J&J Sports Productions, Inc v. Nguyen

Filing 25

Order by Hon. Edward J. Davila granting 16 Motion for Default Judgment. (ejdlc2, COURT STAFF) (Filed on 12/14/2011)

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UNITED STATES DISTRICT COURT

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NORTHERN DISTRICT OF CALIFORNIA

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SAN JOSE DIVISION

United States District Court
For the Northern District of California

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J & J SPORTS PRODUCTIONS, INC.,
Plaintiff,

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v.
VAN T. NGUYEN,
Defendant.

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Case No.: 5:11-CV-01169 EJD
ORDER GRANTING MOTION FOR
DEFAULT JUDGMENT
[Docket Item No. 16]

Plaintiff J & J Sports Productions, Inc. (“Plaintiff”) moves for entry of default judgment in

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the amount of $111,800.00 against Defendant Van T. Nguyen a/k/a Van H. Nguyen, individually

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and d/b/a Got Hong (“Defendant”). Plaintiff seeks damages stemming from Defendant’s alleged

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violation of 47 U.S.C. § 605(a) and conversion of Plaintiff's property. The Court has considered the

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moving papers and the oral argument of Plaintiff's counsel presented at the hearing on September

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

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I. BACKGROUND
A. Procedural history
Plaintiff filed the instant action on March 10, 2011. After Defendant was served with

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process and failed to respond, Plaintiff moved for entry of default and served the motion by mail.

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See ECF No. 13. The clerk entered default on July 25, 2011. Plaintiff moved for default judgment

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on August 16, 2011, and has provided proof of service indicating that a copy of the notice and

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Case No.: 5:11-CV-01169 EJD
ORDER GRANTING MOTION FOR DEFAULT JUDGMENT

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application for default judgment were mailed to Defendant. See ECF No. 16. Defendant did not

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appear at the hearing.

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B. Factual history

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

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broadcast a March 13, 2010 championship fight between Manny Pacquiao and Joshua Clottey,

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together with undercard bouts, televised replay, and color commentary (collectively, the

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“Program”). It then entered into sublicenses with third parties such as casinos, bars, and social

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clubs, allowing the sublicensees to exhibit the Program to their patrons. The Program was

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broadcast in interstate commerce by means of an encrypted transmission, and only Plaintiff's

United States District Court
For the Northern District of California

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sublicensees were entitled to decrypt that transmission.
On the day of the broadcast, Gary Gravelyn (“Gravelyn”), an investigator hired by Plaintiff,

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observed an exhibition of the Program in Got Hong. Defendant was not a sublicensee entitled to

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exhibit the Program. Gravelyn entered the premises without paying a cover charge and observed

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the Program on seven televisions. Decl. of Affiant at 2. Between 9:11 p.m. and 9:35 p.m., he

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performed three headcounts, noting the presence of fifty-seven, fifty-eight, and fifty-eight people

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by each respective count. Id. at 2-3. The declaration indicates the capacity of Got Hong as seventy-

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five and that Gravelyn did not observe either a satellite dish or a cable box. Id. at 2.

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II. DISCUSSION

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

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$100,000 in enhanced damages pursuant to 47 U.S.C. § 605(e)(3)(C)(ii), and $1,800 in damages

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

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

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

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

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

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

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

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Cir. 1974)). Plaintiff seeks damages pursuant to § 605, which “requires proof that a defendant has
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Case No.: 5:11-CV-01169 EJD
ORDER GRANTING MOTION FOR DEFAULT JUDGMENT

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

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

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

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

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

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Program. Compl. ¶¶ 9-13.

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

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

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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

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

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broadcast, and Gravelyn does not state that he observed a satellite dish at Got Hong. Decl. of

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Affiant. Plaintiff contends that it has been unable to ascertain whether Defendant utilized a satellite

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dish only because Defendant has refused to answer and appear in the instant case. Nonetheless, the

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Court may not enter default judgment if the factual allegations in the pleadings are insufficient to

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establish liability.

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

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

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

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

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observed a cable box, it is undisputed that Defendant intercepted the broadcast by some means, and

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a cable box is hidden more easily than a satellite dish. Accord J & J Sports Productions, Inc. v.

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Guzman et al., 3:08-cv-05469-MHP, 2009 WL 1034218, at *2 (N.D. Cal. April 16, 2009).

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Accordingly, Plaintiff's allegations are sufficient for present purposes to establish Defendant's

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liability under § 553(a)(1).

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

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

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

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than $250 or more than $10,000 as the court considers just.” 47 U.S.C. § 553(c)(3)(A)(ii). Plaintiff
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Case No.: 5:11-CV-01169 EJD
ORDER GRANTING MOTION FOR DEFAULT JUDGMENT

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requests the statutory maximum. Plaintiff contends that the maximum award against Defendant is

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necessary to deter future violations.

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Plaintiff has presented evidence of the capacity of the establishment as seventy-five, which

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served fifty-seven, fifty-eight, and fifty-eight persons during Gravelyn’s headcounts, and the

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Program was shown on seven televisions. These factors suggest that maximum damages are

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unwarranted. The Court finds that an award of $5,000 is sufficient under the circumstances.

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

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

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

United States District Court
For the Northern District of California

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

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

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

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F.2d at 560.

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“Courts in this district have considered several cases involving pirating of closed-circuit

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

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damages slightly over the statutory minimum.” J & J Sports Productions, Inc. v. Basto, et al., No. C

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10-1803, 2011 WL 566843, at 2 (N.D.Cal. Feb. 14, 2011) (citing Universal Sports Network v.

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Jimenez, 2002 WL 31109707, at *1 (N.D.Cal. Sept.18, 2002)).

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Plaintiff has brought to the attention of the court a 2010 case, 5:10-5856 EJD, which

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alleged Defendant unlawfully broadcast another program on January 2, 2010. Defendant was

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served with the complaint in that case after the events at issue in this action. The presence of the

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2010 case therefore is not particularly probative of Defendant’s wilfulness during the events at

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issue here. The 2010 case, however, ended in a default judgment against Defendant, indicating that

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the event in this case was not the first time Defendant unlawfully broadcast a program at Got Hong.

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In light of Defendant’s status as a repeat violator and the facts of this violation — that there

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were fifty-seven, fifty-eight, and fifty-eight people during Gravelyn’s headcounts, the capacity of

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the establishment of seventy-five was almost filled, and the Program was shown on seven

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televisions — the Court concludes that an enhanced damages award of $5,000 is appropriate.
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Case No.: 5:11-CV-01169 EJD
ORDER GRANTING MOTION FOR DEFAULT JUDGMENT

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B. Damages for conversion

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

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

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

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conversion. See Culp v. Signal Van & Storage, 142 Cal. App. 2d Supp. 859, 862 (App. Div. 1956).

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Pursuant to Cal. Civ. Code § 3336, Defendant is liable for the value of the property at the time of

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the conversion. Accordingly, Plaintiff is entitled to recover the sublicensing fee of $1,800.

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III. CONCLUSION
Plaintiff's motion is granted. Plaintiff shall recover $5,000 in statutory damages pursuant to

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United States District Court
For the Northern District of California

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47 U.S.C. § 553(c)(3)(A)(ii), $5,000 in enhanced damages pursuant to 47 U.S.C. § 553(c)(3)(B),

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and $1,800 pursuant to Cal. Civ. Code § 3336.

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IT IS SO ORDERED.

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Dated:

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_________________________________
EDWARD J. DAVILA
United States District Judge

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Case No.: 5:11-CV-01169 EJD
ORDER GRANTING MOTION FOR DEFAULT JUDGMENT