J & J Sports Productions, Inc. v. Rodriguez
Filing
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ORDER granting 16 Application for Default Judgment. The hearing scheduled for 5/19/2016 is VACATED and the Clerk shall close this file. Signed by Judge Edward J. Davila on 5/16/2016. (ejdlc1S, COURT STAFF) (Filed on 5/16/2016)
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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 SPORTS PRODUCTIONS, INC.,
Case No. 5:15-cv-04021-EJD
Plaintiff,
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ORDER GRANTING PLAINTIFF’S
APPLICATION FOR DEFAULT
JUDGMENT
v.
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LUIS GONZALEZ RODRIGUEZ,
Re: Dkt. No. 16
United States District Court
Northern District of California
Defendant.
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I.
INTRODUCTION
Plaintiff J & J Sports Productions, Inc. (“Plaintiff”) is an international distributor of sports
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and entertainment programming and secured the domestic commercial exhibition rights to
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broadcast and sublicense one particular program, namely “Mayhem: Floyd Mayweather, Jr. v.
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Marcos Rene Maidana, II WBC World Lightweight Championship Fight Program” (the “Event”),
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which was telecast nationwide on September 13, 2014. In this action, Plaintiff alleges that
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Defendant Luis Gonzalez Rodriguez illegally intercepted and broadcasted the Event at his
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restaurant, Los Jarritos.
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Federal jurisdiction arises pursuant to 28 U.S.C. § 1331 and personal jurisdiction arises
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from service on Defendant in California. Burnham v. Super. Ct., 495 U.S. 604, 610-11 (1990).
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Plaintiff filed the Complaint on September 2, 2015. Defendant failed to answer and his default
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was entered by the Clerk on February 1, 2016. Dkt. No. 15.
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Plaintiff’s now applies for entry of default judgment. Dkt. No. 16. The court finds this
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matter suitable for decision without oral argument pursuant to Civil Local Rule 7-1(b).
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Accordingly, the hearing scheduled for May 19, 2016, will be vacated. Plaintiff’s application will
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Case No.: 5:15-cv-04021-EJD
ORDER GRANTING PLAINTIFF’S APPLICATION FOR DEFAULT JUDGMENT
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be granted for the reasons explained below.
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II.
BACKGROUND
Plaintiff is in the business of marketing and licensing commercial exhibitions of pay-per-
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view prizefight events. Aff. of Joseph M. Gagliardi (“Gagliardi Aff.”), Dkt. No. 16, at ¶ 4.
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Plaintiff was licensed to exhibit the Event at closed circuit locations located in commercial
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establishments. Id. at ¶ 5. In order for commercial establishments to broadcast the Event, owners
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were required to enter into a sublicense agreement with Plaintiff and pay a fee calculated using the
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capacity of the establishment. Id. at ¶¶ 6, 8. The sublicense provided commercial establishments
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the ability to publicly exhibit the Event. Id. at ¶ 7.
On September 13, 2014, investigator Jeff Kaplan viewed a broadcast of the Event at Los
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United States District Court
Northern District of California
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Jarritos in San Jose, California. Aff. of Jeff Kaplan (“Kaplan Aff.”), Dkt. No. 16. Based on
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Kaplan’s observations, Plaintiff alleges that Defendant displayed the Event without obtaining the
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proper sublicense. Gagliardi Aff., at ¶ 9.
While he was at Los Jarritos, Kaplan observed one large screen in the back of the room
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displaying prefight interviews, highlights from the first fight between the main event boxers, and
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the start of the undercard fight. Plaintiff owned the rights to distribute those preliminary events.
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Gagliardi Decl., at ¶ 3. The establishment’s capacity was approximately 75 persons. Three
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separate headcounts - all of which apparently occurred in one minute or less at 6:04 p.m.1 - yielded
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10 persons each time.
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III.
