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

Filing 28

ORDER Granting 16 Plaintiff's Motion for Partial Summary Judgment. The Court finds Defendants Lucina Contreras Valencia and El Tejate, Inc., liable under count 1 (violation of 47 U.S.C. § 605) and count 3 (conversion). Signed by Judge Thomas J. Whelan on 6/19/2019. (jao)

1
2
3
4
5
6
7
8
9
10

UNITED STATES DISTRICT COURT

11

SOUTHERN DISTRICT OF CALIFORNIA

12
13
14

G&G CLOSED CIRCUIT EVENTS,
LLC,

17

ORDER GRANTING PLAINTIFF’S
MOTION FOR PARTIAL
SUMMARY JUDGMENT [DOC. 16]

Plaintiff,

15
16

Case No.: 18-cv-0423 W (MSB)

v.
LUCINA CONTRERAS VALENCIA, et
al.,

18

Defendants.

19
20
21

Pending before the Court is Plaintiff G&G Closed Circuit Events, LLC’s motion

22

for partial summary judgment. Plaintiff is seeking to establish liability against

23

Defendants Lucina Contreras Valencia and El Tejate, Inc. under 47 U.S.C. § 605 and a

24

state-law conversion count. Defendants oppose the motion.

25

The Court decides the matter on the papers submitted and without oral argument.

26

See Civ. L.R. 7.1(d)(1). For the following reasons, the Court GRANTS Plaintiff’s

27

motion [Doc. 16].

28
1
18-cv-0423 W (MSB)

1

I.

2

BACKGROUND
Plaintiff G&G Closed Circuit Events, LLC, is a closed-circuit distributor of sport

3

and entertainment programming. (Gagliardi Affidavit [Doc. 16-4] ¶ 3.) G&G purchased

4

the exclusive commercial exhibition licensing rights to Gennady Golovkin v. Saul Alvarez

5

IBF World Middleweight Championship Fight (the “Program”), which was telecast

6

nationwide on Saturday, September 16, 2017. (Id. ¶¶ 3, 4)

7

Defendant Lucina Contreras Valencia is the owner and an officer of Defendant El

8

Tejate, Inc., which owns and operates El Tejate Restaurant (the “Restaurant”). (Valencia

9

Decl. [Doc. 17-1] ¶ 2; Riley Decl. [Doc. 16-2] Ex. 2.) Defendants did not purchase a

10

license from G&G to show the Program. (Gagliardi Affidavit ¶ 3; Riley Decl. Ex. 1 at

11

2:24–4:10.) Nevertheless, the Restaurant’s televisions showed the Program through a

12

SkyTv satellite account, which was paid for by the business. (Valencia Decl. ¶ 3; Riley

13

Decl. Ex. 1 at 5:11–14.)

14

On February 23, 2018, G&G filed this lawsuit against Defendants. (See Compl.

15

[Doc. 1].) The Complaint asserts four counts for: (1) Violation of 47 U.S.C. § 605; (2)

16

Violation of 47 U.S.C § 553; (3) Conversion; and (4) Violation of California Business &

17

Professions Code §§ 17200, et seq. G&G now moves for partial summary judgement on

18

the first and third counts. Specifically, the G&G seeks summary adjudication “with

19

respect to the liability of Defendants Contreras Valencia, individually and d/b/a El Tejate

20

Restaurant or El Tejate, Inc.,… for Plaintiff’s claims under 47 U.S.C. § 605 and for its

21

conversion claim under California law….” (Notice of Motion [Doc. 16] 2:1–8.)

22
23

II.

LEGAL STANDARD

24

Summary judgment is appropriate under Rule 56(c) where the moving party

25

demonstrates the absence of a genuine issue of material fact and entitlement to judgment

26

as a matter of law. See Fed.R.Civ.P. 56(c); Celotex Corp. v. Catrett, 477 U.S. 317, 322

27

(1986). A fact is material when, under the governing substantive law, it could affect the

28

outcome of the case. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). A
2
18-cv-0423 W (MSB)

1

dispute about a material fact is genuine if “the evidence is such that a reasonable jury

2

could return a verdict for the nonmoving party.” Id. at 248.

