Joe Hand Promotions, Inc. v. Zani et al
Filing
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MEMORANDUM Opinion and Order. Signed by the Honorable James B. Zagel on 10/7/2013. (ep, )
UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF ILLINOIS
EASTERN DIVISION
JOE HAND PROMOTIONS, INC.,
Plaintiff,
No. 11 C 4319
Judge James B. Zagel
v.
DRITAN ZANI, et al.,
Defendant.
MEMORANDUM OPINION AND ORDER
Plaintiff Joe Hand Promotions, Inc. has brought this action against Defendants Dritan
Zani and Euro Star Café, Inc. for a violation of 47 U.S.C. § 605. Plaintiff now moves for
summary judgment as to both liability and damages. For the following reasons, Plaintiff’s
motion is granted in part and denied in part.
BACKGROUND
Plaintiff was the exclusive domestic commercial distributor of the transmission signal of
the December 11, 2010, telecast of Ultimate Fighting Championship 124: St-Pierre vs. Koscheck
2 (“The Event”). These rights included all undercard bouts and the entire television broadcast.
Plaintiff makes its money by entering into agreements with commercial entities to permit their
display of the Broadcast. The rates are determined based on the capacity of each establishment;
in this case the rate would have been $1,300.00.
Plaintiff’s primary revenue source is the sublicense fees it charges to commercial
establishments to broadcast programming. Plaintiff states it has lost millions due to unauthorized
broadcasts. Plaintiff alleges that it has lost and will continue to lose customers due to the
unauthorized exhibition of its programs, in part because the commercial establishments that
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properly purchase rights cannot make money as a result. Moreover, Plaintiff states that the
unauthorized exhibition of its program damages its goodwill and reputation because it cannot
provide customers with an accurate list of locations that are showing an event.
Abram Gale Sports Bar is located at 2366 N. Neva, Chicago, Illinois 60707 and has a
capacity of 168 persons. Defendants admit to showing the Event in the bar without a proper
license. The event was advertised on Facebook and Twitter, but Defendants say they reached just
nine followers.
Defendants state that Direct TV came to the bar to set up the account. It appears that
Direct TV mistakenly gave Defendants a residential account, though Defendants assert that this
was not made clear to them until this lawsuit was filed. Direct TV sent bills directly to the bar,
and Defendants assert that they were unaware there were different rates for residential and
commercial accounts. Further, Defendant Zani states that he has no residential satellite
television service with Direct TV in his home. It is uncontested that Defendants purchased the
Event from Direct TV as a Pay-Per-View event and paid the rate they were charged, which was
the residential fee.
DISCUSSION
Courts “shall grant summary judgment if the movant shows that there is no genuine
dispute as to any material fact and the movant is entitled to judgment as a matter of law.” FED. R.
CIV. P. 56(c). “On summary judgment the inferences to be drawn from the underlying
facts…must be viewed in the light most favorable to the party opposing the motion.” United
States v. Diebold, Inc., 369 U.S. 654, 655 (1962); Bell v. EPA, 232 F.3d 546, 549 (7th Cir. 2000).
The evidence relied upon in defending a motion for summary judgment must be
admissible at trial, although the court may consider sworn testimony. Hemsworth v.
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Quotesmith.Com, Inc., 476 F.3d 487, 490 (7th Cir. 2007). Moreover, the moving party must
provide specific facts and cannot rely solely on the pleading: “[t]he mere existence of a scintilla
of evidence in support of the plaintiff's position will be insufficient; there must be evidence on
which the jury could reasonably find for the plaintiff.” Anderson v. Liberty Lobby, Inc., 477 U.S.
242, 252 (1986).
A. Liability
47 U.S.C. § 605(a) essentially provides for strict liability. See King Visiont Pay-PerView Ltd. v. Lake Alice Bar, 168 F.3d 347, 349 (9th Cir. 1999). By their admission, Defendants
violated § 605(a) when they commercially published the Event after having been charged only
the residential rate. Section 605(a) provides in relevant part:
[N]o person receiving, assisting in receiving, transmitting, or assisting in
transmitting, any interstate or foreign communication by wire or radio shall
divulge or publish the existence, contents, substance, purport, effect, or meaning
thereof, except through authorized channels of transmission or reception, (1) to
any person other than the addressee, his agent, or attorney
It is undisputed that Defendants did not pay the proper fee for commercial use of the
broadcast. Publication of the broadcast to patrons in the bar was thus unauthorized, resulting in a
violation of § 605(a). Summary judgment in favor of Plaintiff as to liability is therefore
appropriate.
B. Damages
Plaintiff has also moved for summary judgment as to damages under both 47 U.S.C.
§ 605(e)(3)(C)(i)(II) and 47 U.S.C. § 605(e)(3)(C)(ii). Because Plaintiff has not alleged
sufficient undisputed facts to support its damages request under either section of the statute,
Plaintiff’s motion for summary judgment is denied as to damages.
1. Damages Under 47 U.S.C. § 605(e)(3)(C)(i)(II)
Section 605(e)(3)(C)(i)(II) permits a plaintiff to recover a statutory damages award for
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each violation of § 605(a) “in a sum of not less than $1,000 or more than $10,000, as the court
considers just.” Plaintiff asks that I award the maximum amount allowable under the statute, but
has not offered sufficient evidence to persuade me that an award of even the minimum amount
would be just.