LEGAL STANDARD
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Pursuant to Federal Rule of Civil Procedure 55(b), the 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 default judgment is a discretionary one.” Aldabe v. Aldabe, 616 F.2d
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1089, 1092 (9th Cir. 1980).
The Ninth Circuit has provided seven factors for consideration by the district court to
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In his affidavit, Kaplan states he both entered and left Los Jarritos at 6:04 p.m. on September 13,
2014.
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Case No.: 5:15-cv-04021-EJD
ORDER GRANTING PLAINTIFF’S APPLICATION FOR DEFAULT JUDGMENT
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determine whether to enter a default judgment, known commonly as the Eitel factors. They are:
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(1) the possibility of prejudice to the plaintiff; (2) the merits of plaintiff’s substantive claim; (3)
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the 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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Eitel v. McCool, 782 F.2d 1470, 1471-72 (9th Cir. 1986). When assessing these factors, all well-
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pled factual allegations in the complaint are taken 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).
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IV.
DISCUSSION
A.
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United States District Court
Northern District of California
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This court has previously found the Eitel factors weigh in favor of default judgment under
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The Eitel Factors
nearly identical circumstances. The result is the same in this case.
As to the first factor, denying Plaintiff’s application for default judgment would make little
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sense since Defendant has refused to respond to this action. The court would hear and review the
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same evidence it has before it now if Plaintiff was required to prove up its case at an uncontested
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trial. For that reason, Plaintiff would be prejudiced in the form of further delay and expense if the
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court were to deny the present application. This factor weighs in favor of default judgment.
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As to the second and third factors, Plaintiff’s substantive claims appear meritorious and the
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Complaint is sufficiently pled. Plaintiff has alleged that Defendant violated two sections of Title
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47 and the alleged activities of Defendants appear to have violated at least one of those sections.
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Additionally, Plaintiff has stated relevant laws pursuant to which the court may provide relief.
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These factors also weigh in favor of default judgment.
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As to the fourth factor, the sum of money at stake has yet to be determined but the
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damages cannot exceed the amounts specified in 47 U.S.C. § 553 (for reasons more fully
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explained below), and the maximum amount allowable for the tort of conversion. Accordingly,
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statutory damages cannot exceed $10,000 and enhanced damages may not exceed $50,000. See
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47 U.S.C. § 553(c)(3)(A)(ii), (B). Plaintiff is seeking $2,000 in damages for conversion, or the
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Case No.: 5:15-cv-04021-EJD
ORDER GRANTING PLAINTIFF’S APPLICATION FOR DEFAULT JUDGMENT
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amount Defendant would have been required to pay for the license. All things considered, the
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relatively small sum of damages weighs in favor of default judgment.
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As to the fifth factor, there is no dispute of material fact. Indications that there is a dispute
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of material fact can weigh against entry of default judgment. See Eitel, 782 F.2d at 1471-72. But
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here, Defendant has not disputed any of Plaintiff’s contentions since Defendant failed to respond
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to either the Complaint or this motion, and the material facts pled in the Complaint are supported
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or explained by affidavit or declaration.
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For the sixth factor, it is unlikely that default was the result of excusable neglect. This
action was filed approximately 8 months ago and the docket reveals that Defendant was properly
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noticed of this action through substitute service at the establishment. In addition, Defendant was
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United States District Court
Northern District of California
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served with a copy of the instant motion. Defendant failed to respond despite these notifications.
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This factor, therefore, weighs in favor of default judgment.
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Finally, the seventh factor weighs in favor of default judgment because “although federal
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policy favors decisions on the merits, Rule 55(b)(2) permits entry of default judgment in situations
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such as this where defendants refuse to litigate.” J & J Sports Prods, Inc. v. Concepcion, No. 10-
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CV-05092, 2011 U.S. Dist. LEXIS 60607, at *5, 2011 WL 2220101 (N.D. Cal. June 7, 2011).
