Joe Hand Promotions, Inc. v. Ahmadi
Filing
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FINDINGS and RECOMMENDATIONS signed by Magistrate Judge Deborah Barnes on 11/18/2016 RECOMMENDING that Plaintiff's 14 motion for default judgment be granted. Judgment be entered against defendant in the sum of $6,000. This case be closed. Motion referred to Judge John A. Mendez. Objections to F&R due within 14 days. (Zignago, K.)
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UNITED STATES DISTRICT COURT
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FOR THE EASTERN DISTRICT OF CALIFORNIA
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JOE HAND PROMOTIONS, INC.,
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Plaintiff,
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No. 2:15-cv-1106 JAM DB
v.
MOHAMMAD WASIM AHMADI,
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FINDINGS AND RECOMMENDATIONS
Defendant.
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On April 25, 2016, plaintiff Joe Hand Promotions, Inc.’s (“plaintiff”) motion for default
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judgment against defendant Mohammad Wasim Ahmadi (“defendant”) was taken under
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submission.1 Having considered all written materials submitted with respect to the motion the
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undersigned recommends that the motion for default judgment be granted.
PROCEDURAL BACKGROUND
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Plaintiff commenced this action on May 21, 2015, by filing a complaint and paying the
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required filing fee. (ECF No. 1.) Plaintiff’s complaint alleges that it was granted the exclusive
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nationwide commercial distribution (closed-circuit) rights to the “Ultimate Fighting
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Championship 173: Renan Barao v. T.J. Dillashaw,” (“program”) which was telecast nationwide
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on Saturday, May 24, 2014. (Compl. (ECF No. 1) at 4.) Defendant Ahmadi is the owner,
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On August 2, 2016, this matter was reassigned from the previously assigned Magistrate Judge
to the undersigned. (ECF No. 18.)
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operator, licensee, permittee, or person in charge of the commercial establishment doing business
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as Yolo Gyros and Burgers Sports Bar and Lounge operating at 1345 Merkley Avenue, in West
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Sacramento, California 95691. (Id. at 3.) Plaintiff’s complaint alleges that the defendant
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personally, or through specific direction of his employees, unlawfully intercepted and broadcast
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the program without authorization to do so. (Id. at 4.) The complaint alleges violations of 47
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U.S.C. § 605 and 47 U.S.C. § 553, conversion, and violation of California Business &
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Professions Code § 17200, et seq. (Id. at 4-12.)
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The record reflects that service of process was effected on defendant Ahmadi on
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December 24, 2015, by substituted service at the defendant’s residence. (ECF No. 11.) Despite
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being served with process, defendant failed to appear in this action and, pursuant to plaintiff’s
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request, (ECF No. 12), the Clerk of the Court entered defendant’s default on February 1, 2016.
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(ECF No. 13.)
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On March 4, 2016, plaintiff filed the motion for default judgment now pending before the
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court. (ECF No. 14.) Despite being served with all papers filed in connection with the motion,
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there was no opposition filed by defendant Ahmadi. (ECF No. 14 at 4.)
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LEGAL STANDARDS
Federal Rule of Civil Procedure 55(b)(2) governs applications to the court for default
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judgment. Upon entry of default, the complaint’s factual allegations regarding liability are taken
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as true, while allegations regarding the amount of damages must be proven. Dundee Cement Co.
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v. Howard Pipe & Concrete Prods., 722 F.2d 1319, 1323 (7th Cir. 1983) (citing Pope v. United
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States, 323 U.S. 1 (1944); Geddes v. United Fin. Group, 559 F.2d 557 (9th Cir. 1977)); see also
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DirectTV v. Huynh, 503 F.3d 847, 851 (9th Cir. 2007); TeleVideo Sys., Inc. v. Heidenthal, 826
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F.2d 915, 917-18 (9th Cir. 1987).
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Where damages are liquidated, i.e., capable of ascertainment from definite figures
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contained in documentary evidence or in detailed affidavits, judgment by default may be entered
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without a damages hearing. Dundee, 722 F.2d at 1323. Unliquidated and punitive damages,
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however, require “proving up” at an evidentiary hearing or through other means. Dundee, 722
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F.2d at 1323-24; see also James v. Frame, 6 F.3d 307, 310-11 (5th Cir. 1993).
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Granting or denying default judgment is within the court’s sound discretion. Draper v.
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Coombs, 792 F.2d 915, 924-25 (9th Cir. 1986); Aldabe v. Aldabe, 616 F.2d. 1089, 1092 (9th Cir.
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1980). The court is free to consider a variety of factors in exercising its discretion. Eitel v.