3

A party seeking summary judgment always bears the initial burden of establishing

4

the absence of a genuine issue of material fact. Celotex, 477 U.S. at 323. The moving

5

party can satisfy this burden in two ways: (1) by presenting evidence that negates an

6

essential element of the nonmoving party’s case; or (2) by demonstrating that the

7

nonmoving party failed to make a showing sufficient to establish an element essential to

8

that party’s case on which that party will bear the burden of proof at trial. Id. at 322–23.

9

“Disputes over irrelevant or unnecessary facts will not preclude a grant of summary

10

judgment.” T.W. Elec. Serv., Inc. v. Pac. Elec. Contractors Ass’n, 809 F.2d 626, 630

11

(9th Cir. 1987). If the moving party fails to discharge this initial burden, summary

12

judgment must be denied and the court need not consider the nonmoving party’s

13

evidence. Adickes v. S.H. Kress & Co., 398 U.S. 144, 159–60 (1970).

14

If the moving party meets this initial burden, the nonmoving party cannot avoid

15

summary judgment merely by demonstrating “that there is some metaphysical doubt as to

16

the material facts.” In re Citric Acid Litig., 191 F.3d 1090, 1094 (9th Cir. 1999) (citing

17

Matsushita Elec. Indus. Co., Ltd. v. Zenith Radio Corp., 475 U.S. 574, 586 (1986); Triton

18

Energy Corp. v. Square D Co., 68 F.3d 1216, 1221 (9th Cir. 1995) (citing Anderson, 477

19

U.S. at 252) (“The mere existence of a scintilla of evidence in support of the nonmoving

20

party’s position is not sufficient.”). Rather, the nonmoving party must “go beyond the

21

pleadings and by her own affidavits, or by ‘the depositions, answers to interrogatories,

22

and admissions on file,’ designate ‘specific facts showing that there is a genuine issue for

23

trial.’” Ford Motor Credit Co. v. Daugherty, 279 Fed. Appx. 500, 501 (9th Cir. 2008)

24

(citing Celotex, 477 U.S. at 324). Additionally, the court must view all inferences drawn

25

from the underlying facts in the light most favorable to the nonmoving party. See

26

Matsushita, 475 U.S. at 587.

27
28
3
18-cv-0423 W (MSB)

1

III.

DISCUSSION
Defendant El Tejate, Inc. is liable under 47 U.S.C. § 605 (a)1

2

A.

3

G&G’s motion seeks to establish that Defendant El Tejate, Inc., violated 47 U.S.C.

4

§ 605(a). This section provides:

5

No person not being authorized by the sender shall intercept any radio
communication and divulge or publish the existence, contents, substance,
purport, effect, or meaning of such intercepted communication to any
person. No person not being entitled thereto shall receive or assist in
receiving any interstate or foreign communication by radio and use such
communication (or any information therein contained) for his own benefit or
for benefit of another not entitled thereto. No person having received any
intercepted radio communication or having become acquainted with the
contents, substances, purport, effect, or meaning of such communication (or
any part thereof) knowing that such communication was intercepted, shall
divulge or publish the existence, contents, substance, purport, effect, or
meaning of such communication (or any part thereof) or use such
communication (or any information therein contained) for his own benefit or
for the benefit of another not entitled thereto.

6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23

47 U.S.C. § 605(a). “Section 605 of the Communications Act prohibits the unauthorized
receipt and use of radio communications for one’s ‘own benefit or for the benefit of
another not entitled thereto.’” DirecTV, Inc. v. Webb, 545 F.3d 837, 844 (9th Cir. 2008)
(citing 47 U.S.C. § 605(a)). Although not originally intended to address television signal
piracy, in the 1980’s Congress “extended the statute’s reach to the unauthorized reception
or interception of television programming.” Id. at 843. To establish liability under this
section, a plaintiff must establish that the defendant “unlawfully intercepted, received,
published, or divulged Plaintiff’s privileged communication.” J&& Sports Productions
Inc. v. Rubio, 2017 WL 3234939 (Dist. AZ 2017) (citing 47 U.S.C. § 605).

