Summit Entertainment LLC v. Daiana Santia et al

Filing 49

ORDER DENYING SUMMITS MOTION FOR DEFAULT JUDGMENT 42 . The Clerk of Court shall close this case. by Judge Otis D. Wright, II (Made JS-6. Case Terminated.). (lc) .Modified on 8/9/2013. (lc).

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UNITED STATES DISTRICT COURT

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CENTRAL DISTRICT OF CALIFORNIA

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SUMMIT ENTERTAINMENT, LLC,
Plaintiff,

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Case No. 2:11-cv-6310-ODW(SSx)
ORDER DENYING MOTION FOR
DEFAULT JUDGMENT [42]

v.
DAIANA SANTIA; HECTOR SANTIA;
and JOHN DOES 1-10,
Defendants.

Before the Court is Plaintiff Summit Entertainment, LLC’s Motion for Default

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Judgment against Defendants Daiana Santia and Hector Santia.

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Having carefully considered the papers filed in support of this Motion, the Court

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deems this matter appropriate for decision without oral argument. Fed. R. Civ. P. 78;

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L.R. 7-15. For the following reasons, the Court DENIES Summit’s Motion.

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I.

(ECF No. 42.)

BACKGROUND

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This action arises out of Defendants’ alleged illegal access of Summit’s

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computer servers and infringement upon Summit’s registered copyrights. Summit

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owns rights in the feature films The Twilight Saga: Breaking Dawn-Part 1 and The

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Twilight Saga: Breaking Dawn-Part 2. (Compl. ¶ 4.) Summit alleges that Defendants

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infringed 13 of its registered copyrights, which consists of images, miscellaneous

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video clips, and the feature films, by accessing Summit’s computer servers without

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authorization, obtaining the copyrighted material, and distributing them through

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various Internet means. (Compl. ¶ 13.)

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II.

LEGAL STANDARD

Federal Rule of Civil Procedure 55(b) permits a court-ordered default judgment

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following the Clerk’s entry of default under Rule 55(a).

Federal Rule of Civil

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Procedure 55(b) and Local Rule 55-1 require that applications for default judgment set

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forth (1) when and against what party the default was entered; (2) the identification of

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the pleadings to which the default was entered; (3) whether the defaulting party is an

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infant or incompetent person, and if so, whether that person is represented by a

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general guardian, committee, conservator, or other representative; (4) that the Service

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Member’s Relief Act does not apply; and (5) that notice has been served on the

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defaulting party, if required by Rule 55(b)(2).

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The district court is given discretion to decide whether to enter a default

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judgment. Aldabe v. Aldabe, 616 F.2d 1089, 1092 (9th Cir. 1980). Upon default, the

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defendant’s liability generally is conclusively established, and the well-pleaded factual

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allegations in the complaint—except those pertaining to damages—are accepted as

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true. Televideo Sys., Inc. v. Heidenthal, 826 F.2d 915, 917-19 (9th Cir. 1987) (per

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curiam) (citing Geddes v. United Fin. Group, 559 F.2d 557, 560 (9th Cir. 1977)).

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However, in exercising its discretion regarding entry of default, a court must consider

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several factors, including: (1) the possibility of prejudice to plaintiff; (2) the merits of

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plaintiff’s substantive claim; (2) the sufficiency of the complaint; (4) the sum of

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money at stake in the action; (5) the possibility of a dispute concerning material facts;

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(6) whether the defendant’s default was due to excusable neglect; and (7) the strong

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policy underlying the Federal Rules of Civil Procedure favoring decisions on the

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merits. Eitel v. McCool, 782 F.2d 1470, 1471–72 (9th Cir. 1986).

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III.

DISCUSSION

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Summit’s Motion for Default Judgment seeks judgment as to liability on each

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cause of action asserted in its Complaint. In terms of remedies, Summit seeks an

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injunction to prevent Defendants from further conducting their alleged illegal acts,

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$2,100,000 in statutory damages, $47,600 in attorney’s fees, and post-judgment

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interest. Notwithstanding the fact that Summit is seeking the maximum possible

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statutory-damages award under the Copyright Act, there are other problems with

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Summit’s Motion.

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Upon consideration of the Eitel factors, the Court finds that it weighs against

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entering default judgment. Assuming proper proof of its claims, Summit would suffer

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prejudice if its Motion is not granted because Summit “would be denied the right to

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judicial resolution of the claims presented, and would be without other recourse for

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recovery.” Electra Entm’t Grp. Inc. v. Crawford, 226 F.R.D. 388, 392 (C.D. Cal.

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2005). But Summit fails to submit any evidence tending to prove that Defendants did

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the acts Summit complains has occurred. And the Court finds the bald allegations in

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Summitt’s Complaint insufficient to establish the merits of its claims.

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pleadings are admitted as true on default, Summit’s pleadings do not allude at all

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(much less with the factual specificity required under Iqbal and Twombly to survive a

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motion to dismiss) to exactly how Defendants improperly accessed Summit’s servers

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or how Defendants infringed Summit’s copyrights.

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indicate exactly what was downloaded from Summit’s servers—Summit provides no

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filenames or descriptions of the data files that were taken. What Summit provides is a

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list of 13 copyrights. (Compl. Ex. 1.) There is also no evidence that the Defendants

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are the real perpetrators and Summit provides no explanation why Defendants are the

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persons they believe have committed the acts alleged. And given that the Complaint

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alleges illegal activity solely perpetrated via the Internet, there is a good possibility

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that there is a material dispute about the facts laid out in the Complaint.

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Notably, Summit does not

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Further, Summit seeks $2,100,000 in statutory damages under the Copyright

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Act, but has made no effort to prove actual damages, or to seek damages under its

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other causes of action. Indeed, the Court requested Summit to further brief this

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matter, to “explain why the Court should, in its discretion, award $150,000 in

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statutory damages . . . instead of an award towards the lower $750 minimum limit.

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(ECF No. 44.) But instead of explaining the value of its infringed materials or the

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value of the harm it received, Summit essentially responded by asserting that

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$2,100,000 correlates with Defendants’ egregious conduct as well as the revenue

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Summit obtained at the box office—$1.8 billion.
But upon closer inspection, only nine of these are registered copyrights. Even

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so, the earliest registration date of these nine copyrights is July 8, 2011.

This

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Complaint was filed on August 1, 2011, and the Complaint vaguely alleges that

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Defendants began accessing the Summit servers in October 2010, and on other

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occasions in 2010 and 2011. But based on these allegations, the Court finds it

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unlikely that the infringing acts occurred after the July 8, 2011 registration date.

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So even if the Court were to find Defendants liable for their alleged actions,

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Summit has failed to prove damages and is not entitled to statutory copyright

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damages. Derek Andrew, Inc. v. Poof Apparel Corp., 528 F.3d 696, 700 (9th Cir.

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2008). And Defendants have not asserted damages under any cause of action other

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than copyright infringement.

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Finally, the Court notes that it took Summit almost two years to serve the

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Defendants, that the Defendants are alleged to reside in Argentina, and that they were

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served via the Hague Convention. This gives rise to the possibility that Defendants’

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default was due to excusable neglect. Thus, all of the Eitel factors weigh against an

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entry of default judgment except for the first factor of prejudice against Summit.

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Under these circumstances, the Court finds that default judgment should not be

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entered.

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IV.

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CONCLUSION

For the foregoing reasons, Summit’s Motion for Default Judgment is DENIED.
(ECF No. 42.) The Clerk of Court shall close this case.
IT IS SO ORDERED.

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August 9, 2013
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OTIS D. WRIGHT, II
UNITED STATES DISTRICT JUDGE

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