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McCool, 782 F.2d 1470, 1471-72 (9th Cir. 1986). Among the factors that may be considered by
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the court are
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(1) the possibility of prejudice to the plaintiff, (2) the merits of
plaintiff’s substantive claim, (3) the sufficiency of the complaint,
(4) the sum of money at stake in the action; (5) the possibility of a
dispute concerning material facts; (6) whether the default was due
to excusable neglect, and (7) the strong policy underlying the
Federal Rules of Civil Procedure favoring decisions on the merits.
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Eitel, 782 F.2d at 1471-72 (citing 6 Moore’s Federal Practice ¶ 55-05[2], at 55-24 to 55-26).
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ANALYSIS
I.
Whether Default Judgment Should Be Entered
The factual allegations of plaintiff’s complaint, taken as true pursuant to the entry of
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default against defendant Ahmadi, establish the following circumstances: (1) defendant Ahmadi
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is the owner, operator, licensee, permitee, person in charge, or person with control over the
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commercial establishment doing business as Yolo Gyros and Burgers Sports Bar and Lounge at
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1345 Merkley Avenue, West Sacramento, California 95691; (2) by contract, plaintiff paid for the
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proprietary rights to distribute the “Ultimate Fighting Championship 173: Renan Barao v. T.J.
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Dillshaw,” telecast nationwide on May 24, 2014, via closed-circuit television; (3) pursuant to the
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contract, plaintiff entered into sublicensing agreements with various commercial entities
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throughout North America by which it granted those entities limited sublicensing rights to exhibit
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the program at respective commercial establishments; (4) as a commercial distributor of sporting
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events, plaintiff expended substantial monies marketing, advertising, promoting, administering,
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and transmitting the program to its customers; (5) with full knowledge that the program was not
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to be intercepted, received, and/or exhibited by unauthorized entities, defendant exhibited the
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program at the time of its transmission and did so willfully and for purposes of commercial or
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private gain; (6) defendant violated 47 U.S.C. § 605, et seq., which prohibits the unauthorized
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publication or use of communications; (7) defendant violated 47 U.S.C. § 553, et seq., which
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prohibits the unauthorized interception, exhibition, publication, and divulgence of programs; (8)
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by reason of defendant’s violations of §§ 605 and 553, plaintiff has a private right of action
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pursuant to both statutes; (9) defendant also tortiously obtained possession of plaintiff’s program
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and wrongfully converted it to defendant’s own use and benefit; (10) by reason of defendant’s
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tortious conversion, plaintiff is entitled to compensatory and punitive damages; (11) the
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interception and exhibition of the program violated California Business & Professions Code §
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17200, et seq.; and (12) by reason of defendant’s violation of the Business & Professions Code §
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17200, et seq., plaintiff is entitled to such remedies as restitution, disgorgement, and attorneys’
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fees.2 (ECF No. 1 at 3-10.)
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In its complaint, plaintiff prays for statutory damages of $110,000 for the willful violation
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of 47 U.S.C. § 605 and for recovery of all costs and reasonable attorneys’ fees. (Id. at 11.)
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Plaintiff prays for statutory damages of $60,000 for the willful violation of 47 U.S.C. § 553 and
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for recovery of all costs and reasonable attorneys’ fees. (Id.) Plaintiff also seeks compensatory
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and punitive damages, reasonable attorneys’ fees, and costs of suit for defendant’s tortious
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conversion of plaintiff’s sports program. (Id. at 12.) Finally, plaintiff seeks restitution,
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declaratory relief, injunctive relief, attorneys’ fees, and costs of suit for defendant’s violation of
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the California Business & Professions Code. (Id.)
Plaintiff’s complaint and summons were served upon defendant Ahmadi on December 24,
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2015, by substituted service at defendant Ahmadi’s residence. (ECF No. 11.) The undersigned
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finds that the defendant was properly served with the complaint and that the Clerk properly
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entered the default of the defendant on February 1, 2016. (ECF No. 13.) Defendant Ahmadi was
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also served with plaintiff’s application for default judgment by the court. (ECF No. 14 at 4.)
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Despite being served with process and all papers filed in connection with plaintiff’s motion for
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default judgment, defendant failed to respond to plaintiff’s complaint and plaintiff’s motion for
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default judgment.
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Plaintiff’s motion for default judgment does not seek damages for defendant’s alleged violation
of 47 U.S.C. § 553, et seq. or California Business & Professions Code § 17200, et seq.