24
25
26
27
28

1

G&G’s points and authorities also raise liability under section 553. However, the Notice of Motion
states that liability is sought under section 605, and there is no mention of section 553. (Notice of Motion
2:1–8.) Additionally, G&G’s reply seems to drop arguments related to liability under section 553. (See
Reply [Doc. 19] 3:28–4:2 (“In light of the use of satellite technology, which is undisputed, this is a 47
U.S.C. § 605 case.”)

4
18-cv-0423 W (MSB)

1

Here, there is no dispute that G&G owned the exclusive commercial licensing

2

rights to the Program. (Gagliardi Affidavit ¶¶ 3, 4.) There is also no dispute that none of

3

the Defendants purchased a license from G&G to show the Program (Gagliardi Affidavit

4

¶ 3; Riley Decl. Ex. 1 at 2:24–4:10), and that the Program was “published” at the

5

Restaurant (Valencia Decl. ¶ 3; Riley Decl. Ex. 1 at 5:11–14).

6

Defendants nevertheless argue that they did not violate section 605(a) because they

7

“lawfully obtained [the Program] by a TV service provider who the business paid the

8

subscription fee to for service, namely SkyTV,” and therefore Defendants were not

9

“unauthorized to receive the signal or display the programming.” (Opp’n [Doc. 17] 4:6–

10

8, 5:10–12, citing Valencia Decl. ¶ 3.) In support of this argument, Defendants cite two

11

cases, J&J Sports Productions, Inc. v. Schmalz, 745 F.Supp.2d 844 (S.D. Ohio, 2010),

12

and J&J Sports Productions, Inc. v. Mandell Family Ventures, LLC, 751 F.3d 346 (5th

13

Cir. 2014).

14
15
16
17
18
19
20
21
22
23
24
25
26

But as G&G points out, Schmalz and Mandell involved liability under section 553,
which differs from section 605. Section 553 provides:
No person shall intercept or receive or assist in intercepting or receiving any
communications service offered over a cable system, unless specifically
authorized to do so by a cable operator or as may otherwise be specifically
authorized by law.
47 U.S.C. § 553 (emphasis added). The emphasized language is a safe-harbor provision
that “precludes the imposition of liability on the majority of cable recipients—customers
of cable providers” by allowing the “cable operator” to “authorize” a person to receive
the “communications service” (i.e., the Program). Mandell, 751 F.3d at 348. Relying on
this safe-harbor provision, Schmalz and Mandell found the cable-customer defendants
were not liable for violating section 553 because they were “authorized” by their cable
providers to receive the programs. Schmalz, 745 F.Supp.2d at 851; Mandell, 751 F.3d at
348–350.

27
28
5
18-cv-0423 W (MSB)

1

In contrast to section 553, section 605(a) allows only the communication’s

2

“sender”—not a “cable operator” or the satellite provider—to “authorize” the reception

3

or display of a communication. Thus, under section 605(a), a person who mistakenly

4

receives a communication from a satellite provider who is not also the “sender”, is not

5

shielded from liability for “publishing” the communication. For example, in National

6

Satellite Sports, Inc. v. Eliadis, Inc., 253 F.3d 900, 916 (6th Cir. 2001), the Sixth Circuit

7

explained that because the cable provider was “not authorized [by the sender] to transmit

8

the event to commercial establishments[,]” the cable provider’s customer was not

9

“authorized” within the meaning of the first sentence of section 605(a). See also Garden

10

City Boxing Club, Inc. v. Vinson, 2003 WL 22077958 (N.D. TX 2003) (because

11

DirecTV was not authorized to sell the pay-per-view fight to commercial establishments,

12

defendant Red Dog Saloon violated section 605(a) by broadcasting the fight despite

13

purchasing it from DirecTV); J&J Sports Productions Inc. v. Rubio, 2017 WL 3234939

14

(Dist. AZ 2017) (defendant violated section 605(a) despite legally receiving the signal

15

from its satellite provider, SkyTV). Under this interpretation of the statute, Defendants’

16

belief that they were authorized to receive and display the Program is irrelevant, which is

17

consistent with the fact that section 605 is a strict-liability statute.

