J & J Sports Productions, Inc. v. Reyes

Filing 19

ORDER GRANTING PLAINTIFF'S MOTION FOR DEFAULT JUDGMENT 14 (Illston, Susan) (Filed on 3/8/2013)

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IN THE UNITED STATES DISTRICT COURT

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FOR THE NORTHERN DISTRICT OF CALIFORNIA

United States District Court
For the Northern District of California

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J & J SPORTS PRODUCTIONS, INC.,

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Plaintiff,

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No. C 12-4845 SI
ORDER GRANTING PLAINTIFF’S
MOTION FOR DEFAULT JUDGMENT

v.
EDUARDO RAUL REYES,

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Defendant.

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On March 8, 2013, the Court held a regularly-noticed hearing on plaintiff's motion for default

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judgment. Plaintiff appeared through counsel. No one appeared on behalf of defendant. The Court

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GRANTS plaintiff’s motion for default judgment.

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BACKGROUND

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Plaintiff, the exclusive licensor of rights to exhibit certain closed circuit and pay-per-view sports

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programming, brought suit against defendant Eduardo Raul Reyes, individually and dba Acaxulta

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Restaurant, operating at 2282 Mission Street, San Francisco, CA. The complaint alleges that defendant

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showed a program in his establishment without a license. Plaintiff’s complaint alleges that defendant

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is liable under the Federal Communications Act, 47 U.S.C. § 605 et seq., for receiving, intercepting and

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assisting in the receipt or interception of licensed programming.1 The complaint also alleges claims for

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47 U.S.C. § 605 prohibits the unauthorized interception of satellite programming. Plaintiff
also alleges that defendant is liable under 47 U.S.C. § 553, which prohibits unauthorized interception
of cable programming. Plaintiff does not allege, in either the complaint or in the motion for default

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conversion and violation of the California Business and Professions Code Section 17200. Plaintiff

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alleges it secured the domestic commercial exhibit right to broadcast and license “Star Power”: Floyd

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Mayweather Jr. v. Victor Ortiz, WBO Welterweight Championship Fight Program, including the

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undercard bouts and commentary (“Program”). Plaintiff asserts that had defendant wished to legally

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broadcast the Program, the cost would have been $2,200. Plaintiff’s hired private investigator was

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present on the evening of the fight, September 17, 2011, in defendant’s establishment and saw one of

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the undercard bouts in the Program. See Affidavit of Jeff Kaplan. Plaintiff filed a complaint against

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defendant, who never responded. The Clerk entered default against defendant on December 26, 2012.

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DISCUSSION

United States District Court
For the Northern District of California

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The Federal Communications Act, 47 U.S.C. § 605 et seq., prohibits commercial establishments

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from intercepting and broadcasting to its patrons satellite cable programming. The Act allows an

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aggrieved party to bring a civil action in federal district court and permits that party to elect an award

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of either statutory or actual damages. See 47 U.S.C. § 605(e)(3)(C)(I). The statute allows the court to

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award between $1,000 and $10,000 for each violation of section 605 as it considers just. Id. at

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§ 605(e)(3)(C)(i)(II). The Court may increase its award by not more than $100,000 when the violation

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has been “committed willfully and for purposes of direct or indirect commercial advantage or private

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financial gain.” 47 U.S.C. § 605(e)(3)(C)(ii). Plaintiff’s application for default judgment contends that

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defendant’s violation of 47 U.S.C. § 605 et seq. was willful and that this Court should enter default

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judgment in the amount of the statutory maximum, $110,000 plus $2,200 for conversion damages.

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This Court declines to grant plaintiff’s request for the statutory maximum. The allegations in

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a complaint regarding the monetary amount of damages that should be granted in a default judgment

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are not controlling, and “the mere assertion that defendants acted willfully is insufficient to justify

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enhanced damages.” Kingvision Pay-Per-View Ltd. v. Backman, 102 F. Supp. 1196, 1198 (N.D. Cal.

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2000).

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Communications Act have cited such factors as the repeated violation of the Act, the intent to profit

Courts that have awarded enhanced damage awards due to willful violations of the

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papers which method of transmission defendant used, but plaintiff seeks damages solely under 47 U.S.C.
§ 605.
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from the violations and actual profit derived from the violation. Id. at 1197-98. Plaintiff’s papers do

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not disclose whether defendant advertised the broadcast and plaintiff’s affiant did not pay a cover charge

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to enter defendant’s establishment. According to the affidavit of Mr. Kaplan, the capacity of defendant’s

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establishment is “40+” people, and during three separate head counts only “20+” patrons were present.

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Plaintiff asserts that Mr. Kaplan observed that the program was broadcast on nine televisions at the

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restaurant. However, although Mr. Kaplan’s affidavit states that there were nine televisions in the

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restaurant, Mr. Kaplan does not state that the program was broadcast on all nine televisions, nor does

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he state on how many televisions he observed the program.
“Courts in this district have considered several cases involving pirating of closed-circuit sports

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United States District Court
For the Northern District of California

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broadcasts and, absent a showing of egregious wrongdoing, generally have awarded damages slightly

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over the statutory minimum.” Universal Sports Network v. Jimenez, No. C–02–2768–SC, 2002 WL

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31109707, at *1 (N.D. Cal. Sept. 18, 2002). The Court finds that an enhanced damage award is not

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warranted under the statute. Under 47 U.S.C. § 605(e)(3) the Court may award statutory damages

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between $1,000 and $10,000 for a violation of the Act. Based on the facts alleged – including the fact

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that the license fee was $2,200, the establishment did not charge a cover fee, the absence of allegations

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that defendant is a repeat offender or that defendant advertised the program, and the fact that there were

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not many patrons – the Court finds that an award of $2,200 is appropriate.

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Plaintiff also requests default judgment on its state law claim of conversion. The Court finds

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that the statutory damages in the amount of $2,200 sufficiently compensates plaintiff, and this case does

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not present a set of circumstances where an additional award might be warranted. Further, plaintiff’s

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conversion claim raises what one judge in the Eastern District of California has called “the

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thought-provoking question of whether an interest in intangible property such as an exclusive license

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to distribute a broadcast signal is the proper subject of a claim of conversion under California law.” See

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J & J Sports Productions, Inc. v. Hernandez, No. 09-CV-3389 GEB KJN, 2010 WL 1980186, *6 n.12

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(E.D. Cal. May 17, 2010). California state and federal courts have reached varying conclusions.

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Compare, e.g., Fremont Indem. Co. v. Fremont Gen. Corp., 148 Cal. App. 4th 97, 119 (Ct. App. 2007)

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(noting California courts' traditional refusal to recognize as conversion the unauthorized taking of

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intangible interests not merged with or reflected in something tangible), with DIRECTV, Inc. v. Pahnke,
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405 F. Supp. 2d 1182, 1189 (E.D. Cal. 2005) (observing that courts have relaxed tangibility requirement,

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and granting summary judgment for conversion of satellite broadcast programming) and Don King

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Prods./Kingvision v. Lovato, 911 F. Supp. 419, 423 (N.D. Cal. 1995) (finding that plaintiff’s exclusive

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rights to distribute program in California qualified as right to possession of property under conversion

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claim).

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CONCLUSION
For the foregoing reasons, the Court GRANTS plaintiff’s motion for default judgment. Docket
No. 14. The Court awards $2,200.

United States District Court
For the Northern District of California

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IT IS SO ORDERED.

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Dated: March 8, 2013
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SUSAN ILLSTON
UNITED STATES DISTRICT JUDGE

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