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After weighing the Eitel factors, the undersigned finds that the material allegations of the
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complaint support plaintiff’s claims. Plaintiff will be prejudiced if default judgment is denied
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because plaintiff has no other recourse for recovery of the damages suffered due to the
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defendant’s failure to pay for the right to exhibit the program to the patrons within Yolo Gyros
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and Burgers Sports Bar.
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In light of the entry of default against defendant, there is no apparent possibility of a
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dispute concerning the material facts underlying the action. Nor is there any indication that
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defendant’s default resulted from excusable neglect, since defendant was properly served with
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plaintiff’s pleading as well as with plaintiff’s request for entry of default and motion for default
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judgment. Thus, defendant Ahmadi has had ample notice of plaintiff’s intent to pursue a default
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judgment against him.
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Although public policy generally favors the resolution of a case on its merits, defendant’s
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failure to make a proper appearance and defend against plaintiff’s claims has made a decision on
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the merits impossible in this case. Because most of the Eitel factors weigh in plaintiff’s favor, the
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undersigned, while recognizing the public policy favoring decisions on the merits, will
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recommend that default judgment be entered against the defaulted defendant.
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II.
Terms Of Judgment To Be Entered
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After determining that entry of default judgment is warranted, the court must next
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determine the terms of the judgment. Upon consideration of all of plaintiff’s briefing, the
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undersigned will recommend that damages be awarded but not in the amount requested.
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By its motion for default judgment, plaintiff seeks a judgment in the total amount of
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$110,850 against the defaulted defendant. That sum consists of $110,000 for violation of 47
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U.S.C. § 605(e)(3)(B)(iii) and (c)(ii) and $850 for the tort of conversion. (ECF No. 14-2 at 2.)
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The undersigned is mindful that defendant was served with plaintiff’s motion for default
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judgment and was placed on notice of the amount sought by plaintiff. However, granting or
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denying default judgment is within the court’s sound discretion, and one of the factors the court is
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free to consider in exercising its discretion is the sum of money at stake. See J & J Sports
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Productions, Inc. v. Betancourt, No. 08cv937 JLS (POR), 2009 WL 3416431, at *3 (S.D. Cal.
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Oct. 20, 2009).
Under the Federal Communications Act, a plaintiff may elect to seek either actual or
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statutory damages. 47 U.S.C. § 605(e)(3)(C)(i)(I & II). The statute provides for statutory
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damages for each violation of not less than $1,000 and not more than $10,000, as the court
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considers just. 47 U.S.C. § 605(e)(3)(C)(i)(II). Plaintiff seeks the maximum award of $10,000.
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The statute also authorizes enhanced damages of not more than $100,000 if the court finds the
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violation was “committed willfully and for purpose of direct or indirect commercial advantage or
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private financial gain.” 47 U.S.C. § 605(e)(3)(C)(ii). “[T]he mere assertion that Defendant acted
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willfully is insufficient to justify enhanced damages.” Kingvision Pay-Per-View, Ltd. v.
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Backman, 102 F.Supp.2d 1196, 1198 (N.D. Cal. 2000).
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Here, plaintiff seeks $100,000 in enhanced statutory damages. Plaintiff argues that the
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requested amount is justified primarily because of the need to deter broadcast piracy in light of
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the harm done to plaintiff’s business as a result of such activities. In determining whether
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enhanced statutory damages are appropriate, courts usually consider “repeated violations over an
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extended period of time; substantial unlawful monetary gains; significant actual damages to
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plaintiff; defendant’s advertising for the intended broadcast of the event; defendant’s charging a
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cover charge or charging premiums for food and drinks.” Kingvision Pay-Per-View, Ltd. v.
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Gutierrez, 544 F.Supp.2d 1179, 1185 (D. Colo. 2008) (quotation omitted).
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Plaintiff has submitted an affidavit from its investigator stating that during the airing of
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the program at defendant’s establishment the investigator observed a maximum of 26 patrons
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inside the establishment and that there was no cover charge to enter the establishment. (ECF No.
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14-3 at 2.) Plaintiff has come forward with no evidence of any promotion by defendant that the
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fight would be shown at the establishment, that a special premium on food or drink was being
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charged at the establishment on the night of the program, or that the establishment was doing any
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greater level of business on the night the program was shown than at any other time. As
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acknowledged by plaintiff, there are “no egregious circumstanced noted” in this action. (Pl.’s
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MDJ (ECF No. 14-1) at 11.) Moreover, plaintiff has presented no evidence to the court
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suggesting that the defendant is a repeat broadcast piracy offender.3
In light of this record, the undersigned finds plaintiff’s argument in support of enhanced
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statutory damages to be unpersuasive and not supported by the weight of authority in this area.
