packages. (Pis. 56.1 ¶ 51; Midwest 56.1 ¶ 51.) In August 2011, a Midwest affiliate called “Tri Mex” ordered tens of thousands of counterfeit English-language 5-hour ENERGY display boxes from a company called MCR Printing. (Pls. 56.1 ¶1¶ 55-56.) Walid Jamil at Midwest then contacted a “label broker” named Leslie Roman and ordered 500,000 counterfeit English-language plastic sleeves to shrink-wrap onto the authentic 5-hour ENERGY bottles that had been wrapped in Spanish-language sleeves. (Pls. 56.1 ¶¶ 58-59; JA 40, 12/3/2012 Deposition of Mario Ramirez Tr. 43:18-45:19.) Walid’s brother, Raid “Brian” Jamil, signed Midwest’s first purchase order for the counterfeit labels and completed a fraudulent California Resale Certificate explaining that Midwest was a “wholesaler” purchasing the labels for “resale” purposes. (Pls. 56.1 ¶ 60.) Roman then worked with a printing company to recreate U.S. 5-hour ENERGY labels. (Pls. 56.1 ¶ 61.)

In early September 2011, Baja began shipping loads of authentic Mexican-label 5-hour ENERGY to Midwest’s warehouse in California. (Pls. 56.1 ¶ 65.) Upon delivery, Midwest’s Justin Shayota and a team of workers removed the Mexican labels from bottles using a razor blade and wiped away the lot code and expiration date using rags and a solvent. (Pls. 56.1 ¶ 67-68.) New lot numbers and expiration dates were then applied to the bottles using an industrialized printer. (Pls. 56.1 ¶ 69.) Workers at the Midwest warehouse, under Justin’s direction, would then place English-language counterfeit labels over the bottles and shrink them into place using a steam tunnel. (Pls. 56.1 ¶ 70.) Other members of Justin’s team assembled the individual bottles inside counterfeit display boxes, which were then packed into counterfeit master case boxes. (Pls. 56.1 ¶ 71.) By December 2011, Baja sold the entire inventory of repackaged 5-hour ENERGY - almost 355,000 bottles - to Dan-Dee and other wholesalers. (Pls. 56.1 ¶ 75.)

B. Counterfeit 5-hour ENERGY Bottles, Labels, and Liquid

Between December 2011 and October 2012, Midwest’s Walid Jamil and Justin Shayota ordered more than 7 million additional counterfeit 5-hour ENERGY bottle labels. (Pls. 56.1 ¶ 76.) Walid also contacted Leslie Roman to find a manufacturer of bottles and caps. (Pls. 56.1 ¶ 80; JA 8, 12/10/2012 Deposition of Leslie Roman (“Roman Dep.”) Tr. 52:24-53:6.) In turn, Roman contacted Juan Romero Gutierrez (“Romero”), a manufacturer of made-to-order liquid products who did business as Advanced Nutraceutical Manufacturing, LLC and Nutrition Private Label, Inc. (Pls. 56.1 ¶ 81.) Roman gave Romero samples of authentic 5-hour ENERGY bottles and bottle caps, as well as an image of Living Essentials’ trademarked “Running Man” logo that appears on authentic bottle caps, to provide to potential suppliers. (Pls. 56.1 ¶ 82.) Roman and Romero traveled to Mexico and hired two Mexican companies to supply blank bottles and caps imprinted with the “Running Man” logo. (Pls. 56.1 ¶ 83.) Romero proceeded to order millions of these bottles and caps. (Pls. 56.1 ¶ 84.) The counterfeit bottles were problematic because they were slightly wider than the authentic Mexican-label bottles that the Midwest Defendants had been relabeling. (Pls. 56.1 ¶ 86.) As a result, the Midwest Defendants had to order new counterfeit labels. (Id.)

Romero filled the counterfeit bottles with counterfeit liquid that he personally manufactured. (Pls. 56.1 ¶ 88; Roman Dep. Tr. 60:18-61:9; JA 10, 1/22/2013 Deposition of Juan Romero Gutierrez (“Romero Dep.”) Tr. 103:25-104:5.) Romero purchased at least some of the ingredients for his mixture (e.g., malic acid) by the ton (Pls. 56.1 ¶ 91; Romero Dep. Tr. 152:11-18) and mixed the ingredients together in 200-liter barrels at his warehouse. (Pls. 56.1 ¶ 91; Romero Dep. Tr. 19-20.) The list of ingredients that Romero used for the counterfeit liquid features the same ingredients as those ingredients listed on bottles of authentic 5-hour ENERGY. (Pls. 56.1¶ 89.)

The counterfeit bottles filled with counterfeit liquid were placed into boxes that held approximately 200 bottles each. (Pls. 56.1¶ 93.) One of Romero’s employees then delivered the boxes to Midwest’s warehouse in Otay Mesa, California. (Pls. 56.1¶ 93.) The bottles did not contain lot numbers or expiration dates at the time of delivery. (Id,) Justin Shayota or one of his laborers signed packing slips to verify the number of bottles and flavors delivered. (Id.) In purchase orders or invoices, Romero, Roman, and Midwest’s Walid Jamil referred to the contents of the counterfeit 5-hour ENERGY as “michelada,” “juice blend,” and “spices.” (Pls. 56.1 ¶ 95.)

By October 2012, the Romero Defendants and the Midwest Defendants were producing 75,000 bottles of counterfeit 5-hour ENERGY per day. (Pls. 56.1 ¶ 94.) The Romero Defendants delivered a total of 4,303,724 bottles of counterfeit 5-hour ENERGY to the Midwest Defendants over five months. (Id.) The Midwest Defendants acknowledge that they “received already filled bottles of 5-Hour Energy, labeled them, and sent them to Baja and later Dan-Dee” for distribution. (Midwest Opp. at 3.) The Midwest Defendants’ own records establish that they sold at least 4,029,264 of the counterfeit bottles: 508,032 to Baja and 3,521,232 to Dan-Dee. (Pls. 56.1¶ 131.)