18

Because Defendants have provided no evidence indicating that G&G “authorized”

19

Defendants or SkyTV to receive or publish the Program, El Tejate, Inc. is liable under

20

section 605(a).

21
22

B.

23

Plaintiffs also seek to hold Valencia personally liable under section 605. To do so,

Defendant Valencia is liable for El Tejate, Inc.’s violation of § 605(a)

24

Plaintiffs must show “that the corporate officer had a ‘right and ability to supervise the

25

violations, and that [he] had a strong financial interest in such activities.’” J&J Sports

26

Productions, Inc. v. Ribeiro, 562 F.Supp.2d 498, 501 (S.D.N.Y. 2008).

27

Here, the California Secretary of State’s Statement of Information lists Valencia as

28

a corporate officer, director, owner and the agent for service of process for El Tejate, Inc.,
6
18-cv-0423 W (MSB)

1

which owns and operates the Restaurant. (Riley Decl. Ex. 2; Valencia Decl. ¶ 2.) She is

2

also listed as the owner of the Restaurant on the liquor license and on the City of

3

Escondido Business License (Riley Decl. Exs. 4, 5.) These facts are sufficient to

4

establish Valencia had the right and ability to supervise the violation, and a strong

5

financial interest therein. See J&J Sports Productions, Inc. v. Mikhael, 2016 WL

6

2984191, *2 (C.D.Cal. 2016) (finding individual defendants liable because as “members”

7

and registered agent of Vape Escape, LLC, they had “‘a right and ability to supervise’ the

8

violation and a strong financial interest therein.”). Accordingly, the Court finds Valencia

9

is liable for the Restaurant’s violation of section 605(a).

10
11

C.

12

G&G also seeks summary adjudication that Defendants are liable for conversion.

13
14
15
16
17

Conversion

To prevail on a conversion count, G&G must establish the following elements:
(1) plaintiff’s ownership or right to possession of the property at the time of the
conversion;
(2) defendant’s conversion of plaintiff’s property by a wrongful act or disposition;
and
(3) damages.

18

Tyrone Pac. Intern., Inc. v. MV Eurychili, 658 F.2d 664, 666 (9th Cir. 1981). “Both the

19

federal and state statutes recognize the property interest inherent in satellite broadcast

20

transmissions and treat the unauthorized receipt of television signals as theft.” DirecTV,

21

Inc., 545 F.3d at 848 (citing 47 U.S.C. § 605(a) and Cal. Penal Code § 593d(a)).

22

As set forth above, there is no dispute G&G had the exclusive distribution rights

23

to the Program, Defendants did not purchase a license to show the Program at the

24

Restaurant, and that the Program was shown on the Restaurant’s televisions.

25

Additionally, Defendants do not dispute G&G’s contention that it suffered damages as a

26

result of Defendants’ conduct. (See Gagliardi Affidavit ¶¶ 12, 19.) Accordingly,

27

Defendants are liable to G&G for conversion of its Program.

28
7
18-cv-0423 W (MSB)

1

IV.

CONCLUSION & ORDER

2

For the reasons discussed above, the Court GRANTS G&G’s motion for partial

3

summary judgment [Doc. 16] and finds Defendants Lucina Contreras Valencia and El

4

Tejate, Inc., liable under count 1 (violation of 47 U.S.C. § 605) and count 3 (conversion).

5
6

IT IS SO ORDERED.
Dated: June 19, 2019

7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
8
18-cv-0423 W (MSB)