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Accordingly, the undersigned will recommend that judgment be entered against the defaulted
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defendant, and that plaintiff be awarded $6,000 in statutory damages, with no award for enhanced
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statutory damages, pursuant to 47 U.S.C. § 605(e)(3)(C)(i & ii). See J & J Sports Productions
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Inc. v. Ocampo, Case No. 1:16-cv-0559 LJO JLT, 2016 WL 6246490, at *6 (E.D. Cal. Oct. 26,
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2016) (“Because there is insufficient evidence to demonstrate the piracy was done for purposes of
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commercial or private gain, enhanced damages are not recommended.”); J & J Sports
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Productions, Inc. v. Bolano, Case No. 5:14-cv-3939-BLF, 2015 WL 4512322, at *4 (N.D. Cal.
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July 24, 2015) (“In sum, it is Plaintiff’s burden to establish willfulness and Plaintiff has offered
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no evidence nor conducted any analysis of the specific facts in this case on this point sufficient to
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warrant an award of enhanced damages. As such, Plaintiff has failed to demonstrate entitlement
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to enhanced damages and the Court declines to award such damages here.”); J & J Sports
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Productions, Inc. v. Lorenzana, Case No. 13-cv-5554 BLF (JCS), 2014 WL 3044566, at *4 (N.D.
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Cal. May 13, 2014) (“There is also insufficient evidence that Defendant displayed the Program
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for a ‘commercial advantage’ or for ‘financial gain,’ which is required for an award of enhanced
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damages.”).
Plaintiff’s motion for default judgment also seeks an award of $850 in damages for the
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state law tort of conversion. (Pl.’s MDJ (ECF No. 14-1) at 20.) However, “because Plaintiff
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chose to receive statutory damages rather than actual damages under the Communications Act,
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damages for conversion are subsumed into the total award” of $6,000. J & J Sports Productions
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Inc. v. Ocampo, Case No. 1:16-cv-0559 LJO JLT, 2016 WL 6246490, at *6 (E.D. Cal. Oct. 26,
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It appears, however, that during the course of this litigation, defendant was found to have
committed broadcast piracy on a separate occasion. See J & J Sports Productions, Inc. v.
Ahmadi, No. 2:15-cv-0941 MCE CKD, 2016 WL 1203406, at *1 (E.D. Cal. Mar. 29, 2016)
(recommending default judgment against defendant based on similar facts). “Until an offender is
given notice that damages will be sought, there is no additional incentive to stop the subsequent
violations.” J & J Sports Productions, Inc. v. Lorenzana, Case No. 13-cv-0554 BLF (JCS), 2014
WL 3044566, at *3 (N.D. Cal. May 13, 2014).
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2016); see, e.g., J & J Sports Productions, Inc. v. Ahmadi, No. 2:15-cv-0941 MCE CKD, 2016
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WL 1203406, at *3 (E.D. Cal. Mar. 29, 2016) (declining to award conversion damages where
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statutory damages awarded “sufficiently compensates plaintiff”); Joe Hand Promotions, Inc. v.
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Forsberg, No. 2:14-cv-1559 WBS EFB, 2016 WL 235274, at *6 (E.D. Cal. Jan. 20, 2016) (same);
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J &J Sports Productions v. Mannor, No. CIV 2:10-cv-3021 LKK JFM, 2011 WL 1135356, at *3
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(E.D. Cal. Mar. 28, 2011) (declining to award damages for conversion because “plaintiff has been
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sufficiently compensated through the federal statutory scheme” where the award total was $3,200
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and the cost of the proper license was $2,200). Accordingly, the undersigned will not recommend
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an award of damages with respect to the tort of conversion.
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CONCLUSION
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For the reasons set forth above, IT IS RECOMMENDED that:
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1. Plaintiff’s March 4, 2016 motion for default judgment (ECF No. 14) be granted;
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2. Judgment be entered against defendant in the sum of $6,000; and
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3. This case be closed.
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These findings and recommendations will be submitted to the United States District Judge
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assigned to the case, pursuant to the provisions of 28 U.S.C. § 636(b)(1). Within fourteen (14)
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days after these findings and recommendations are filed, any party may file written objections
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with the court. A document containing objections should be titled “Objections to Magistrate
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Judge’s Findings and Recommendations.” Any reply to the objections shall be served and filed
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within seven (14) days after service of the objections. The parties are advised that failure to file
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objections within the specified time may, under certain circumstances, waive the right to appeal
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the District Court’s order. See Martinez v. Ylst, 951 F.2d 1153 (9th Cir. 1991).
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Dated: November 18, 2016
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DLB:6
DB/orders/orders.civil/joehand1106.mdj.f&rs
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