DISH Network L.L.C. et al v. Silva
Filing
19
ORDER by Judge Lucy H. Koh granting 14 Motion for Default Judgment. (lhklc4S, COURT STAFF) (Filed on 5/12/2015) **The Clerk shall enter judgment against Silva in accordance with this order. The clerk shall close the case file.** Modified on 5/12/2015 (sms, COURT STAFF).
1
2
3
4
5
6
7
8
UNITED STATES DISTRICT COURT
9
NORTHERN DISTRICT OF CALIFORNIA
10
SAN JOSE DIVISION
United States District Court
Northern District of California
11
12
DISH NETWORK L.L.C., et al.,
Plaintiffs,
13
ORDER GRANTING PLAINTIFFS'
MOTION FOR DEFAULT JUDGMENT
v.
14
15
Case No. 14-CV-04848-LHK
Re: Dkt. No. 14
JUAN SILVA,
16
Defendant.
17
Plaintiffs Dish Network LLC, EchoStar Technologies LLC, and NagraStar LLC
18
19
(collectively, “Plaintiffs”) move for default judgment against Defendant Juan Silva (“Silva”).
20
ECF No. 14 (“Mot.”). Pursuant to Civil Local Rule 7-1(b), the Court finds this matter appropriate
21
for resolution without oral argument and therefore VACATES the hearing set for May 14, 2015.
22
For the reasons set forth below, Plaintiffs’ motion is GRANTED.
23
I.
24
BACKGROUND
A. Factual Background
25
1. Plaintiffs’ Satellite Television Programming
26
Plaintiff Dish Network LLC (“Dish Network”) is a multi-channel video provider that
27
28
delivers video, audio, and data services to approximately 14 million customers throughout the
1
Case No. 14-CV-04848-LHK
ORDER GRANTING PLAINTIFFS' MOTION FOR DEFAULT JUDGMENT
1
United States, Puerto Rico, and the U.S. Virgin Islands through a direct broadcast satellite system.
2
ECF No. 1 (“Compl.”) ¶ 10. Dish Network uses high-powered satellites to broadcast movies,
3
sports, and general entertainment services to consumers who have been authorized to receive these
4
services after payment of a subscription fee. Id. ¶ 11. Dish Network purchases distribution rights
5
for the content it broadcasts from providers such as network affiliates, motion picture distributors,
6
sports leagues, etc. Id. ¶ 12. The content distributed by Dish Network is copyrighted, and Dish
7
Network is required by the copyright holders to protect the works from unauthorized distribution.
8
Id. ¶ 13. Thus, Dish Network broadcasts television programming in an encrypted, or scrambled,
9
format to limit its distribution only to those authorized to receive the copyrighted programming.
10
United States District Court
Northern District of California
11
Id. ¶ 17-19.
Plaintiff EchoStar Technologies LLC (“EchoStar”) provides set-top box receivers, satellite
12
dish antennas, and other digital equipment for the Dish Network system. Id. ¶ 15. Plaintiff
13
NagraStar LLC (“NagraStar”) provides smart cards and other proprietary security technologies for
14
use in conjunction with EchoStar’s receivers. Id. The security technologies provided by
15
NagraStar form a conditional access system for the Dish Network system. Id. Specifically, each
16
receiver and smart card is assigned a unique serial number that is used by Dish Network when
17
activating the equipment. Id. ¶ 16. These unique serial numbers allow Dish Network to ensure
18
that the equipment only decrypts programming and services that the customer is authorized to
19
receive as part of their subscription package. Id. Dish Network is therefore able to “turn on” and
20
“turn off” programming a customer has ordered, cancelled, or changed. Id. ¶ 17. Dish Network is
21
also able to control which users are able to descramble the programming and services broadcast
22
via Dish Network’s broadcast satellite system. Id. Together, the EchoStar receiver and NagraStar
23
smart card convert Dish Network’s encrypted satellite signal into viewable programming that can
24
be displayed on a television of an authorized viewer. Id. ¶ 19.