C. Distribution and Sale of Counterfeit 5-hour ENERGY

Dan-Dee admits it was the “largest first-tier distributor” of counterfeit 5-hour ENERGY. (Dan-Dee 56.1 ¶ 109; see also Pis. 56.1¶ 109.) According to its own invoices, Dan-Dee sold millions of counterfeit bottles of 5-hour ENERGY to second-tier distributors located in California, Florida, Illinois, Michigan, Pennsylvania, and Texas. (Pls. 56.1 ¶¶ 132-45.) In all, over forty wholesale or retail entities throughout the United States bought or sold 5-hour ENERGY produced by the counterfeiting operation. It is undisputed that among the downstream sellers of counterfeit 5-hour ENERGY were the Baseline Defendants, FDI Defendants, Elegant Defendants, Purity, Valero, and Core-Mark.

III. Discovery of Counterfeit 5-hour ENERGY

In August 2012, salespeople from Paramount Sales - an independent broker based in San Jose, California - noticed an irregularity in its sales of 5-hour ENERGY. (Pis. 56.1 ¶ 207.) Paramount was concerned because Piteo Foods (“Piteo”), one of its major 5-hour ENERGY buyers and a former defendant in this case, had not ordered Berry or Extra Strength Berry 5-hour ENERGY in several months. - (Pls. 56.1¶208.) Two salespeople associated with Paramount visited Piteo, recorded the lot numbers on the Berry and Extra Strength Berry product in Pitco’s inventory, and passed that information on to Living Essentials. (Pls. 56.1 ¶ 210.) Paramount obtained a box of 5-hour ENERGY from Piteo and sent it to Living Essentials for inspection. (Pls. 56.1 ¶ 211.) As Living Essentials inspected the product, Paramount determined that many of its other customers in California had Berry and Extra Strength Berry 5-hour ENERGY with the same lot numbers as the product in Pitco’s inventory. (Pls. 56.1 ¶ 212.)

In approximately late September 2012, Living Essentials determined that the bottles from Pitco’s inventory were counterfeits. (Pis.'56.1 ¶213.) The counterfeits appeared nearly identical to authentic 5-hour ENERGY, but Living Essentials was able to identify the following differences:

• the counterfeit bottles were slightly shorter than' authentic bottles;

• the caps of many counterfeit bottles lacked a “sprue” or “pimple” on top of the caps that is found on authentic bottles;

• authentic bottles feature Living Essentials’ “Running Man” logo on the caps, while the counterfeit bottles featured a “fatter” silhouette of a man running;

• authentic 5-hour ENERGY is always the same pale pink color, while the . liquid inside the counterfeit bottles was varied in color;

• the counterfeit product did not taste or smell the same as authentic 5-hour ENERGY.

(Pls. 56.1 ¶214.) Further inspection revealed that all of the counterfeit 5-hour ENERGY had one of nine flavor/lot number/expiration date combinations. (Pls. 56.1 ¶ 215.)

Living Essentials, together with retained private investigators from Kroll Associates (“Kroll”),' subsequently began visiting retailers throughout the United States to attempt to inspect and quarantine counterfeit 5-hour ENERGY. (Pls. 56.1¶¶ 221-22.) In late October 2012, plaintiffs filed this lawsuit and the parallel Pittsburg Action. Plaintiffs sought and obtained seizure orders and restraining pr-ders from both courts. (See, e.g,, ECF No. 7, Seizure Order dated 10/25/2013.) Over the ensuing month, Living Essentials seized hundreds of thousands of bottles of counterfeit 5-hour ENERGY at dozens of locations throughout the United States. (Pls. ¶¶ 225-26.)

Kroll employees contemporaneously tracked and logged counterfeit product using chain-of-custody forms that listed the location where the product was obtained, the variety of 5-hour ENERGY, the. lot number, expiration date, and quantity of bottles seized. (Pls. 56.1 ¶ 227.) The chain-of-custody forms and the seized or recovered bottles of counterfeit 5-Hour ENERGY are located in four secure storage facilities in California and New Jersey. (Pls. 56.1¶ 336.) In July and August 2014, Kroll employees visited the storage facilities and manually counted the counterfeit bottles stored at each location. (Pls. 56.1 ¶337; Declaration of Teague Ryan dated 10/24/2014 (“Ryan Decl.”) ¶¶6-17.) Ultimately, Kroll investigators counted a total of 2,670,997 counterfeit bottles of 5-hour ENERGY seized or recovered over the course of this action. (Pls. 56.1 ¶ 364; Ryan Decl. ¶¶ 95-96.)

LEGAL FRAMEWORK

The court will address the legal framework for analyzing plaintiffs’ claims (including available remedies), then consider defendants’ liability and damages on a case-by-case basis. The cross-motion .for summary judgment filed by individual defendant David Flood will be considered within the analysis of his individual liability to plaintiffs.

I. Summary Judgment

“Summary judgment is appropriate where there is no genuine dispute as to any material fact and the record as a whole indicates that no rational factfinder could find in favor of the non-moving party.” Graves v. Finch Pruyn & Co., 353 Fed.Appx. 558, 560 (2d Cir.2009) (citing Rodal v. Anesthesia Grp. of Onondaga, P.C., 369 F.3d 113, 118 (2d Cir.2004)). “In ruling on a summary judgment motion, the district court must resolve all ambiguities, and credit all factual inferences that could rationally be drawn, in favor of the party opposing summary judgment and determine whether there is a genuine dispute as to a material fact, raising an issue for trial.” McCarthy v. Dun & Bradstreet Corp., 482 F.3d 184, 202 (2d Cir.2007) (quotation marks omitted). “A fact is material when it might affect the outcome of the suit under governing law.” Id. (internal quotation marks omitted). Moreover, an issue of fact is genuine only if “the evidence is such that a reasonable jury could return a verdict for the nonmoving party.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986).