Plaintiff notes the lost licensing fee, and asserts it has been deprived of the “value,
benefits and profits derived from the unauthorized broadcast of the Event.” Plaintiff further
claims the loss of customers due to the unauthorized exhibition of its programs, in part because
those commercial establishments that purchase proper rights cannot make money when they
must compete with unauthorized exhibitors. Plaintiff explains that its primary revenue source is
the sublicense fees it charges commercial establishments to broadcast programming. If
legitimate customers stop purchasing licenses, Plaintiff will suffer losses. Plaintiff also makes
broad claims of damage to its goodwill and reputation caused by its inability to give customers a
list of locations that will exhibit a given event.
Aside from the lost licensing fee, however, these claims for loss are insufficiently
supported. Whether and to what extent Plaintiff has sustained losses as a result of this sort of
unauthorized use generally, or this instance of unauthorized use involving Defendants in
particular, is not at all clear from Plaintiff’s motion. Indeed, Defendants make uncontested
assertions suggesting that an award of as little as $250 under § 605(e)(3)(C)(iii) may be far more
appropriate.1
2. Damages Under 47 U.S.C. § 605(e)(3)(C)(ii)
Section 605(e)(3)(C)(ii) permits a court to increase a damage award by as much as
$100,000 where the violation was “committed willfully and for purposes of direct or indirect
commercial advantage or private financial gain.” Plaintiff asks for an additional award of
1
See note 2, infra, and accompanying text.
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$50,000 under this section, but has not sufficiently shown that Defendants acted willfully.
Plaintiff cites to ON/TV of Chicago v. Julien, 763 F.2d 839, 844 (7th Cir. 1985), where
the Seventh Circuit defined a willful violation of a statute in the civil context as “disregard for
the governing statute and an indifference to its requirements.” See also Trans World Airlines,
Inc. v. Thurston, 469 U.S. 111, 128-29 (1985) (holding that this is an “acceptable” way to
articulate a definition of “willful,” but rejecting the lower court’s application of the standard). In
Trans World Airlines, the Supreme Court case on which the Seventh Circuit relied, the Court
held that in order for a violation of a statute to be willful, the defendant must “know” that his
conduct would violate the statute, or he must recklessly disregard the statutes requirements.
Trans World Airlines, 469 U.S. at 129-30.
Defendants assert that they were unaware that their Direct TV account was set up in
potential violation of § 605(a). They assert that Direct TV mistakenly installed their service as a
residential account without their knowledge, and they assert that they had no reason to know that
the fee they paid upon purchasing the Event was not the proper fee. These assertions stand
uncontroverted.
Plaintiff asserts that “Defendants could not have ‘innocently’ accessed the broadcast of
the Event, and therefore, it is certain that Defendants specifically and willfully acted to illegally
intercept the transmissions of the Event for Defendants’ commercial advantage.” But Plaintiff
does not explain why this must be so. Plaintiff further asserts that it is “certain” that Defendants
took “affirmative untoward actions” to bypass safeguards in place to protect satellite
programming, but, again, Plaintiff does not explain why.
Plaintiff points to courts that have found willfulness where a defendant violates the
Federal Communications Act “for the purposes of direct or indirect commercial advantage or
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private financial gain.” Kingvision Pay–Per–View, Ltd. v. Admiral's Anchor, Inc. No. 2, 172 F.
Supp. 2d 810, 812 (S.D.W. Va. 2001); Time Warner Cable v. Googies Luncheonette, Inc., 77 F.
Supp. 2d 485, 490 (S.D.N.Y. 1999); Time Warner Cable of New York City v. Taco Rapido Rest.,
988 F. Supp. 107, 111 (E.D.N.Y. 1997). But these are cases in which default judgments were
entered against the defendants, and in which the courts accepted all allegations - including
willfulness - as true.
Notably, however, in cases like the one currently before the Court, where the defendant
was mistakenly charged the residential rate, where the defendant was apparently unaware that a
mistake had been made, and where the defendant paid the fee he was actually charged, courts
have opted to award only $250 in damages, as provided for in § 605(e)(3)(C)(iii).2 These courts
have generally reasoned that the error on the part of the cable company, without more, suggests
an absence of willfulness on the part of the defendant. See Joe Hand Promotions, Inc. v. That
Place, LLC, 2012 WL 2525653 at *5 (E.D. Wis. June 29, 2012); Joe Hand Promotions, Inc., v.
Kennedy, 2012 WL 1068789 at *2 (N.D. Ohio Mar. 29, 2012); Joe Hand Promotions, Inc. v.
Marshall, 2012 WL 300542 at *4 (M.D. Tenn. Feb. 1, 2012).
CONCLUSION
For the foregoing reasons, Plaintiff’s motion for summary judgment is granted in part and
denied in part. Consistent with this opinion, the Court hereby orders a damages hearing to be
held on 11/20/13 at 10:30 a.m.
2
Section 605(e)(3)(C)(iii) permits a court, in its discretion, to reduce an award of damages to a sum of not less than
$250 “where the court finds that the violator was not aware and had no reason to believe that his acts constituted a
violation of this section.”
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ENTER:
James B. Zagel
United States District Judge
DATE: October 7, 2013
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