G&G Closed Circuit Events, LLC v. Nguyen

Filing 29

Order by Hon. Edward J. Davila granting 20 Motion for Default Judgment.(ejdlc2, COURT STAFF) (Filed on 9/30/2011)

1
2
3
4
5
6
7

UNITED STATES DISTRICT COURT

8

NORTHERN DISTRICT OF CALIFORNIA

9
United States District Court
For the Northern District of California

10
11
12
13
14
15

SAN JOSE DIVISION
G & G CLOSED CIRCUIT EVENTS, LLC,
Plaintiff,
v.
HUONG XUAN THI NGUYEN,
Defendant.

)
)
)
)
)
)
)
)
)
)

Case No.: 5:10-CV-05715 EJD
ORDER GRANTING MOTION FOR
DEFAULT JUDGMENT

16

Plaintiff G & G Closed Circuit Events, LLC (“Plaintiff”) moves for entry of default

17

judgment in the amount of $111,200.00 against Defendant Huong Xuan Thi Nguyen, individually

18

and d/b/a/ Bun Rieu 1 a/k/a Quan Huong (“Defendant”). Plaintiff seeks damages stemming from

19

Defendant’s alleged violation of 47 U.S.C. § 605(a) and conversion of Plaintiff's property. The

20

court has considered the moving papers and the oral argument of Plaintiff's counsel presented at the

21

hearing on September 23, 2011. For the reasons discussed below, the motion will be GRANTED.

22
23
24

I. BACKGROUND
A. Procedural history
Plaintiff filed the instant action on December 15, 2010. After Defendant was served with

25

process and failed to respond, (Docket No. 16), Plaintiff moved for entry of default and served the

26

motion by mail, (Docket No. 18). The clerk entered default on July 1, 2011. (Docket No. 19).

27

Plaintiff moved for default judgment on August 9, 2011, and has provided proof of service

28
Case No.: 5:10-CV-05715 EJD
ORDER GRANTING DEFAULT JUDGMENT

1

1

indicating that a copy of the notice and application for default judgment were mailed to Defendant.

2

(Docket No. 19). Defendant did not appear at the hearing.

3

B. Factual history

4

Plaintiff is a distributor of sports and entertainment programming. It purchased the rights to

5

broadcast a December 19, 2009 Stikeforce event between Cung Le and Scott Smith, together with

6

undercard bouts, televised replay, and color commentary (collectively, the “Program”). It then

7

entered into sublicenses with third parties such as casinos, bars, and social clubs, allowing the

8

sublicensees to exhibit the Program to their patrons. The Program was broadcast in interstate

9

commerce by means of an encrypted transmission, and only Plaintiff's sublicensees were entitled to

United States District Court
For the Northern District of California

10

decrypt that transmission.

11

On the day of the broadcast, Jeff Kaplan (“Kaplan”), an investigator hired by Plaintiff,

12

observed an exhibition of the Program in Bun Rieu 1 a/k/a Quan Huong. Defendant was not a

13

sublicensee entitled to exhibit the Program. Kaplan entered the premises without paying a cover

14

charge and observed the Program on five televisions. (Decl. of Affiant at 2). Between 7:50 p.m.

15

and 7:58 p.m., he performed three headcounts, noting the presence of ten, ten, and ten people by

16

each respective count. (Id. at 3). The declaration indicates the capacity of Bun Rieu 1 a/k/a Quan

17

Huong as fifty and did not state whether Kaplan observed either a satellite dish or a cable box. (Id.)

18

II. DISCUSSIONs

19

Plaintiff seeks $10,000 in statutory damages pursuant to 47 U.S.C. § 605(e)(3)(C)(i)(II),

20

$100,000 in enhanced damages pursuant to 47 U.S.C. § 605(e)(3)(C)(ii), and $1,200 in damages

21

for conversion. Plaintiff also alleges that Defendant has violated 47 U .S.C § 553(a), which

22

provides for statutory damages pursuant to subsection (c)(3)(A)(ii) and enhanced damages pursuant

23

to subsection (c)(3)(B).

24

A. Whether to apply 47 U.S.C. § 605 or 47 U.S.C § 553

25

“[U]pon default the factual allegations of the complaint, except those relating to the

26

amount of damages, will be taken as true.” Geddes v. United Fin. Group, 559 F.2d 557, 560 (9th

27

Cir. 1977) (citing Pope v. United States, 323 U.S. 1 (1944); Flaks v. Koegel, 504 F.2d 702, 707 (2d

28

Cir. 1974)). Plaintiff seeks damages pursuant to § 605, which “requires proof that a defendant has
2
Case No.: 5:10-CV-05715 EJD
ORDER GRANTING DEFAULT JUDGMENT

1

‘(1) intercepted or aided the interception of, and (2) divulged or published, or aided the divulging

2

or publishing of, a communication transmitted by the plaintiff.’” California Satellite Systems v.

3

Seimon, 767 F.2d 1364, 1366 (9th Cir. 1985) (citing National Subscription Television v. S & H

4

TV, 644 F.2d 820, 826 (9th Cir. 1981)). Plaintiff alleges in its complaint that it transmitted the

5

Program, that Defendant unlawfully intercepted the Program, and that Defendant exhibited the

6

Program. (Complaint ¶¶ 9-13.)