“In order to defeat a motion for summary judgment supported by proof of facts that would entitle the movant to judgment as a matter of law, the nonmoving party is required under Rule 56(e) to set forth specific facts showing that there is a genuine issue of material fact to be tried.” Ying Jing Gan v. City of New York, 996 F.2d 522, 532 (2d Cir.1993) (citations omitted). “[O]nly disputes over facts that might affect the outcome of the suit under the governing law will properly preclude entry of summary judgment.” Anderson, 477 U.S. at 248, 106 S.Ct. 2505. The nonmoving party may not, however, “rely simply on conclusory statements or on contentions that the affidavits supporting the motion are not credible, or upon the mere allegations or denials of the nonmoving party’s pleading.” Ying Jing Gan, 996 F.2d at 532-33 (citations and quotation marks omitted).

The standard is the same when cross motions for summary judgment are made. See Morales v. Quintel Entm’t, Inc., 249 F.3d 115, 121 (2d Cir.2001); Eschmann v. White Plains Crane Serv., Inc., No. 11-CV-5881, 2014 WL 1224247, at *3 (E.D.N.Y. Mar. 24, 2014). The court must examine each party’s motion independently, and “in' each case all reasonable inferences must be drawn against the party whose- motion is under consideration.” Morales, 249 F.3d at 115 (citation omitted).

II. Liability

A. Lanham Act

Plaintiffs allege that defendants violated the Lanham Act by committing trademark infringement pursuant to 15 U.S.C. § 1114(1) (a) — (b) and false designation of origin pursuant to § 1125(a)(1)(A). (Pis. Mem. at 75.)

1. Trademark Infringement

Section 32(a)(1) of the Lanham Act provides, in relevant part:

(1) Any person who shall, without the consent of the registrant -

(a) use in commerce any reproduction, counterfeit, copy, or colorable imitation of a registered mark in connection with the sale, offering for sale, distribution, or advertising of any goods or services on or in connection with which such use is likely to cause confusion, or to cause mistake, or to deceive; or

(b) reproduce, counterfeit, copy, or colorably imitate a registered mark and apply such reproduction, counterfeit, copy, or colorable imitation to labels, signs, prints, packages, wrappers, receptacles or advertisements intended to be used in commerce upon or in connection with the sale, offering for sale, distribution, or advertising of goods or services on or in connection with which such use is likely to cause confusion, or to cause mistake, or to deceive,

shall be liable in a civil action by the registrant. 15 U.S.C. § 1114(l)(a)-(b).

To prevail on a trademark infringement claim under the Lanham Act, “the plaintiff must prove: (1) that it owns a valid, protectable trademark; (2) that the defendants used the registrant’s trademark in commerce and without consent; and (3) that there was a likelihood of consumer confusion.” Procter & Gamble Co. v. Quality King Distrib., Inc., 123 F.Supp.2d 108, 113 (E.D.N.Y.2000). Because the Lanham Act is a strict liability statute, a registrant need not prove knowledge or intent in order to establish liability. Id.; see also Sunward Elec., Inc. v. McDonald, 362 F.3d 17, 25 (2d Cir.2004); El Greco Leather Products Co. v. Shoe World, Inc., 806 F.2d 392, 396 (2d Cir.1986) (defendants’ “claimed lack of knowledge of its supplier’s infringement, even if true, provides no defense”).

Plaintiffs have proven the first element of infringement, ownership of valid trademarks. It is undisputed that the counterfeits at issue bore reproductions of the five “5-Hour ENERGY Marks” that are registered on -the Principal Registry of the U.S. Patent and Trademark Office. (Pls. 56.1 ¶¶ 18-24; Dolmage Decl. ¶ 8.) A certificate of registration establishes that a mark is “valid (i.e., protectable), that the registrant owns the mark, and that the registrant has the exclusive right to use the mark in commerce.” Lane Capital Mgmt., Inc. v. Lane Capital Mgmt., Inc., 192 F.3d 337, 345 (2d Cir.1999). When a plaintiff sues for infringement of its registered trademark, the defendant bears the burden to rebut the mark’s protectability. Id. Defendants do not contest the validity and ownership of plaintiffs marks. Accordingly, the 5-Hour ENERGY Marks- are protected under the Lanham Act.

The next inquiry is whether the counterfeit trademarks created a likelihood of consumer confusion. To determine likelihood of confusion, courts in the Second Circuit ordinarily apply the eight-factor test set forth in Polaroid Corp. v. Polarad Elecs. Corp., 287 F.2d 492, 495-96 (2d Cir.1961). In the counterfeiting context, however, the court need not undertake an exhaustive analysis of the Polaroid factors because “counterfeit marks are inherently confusing.” Fendi Adele S.R.L. v. Burlington Coat Factory Warehouse Corp., 689 F.Supp.2d 586, 596-97 (S.D.N.Y.2010); Gucci Am., Inc. v. Duty Free Apparel Ltd., 286 F.Supp.2d 284, 287 (S.D.N.Y.2003) (use of counterfeits likely to cause confusion because “counterfeits, by their very nature cause confusion”). Defendants do not dispute that the counterfeit 5-Hour ENERGY at issue created a likelihood of confusion.

