Shefts v. Petrakis

Filing 269

ORDER Entered by Judge Joe Billy McDade on 2/20/13. The Court has herein resolved several outstanding questions related to the calculation of damages in this case, assuming that the jury will find Defendants liable. In addition, the Court believes that all of the claims under Count III have been resolved or dropped; if Plaintiff wishes to proceed with the Yahoo! email claim under the SCA, he SHALL notify the Court within seven days of the date of this Order.(SW, ilcd)

E-FILED

Thursday, 21 February, 2013 08:20:39 AM
Clerk, U.S. District Court, ILCD

UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF ILLINOIS
PEORIA DIVISION
JAMISON SHEFTS,
Plaintiff,
v.
JOHN PETRAKIS, KEVIN MORGAN,
HEIDI HUFFMAN, and ACCESS2GO,
INC., an Illinois corporation
Defendants.

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Case No. 10-cv-1104

ORDER & OPINION
This matter is before the Court on the parties’ briefs on damages. (Docs. 260,
261, 264 & 265). This Order resolves a number of issues relating to the calculation
of damages, should liability be found. It assumes, for the purpose of analysis only,
that the jury will find in Plaintiff’s favor as to each claim and against each
Defendant, though such assumption is made, of course, without prejudice to
Defendants’ arguments against liability.
Aside from these legal questions regarding the calculation of damages, there
is an additional issue the Court wishes to resolve in this Order: the status of Count
III of the Amended Complaint, which arises under the SCA. Plaintiff originally
claimed that Defendants had violated the SCA by accessing his Access2Go email,
his Blackberry text messages, and his Yahoo! email. The Court has already
determined that Plaintiff cannot recover for Defendants’ conduct as to the
Access2Go email and Blackberry text messages. (Docs. 249 & 268). The Court had
assumed that Plaintiff intended to persist with the Yahoo! SCA claim, but did not

address whether it was viable because the parties had not litigated that question.
(Doc. 268 at 1 n. 1, 12-13). Having reviewed Plaintiff’s initial brief on damages (filed
prior to the recent ruling on the text messages claim) more closely, to the Court it
appears that he only seeks damages as to Defendants’ alleged accession of his
Blackberry text messages, not the Yahoo! email messages; he appears to have
dropped the SCA claim as to the Yahoo! email messages. (Doc. 261 at 8). If Plaintiff
has indeed dropped the SCA claim as to the Yahoo! emails, there are no issues
remaining to be tried under Count III of the Amended Complaint. If Plaintiff
disagrees with this reading of his damages brief, he must notify the Court within
seven days of the date of this Order.
As the Court explained in its last Order, the parties’ first briefs on damages
raised a number of legal issues that are beneficially resolved prior to trial:
Plaintiff’s brief raised two related questions: (1) under the ECPA,
Plaintiff alleges that Defendants intercepted both his Access2Go email
and his Yahoo! email, by two separate mechanisms, and he claims that
he should be permitted to recover for each of these alleged violations
separately; and (2) also under the ECPA, Plaintiff multiplies his
damages calculation for each violation by three, as there are three
Defendants. … Defendants’ brief raised [the issue of] whether, under
the ECPA, the fact that Plaintiff does not seek actual damages will or
should prevent his recovery of attorney’s fees.
(Doc. 263 at 5).1 The Court therefore allowed each party to respond to these points
in its opponent’s brief, and those responses have now been filed. The Court also

Defendants’ brief also raised the question of “whether, under the SCA, the
fact that Plaintiff does not seek actual damages will prevent his recovery of
statutory damages.” (Doc. 263 at 5). As noted above, the Court believes that all of
the SCA claims have been resolved or dropped. Therefore, the Court will not
address this question in the instant Order. If Plaintiff indicates that he wishes to
proceed with the SCA claim related to the Yahoo! email, the Court will then rule on
this question.
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permitted the parties to raise any additional damages issue that they believed could
be efficiently resolved prior to trial, and Defendants have accordingly raised the
question of whether district courts have the discretion to deny an award of statutory
damages under the ECPA, citing DirectTV, Inc. v. Barczewski, 604 F.3d 1004 (7th
Cir. 2010).
I.