25
2. Piracy of Dish Network Programming
26
Over the years, many devices and methods have been used by individuals to illegally
27
28
decrypt, or “pirate,” television programming. Id. ¶¶ 20-25. The black market in piracy devices
2
Case No. 14-CV-04848-LHK
ORDER GRANTING PLAINTIFFS' MOTION FOR DEFAULT JUDGMENT
1
represents a multimillion dollar industry in the United States. Id. ¶ 20. One method of pirating
2
network programming involves Internet key sharing, or “IKS.” Id. ¶ 22. At a high level, IKS
3
allows users to share the “control words” generated by authorized smart cards which are in turn
4
used by a receiver to decrypt Dish Network’s satellite signals. See id. ¶¶ 23-25. With IKS,
5
therefore, unauthorized users are able to decrypt Dish Network’s encrypted satellite signal and
6
view programming without paying a subscription fee to Dish Network. Id. ¶ 24-25.
7
A service called NFusion Private Server (“NFPS”) is a subscription-based IKS service. Id.
8
¶ 25. Members of this service pay an access fee and are able to obtain, over the internet, the
9
control words necessary to decrypt Dish Network’s satellite signal. Id. Francis Philip (“Philip”),
known as “Vgiddy,” sold subscriptions to NFPS. Id. ¶ 26. In exchange for a fee, Philip would
11
United States District Court
Northern District of California
10
provide a NFPS subscriber with a passcode to a server whereby the NFPS subscriber could obtain
12
the proprietary control words to decrypt Dish Network’s programming. Id. ¶ 25. Dish Network
13
acquired Philip’s business records. Id. ¶ 26.
14
3. Silva’s Conduct
15
According to Philip’s records, Silva purchased multiple subscriptions to NFPS between
16
March and June 2012, and again in March 2013. Id. ¶ 26. Silva used an unauthorized receiver
17
loaded with piracy software to access the NFPS service. Id. ¶ 27. Accordingly, each time Silva’s
18
unauthorized receiver was tuned to an encrypted Dish Network channel, Silva’s receiver would
19
retrieve the control word for that channel from the NFPS service. Id. Using this received control
20
word, Silva’s receiver could then decrypt Dish Network’s encrypted satellite signal. Id. Once
21
decrypted, Silva could then view Dish Network programming without having to purchase a
22
subscription from Dish Network. Id.
23
Philip’s records also link Silva to certain posts made on an internet forum. Mot. at 7.
24
These posts reveal that Silva used two receivers in connection with the NFPS service and that his
25
NFPS service was “working fine” and that he was able to watch “one or 2 movies all the time.”
26
Id. at 7-8. Additional posts suggest that Silva had previously been able to watch Ultimate Fighting
27
Championship events using this NFPS service. Id.
28
3
Case No. 14-CV-04848-LHK
ORDER GRANTING PLAINTIFFS' MOTION FOR DEFAULT JUDGMENT
B. Procedural History
1
On October 31, 2014, Plaintiffs filed their complaint in the instant litigation alleging that
2
3
4
5
6
7
8
9
10
United States District Court
Northern District of California
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
Silva’s conduct violated the Digital Millennium Copyright Act, Federal Communications Act, and
Electronic Communications Privacy Act. Compl. ¶¶ 29-41. Silva was personally served on
November 25, 2014 at 4:44 pm. ECF No. 11. Silva’s answer was therefore due twenty-one days
later, on December 16, 2014. Fed. R. Civ. P. 12(a)(1)(A)(i). Silva did not file an answer. On
January 6, 2015, Plaintiffs filed a motion requesting that the clerk enter default. ECF No. 12. The
clerk entered default on January 14, 2015. ECF No. 13. On January 27, 2015, Plaintiffs filed the
instant Motion for Default Judgment on Plaintiffs’ third cause of action, alleging that Silva’s
conduct violated the Electronic Communications Privacy Act, 18 U.S.C. §§ 2511(1)(a), 2520
(”ECPA”). ECF No. 14.
II.
LEGAL STANDARD
Pursuant to Rule 55(b)(2), the court may enter a default judgment when the clerk, under
Rule 55(a), has previously entered the party’s default. Fed. R. Civ. P. 55(b). “The district court’s
decision whether to enter a default judgment is a discretionary one.” Aldabe v. Aldabe, 616 F.2d
1089, 1092 (9th Cir. 1980). Once the Clerk of Court enters default, all well-pleaded allegations
regarding liability are taken as true, except with respect to damages. See Fair Hous. of Marin v.