Based on the above, plaintiffs have established that (1) the 5-hour ENERGY Marks are valid and entitled to protection under the Lanham Act, and (2) the use of counterfeit 5-hour ENERGY trademarks created a likelihood of confusion. It is also undisputed that plaintiffs did not consent to use of counterfeit '5-hour ENERGY trademarks on bottles of counterfeit 5-hour ENERGY made from scratch'. Therefore, the sole remaining issue to determine liability for trademark infringement is whether defendants .used the 5-Hour ENERGY marks “in commerce.” The Lanham Act provides that a “mark shall be deemed to be in use in commerce ... on goods when ... it is placed in any manner on the goods or their containers ... and ... the goods are sold or transported in commerce.” 15 U.S.C. § 1127. The sale of counterfeit goods is sufficient use to establish liability. See El Greco Leather Prods. Co. v. Shoe World, Inc., 806 F.2d 392, 396 (2d Cir.1986) (“Even though [defendant] was involved neither in the manufacture nor the affixing of the [plaintiffs] trademark to the shoes, its sale of the shoes was sufficient ’use’ for it to be liable for the results of such infringement.”). There is no dispute that plaintiffs have established Defendants’ involvement in the transportation and sale of counterfeit 5-hour ENERGY using invoices, deposition testimony, and evidence recovered by Kroll. Liability for trademark infringement is addressed below on a defendant-by-defendant basis.

2. False Designation of Origin

False designation of origin claims are governed by Section 43 of the Lanham Act, 15 U.S.C. § 1125(a)(1). Section 43(a)(1) provides, in relevant part:

Any person who, on or in connection with any goods or services' or any container for goods, uses in commerce any word,1 term, name, symbol, or device, or any combination thereof, or any false designation of origin, false or misleading description of fact, or false or misleading representation of fact which ... is likely to cause confusion, or to cause mistake, or to deceive as to the affiliation, connection, or association of such person with another person, or aS to the origin, sponsorship or approval of his or her goods, services or commercial activities by another person ...

shall be liable in a civil action. 15 U.S.C. § 1125(a)(1).

Although § 1114 and § 1125 differ in that the latter statute covers both registered and unregistered - trademarks, the legal standard to establish liability “is the same” under both sections. Lorillard Tobacco Co. v. Jamelis Grocery, Inc., 378 F.Supp.2d 448, 454 (S.D.N.Y.2005); Invicta Plastics (USA) Ltd. v. Mego Corp., 523 F.Supp. 619, 622 (S.D.N.Y.1981) (“Under both the infringement section of the Lan-ham Act, 15 U.S.C § 1114, and the false designation of origin section, 15 U.S.C. § 1125, the same test is applied to determine whether a particular activity violates the Act.”); Microsoft Corp. v. AGA Solutions, Inc., 589 F.Supp.2d 195, 202 (E.D.N.Y.2008) (“case law applicable to section 32 claims applies to section 43 claims”). Accordingly, the court need not conduct a separate analysis of plaintiffs’ false designation of origin claim because “[t]he same facts that establish [defendants] violated section 32 of the Lanham Act establish[ ] that they violated section 43(a).” Microsoft Corp., 589 F.Supp.2d at 203.

3. Lanham Act Liability of Individual Defendants

Plaintiffs seek summary judgment against seven individuals who are owners and/or principals of certain defendants. In the Second Circuit, it is well-established that “under the Lanham Act, a corporate officer may be held personally liable for trademark infringement and unfair competition if the officer is a moving, active!,] conscious force [behind the defendant corporation’s] infringement.” KatiRoll Co. v. Kati Junction, Inc., 33 F.Supp.3d 359, 367 (S.D.N.Y.2014). In determining individual liability under the Lanham Act, “it is immaterial ... whether [the individual] knows that his acts will result in an infringement.” Id. A corporate officer is considered a “moving, active, conscious force” behind a company’s infringement when the officer “was either the sole shareholder and employee, and therefore must have approved of the infringing act, or a direct participant in the infringing activity,” Chloe v. Queen Bee of Beverly Hills, LLC, No. 06-cv-3140, 2011 WL 3678802, at *4 (S.D.N.Y. Aug. 19, 2011); see also Katiroll, 33 F.Supp.3d at 367 (a showing that an officer “authorized and approved the acts of unfair competition which are the basis of [the] ... corporation’s liability .,. is sufficient .participation in the wrongful acts” to subject the officer to liability).

B. Copyright Act

Plaintiffs allege that the text of the “Caution” label appearing on authentic bottles of 5-Hour ENERGY is subject to protection under the Copyright Act, 17 U.S.C. § 101 et seq. They seek summary judgement on their claim that defendants violated the Copyright Act by reproducing the exact text of their “Caution” labels on the counterfeit bottles at issue. (Pls. Mem. 83-84.)

To establish copyright infringement, a plaintiff must prove (1) ownership of a valid copyright, and (2) that the defendant copied constituent elements of the work that are original. Feist Publ’n, Inc. v. Rural Tel. Serv. Co., 499 U.S. 340, 345, 111 S.Ct. 1282, 113 L.Ed.2d 358 (1991). Like trademark infringement, copyright infringement is a strict liability offense, meaning “intent or knowledge is not an element of infringement.” Fitzgerald Publ’g. Co. v. Baylor Publ’g Co., 807 F.2d 1110, 1113 (2d Cir.1986).

It is undisputed that Living Essentials holds copyright registration certifícate TX 6-833-514 for the text appearing on the “Caution” labels of 5-hour ENERGY. (Pls. 56.1 ¶ 19.) Such registration is prima facie evidence of the first element of copyright infringement (ownership of a valid copyright), although a defendant may rebut that presumption. See Scholz Design, Inc. v. Sard Custom Homes, LLC, 691 F.3d 182, 186 (2d Cir.2012).

The second element of copyright infringement under Feist is whether the work was actually copied and whether the copied work was sufficiently original to warrant copyright protection. “Copying” is established by showing “that the defendant had access to the copyrighted work and that there is a substantial similarity of protectable material between the two works.” Faulkner v. Nat’l Geographic Soc’y, 576 F.Supp.2d 609, 613 (S.D.N.Y.2008) (quoting Eastern America Trio Products, Inc. v. Tang Electronic Corp., 97 F.Supp.2d 395, 415 (S.D.N.Y.2000)). Here, defendants do not dispute that the counterfeit bottles at issue included an identical reproduction of the copyrighted “Caution” text that appears on authentic labels. (Pls. 56.1 ¶¶ 61-62; 214-15.)

