J & J Sport Productions, Inc., v. Salas et al

Filing 54

ORDER GRANTING 52 MOTION FOR ENTRY OF DEFAULT JUDGMENT. Signed by Hon. Beth Labson Freeman on 5/27/2015. (blflc2, COURT STAFF) (Filed on 5/27/2015)

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UNITED STATES DISTRICT COURT

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NORTHERN DISTRICT OF CALIFORNIA

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SAN JOSE DIVISION

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J & J SPORT PRODUCTIONS, INC.,,

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Case No. 13-cv-05553-BLF

Plaintiff,
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v.

ORDER GRANTING MOTION FOR
ENTRY OF DEFAULT JUDGMENT

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JAVIER SALAS, et al.,

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[RE: ECF 52]

Defendants.

United States District Court
Northern District of California

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Before the Court is the Motion for Entry of Default Judgment filed by defendants Javier

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Salas, Apolonio Castro, and Taqueria El Caminito (collectively, “Defendants”), whereby

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Defendants seek default judgment against third-party defendant Continental Satelites

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(“Continental”). Defs.’ Mot., ECF 52. The Court finds this matter suitable for submission on the

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papers and hereby VACATES the June 4, 2015 hearing date pursuant to Civil Local Rule 7-1(b).

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I.

BACKGROUND
Plaintiff J & J Sport Productions, Inc. (“J & J”) brought the original claims in this action

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against Defendants alleging violation of the Federal Communications Act, 47 U.S.C. § 605,1 and a

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variety of state law claims, based on Defendants’ unauthorized airing of a pay-per-view fight

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program (“Program”) at their taqueria on December 8, 2012 for which J & J is the exclusive

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domestic distributor. Compl. ¶ 18, ECF 1.

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On October 16, 2014, the Court granted Defendants’ unopposed motion to implead third-

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party defendant Continental. ECF 38. Defendants filed the third-party complaint on October 17,

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2014 and served summons on Continental on October 23, 2014. Certificate of Service, ECF 42.

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J & J also alleged a violation of 47 U.S.C. § 553 that the parties stipulated to dismiss. ECF 37.

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Continental never responded to the third-party complaint. Defendants sought and obtained a

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clerk’s entry of default on January 15, 2015 and then filed the present motion for entry of default

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judgment on February 23, 2015. ECF 46, 52. Just prior to the filing of the instant motion, J & J

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and Defendants stipulated on February 19, 2015 to dismiss all of J & J’s remaining claims in this

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action, after the parties fully settled their dispute. ECF 51. As such, the only claims remaining in

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this action are Defendants’ third-party claims against Continental.
Defendants allege that Continental claims to be an authorized reseller of satellite and cable

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services and that Continental’s employee, Hugo Arango, sold Defendants a Latino Dish satellite

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subscription plan in October 2012. Third-Party Compl. ¶¶ 8-9, ECF 39. Arango told defendant
Castro that he could use the subscription at the taqueria and “assured Mr. Castro that he could use

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United States District Court
Northern District of California

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the satellite dish in the restaurant and list Mr. Castro’s home address on the account.” Id. ¶ 9. On

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December 8, 2012, the day of the Program, Arango also “assured Mr. Castro that as long as Mr.

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Castro paid the satellite provider Dish the pay-per-view fee . . . he and his family could watch the

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Program at the Taqueria.” Id. ¶ 11. J & J later sued Defendants for airing the Program at their

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taqueria, and Defendants settled with J & J for $3,000. Defs.’ Mot. 3; Decl. of Anthony Tartaglio

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¶¶ 1, 3, ECF 52-1. Defendants now seek to recover that amount from Continental based upon

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Continental’s alleged intentional and/or negligent misrepresentations concerning Defendants’

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ability to use their Dish satellite subscription to watch the Program at their taqueria. Defs.’ Mot.

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4-5; Third-Party Compl. ¶¶ 14-32.

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II.

LEGAL STANDARD
Pursuant to Federal Rule of Civil Procedure 55(b), a court may enter default judgment

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against a defendant who has failed to plead or otherwise defend an action. “The district court’s

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decision whether to enter a default judgment is a discretionary one.” Aldabe v. Aldabe, 616 F.2d

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1089, 1092 (9th Cir. 1980). In exercising this discretion, district courts in this circuit consider the

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seven factors set forth in Eitel v. McCool, 782 F.2d 1470 (9th Cir. 1986) (“Eitel factors”): (1) the

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possibility of prejudice to the plaintiff; (2) the merits of plaintiff’s substantive claim; (3) the

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sufficiency of the complaint; (4) the sum of money at stake in the action; (5) the possibility of

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dispute concerning material facts; (6) whether default was due to excusable neglect; and (7) the
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strong policy underlying the Federal Rules of Civil Procedure favoring decisions on the merits.