Combs, 285 F.3d 899, 906 (9th Cir.2002); TeleVideo Sys. v. Heidenthal, 826 F.2d 915, 917–18
(9th Cir. 1987); Philip Morris USA v. Castworld Prods., 219 F.R.D. 494, 499 (C.D. Cal. 2003)
(“[B]y defaulting, Defendant is deemed to have admitted the truth of Plaintiff’s averments.”). “In
applying this discretionary standard, default judgments are more often granted than denied.”
Philip Morris, 219 F.R.D. at 498 (quotation omitted).
“Factors which may be considered by courts in exercising discretion as to the entry of a
default judgment include: (1) the possibility of prejudice to the plaintiff, (2) the merits of
plaintiff’s substantive claim, (3) the sufficiency of the complaint, (4) the sum of money at stake in
the action; (5) the possibility of a dispute concerning material facts; (6) whether the default was
due to excusable neglect, and (7) the strong policy underlying the Federal Rules of Civil
4
Case No. 14-CV-04848-LHK
ORDER GRANTING PLAINTIFFS' MOTION FOR DEFAULT JUDGMENT
1
Procedure favoring decisions on the merits.” Eitel v. McCool, 782 F.2d 1470, 1471–72 (9th Cir.
2
1986).
3
“When entry of judgment is sought against a party who has failed to plead or otherwise
4
defend, a district court has an affirmative duty to look into its jurisdiction over both the subject
5
matter and the parties. A judgment entered without personal jurisdiction over the parties is void.”
6
In re Tuli, 172 F.3d 707, 712 (9th Cir. 1999) (citations omitted).
7
III.
8
9
10
DISCUSSION
A. Jurisdiction
1. Subject Matter Jurisdiction
This Court has subject matter jurisdiction over Plaintiffs’ claim under the Electronic
United States District Court
Northern District of California
11
Communications Privacy Act, 18 U.S.C. § 2511 et seq. because the statute provides a civil cause
12
of action for any person whose “electronic communication is intercepted” and presents an issue of
13
federal law. 18 U.S.C. § 2520 (“[A]ny person whose wire, oral, or electronic communication is
14
intercepted, disclosed, or intentionally used in violation of this chapter may in a civil action
15
recover from the person or entity . . . which engaged in that violation such relief as may be
16
appropriate.”); 28 U.S.C. § 1331 (“The district courts shall have original jurisdiction of all civil
17
actions arising under the . . . laws . . . of the United States.”).
18
2. Personal Jurisdiction
19
There is no applicable federal statute governing personal jurisdiction in this case.
20
Therefore, California state law applies. Panavision Int’l v. Toeppen, 141 F.3d 1316, 1320 (9th Cir.
21
1998) (citing Core–Vent Corp. v. Nobel Indus. AB, 11 F.3d 1482, 1484 (9th Cir. 1993)).
22
California courts “may exercise jurisdiction on any basis not inconsistent with the Constitution of
23
this state or of the United States.” Cal. Civ. Proc. Code § 410.10. Accordingly, as long as the
24
requirements of the Due Process Clause of the United States Constitution are satisfied, this Court’s
25
exercise of personal jurisdiction over Silva is proper. See Panavision, 141 F.3d at 1320. “Due
26
process requires that a defendant have minimum contacts with the forum ‘such that the
27
maintenance of the suit does not offend traditional notions of fair play and substantial justice.’”
28
5
Case No. 14-CV-04848-LHK
ORDER GRANTING PLAINTIFFS' MOTION FOR DEFAULT JUDGMENT
1
Brainerd v. Governors of the Univ. of Alberta, 873 F.2d 1257, 1259 (9th Cir. 1989) (quoting Int’l
2
Shoe Co. v. Washington, 326 U.S. 310, 316 (1945)). “Personal jurisdiction may be founded on
3
either general jurisdiction or specific jurisdiction.” Panavision, 141 F.3d at 1320.
4
The Supreme Court recently stated that “[f]or an individual, the paradigm forum for the
5
exercise of general jurisdiction is the individual’s domicile.” Goodyear Dunlop Tires Operations
6
v. Brown, 131 S.Ct. 2846, 2853 (2011). The Court concludes that the Complaint adequately
7
alleges that Silva is domiciled in California. Specifically, Plaintiffs allege in the Complaint that
8
Silva “resides in and regularly conducts business in the State of California” and that Silva “is an
9
individual that resides at 1130 Kimberly Ct., Hollister, California 95023.” Compl. ¶¶ 2, 8.