To be considered sufficiently original for copyright protection, a work must “possess at least some minimal degree of creativity.” Scholz, 691 F.3d at 187 (internal citation omitted). In Feist, the Supreme Court explained that “the requisite level of creativity is extremely low; even a slight amount will suffice. The vast majority of works make the grade quite easily, as they possess some creative spark, no matter how crude, humble, or obvious it might be.” 499 U.S. at 345, 111 S.Ct. 1282.

The only challenge to plaintiffs copyright infringement claim is raised by the Elegant Defendants, who attempt to rebut the presumptive validity of plaintiffs copyright. (Elegant Opp. at 8-9.) They rely on the doctrine of merger, a defense that bars a copyright “when there is essentially only one way to express an idea and thus the idea and its expression are inseparable.” MyWebGrocer, LLC v. Hometown Info, Inc., 375 F.3d 190, 194 (2d Cir.2004) (internal citation and quotation omitted). Where an idea and its expression are inseparable, “protection of the expression would effectively accord protection to the idea itself’ and the idea and expression are said to have “merged.” N.Y. Mercantile Exch., Inc. v. IntercontinentalExchange, Inc., 497 F.3d 109, 116-17 (2d. Cir.2007) (quoting Kregos v. Associated Press, 937 F.2d 700, 705 (2d Cir.1991)). Because merger is a means to invalidate a registered copyright, defendant bears the burden to establish merger. See Yurman Design, Inc. v. PAJ, Inc., 262 F.3d 101, 109 (2d Cir.2001).

In support of its merger defense, the Elegant Defendants argue that there are so few ways to express the idea conveyed on the 5-hour ENERGY “Caution” label that affording it copyright protection “would ostensibly grant Plaintiffs ownership over the idea of a caution label for caffeinated beverages itself.” (Elegant Opp. 8.) The “Caution” label states:

CAUTION: Contains about as much caffeine as a cup of coffee. Limit caffeine products to avoid nervousness, sleeplessness, and occasionally rapid heartbeat. You may experience a Niacin Flush (hot feeling, skin redness) that lasts a few minutes. This is caused by Niacin (Vitamin B3) increasing blood flow near the skin.

In considering a merger defense, a court “begins[s] by identifying the ’idea’ that might be merging with its expression.” N.Y. Mercantile, 497 F.3d at 117. It should then consider “the range of possible expressions” and whether all possible expressions are so similar that recognizing a copyright would bar others from expressing the idea. Id.; see also Mason v. Montgomery Data, Inc., 967 F.2d 135, 138 (5th Cir.1992) (courts “focus on whether the idea is capable of various modes of expression”).

Here, the “idea” expressed on the “Caution” label is a warning about the caffeine content in 5-hour ENERGY and potential side effects of consuming caffeine and niacin. Such a warning obviously can be expressed in a variety of different ways. The particular “Caution” text copyrighted by Living Essentials reflects deliberate choices of content, language, and word order to convey its warning. For example, plaintiffs chose to compare the amount of caffeine in 5-hour ENERGY to the amount of caffeine in a cup of coffee. They could just as readily have listed the milligrams of caffeine contained in each bottle. Even plaintiffs’ warning regarding potential side effects of niacin (in addition to caffeine) is enough to overcome Elegant’s objection that the copyright at issue risks “granting] Plaintiffs ownership over the idea of a caution label for caffeinated beverages.” (Elegant Opp. at 8.) The myriad ways plaintiffs could have chosen to communicate their warning demonstrates that the “Caution” label idea and expression have not merged. See, e.g., Innovation Ventures, LLC v. N2G Distrib., 635 F.Supp.2d 632 (E.D.Mich.2008) (rejecting merger challenge to 5-Hour ENERGY “Caution” label copyright and finding “there is not a standard way of expressing the idea”). Accordingly, Elegant’s merger defense is inapplicable and presents no bar to judgment on plaintiffs’ copyright infringement claim.

C. State Law Unfair Competition

Plaintiffs also move for summary judgment on their state law unfair competition claims pursuant to New York law. (Pls. Mem. 84-85.) Plaintiffs brought unfair competition claims under New York law in the Ultimate Action against all remaining defendants (except Dan-Dée), and under California law in the Pittsburg Action against Dan-Dee (and against other defendants that also have settled).

The “essence” of a claim for unfair competition under New York law is that the defendant has misappropriated “the labors and expenditures of another” in a manner “likely to cause confusion or to deceive purchasers as to the origin of the goods.” Jeffrey Milstein, Inc. v. Greger; Lawlor, Roth, Inc., 58 F.3d 27, 34-45 (2d Cir.1995) (internal citations omitted). To establish a claim for cómmon law unfair competition, “the plaintiff must state a Lanham Act claim coupled with a showing of bad faith or intent.” Katiroll, 33 F.Supp.3d at 370; see also Genesee Brewing Co. v. Stroh Brewing Co., 124 F.3d 137, 149 (2d Cir.1997) (“[Plaintiffs] state law claim of unfair competition is not viable without a showing of bad faith.”).

The Elegant Defendants argue that , the court should deny summary judgment on plaintiffs’ unfair competition claim because there is no basis to find that Elegant acted with bad faith. (Elegant Opp. at 7.) They reason that because plaintiffs have not established (or even attempted to establish) that Elegant willfully infringed the 5-Hour ENERGY Marks, plaintiffs cannot satisfy the bad faith element of their unfair .competition claim. (Id.) Plaintiffs counter that Elegant’s knowledge and intent is irrelevant to liability for unfair competition in this case because “a presumption of bad faith attaches to the use of a counterfeit mark.” (Pls. Mem. at 85) (quoting Lorillard Tobacco, 378 F.Supp.2d at 456).