Should separate damages be awarded to Plaintiff under the ECPA
for both the interception of his Access2Go email and his Yahoo!
email?
Defendants argue that Plaintiff should only be permitted to recover damages

for the time period during which they were intercepting his communications, and
that the damages calculation should not take into account that there were two
separate violations of the ECPA alleged during that time period. The Court agrees
with Plaintiff’s position. Plaintiff has two separate claims under the ECPA: that the
Defendants intercepted his Access2Go email, and that they intercepted his Yahoo!
email. These two claims cover two distinct sets of communications, and allege that
Defendants used two different mechanisms to carry out the interception. The fact
that Plaintiff put these two claims together under the heading of “Count I” was
merely an organizational device reflecting the fact that both arise under the ECPA.
However, he could have just as easily separated the two claims into two separate
“counts.”
Defendants rely on Desilets v. Wal-Mart Stores, Inc., 171 F.3d 711, 714 (1st
Cir. 1999) to argue that the number of violations is irrelevant to the calculation of
damages under the ECPA, but this reliance is misplaced. In Desilets, the district
court erred in awarding damages separately for the defendant’s interception and

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unlawful use of the communications at issue. The First Circuit’s analysis, though,
addressed the fact that the two “types” of violations were actually “interception” and
“unlawful use,” but did not deal with a situation in which the defendants unlawfully
intercepted or used different kinds of communications in different ways. Both
Desilets and Smoot v. United Transportation Union, 246 F.3d 633, 642-646 (6th Cir.
2001), focus only on the fact that the ECPA prohibits unlawful interception,
unlawful disclosure, and unlawful use of the communications, and correctly explain
that the statutory language of the ECPA does not permit separate awards of
damages for each of these types of violations. Where only one type of communication
is intercepted and/or disclosed and/or misused, tying damages to the number of days
those violations occurred, rather than the number of violations per day, makes
sense. See Smoot, 246 F.3d at 646 (statute should be interpreted to avoid “treating
one disclosure and one use differently from two interceptions”).
The instant situation is quite different, and neither Desilets nor Smoot
addresses it: here, it is not simply that the statute contemplates different types of
violations, it is that different types of communications and different mechanisms for
their interception are concerned.2 Defendants cite no cases in which a court faced

The only cases cited by Defendants that involve a number of separate
“devices” are the district court cases of Klumb v. Goan, No. 2:09-cv-115, 2012 WL
2958228, *19 (E.D. Tenn. Jul. 19, 2012), and DirecTV v. Schulien, 401 F.Supp.2d
906, 918 (N.D. Ill. 2005). Neither of these is helpful to Defendants’ argument here,
as both involve merely multiple versions of the same device, intended to intercept
the same communications. In Klumb, the defendant installed a particular piece of
spy software on two of the plaintiff’s computers in order to intercept his email from
a single email account; the court determined that only one statutory damages
award was appropriate, as the defendant “was still intercepting the same person’s
email.” 2012 WL 2958228, *19. Similarly, in Schulien, the district court rejected the
plaintiff’s attempt to collect separately-calculated statutory damages based on “the
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the allegation that a defendant had undertaken to invade the plaintiff’s privacy in
as many fora as it could reach, using several different technical mechanisms, and
this Court does not find that either the language of the ECPA or the cases of
Desilets and Smoot require the courts to withhold statutory compensation from a
plaintiff who has suffered completely separate invasions of his privacy.
Therefore, if liability under the ECPA is found as to both the Access2Go
email and the Yahoo! email, and if the Court decides that an award of damages for
both violations are appropriate (see discussion under “III,” infra) the Court will
permit Plaintiff to recover damages for both violations. In other words, the period
during which Defendants unlawfully intercepted Plaintiff’s Access2Go email will
result in one damages calculation, and the period during which they unlawfully
intercepted his Yahoo! email will result in another, and these two figures will be
added together.
II.