Moreover, Silva was personally served at this address on November 25, 2014, at 4:44 p.m. ECF
11
United States District Court
Northern District of California
10
No. 11. Accordingly, the Court concludes that general jurisdiction over Silva is proper.
12
B. Plaintiffs’ Claim for Damages
13
Upon review of Plaintiffs’ Complaint, Motion for Default Judgment, and supporting
14
papers, the Court concludes that Plaintiffs have sufficiently alleged violations of the ECPA, and is
15
entitled to monetary and injunctive relief for the reasons stated below. Accordingly, factors two
16
through four of Eitel—the substantive merits of plaintiffs’ claim, the sufficiency of the complaint,
17
and the amount of money at stake—favor entry of default judgment. See Eitel, 782 F.2d at 1471.
18
Plaintiffs adequately plead a claim for relief under the ECPA, specifically under 18 U.S.C.
19
§ 2511(1)(a). The ECPA makes it unlawful to “intentionally intercept” an “electronic
20
communication,” such as an encrypted satellite broadcast of television programming. See id.; see
21
also § 2510(12). According to the complaint, Silva purchased multiple subscriptions to the NFPS
22
service. Compl. ¶ 26. Silva accessed the NFPS service by using an unauthorized receiver loaded
23
with piracy-enabling software. Id. ¶ 27. Each time Silva tuned his receiver to an encrypted Dish
24
Network channel, the control word for that specific channel was requested from the NFPS server.
25
Id. In response, the NFPS server returned the control word to Silva’s receiver, which used the
26
control word to decrypt Dish Network’s encrypted satellite signal, permitting Silva the ability to
27
view Dish Network’s programming without authorization. Id. Silva’s interception was the
28
6
Case No. 14-CV-04848-LHK
ORDER GRANTING PLAINTIFFS' MOTION FOR DEFAULT JUDGMENT
1
product of several deliberate acts directed at exploiting the NFPS service, and therefore was
2
intentional and not inadvertent. Id. at ¶¶ 26-28, 39-41.
3
Plaintiffs seek statutory damages of $10,000 pursuant to 18 U.S.C. § 2520(c)(2). Under
4
this section, Plaintiffs may recover the greater of either (a) actual damages, (b) statutory damages
5
of $100 per day for each day of violation, or (c) statutory damages of $10,000. Id. Because Silva
6
has defaulted and not participated in this litigation, Plaintiffs are unable to establish either (a)
7
actual damages or (b) the number of days that Silva was in violation of the ECPA. Accordingly,
8
Plaintiffs seek to recover statutory damages of $10,000 pursuant to 18 U.S.C. § 2520(c)(2)(B)
9
(“the court may assess as damages . . . statutory damages of . . . $10,000.”). “Because Congress
has expressly authorized a court to award damages of $10,000, the Court cannot conclude that this
11
United States District Court
Northern District of California
10
amount is per se unreasonable such that it would preclude or weigh against the entry of default
12
judgment. This factor weighs in favor of default judgment.” Dish Network LLC v. Gonzalez, No.
13
13-cv-107-LJO-SKO, 2013 WL 2991040, at *4 (E.D. Cal. June 14, 2013). Accordingly, the Court
14
awards Plaintiffs statutory damages of $10,000.
15
C. Plaintiffs’ Claim for Injunctive Relief
16
Plaintiffs also seek permanent injunctive relief pursuant to 18 U.S.C. § 2520(b)(1). Under
17
the ECPA, the Court may award “such preliminary and other equitable or declaratory relief as may
18
be appropriate.” Id. The Supreme Court has held that a permanent injunction is warranted where
19
the plaintiff shows: “(1) that it has suffered an irreparable injury; (2) that remedies available at
20
law, such as monetary damages, are inadequate to compensate for that injury; (3) that, considering
21
the balance of the hardships between the plaintiff and defendant, a remedy in equity is warranted;
22
and (4) that the public interest would not be disserved by a permanent injunction.” eBay Inc. v.
