J & J Sports Productions, Inc v. Seldner

Filing 24

ORDER GRANTING MOTION FOR DEFAULT JUDGMENT. Signed by Judge Richard Seeborg on 7/26/12. (cl, COURT STAFF) (Filed on 7/26/2012)

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IN THE UNITED STATES DISTRICT COURT

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FOR THE NORTHERN DISTRICT OF CALIFORNIA

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SAN FRANCISCO DIVISION

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For the Northern District of California

United States District Court

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J&J SPORTS PRODUCTIONS, INC.,

No. C 11-5450 RS
ORDER GRANTING MOTION FOR
DEFAULT JUDGMENT

Plaintiff,
v.

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AURORA MANALASTAS SELDNER,
doing business as AURORA’S
RESTAURANT,
Defendant.
____________________________________/

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I. INTRODUCTION

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Plaintiff J&J Sports Productions, Inc. seeks default judgment against defendant Aurora

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Manalastas Seldner, doing business as Aurora’s Restaurant. J&J licenses the right to broadcast pay-

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per-view sports entertainment in commercial establishments. It contends that on November 13,

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2010, Seldner exhibited “‘Tactical Warfare’: Manny Pacquiao v. Antonio Margarito, WBC Light

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Middleweight Championship Fight” on a television in her restaurant to approximately 50 patrons,

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without obtaining a license and paying the requisite fee to J&J. Because J&J has established the

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No. C 11-5450 RS
ORDER GRANTING MOTION FOR DEFAULT JUDGMENT

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right to have default judgment entered in its favor, its motion will be granted, although statutory

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damages will be awarded in an amount less than requested.

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II. BACKGROUND

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J&J employs investigators to police against unauthorized (and unpaid) exhibitions in

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commercial establishments of pay-per-view sports and entertainment programming to which J&J

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holds licensing rights. J&J’s investigator, Michael Joffee, has submitted an affidavit describing his

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observations upon visiting Aurora’s Restaurant operated by defendant Seldner. Joffee declares he

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observed part of the Program being shown on one television in the establishment. Joffee conducted
three separate headcounts, observing just over 50 patrons present each time, in a room with a

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For the Northern District of California

United States District Court

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capacity of approximately 50. There is no evidence that the bar advertised or promoted the

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availability of the Program, or that it imposed a cover charge for admission.

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The Program apparently was available both through satellite television services and cable

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television providers. See Complaint, Count I, alleging violation of 47 U.S.C. § 605 (prohibiting

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unauthorized interception of satellite programming) and Count II, alleging violation of 47 U.S.C. §

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553 (prohibiting unauthorized interception of cable programming). There is no evidence as to which

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of the two Seldner utilized to obtain the Program. J&J asserts that the Program could not have been

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mistakenly, innocently, or accidentally intercepted and shown.

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Had Seldner obtained a license to exhibit the Program at the restaurant, the fee would have

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been $2200. J&J’s claim for conversion therefore seeks damages in that amount. This is not the

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first time Seldner has exhibited unauthorized pay-per-view boxing at her restaurant or the first time

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that she has failed to appear and defend. See J&J Sports Productions, Inc. v. Seldner, C 10-5137

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TEH (default judgment entered July 6, 2011).

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III. STANDARD
Following entry of default, courts are authorized to grant default judgment in their
discretion. See Fed. R. Civ. P. 55; Aldabe v. Aldabe, 616 F.2d 1089, 1092 (9th Cir. 1980). In

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ORDER GRANTING MOTION FOR DEFAULT JUDGMENT

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exercising its discretion, the factors the court may consider include: (1) the possibility of prejudice

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to the plaintiff, (2) the merits of plaintiff’s substantive claim, (3) the sufficiency of the complaint,

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

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(6) whether the default was due to excusable neglect, and (7) the strong policy underlying the

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Federal Rules of Civil Procedure favoring decisions on the merits. Eitel v. McCool, 782 F.2d 1470,

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1471-72 (9th Cir. 1986). In considering these factors, all factual allegations in the plaintiff’s

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complaint are taken as true, except for those relating to damages. TeleVideo Sys., Inc. v. Heidenthal,

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826 F.2d 915, 917-18 (9th Cir. 1987).

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IV. DISCUSSION
In this case, the Eitel factors weigh in favor of granting J&J’s motion for default judgment.

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For the Northern District of California

United States District Court

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The allegations in the complaint, taken as true, and further supported by the evidence submitted with

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the motion, establish that Seldner displayed the Program in a commercial establishment without

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authorization and payment of the requisite fee. Seldner was given notice of this action, and knew or

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should have known that she had an obligation to file a response. Under these circumstances, the

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policy favoring decisions on the merits must yield to J&J’s right to a judicial determination of its

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claims.

