G & G Closed Circuit Events, LLC v. Macias et al

Filing 17

ORDER denying 15 Motion for Default Judgment. Case Management Statement due by 3/2/2021. Initial Case Management Conference set for 3/9/2021 09:30 AM. Signed by Judge Susan van Keulen on 11/19/2020. (svklc1S, COURT STAFF) (Filed on 11/19/2020)

Case 5:20-cv-02916-SVK Document 17 Filed 11/19/20 Page 1 of 6

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UNITED STATES DISTRICT COURT

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NORTHERN DISTRICT OF CALIFORNIA

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G & G CLOSED CIRCUIT EVENTS, LLC,
Plaintiff,

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v.

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Case No. 20-cv-02916-SVK
ORDER DENYING PLAINTIFF'S
MOTION FOR DEFAULT JUDGMENT
Re: Dkt. No. 15

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RAMON MACIAS, et al.,

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Defendants.
The Clerk of Court entered default against Defendants Ramon Macias, individually and

United States District Court
Northern District of California

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d/b/a Los Compadres Bar & Grill and Los Compadres Bar & Grill, Inc., an unknown business

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entity d/b/a Los Compadres Bar & Grill (collectively, “Defendants”), after Defendants failed to

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appear or otherwise respond to the Summons and Complaint within the time prescribed by the

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Federal Rules of Civil Procedure. Dkt. 14. Before the Court is Plaintiff G&G Closed Circuit

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Events, LLC’s motion for default judgment. Dkt. 15. Defendants, not having appeared in this

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action to date, have not opposed the motion. Pursuant to Civil Local Rule 7-1(b), the Court finds

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this matter for suitable for resolution without oral argument.
For the reasons that follow, the Court DENIES Plaintiff’s motion for default judgment,

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without prejudice to Plaintiff filing an amended complaint and/or renewed motion for default

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judgment if it has additional evidence regarding Defendants’ unlawful exhibition of the closed-

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circuit program at issue in this case.

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I.

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BACKGROUND
Plaintiff is a commercial distributor and licensor of closed-circuit sports and entertainment

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programming. Dkt. 1 (Complaint) ¶ 21; Dkt. 15-2 (Gagliardi Decl.) ¶ 3. Plaintiff alleges that it

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owns exclusive nationwide commercial distribution (closed-circuit) rights to the Saul “Canelo”

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Alvarez v. Daniel Jacobs WBA/WBC/IBF Middleweight Championship Fight Program on May 4,
2019, including all under-card bouts and fight commentary (collectively, the “Program”). Dkt. 1

Case 5:20-cv-02916-SVK Document 17 Filed 11/19/20 Page 2 of 6

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¶ 18; Dkt. 15-2 ¶¶ 3-4 and Ex. 1. Plaintiff then sublicensed the right to publicly exhibit the

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Program to various commercial entities throughout California and North America. Dkt. 1 ¶ 19;

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Dkt. 15-2 ¶ 3.
Plaintiff alleges that Defendants unlawfully intercepted and exhibited the Program at their

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commercial establishment, Los Compadres Bar & Grill, located at 4126 Monterey Road, San Jose,

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California 95111. Dkt. 1 ¶¶ 12, 23-24; Dkt. 15-2 ¶¶ 3, 7, 9-11.
On April 28, 2020, Plaintiff filed this action for violation of 47 U.S.C. §§ 553 and 605,

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conversion, and violation of California Business and Professions Code §§ 17200 et seq. Dkt. 1. In

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the present motion for default judgment, however, Plaintiff seeks damages only under 47 U.S.C.
§ 605 and for conversion. Dkt. 15-1 at 5.

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United States District Court
Northern District of California

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II.

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LEGAL STANDARD
After entry of default, a court may, in its discretion, enter default judgment. See Fed. R.

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Civ. P. 55; Aldabe v. Aldabe, 616 F.2d 1089, 1092 (9th Cir. 1980). Before entering default

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judgment, the Court must assess the adequacy of the service of process on the party against whom

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default is requested. See Trustees of ILWU-PMA Pension Plan v. Coates, No. C-11-3998 EMC,

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2013 WL 556800, at *4 (N.D. Cal. Feb. 12, 2013). The Court must also determine whether it has

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subject matter jurisdiction over the action and personal jurisdiction over the defaulted defendant.