23
MercExchange, LLC, 547 U.S. 388, 391 (2006). For the reasons stated in Plaintiffs’ Motion, the
24
Court agrees that Plaintiffs are entitled to permanent injunctive relief.
25
26
Plaintiffs seek to enjoin “Defendant, and anyone acting in active concert or participation
with Defendant” from:
27
28
7
Case No. 14-CV-04848-LHK
ORDER GRANTING PLAINTIFFS' MOTION FOR DEFAULT JUDGMENT
A. circumventing or assisting others to circumvent DISH Network’s
security system, or otherwise intercepting or assisting others to
intercept DISH Network’s satellite signal;
1
2
B. testing, analyzing, reverse engineering, manipulating, or
extracting codes, data, or information from DISH Network’s
satellite receivers, smart cards, satellite data stream, or any other
part or component of the DISH Network security system.
3
4
5
ECF No. 14-7 at 3. The Court concludes that the terms of the permanent injunction, as proposed
6
by Plaintiffs, are sufficiently precise and that the scope of the injunction is adequately tailored “to
7
restrain acts which are of the same type or class as unlawful acts which the court has found to have
8
been committed or whose commission in the future, unless enjoined, may be fairly anticipated
9
from the defendant’s conduct in the past.” Orantes-Hernandez v. Thornburgh, 919 F.2d 549, 564
10
(9th Cir. 1990). Accordingly, Plaintiffs’ request for permanent injunctive relief is granted.
United States District Court
Northern District of California
11
D. Remaining Eitel Factors
12
The Court concludes that the remaining enumerated Eitel factors are consistent with entry
13
of default judgment in this case. Regarding the possibility of a dispute concerning material facts
14
(factor 5), the alleged facts are readily verifiable through records, and there is a low likelihood that
15
Silva could successfully contest them. See also TeleVideo, 826 F.2d at 917-18 (“The general rule
16
of law is that upon default the factual allegations of the complaint, except those relating to the
17
amount of damages, will be taken as true.” (citation omitted)). As to whether default was due to
18
excusable neglect (factor 6), Plaintiffs provided sufficient proof of service, see ECF No. 11, Silva
19
never responded or filed any papers, and no circumstances indicate excusable neglect by Silva.
20
Finally, regarding the possibility of prejudice to Plaintiffs and public policy concerns (factors 1
21
and 7), adjudication on the merits is not possible because Silva has not participated in this case,
22
and Plaintiffs may have no recourse if default is denied. Accordingly, no relevant factors preclude
23
default judgment in this situation.
24
IV.
25
26
27
28
CONCLUSION
For the foregoing reasons, Plaintiffs’ motion for default judgment is GRANTED. The
Clerk shall enter judgment against Silva in accordance with this order, specifically:
$10,000 statutory damages for violations of 18 U.S.C. §§ 2155(1)(a) and 2520(a), and
8
Case No. 14-CV-04848-LHK
ORDER GRANTING PLAINTIFFS' MOTION FOR DEFAULT JUDGMENT
1
immediate permanent injunctive relief enjoining Mr. Juan Silva, and anyone acting in
2
active concert or participation with, or at the direction or control of Mr. Silva, from (1)
3
circumventing or assisting others to circumvent DISH Network’s security system, or
4
otherwise intercepting or assisting others to intercept DISH Network’s satellite signal
5
and (2) testing, analyzing, reverse engineering, manipulating, or extracting codes, data,
6
or information from DISH Network’s satellite receivers, smart cards, satellite data
7
stream, or any other part or component of the DISH Network security system.
8
The Court retains jurisdiction over this action for two years for the purpose of enforcing this final
9
judgment and permanent injunction. The clerk shall close the case file.
10
IT IS SO ORDERED.
United States District Court
Northern District of California
11
12
13
Dated: May 12, 2015
_________________________________
LUCY H. KOH
United States District Judge
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
9
Case No. 14-CV-04848-LHK
ORDER GRANTING PLAINTIFFS' MOTION FOR DEFAULT JUDGMENT
Disclaimer: Justia Dockets & Filings provides public litigation records from the federal appellate and district courts. These filings and docket sheets should not be considered findings of fact or liability, nor do they necessarily reflect the view of Justia.
Why Is My Information Online?