7

However, § 605 applies only to intercepted “radio” communications or broadcasts through

8

the air, such as satellite broadcasts. J & J Sports Productions, Inc. v. Man Thi Doan, No. C-08-

9

00324 RMW, 2008 WL 4911223, at *2 (N.D. Cal. Nov.13, 2008) (citing United States v. Norris,

United States District Court
For the Northern District of California

10

88 F.3d 462 (7th Cir. 1996)). The pleadings do not allege that Defendant intercepted a satellite

11

broadcast, and Kaplan does not state that he observed a satellite dish at Bun Rieu 1 a/k/a Quan

12

Huong. (Decl. of Affiant). Plaintiff contends that it has been unable to ascertain whether Defendant

13

utilized a satellite dish only because Defendant has refused to answer and appear in the instant

14

case. Nonetheless, the Court may not enter default judgment if the factual allegations in the

15

pleadings are insufficient to establish liability.

16

However, the complaint also asserts a claim under 47 U.S.C. § 553, which “prohibits a

17

person from ‘intercept[ing] or receiv[ing] or assist[ing] in intercepting or receiving any

18

communications service offered over a cable system.’” Man Thi Doan, 2008 WL 4911223 at *2

19

(quoting 47 U.S.C. § 553(a)(1)) (alterations in the original). While Kaplan does not state that he

20

observed a cable box, (Decl. of Affiant), it is undisputed that Defendant intercepted the broadcast

21

by some means, and a cable box is hidden more easily than a satellite dish. Accord J & J Sports

22

Productions, Inc. v. Guzman et al., 3:08-cv-05469-MHP, 2009 WL 1034218, at *2 (N.D. Cal. April

23

16, 2009). Accordingly, Plaintiff's allegations are sufficient for present purposes to establish

24

Defendant's liability under § 553(a)(1).

25

1. Statutory damages pursuant to 47 U.S.C. § 553(c)(3)(A)(ii)

26

An aggrieved party may recover either actual damages pursuant to § 553(c)(3)(A)(i) or

27

statutory damages pursuant to § 553(c)(3)(A)(ii). A court may award statutory damages of “not less

28

than $250 or more than $10,000 as the court considers just.” 47 U.S.C. § 553(c)(3)(A)(ii). While
3
Case No.: 5:10-CV-05715 EJD
ORDER GRANTING DEFAULT JUDGMENT

1

the violation in the instant case does not appear to be particularly egregious, Plaintiff requests the

2

statutory maximum. Plaintiff contends that the maximum award against Defendant is necessary to

3

deter future violations.

4

Plaintiff has presented evidence of the capacity of the establishment as fifty, which served

5

ten persons during each of Kaplan's headcounts, and the Program was shown on five televisions.

6

These factors suggest that maximum damages are unwarranted. The Court finds that an award of

7

$1,000 is sufficient under the circumstances.

8

2. Enhanced damages pursuant to 47 U.S.C. § 553(c)(3)(B)

9

47 U.S.C. § 553(c)(3)(B) provides that in the case of a willful violation for purposes of

United States District Court
For the Northern District of California

10

commercial advantage or private gain, “the court in its discretion may increase the award of

11

damages . . . by an amount of not more than $50,000.” Plaintiff alleges that Defendants'

12

interception of the program was willful and for purposes of commercial advantage or private gain.

13

(Complaint ¶ 13). Facts alleged in the pleadings are binding upon the defaulting party. Geddes, 559

14

F.2d at 560.

15

However, while Bun Rieu 1 a/k/a Quan Huong is a commercial establishment, it is not at all

16

clear that it is “a business where certain events, such as boxing matches, would be shown to the

17

public.” American Cablevision of Queens v. McGinn, 817 F.Supp. 317, 320 (E.D.N.Y. 1993).

18

Although Plaintiff has brought to the attention of the court another case pending in which similar

19

conduct is alleged, that case was filed after the events at issue in this action and therefore is not

20

particularly probative of the Defendant’s wilfulness or purpose during the events at issue here. In

21

light of the fact that Kaplan observed only ten people present and there was no cover charge, the

22

Court concludes that this is not an appropriate situation for the Court to exercise its discretionary

23

authority to impose enhanced damages.

24

B. Damages for conversion

25

As a result of Defendant's default, the facts alleged in the pleadings are sufficient to

26

establish that Defendant wrongfully denied Plaintiff ownership of the right to control the exhibition

27

the Program and therefore are sufficient to establish that Defendant is liable for the tort of

28

conversion. See Culp v. Signal Van & Storage, 142 Cal.App.2d Supp. 859, 862 (Cal. App. Dep't
4
Case No.: 5:10-CV-05715 EJD
ORDER GRANTING DEFAULT JUDGMENT

1

Super. Ct. 1956). Pursuant to Cal. Civ. Code § 3336, Defendant is liable for the value of the

2

property at the time of the conversion. Accordingly, Plaintiff is entitled to recover the sublicensing

3

fee of $1,200.

4
5

III. CONCLUSION
Plaintiff's motion is granted. Plaintiff shall recover $1,000 in statutory damages pursuant to

6

47 U.S.C. § 553(c)(3)(A)(ii) and $1,200 pursuant to Cal. Civ. Code § 3336.

7

IT IS SO ORDERED.

8

Dated: September 30, 2011

9

_________________________________
EDWARD J. DAVILA
United States District Judge

United States District Court
For the Northern District of California

10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
Case No.: 5:10-CV-05715 EJD
ORDER GRANTING DEFAULT JUDGMENT

5