Should Plaintiff be able to recover damages under the ECPA against
each individual Defendant separately?
In his brief on damages, Plaintiff multiplied his damages calculations by

three, reasoning that each of the individual Defendants had violated the ECPA and
thus should be held liable for damages separately. Defendants oppose this theory,
citing to Jacobson v. Rose, in which the Ninth Circuit held that because damages,
number of piracy devices defendant purchased.” 401 F.Supp.2d at 918. The
Northern District of Illinois first noted that there is no private right of action for the
mere possession of piracy devices, so it was inappropriate to calculate damages on
the basis of the number of devices owned. Id. Distinguishing Schulien from this
case, also, is the fact that the defendant there only violated the ECPA by using
those devices to obtain DirecTV signals in his home – again, he was simply using
multiple versions of the same piracy devices in order to obtain the same protected
communications, not using completely different technologies in order to obtain
completely different communications. Id. at 913.
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including liquidated or statutory damages, are intended to compensate the plaintiff
for his loss, not to punish the defendants, it was inappropriate to multiply a
damages award under § 2520 by the number of defendants, which could result in an
unwarranted windfall for plaintiffs based merely on the number of defendants
involved. 592 F.2d 515, 520-21 (9th Cir. 1978). The Jacobson court noted, too, that
to use these types of damages to punish defendants would render superfluous the
statute’s provision of punitive damages. Id. at 520. As Defendants note, there
appear to be no cases contrary to this interpretation, the holding of which comports
with traditional principles of joint and several liability, as well as the purpose of
non-punitive damages. The Jacobson decision is well-reasoned, and the Court sees
no reason to depart from it. Should the jury find in Plaintiff’s favor under the
ECPA, the appropriate damages will be assessed jointly against Defendants.
III.

Does this Court have discretion to deny an award of damages under
the ECPA?
Defendants cite to DirecTV v. Barczewski, a Seventh Circuit case holding that

18 U.S.C. § 2520(c)(2), the section governing the calculation of damages under the
ECPA relevant to this case, gives the district court “discretion not to award
statutory damages under that statutory formula.” 604 F.3d 1004, 1009 (7th Cir.
2010). The Court has found no opposing or limiting caselaw from this or any other
Circuit, and, as the Barczewski court noted, four other circuits agree that §
2520(c)(2)’s language grants this discretion to the district court. Id. at 1007 (citing
DirecTV, Inc. v. Brown, 371 F.3d 814, 817-18 (11th Cir. 2004); Dorris v. Absher, 179
F.3d 420, 429-30 (6th Cir. 1999); Reynolds v. Spears, 93 F.3d 428, 433-35 (8th Cir.
1996); Nalley v. Nalley, 53 F.3d 649, 651-53 (4th Cir. 1995)). The Seventh Circuit
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explicitly did not decide whether district courts have the discretion to award
damages that are greater than $0 but less than the maximum provided for by §
2520(c)(2), but instead remanded to the district court for consideration of whether a
less-than-maximal penalty was appropriate.3 Id. at 1009-10.
Having reviewed Barczewski, the Court concludes that Defendants are
correct that it has the discretion at least to refrain from awarding Plaintiff any
damages under the ECPA. At this point, it would be premature for the Court to
determine whether it is appropriate to award the maximum statutory damages,
deny damages, or grant an “intermediate” damages award. The Court will revisit
this question, if necessary, following the jury’s verdict on Plaintiff’s ECPA claims.
IV.