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Id. at *3-4.

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If the Court concludes that the defaulted defendant was properly served and that the Court

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has jurisdiction, the Court must next consider whether default judgment is appropriate,

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considering seven factors set forth by the Ninth Circuit: (1) the possibility of prejudice to the

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plaintiff; (2) the merits of plaintiff’s substantive claims; (3) the sufficiency of the complaint;

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(4) the sum of money at stake in the action; (5) the possibility of dispute concerning material facts;

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(6) whether default was due to excusable neglect; and (7) the strong policy under the Federal

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Rules of Civil Procedure favoring decisions on the merits. Eitel v. McCool, 782 F.2d 1470,

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1471-72 (9th Cir. 1986). In considering these factors, the Court takes all well-pleaded factual

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allegations in the complaint as true, except those concerning damages. Televideo Sys., Inc. v.

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Heidenthal, 826 F.2d 915, 917-18 (9th Cir. 1987).
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Case 5:20-cv-02916-SVK Document 17 Filed 11/19/20 Page 3 of 6

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III.

REQUEST FOR JUDICIAL NOTICE
Included in Plaintiff’s motion for default judgment is a request that the Court take judicial

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notice of the following documents: (1) a copy of the liquor license for Los Compadres Bar &
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Grill Inc., obtained from the California Department of Alcoholic Beverage Control website;
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(2) the Business Entity Detail for Los Compadres Bar & Grill Inc., obtained from the California
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Secretary of State website; and (3) the Statement of Information for Los Compadres Bar & Grill
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Inc., obtained from the California Secretary of State website. Dkt. 15-3 at ¶¶ 10-12 and Exs. 1-3.
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A court may take judicial notice of such public records because they are capable of accurate and
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ready determination by resort to sources whose accuracy cannot reasonably be questioned. Fed.
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R. Ev. 201(b)(2); see also J&J Sports Productions, Inc. v. Mendoza-Lopez, No. 17-cv-06421-YGR
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(JSC), 2018 WL 4676903, at *1 n.1 (N.D. Cal. Mar. 29, 2018). Accordingly, the Court takes
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United States District Court
Northern District of California

judicial notice of the Exhibits 1-3 to the Declaration of Thomas P. Riley (Dkt. 15-3) submitted in
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support of Plaintiff’s motion for default judgment.

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IV.

DISCUSSION
A.

Service and Jurisdiction

Plaintiff filed proofs of service of the Summons and Complaint on Defendant Ramon
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Macias, both personally and as agent for service of process for Defendant Los Compadres Bar &
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Grill, Inc. Dkt. 10-11. A sworn proof of service constitutes “prima facie evidence of valid service
which can be overcome only by strong and convincing evidence.” Securities & Exchg. Comm’n v.

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Internet Solutions for Business, Inc., 509 F.3d 1161, 1166 (9th Cir. 2007). Accordingly, based on
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the sworn proofs of service filed by Plaintiff, the Court concludes that service was proper.
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The Court has subject matter jurisdiction over this matter because federal statutes are at
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issue, and the Court can exercise supplemental jurisdiction over the state law claims. 28 U.S.C.
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§§ 1331, 1367. The requirement of personal jurisdiction is also satisfied because Defendants were
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served, reside, and do business in California. See J. McIntyre Machinery, Ltd. v. Nicastro, 564
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U.S. 873, 880-81 (2011).
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Having concluded that the threshold requirements of service and jurisdiction are met, the
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Court proceeds to review the substance of Plaintiff’s motion for default judgment.

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Case 5:20-cv-02916-SVK Document 17 Filed 11/19/20 Page 4 of 6

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B.