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Thus, the general policy in favor of merits decisions is outweighed by the specific considerations
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made in this case. As such, this factor does not prevent entry of default judgment here.
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B.
Calculation of Damages
i.
Statutory Violation
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Plaintiff requests $10,000 in statutory damages as a result of an alleged violation of 47
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U.S.C. § 605(e)(3)(B)(iii), which prohibits any person from receiving or transmitting “wire or
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radio” signals except through authorized channels. 47 U.S.C. § 605(a). More specifically, the
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statute “‘prohibits commercial establishments from intercepting and broadcasting to its patrons
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satellite cable programming.’” J & J Sports Prods., Inc. v. Ro, No. 09-CV-02860, 2010 U.S. Dist.
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LEXIS 21425, at *7, 2010 WL 668065 (N.D. Cal. Feb. 19, 2010) (quoting J & J Sports Prods.,
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Inc. v. Guzman, No. 08-CV-05469, 2009 U.S. Dist. LEXIS 32273, at *5, 2009 WL 1034218 (N.D.
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ORDER GRANTING PLAINTIFF’S APPLICATION FOR DEFAULT JUDGMENT
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Cal. Apr. 16, 2009)). The statute provides for statutory damages ranging from $1,000 to $10,000
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for each violation. 47 U.S.C. § 605(e)(3)(C)(i)(II).
Plaintiff also mentions another potential basis for relief - 47 U.S.C. § 553(c)(3)(A)(ii) - but
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does not directly request damages under that statute. Plaintiff did, however, allege that Defendant
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violated that statute in the Complaint. Section 553 proscribes “a person from ‘intercepting or
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receiving or assisting in intercepting or receiving any communications service offered over a cable
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system.’” Ro, 2010 U.S. Dist. LEXIS 21425, at *8 (quoting J & J Sports Prods, Inc., v. Manzano,
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2008 U.S. Dist. LEXIS 84931, at *5, 2008 WL 4542962 (N.D. Cal. Sept. 29, 2008)). In essence, §
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553 prohibits “both illegally receiving cable programming and helping others to illegally receive
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cable programming.” Manzano, 2008 U.S. Dist. LEXIS 84931, at *5. Statutory damages under
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United States District Court
Northern District of California
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Section 553 range from $250 to a maximum of $10,000, “as the court considers just.” 47 U.S.C. §
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553(c)(3)(A)(ii).
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Sections 605 and 553 are not coextensive because each section prohibits a distinct method
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of interception. Indeed, “[a] signal pirate violates section 553 if he intercepts a cable signal, he
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violates section 605 if he intercepts a satellite broadcast.” Ro, 2010 U.S. Dist. LEXIS 21425, at
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*8. “But he cannot violate both by a single act of interception.” Id. at *8.
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Here, Plaintiff admits that Kaplan was unable to determine the exact means used by
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Defendant to intercept the Event. In fact, Kaplan makes no comment on the actual means of
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interception in his affidavit. Under circumstances such as these, this court has found § 553 a more
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appropriate basis for the calculation of damages. See Joe Hand Promotions, Inc. v. Lorenzana,
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No. 5:13-cv-05925 EJD, 2014 U.S. Dist. LEXIS 110784, at *8-9, 2014 WL 3965097 (N.D. Cal.
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Aug. 11, 2014); see also J & J Sports Prods. v. Ocampo, No. 5:15-cv-00982-EJD, 2015 U.S. Dist.
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LEXIS 126100, at *8 (N.D. Cal. Sept. 20, 2015). This is because a satellite dish, which requires
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an unobstructed view of the sky, is not easily hidden. A cable box, on the other hand, is easily
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hidden. On this showing, the court concludes that Defendant must have intercepted the program
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via a cable signal in violation of § 553 and not § 605.