Does the fact that Plaintiff does not seek actual damages prevent his
recovery of attorneys’ fees under the ECPA?
Finally, Defendants claim that Plaintiff’s decision to seek only statutory

damages bars his ability to recover attorney’s fees under the ECPA. In support of
their argument, they cite to two district court cases, Reynolds v. Spears, 857
F.Supp.1341 (W.D. Ark. 1994), and Forkes v. Busse, 510 F.Supp. 122 (E.D. Wisc.
1981), in which the courts refused to award attorneys’ fees under the ECPA though
the plaintiffs had shown liability. In Reynolds, the district court cited two
considerations underlying its decision to deny attorneys’ fees. First, it denied
attorneys’ fees for the same reasons it denied statutory damages (finding them
discretionary, as discussed above): there had been no actual damages, the privacy
intrusion was relatively minor, the defendants had already paid a substantial sum,

There are no post-Barczewski cases within this Circuit addressing the
possibility of a lesser award of damages.
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the defendants had no income other than savings, and their motivation for the
violation was benign. 857 F.Supp. at 1348. In addition, the court found attorneys’
fees inappropriate because the Reynolds suit overlapped with another suit, and it
was unfair to force defendants to pay two sets of attorneys’ fees when the two suits
could have been litigated together. Id. Neither of these considerations indicates to
this Court that Plaintiff should be barred from seeking attorneys’ fees here simply
because he seeks only statutory damages. The lack of actual damages was merely
one factor the Reynolds court relied on in determining that neither statutory
damages nor attorneys’ fees were necessary; the Reynolds court did not state or
imply that it alone was decisive. As discussed above, the Court will have to decide
after the jury’s verdict whether and to what extent statutory damages are
appropriate in this case, and the other factors mentioned by the Reynolds court are
the sort of considerations the Court will weigh when determining that question, as
well as what amount of attorneys’ fees is reasonable.
Similarly, in Forkes, the court did not deny attorneys’ fees as Defendants
imply, but instead cut the plaintiff’s requested $18,000 fee back to $2000; the case
thus does not stand for the proposition that a lack of actual damages is a per se bar
to the recovery of attorneys’ fees where liability is shown. 510 F.Supp. 122. The
Forkes court first noted that 18 U.S.C. § 2520(c) provides that a court “shall” award
a reasonable attorneys’ fee to the prevailing plaintiff. Id. at 123 (citing 18 U.S.C. §
2520(c); Jacobson v. Rose, 592 F.2d 515, 521 (9th Cir. 1978); Campiti v. Walonis,
467 F.Supp. 464 (D. Mass. 1979)). The court had originally awarded only $750 in
attorneys’ fees, believing that “[t]he right to pursue a claim with no realistic

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damages other than those small amounts allowed by the statute should not be
translated into an open-ended opportunity to perform excessive legal work.” Id. The
court also found that “the issues were neither complex nor weighty.” Id. However,
upon review of the plaintiff’s attorneys’ submissions, a Seventh Circuit decision,
and its earlier considerations, the court determined that $2000 was a reasonable
fee. Id. at 124 (citing Waters v. Wisconsin Steel Works of Intern. Harvester Co., 502
F.2d 1309, 1322 (7th Cir. 1974)). This Court agrees with the Forkes court that it is
appropriate to balance the likely value of a claim against the amount of legal work
involved, and that “excessive legal work” is not justified. This again, though, is
merely an example of the kind of analysis the Court will undertake when
considering what amount of attorneys’ fees is reasonable.
Plaintiff may thus seek attorneys’ fees though he does not seek actual
damages. If the jury finds Defendants liable under the ECPA, the Court will then
consider the question of what amount of attorneys’ fees is reasonable.

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CONCLUSION
The Court has herein resolved several outstanding questions related to the
calculation of damages in this case, assuming that the jury will find Defendants
liable. In addition, the Court believes that all of the claims under Count III have
been resolved or dropped; if Plaintiff wishes to proceed with the Yahoo! email claim
under the SCA, he SHALL notify the Court within seven days of the date of this
Order.
IT IS SO ORDERED.

Entered this 20th day of February, 2013.

s/ Joe B. McDade
JOE BILLY McDADE
United States Senior District Judge

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