Contrary to plaintiffs’ assertion, the Second Circuit has indicated that a bad faith presumption only attaches to an unfair competition claim if a defendant was at least aware of its use of counterfeits. See Lorillard Tobacco, 378 F.Supp.2d at 457 (analyzing liability for unfair competition based on whether defendants ‘were aware that they were selling counterfeit cigarettes); Centaur Commc’ns, Ltd. v. A/S/M Commc’ns, Inc., 830 F.2d 1217, 1228 (2d Cir.1987) (“[A]wareness [that a mark is in use] can give rise to an interference of bad faith.”); Philip Morris USA Inc. v. Felizardo, No. 03-CV-5891, 2004 WL 1375277, at *6 (S.D.N.Y. June 18, 2004) (“the evidence [plaintiff]-proffers to demonstrate [defendant’s] intentional use of the coum terfeit marks ... also serves to establish [defendant’s] bad faith under New York common law”) (emphasis added).

If use of counterfeits alone were enough to establish liability — regardless of a defendant’s intent or knowledge — unfair competition claims under New York common law would be rendered indistinguishable. from strict liability Lanham Act claims. Such a narrow standard is plainly at odds with the bad faith component of New York’s unfair competition common law. See, e.g., Saratoga Vichy Spring Co. v. Lehman, 625 F.2d 1037, 1044 (2d Cir.1980) (noting that “some element of bad faith” is central to the notion of unfair competition claims under New York law). Accordingly, because plaintiffs have not attempted to establish that Elegant willfully or knowingly infringed the 5-hour ENERGY Marks, summary judgment is denied with respect to plaintiffs’ unfair competition claim against Elegant. Summary judgment for unfair competition is also denied as to the other four defendants that plaintiff does not attempt to show infringed willfully or knowingly: Baseline Defendants, FDI Defendants, Purity, and Valero. Plaintiffs’ New York common law unfair competition claims against defendants alleged to have willfully infringed (Romero Defendants, Midwest Defendants, and Core-Mark) are addressed below on a case-by-ease basis.

III. Remedies

A. Damages under the Lanham Act

Living Essentials seeks damages under the Lanham Act for defendants’ alleged infringement of the 5-hour ENERGY Marks. Prevailing plaintiffs may recover actual damages under the Lanham Act that equal “(1) defendant’s profits, (2) any damages sustained by the plaintiff, and (3) the costs of the action.” 15 U.S.C. § 1117(a). Alternatively, the Lanham Act permits plaintiffs to elect to recover, at any time before final judgment is rendered, statutory damages instead of actual damages. 15 U.S.C. § 1117(c).

Here, plaintiffs have elected to pursue statutory damages against those defendants they contend infringed willfully (i.e., Romero, Midwest, and Core-Mark) and actual damages against the remaining defendants (i.e., Baseline, Purity, FDI, Elegant, and Valero). (Pis. Mem. at 100-106.)

Several defendants contend that plaintiffs are barred as a matter of law from electing to recover statutory damages against some defendants and actual damages against other defendants in the same action. (See Baseline Opp. at 12-16; FDI Opp. at 4-7; Purity Opp. at 4-7.) In support of their argument, these defendants primarily rely on cases involving multiple defendants where, unlike here, a plaintiff elected to pursue statutory damages against all defendants in a case. See, e.g., Louis Vuitton Malletier S.A. v. LY USA, Inc., 676 F.3d 83, 87 (2d Cir.2012); Church & Dwight Co. v. Kaloti Enters. of Mich, L.L.C., 697 F.Supp.2d 287, 291 (E.D.N.Y.2009); Tu v. TAD Sys. Tech., Inc., No. 08-cv-3822, 2009 WL 2905780, at *2 (E.D.N.Y. Sept. 10, 2009); Johnson & Johnson Consumer Cos., Inc. v. Aini, 540 F.Supp.2d 374, 396 (E.D.N.Y.2008). Defendants also cite Copyright Act cases where courts have noted that a plaintiff may not recover both statutory and actual damages from one defendant for the same copyright violation. See, e.g., Gabbanelli Accordions & Imports., L.L.C. v. Gabbanelli, 575 F.3d 693, 698 (7th Cir.2009).

Although it is true that statutory damages may not be awarded against a defendant where actual damages have been awarded for the same violation (and vice-versa), it does not follow that a plaintiff in a multi-defendant infringement case must recover the same type of damages against all defendants. Indeed, defendants cite no controlling authority for this proposition. Nor does the text of the Lanham Act contain any such restriction. See 15 U.S.C. § 1117. Other courts that have considered the- circumstances .presented here - a plaintiff electing actual damages for ■ infringement against certain defendants and statutory damages against others in the same action - have awarded both types of damages. See, e.g., Ortiz-Gonzalez v. Fonovisa, 277 F.3d 59, 61-62 (1st Cir.2002) (affirming district court’s award of statutory damages for copyright infringement against one defendant and actual damages against a second defendant); Axiom Worldwide, Inc. v. HTRD Grp. H.K. Ltd., No. 11-cv-1468, 2013 WL 2406260 (M.D.Fla. June 1, 2013) (awarding statutory and actual damages against multiple defendants in a Lanham Act case).

The option to recover statutory damages against some infringers and actual damages against others is logical considering “statutory damages may. serve completely different purposes than actual damages.” Nintendo of Am., Inc. v. Dragon Pac. Int’l, 40 F.3d 1007, 1011 (9th Cir.1994). Most significantly among these differences, statutory damage awards may serve a “punitive and deterrent” purpose. See Church & Dwight, 697 F.Supp.2d at 291; see also Philip Morris USA Inc. v. C.H. Rhodes, Inc., No. 08-cv-69, 2010 WL 1196124, at *5 (E.D.N.Y. Mar. 26, 2010) (awarding statutory damages and noting the “great need for deterrence here to discourage large scale counterfeiting”). This contrasts with awards of actual damages, which are ordinarily circumscribed to represent “compensation and not a penalty.” 15 U.S.C. § 1117(a). Considering the different ends actual and statutory damages may serve, and given the absence of authority prohibiting dual election of such damages against different defendants, the court finds that- plaintiffs may pursue statutory damages against defendants alleged to have infringed willfully and actual damages against all other defendants.