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Neither the complaint (the claims of which are alleged in the alternative), nor the

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declarations submitted with the motion, however, establish whether Seldner intercepted a cable

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signal or a satellite signal. Indeed, J&J’s motion expressly acknowledges that it has no information

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as to the method of interception. Thus, while J&J has established that Seldner wrongfully

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intercepted and exhibited the Program, and presumably did so in violation of either 47 U.S.C. § 605

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or 47 U.S.C. § 553, there is an insufficient basis to conclude with certainty which of the two statutes

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would support an award of statutory damages.1

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J&J’s motion seeks statutory damages only under § 605, but contains no explanation why it chose
to pursue its claim under that section and to abandon the alternatively-pleaded claim under § 553.
Nothing in the motion suggests J&J has learned since filing the complaint which section actually
applies; as noted, J&J expressly admits it lacks such information.

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In cases similar to this one, J&J and other holders of pay-per-view licensing rights have

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sometimes been granted default judgments including statutory damages, by orders not expressly

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addressing this issue. When courts have explicitly questioned the adequacy of a plaintiff’s showing

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as to the means by which a pay-per-view signal was intercepted, they have sometimes been willing

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to presume it more likely to have been through a violation of § 553, because “a cable box is hidden

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more easily than a satellite dish.” G & G Closed Circuit Events, LLC v. Vo, 2012 WL 899955, at *2

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(N.D. Cal. 2010); J & J Sports Prods., Inc. v. Guzman, 2009 WL 1034218, at *2 (N.D.Cal. 2009).

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That approach is unsatisfactory here, given that J&J is not seeking damages under § 553.
Nevertheless, § 605 and § 553 each provide a discretionary range of possible damage

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awards, and those ranges are overlapping between the sums of $1000 and $10,000.2 J&J points to

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For the Northern District of California

United States District Court

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numerous cases from various districts involving default judgments against defendants for

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unauthorized exhibition of pay-per-view programming where courts have awarded statutory

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damages up to the maximum, including, in some instances, “enhanced” damages. J&J urges the

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same result here. J&J acknowledges that other courts have declined to enter substantial awards, and

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argues “that those cases that award nominal damages are a major reason why there have been little

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to no decrease in piracy.”
J&J, however, has not shown that there is any threshold amount that creates a deterrent

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effect, or that default judgments ever significantly deter “piracy.” The inference J&J seeks to

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draw—that nominal damages awards in default judgments perpetuate continued misappropriation—

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is undermined by its citation to many cases awarding statutory maximums, which apparently

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likewise have proven ineffective at deterring the conduct.

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Nevertheless, were J&J awarded under its conversion claim only the $2200 license fee

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Seldner avoided paying, it is self-evident that defendants would have no disincentive against simply

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The range under § 605 is from $1000 to $10,000, with the potential of enhanced damages up to
$100,000 for a willful violation committed for commercial advantage, or a reduction to as low as
$250 where, “the violator was not aware and had no reason to believe that his acts constituted a
violation.” Under § 553, the basic range is from $250 to $10,000, with potential enhancement up to
$50,000, or reduction down to $100.

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continuing to exhibit pay-per-view programs without authorization and allowing default judgments

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to be entered when a plaintiff learns of it and pursues the matter. Additionally, in light of Seldner’s

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status as a “repeat offender,” an award greater than that recently entered in another case brought by

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J&J3 is warranted. Accordingly, under all the circumstances here, an award of statutory damages in

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the amount of $7500 is appropriate. Any uncertainty as to whether Seldner in fact violated § 605 is

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immaterial in light of the fact that a statutory award in the same amount is equally appropriate in the

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event she actually violated § 553. Her failure to appear and defend this action cannot be permitted

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to preclude J&J from being awarded any statutory damages, when it has shown that the interception

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of the Program necessarily violated one of the two statutes.
J&J has not shown, however, that an award of “enhanced” damages under either statute is

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For the Northern District of California

United States District Court

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warranted. Nor has it shown that it is entitled to recover actual damages under its conversion theory

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in addition to statutory damages. See § 605(e)(3)(c) (“at the election of the aggrieved party . . . [it]

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may recover the actual damages . . . or . . . statutory damages . . . .”). Judgment will therefore be

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entered in the amount of $7500.

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V. CONCLUSION

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The motion is granted. A separate judgment in plaintiff’s favor will issue.

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IT IS SO ORDERED.
Dated: 7/26/12
RICHARD SEEBORG
UNITED STATES DISTRICT JUDGE

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See J&J Sports Productions, Inc. v. Andrade, C 11-4592 RS.

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