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Consistent with its prior orders on this topic, the court awards Plaintiff $250 in statutory
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Case No.: 5:15-cv-04021-EJD
ORDER GRANTING PLAINTIFF’S APPLICATION FOR DEFAULT JUDGMENT
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damages under § 553. This amount is especially appropriate here because Plaintiff did little if
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anything to develop the record. Since he visited Los Jarritos for one minute or less during the
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broadcast of the Event, it is understandable why Plaintiff’s investigator failed to determine the one
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critical fact that separates a § 553 violation from a § 605 violation. Only the minimum amount of
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statutory damages is justified on this record.
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As to Plaintiff’s request under § 553(c)(3)(B), enhanced damages of no more than $50,000
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may be warranted if the court finds “that the violation was committed willfully and for purposes of
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commercial advantage or private financial gain.” The Ninth Circuit has not set forth controlling
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factors for the determination of when enhanced damages are appropriate in this context, but
various factors specific to this unique line of cases have been considered by district courts. These
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United States District Court
Northern District of California
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include the “use of cover charge, increase in food price during programming, presence of
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advertisement, number of patrons, number of televisions used, and impact of the offender’s
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conduct on the claimant.” Concepcion, 2011 U.S. Dist. LEXIS 60607, at *10. Enhanced damages
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have also been awarded when the defendant has violated sections 605 or 553 on previous
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occasions. See J & J Sports Prods., Inc. v. Paniagua, No. 10-CV-05141-LHK, 2011 U.S. Dist.
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LEXIS 33940, at *5-6, 2011 WL 996257 (N.D. Cal. Mar 21, 2011).
In this case, Plaintiff admits there are “no egregious circumstances” to support a sizeable
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award of enhanced damages. Defendant did not charge a cover to patrons nor is there any
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evidence that Defendant increased prices or required food or drink purchases during the Event.
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The number of patrons in Los Jarritos during Kaplan’s minute-long investigation was only 10.
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Since there is no evidence that Defendant broadcast the program for any particular commercial
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advantage or private financial gain, Plaintiff is entitled to $2,200 in enhanced damages, which
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represents the value of the commercial license to air the program.2 This amount properly accounts
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for the broadcast’s impact on Plaintiff and is sufficient deter future conduct by Defendant and
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Although Gagliardi states in his affidavit that the cost to purchase a license would have been
$2,000 for an establishment with Los Jarritos’ capacity, the rate card indicates it actually would
have been $2,200. Gagliardi Aff., at Ex. 2.
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Case No.: 5:15-cv-04021-EJD
ORDER GRANTING PLAINTIFF’S APPLICATION FOR DEFAULT JUDGMENT
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other similarly-situated establishments.
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C.
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Plaintiff requests damages for the tort of conversion in the amount Defendant would have
Conversion
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been required to pay for a license, which as noted is $2,200. See Cal. Civ. Code § 3336. “The
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elements of conversion are: 1) ownership of a right to possession of property; 2) wrongful
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dissolution of the property right of another; and 3) damages.” Paniagua, 2011 U.S. Dist. LEXIS
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33940, at *6. Damages for conversion are “based on the value of the property at the time of the
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conversion.” Id.
Here, Plaintiff has shown that it owns the right to distribute the Event and has properly
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alleged the misappropriation of the right to distribute the program. As to damages, the “value of
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United States District Court
Northern District of California
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the property” was the value of the commercial license, or $2,200. Accordingly, the court awards
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Plaintiff $2,200 in damages for conversion.
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V.
ORDER
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Based on the foregoing, Plaintiff’s application for default judgment is GRANTED.
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Judgment shall be entered in favor of Plaintiff and against Defendant in the amount of $4,650.00
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in total damages.
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The hearing scheduled for May 19, 2016, is VACATED and the Clerk shall close this file.
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IT IS SO ORDERED.
Dated: May 16, 2016
______________________________________
EDWARD J. DAVILA
United States District Judge
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Case No.: 5:15-cv-04021-EJD
ORDER GRANTING PLAINTIFF’S APPLICATION FOR DEFAULT JUDGMENT
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