1. Actual Damages

Plaintiffs seek two categories of actual damages against defendants Baseline, Purity, FDI, Elegant, and Valero: (1) lost profits they allegedly would have earned but for defendants’ sales of counterfeit 5-hour ENERGY; and (2) “loss control costs” they incurred to find and remove counterfeit product from the market (i.e., the amounts plaintiffs paid to the Kroll investigators). (Pis. Mem. at 106-16.)

a. Lost Profits

Typically, “[l]ost profits are calculated by estimating revenue lost due to the infringing conduct and subtracting what it would have cost to generate that revenue.” GTFM, Inc. v. Solid Clothing, Inc., 215 F.Supp.2d 273, 305 (S.D.N.Y.2002). Damages calculations for lost profits must be made with “specificity” although “courts may engage in some degree of speculation in the computation of such damages, particularly where the defendant’s infringing conduct makes such computation difficult.” The Apollo Theater Found., Inc. v. W. Int’l Syndication, No. 02-cv-10037, 2005 WL 1041141, at *11 (S.D.N.Y. May 5, 2005) (internal citations omitted); see also Schonfeld v. Hilliard, 218 F.3d 164, 172 (2d Cir.2000) (“Although lost profits need not be proven with mathematical precision, they must be capable of measurement based upon known reliable factors without undue speculation.”) (internal citation and quotations omitted).

To establish lost profits, plaintiffs rely on the report and deposition testimony of their damages expert, Dr. Gregory Bell. (See Potter Decl. dated 5/11/2015, Ex. C (“Bell Report”).) Dr. Bell calculated Living Essentials’ profit per authentic bottle of 5-hour ENERGY, which he defined as net sales revenue per bottle minus the costs incurred to make and distribute each bottle. (Id. at 11.) Dr. Bell’s formula is consistent with this Circuit’s accepted methodology for calculating lost profits. See Victoria Cruises, Inc. v. Changjiang Cruise Overseas Travel Co., 630 F.Supp.2d 255, 262 (E.D.N.Y.2008) (“Lost profits are calculated by estimating the revenue lost due to the infringing conduct and subtracting what it would have cost to generate that revenue.”).

To calculate profit per bottle, Dr. Bell used the lowest price at which Living Essentials sold a bottle of authentic 5-hour ENERGY in 2012 (Berry: $1.28; Orange: $1.28; Extra Strength Berry: $1.43) and subtracted the incremental costs Living Essentials would have incurred to make and distribute bottles in those varieties (Berry: $0.19; Orange: $0.20; and Extra Strength Berry: $0.21). (Bell Report at Il12.) Dr. Bell also subtracted a 5% broker commission he assumed Living Essentials would have paid for every bottle it would have sold in place of a bottle of counterfeit product. (Id. at 12-13.) Based on these calculations, Dr. Bell concluded that, for purposes of determining plaintiffs’ actual damages, Living Essentials’ “incremental profit per authentic bottle” in 2012 was $1.03 for Berry, $1.02 for Orange, and $1.15 for Extra Strength Berry. (Id. at Ex. H.)

Several defendants argue that Dr. Bell’s profit-per-bottle calculation is inaccurate because he did not include advertising expenses as an incremental cost necessary to generate sales. (See Baseline Opp. at 19-21; FDI Opp. at 23-26; Purity Opp. at 22-26.) These defendants rely on the report of Purity’s expert, Henry Fuentes, who opined that Living Essentials’ advertising costs are a “variable expense” that grow in proportion to quantity of bottles sold. (Baseline Opp. at 6-8; Schurin Decl., Ex. D (“Fuentes Report”).) According to Mr. Fuentes, Living Essentials would have had to spend more on advertising in order to sell an additional 1.9 million bottles of 5-hour ENERGY in 2012 (i.e., the number of sales lost to counterfeiting). (Fuentes Report at 14-15; Purity Opp. at 25; Baseline Opp. at 7-8.) Dr. Fuentes concluded that Living Essentials’ incremental profit-per-bottle figure should be lower because Dr. Bell failed to deduct advertising costs that Living Essentials would have incurred to make the sales it lost. (Fuentes Report at Ex. 5; Baseline Opp. at 8.)

Plaintiffs counter that Dr. Bell properly excluded advertising costs because they are not a cost that was “avoided” due to the lost sales. (Pis. Reply at 52-54.) They argue that given 5-hour ENERGY’S dominant position in the energy shot market, demand already existed to make all of the sales lost to defendants’ counterfeiting, and no additional advertising was necessary. (Id.)

As a factual matter, the defendants’ dispute over incremental advertising expenses is neither supported by evidence nor material. At his deposition, defendants’ expert Mr. Fuentes conceded that he could not conclude that Living Essentials “save[d] even one penny on advertising because its product was counterfeited.” (JA 63, 7/1/14 Deposition of Henry Fuentes Tr. 72:3-6.) Defendants also fail to present any evidence that Living Essentials would have spent more on advertising absent defendants’ wrongful conduct. Cf. Taylor v. Meirick, 712 F.2d 1112, 1121 (7th Cir.1983) (“Costs that would be incurred anyway should not be subtracted, because by definition they [are not] avoided by curtailing the profit-making activity.”).