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Id. at 1471-72. In considering these factors after a clerk’s entry of default, the court takes all well-

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pleaded factual allegations in the complaint as true, except those with regard to damages.

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Televideo Sys., Inc. v. Heidenthal, 826 F.2d 915, 917-18 (9th Cir. 1987). The Court may, in its

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discretion, consider competent evidence and other papers submitted with a motion for default

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judgment to determine damages. Id.

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III.

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DISCUSSION
This Court has federal question jurisdiction over the original complaint because of J & J’s

claim under the Communications Act. Compl. ¶¶ 1-2; 28 U.S.C. § 1331. 28 U.S.C. § 1367
confers supplemental jurisdiction over Defendants’ third-party complaint, which is based on the

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United States District Court
Northern District of California

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same case or controversy between J & J and Defendants: Defendants claim that they would not

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have been liable to J & J for the unauthorized broadcast of the Program but for Continental’s

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alleged misrepresentations. See Third-Party Compl. ¶¶ 5-6; accord Anthony v. Equifax Info.

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Servs., LLC, No. 2:13-CV-01424-TLN, 2015 WL 502857, at *4 n.4 (E.D. Cal. Feb. 5, 2015).

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Although J & J’s claims—including the only federal claim in this action—have been dismissed,

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the Court may continue to exercise supplemental jurisdiction over the third-party complaint. The

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Court does so now, as dismissing the third-party claims would not further the objectives of

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“economy, convenience and fairness to the parties, and comity.” Trustees of Constr. Indus. &

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Laborers Health & Welfare Trust v. Desert Valley Landscape & Maint., Inc., 333 F.3d 923, 925

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(9th Cir. 2003). The Court has personal jurisdiction over the parties, as Continental is alleged to

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have its principal place of business in San Jose, California. Third-Party Compl. ¶ 4.

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Turning to the Eitel factors, denying default judgment would prejudice Defendants because

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they would be left without a remedy as a result of Continental’s refusal to litigate (first factor).

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Defendants have adequately alleged Continental’s intentional or negligent misrepresentations vis à

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vis Defendants’ ability to air the Program in their taqueria (second factor). Such allegations, when

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taken as true, establish Continental’s liability for the foreseeably resultant injury—Defendants’

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liability to another rights holder (J & J) for the unauthorized broadcast of the Program (third

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factor). See Def.’s Mot. 4-5. While the sum of money at stake is not trivial, Defendants are
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merely seeking to recover the amount that Continental’s misrepresentations caused and the

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reasonableness of this request weighs in favor of entering default judgment (fourth factor).

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Continental has been served with summons and has failed to respond. See Certificate of Service,

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ECF 42. There is therefore no dispute of material fact, nor evidence in the record to suggest that

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Continental’s default is a result of excusable neglect (fifth and sixth factors). As to the remaining

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factor, although federal policy favors decisions on the merits, Rule 55(b)(2) permits entry of

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default judgment in situations such as this where Continental refuses to litigate. J & J Sports

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Productions, Inc. v. Deleon, No. 5:13–CV–02030, 2014 WL 121711, at *2 (N.D. Cal. Jan. 13,

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2014). As such, all of the Eitel factors weigh in favor of entering default judgment.
Finally, Rule 54(c) provides that “[a] default judgment must not differ in kind from, or

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United States District Court
Northern District of California

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exceed in amount, what is demanded in the pleadings.” Here, Defendants have alleged in the

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third-party complaint that they seek judgment against Continental for, inter alia, “the amount of

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damages if they lose the claims asserted by [J & J].” Third-Party Compl. at 8 (Prayer for Relief).

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Defendants served the present motion and supporting papers—including a statement of damages

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sought—on Continental. See Defs.’ Mot. Certificate of Service, ECF 52-2. The amount that

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Defendants seek in the present motion, $3,000, is precisely the amount of damages incurred when

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they settled with J & J and is sufficiently established through documentary evidence. See

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Tartaglio Decl. ¶¶ 1-3. Continental has therefore had ample notice of the amount of damages at

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issue in this case, and default judgment may be entered for the full amount that Defendants seek.

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IV.

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ORDER
Based on the foregoing, Defendants’ Motion for Entry of Default Judgment is GRANTED.

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A separate default judgment shall be entered in Defendants’ favor for the amount of $3,000.00.

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The Clerk of the Court shall close the case file.

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IT IS SO ORDERED.
Dated: May 27, 2015
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BETH LABSON FREEMAN
United States District Judge

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