Eitel Factors

Upon consideration of the Eitel factors, the Court concludes that entry of default judgment
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is not appropriate based on the record currently before the Court. In its motion for default
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judgment, Plaintiff seeks damages on its claim for violation of 47 U.S.C. § 605(a), which provides
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that “no person receiving, assisting in receiving, transmitting, or assisting in transmitting, any

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interstate or foreign communication by wire or radio shall divulge or publish the existence,
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contents, substance, purport, effect, or meaning thereof, except through authorized channels of
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transmission or reception.” Plaintiff also seeks damages for conversion, which requires Plaintiff
to show: (1) Plaintiff’s ownership or right to possession of the property at the time of the
conversion; (2) Defendants’ conversion by a wrongful act or disposition of property rights; and

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(3) damages. Spates v. Dameron Hosp. Assn., 114 Cal. App. 4th 208, 221 (2003).
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United States District Court
Northern District of California

The complaint alleges with respect to the claim for violation of section 605 that on May 4,
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2019, “Defendants intercepted, received, and published the Program at Los Compadres Bar &
Grill” and “divulged and published said communication, or assisted or permitted in divulging and
publishing said communication to patrons within Los Compadres Bar & Grill.” Dkt. 1 ¶ 23; see
also id. ¶¶ 12, 24. Plaintiff’s claim for conversion alleges that “[b]y their aforesaid acts of

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interception, reception, publication, divulgence, display, and/or exhibition of the Program at their
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commercial establishment at the above-captioned address, the aforementioned Defendants,
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tortuously obtained possession of the Program and wrongfully converted the same for their own
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use and benefit.” Id. ¶ 37.

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Although the Court must accept all well-pleaded allegations regarding liability as true, the
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allegations Plaintiff relies on to establish liability merely “parrot[] the statute’s language” or are
“little more than broadly stated, copy-past legal conclusions” and thus are not entitled to a

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presumption of truth. J&J Sports Productions, Inc. v. Crawford, No. 16-cv-01744-RS, 2016 WL
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5942231, at *1 (N.D. Cal. Oct. 13, 2016).
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The affidavit of Plaintiff’s investigator, John Poblete, submitted in support of Plaintiff’s
motion for default judgment fails to supply the information missing from Plaintiff’s complaint.

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Mr. Poblete states that he visited Los Compadres Bar & Grill on the evening of May 4, 2019. Dkt.
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Case 5:20-cv-02916-SVK Document 17 Filed 11/19/20 Page 5 of 6

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15-4. Mr. Poblete says that while he was inside the establishment, he observed the following on

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televisions in the establishment: “The fight had not yet started as this was mins before the start of

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the ‘main event’ bout between, Canelo Alvarez, and Daniel Jacob; Canelo was in the white/gold

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trunks, with Jacobs in the black/red trunks.” Id. This affidavit does not establish that Defendants

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intercepted, received, or published the Program in violation of section 605 or that they committed

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conversion. Mr. Poblete does not claim to have seen any part of the main event fight, the under-

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card bouts, or the fight commentary to which Plaintiff’s rights pertain. Although Mr. Poblete

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describes what the main event fighters were wearing, that information could have been ascertained

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from sources other than an unlawful display of the fight itself.
The inadequacies in Plaintiff’s complaint and the affidavit of its investigator leave open the

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United States District Court
Northern District of California

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possibility of disputes concerning material facts and therefore weigh against entry of default

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judgment. Other Eitel factors also lead the Court to conclude that default judgment should be

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denied on the record as it now stands. Plaintiff asks the Court to award the not-insubstantial sum

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of $22,750. The policy favoring decisions on the merits also weighs against entering default

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judgment. Plaintiff will not be prejudiced by denial of its motion because it can seek to amend its

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deficient complaint, or it can provide additional evidence, if available, from its investigator. See

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Crawford, 2016 WL 5942231, at *2. Although there is no evidence that Defendants’ default

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resulted from excusable neglect, this consideration does not outweigh the other Eitel factors,

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which weigh conclusively in favor of denying Plaintiff’s motion for default judgment.

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V.

CONCLUSION
For the foregoing reasons, Plaintiff’s motion for default judgment is DENIED. If it can do

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so in accordance with the standards of Federal Rule of Civil Procedure Rule 11, Plaintiff may file

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an amended complaint and/or renewed motion for default judgment by December 18, 2020, and

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shall state with particularity sufficient facts to establish Defendants’ liability. A Case

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Case 5:20-cv-02916-SVK Document 17 Filed 11/19/20 Page 6 of 6

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Management Conference will be held on March 9, 2021 at 9:30 a.m., with a Case Management

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Report due on March 2, 2021.

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SO ORDERED.

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Dated: November 19, 2020

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SUSAN VAN KEULEN
United States Magistrate Judge

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United States District Court
Northern District of California

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