Although defendants point to a statement made by Living Essentials’ CFO, Matthew Dolmage, that Living Essentials’ advertising budget varies from year-to-year (Baseline Opp. at 20), that statement does not support the defendants’ position that Living Essentials would have spent more advertising dollars to sell the amount of product lost to counterfeiting. This is especially true considering 5-hour ENERGY had. over 90% share of the energy shot market in 2012. Cf. Nat’l Presto Indus., Inc. v. Black & Decker, Inc., No. 89-cv-8978, 1992 WL 125559, at *5 (N.D.Ill. May 27, 1992) (rejecting defendants’ argument to include advertising as an incremental cost in lost profit calculation and noting that given “evidence that [plaintiffs product] already had reached 90% saturation ... there would have been little added impact from increasing their advertising”). Based on the foregoing, the undisputed evidence presented by plaintiffs establishes for purposes of this action that plaintiffs’ profit per authentic bottle of 5-hour ENERGY in 2012 was $1.03 for Berry, $1.02 for Orange, and $1.15 for Extra Strength Berry.

To calculate Living Essentials’ lost profits, it is also necessary to determine the number of sales lost due to infringement. “[T]he burden is on the plaintiff to demonstrate that it would have made the sales but for the infringing activity” Odegard, Inc. v. Costikyan Classic Carpets, 963 F.Supp. 1328, 1340 (S.D.N.Y.1997). However, “a plaintiff need not present absolute proof that purchasers of the infringing product would have .bought [plaintiffs] product instead. Rather, plaintiffs burden of proof is one of reasonable probability.” Etna Products Co., Inc. v. Q Mktg. Grp., Ltd., No. 03-cv-3805, 2004 WL 1769794, at *12 (S.D.N.Y. Aug, 6, 2004) (internal citation omitted). “The methodology of assessing and computing damages is committed to the sound discretion of the district court.” King Instruments Corp. v. Perego, 65 F.3d 941, 952 (Fed.Cir.1995).

Given the evidence of Living Essentials’ uniquely dominant share of the energy-shot market in 2012, and in the absence of any contrary evidence produced by defendants, there is more than a “reasonable probability” that consumers who purchased counterfeit bottles of 5-hour ENERGY intended to purchase authentic 5-hour ENERGY. Cf. Mishawaka Rubber & Woolen Mfg. Co. v. S.S. Kresge Co., 316 U.S. 203, 206, 62 S.Ct. 1022, 86 L.Ed. 1381 (1942) (holding that “if ... some purchasers bought goods bearing the infringing mark because of the defendant’s .,. reputation or for any reason other than a response to the diffused appeal of the plaintiffs symbol, the burden of showing this is upon the poacher”); Kaon Chun Hing Kee Soy & Sauce Factory, Ltd. v. Eastimpex, No. 04-CV-4146, 2007 WL 328696, at *13 (N.D.Cal. Feb. 2, 2007) (in the absence of evidence submitted by defendants, “it is reasonable to infer, and the Court does infer, that sales of the 13,630 cartons represent lost sales to [plaintiff]”). Two additional factors in addition to the undisputed evidence support this finding. First, it is not disputed that both retailers and wholesalers co-mingled counterfeit. 5-hour ENERGY product with authentic product. (See Bell Report at 8-9.) Second, there is no evidence (and no defendant argues) that the price of counterfeit bottles was lower at the retail level or that customers distinguished between counterfeit and authentic bottles based on price. (Id.) Accordingly, there is no genuine factual dispute that sales of counterfeit 5-hour ENERGY to end-use consumers represented lost sales of authentic 5-hour ENERGY. Cf. Clear Channel Outdoor, Inc. v. City of New York, 594 F.3d 94, 111 (2d Cir.2010) (affirming summary judgment where party opposing summary judgment failed to meet its burden to come forward with admissible evidence to rebut moving parties’ evidence and thus concluding that no material issue of fact existed).

Plaintiffs’ actual damages for lost profits therefore may be determined by multiplying Living Essentials’ per-bottle profit amounts by the number of counterfeit bottles of each flavor sold that ended up in the hands of a consumer. The second half of this equation requires evidence, for each “actual damages” defendant, of the amount of counterfeit product purchased by end-user consumers. On the current record, however, there is insufficient evidence to award damages for lost profits because there are fact disputes regarding the number of counterfeit bottles sold by Baseline, Elegant, FDI, Purity, and Valero that were ultimately purchased by end-use consumers.

Finally, the court notes there is no dispute that individual counterfeit bottles were purchased and sold by multiple defendants in this action. Several defendants raise concerns that plaintiffs will reap a “double recovery” if they are permitted to recover lost profits from each defendant along a particular distribution chain. (See, e.g., Core-Mark/Valero Opp. at 20-21; Purity Opp. at 26-27.) To avoid double recovery, plaintiffs may recover “incremental lost profit” only once for each counterfeit bottle that was sold to an end user. (Pis. Mem. at 73.) To the extent that plaintiffs recover lost-profit damages for a particular bottle from one defendant in a particular chain of distribution, the liability of any other defendant in that distribution chain is reduced accordingly.

b. Kroll “loss control” costs

In addition to lost profits, plaintiffs seek to recover fees they paid Kroll to investigate and seize counterfeit 5-hour ENERGY. (Pls. Mem. at 111-15.) Plaintiffs characterize these fees as “loss-control costs” and contend they may be recovered as actual, damages under 15 U.S.C. § 1117(a). Several defendants argue that plaintiffs’ “loss-control costs” do not qualify as actual damages and are only recoverable as part of an award of attorneys’ fees. (Baseline Opp. at 23-24; Elegant Opp. 17-21.)

In support of their argument that Kroll fees are recoverable ■ as actual damages, plaintiffs rely on false advertising cases where courts awarded fees to plaintiffs for “corrective advertising” necessary to combat defendants’ false statements. See, e.g., Balance Dynamics Corp. v. Schmitt Industries, 204 F.3d 683 (6th Cir.2000); Santana Prods. v. Sylvester & Assocs., No. 9