Joe Hand Promotions, Inc. v. Hurley et al
Filing
22
ORDER granting in part and denying in part 9 Motion to Dismiss for Failure to State a Claim. See Order for details. Signed by Chief Judge David R. Herndon on 12/21/11. (klh, )
IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF ILLINOIS
JOE HAND PROMOTIONS, INC.,
Plaintiff,
v.
DAVID W. HURLEY, indiv. and d/b/a DAVID
HURLEY, LTD. d/b/a HURLEY’S DANCE CLUB,
and DAVID HURLEY, LTD. d/b/a HURLEY’S
DANCE CLUB,
Defendants.
No. 11-0538-DRH
MEMORANDUM and ORDER
HERNDON, Chief Judge:
I. Introduction and Background
Pending before the Court is defendants’ motion to dismiss pursuant to Federal
Rule of Civil Procedure 12(b)(6) (Doc. 9). Plaintiff opposes the motion (Doc. 15).
Based on the following, the Court denies in part and grants in part the motion.
On June 20, 2011, plaintiff filed a three-count complaint against defendants
for violations of 47 U.S.C. § 605, et seq., addressing unauthorized publication or use
of communications (Count I); violation of 47 U.S.C. § 553, et seq., addressing
unauthorized reception of cable services (Count II) and a state law claim for
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conversion (Doc. 2).1 The complaint alleges that plaintiff, a commercial distributor,
paid for and received the exclusive nationwide television distribution rights of
Ultimate Fighting Championship 101: “Declaration” (“Program”), which took place
on August 8, 2009.
It also alleges that defendants, with full knowledge that the
Program was not to be intercepted, received and exhibited by entities unauthorized
to do so, did unlawfully publish, divulge and exhibit the Program at the time of its
transmission at the their respective establishments in order to privately profit.
Thereafter, defendants filed the motion to dismiss on August 18, 2011 (Doc.
9). Specifically, defendants move to dismiss all the counts against David Hurley,
individually, and Count III, the conversion claim. Defendants maintain that plaintiff
failed to allege alter ego status that warrants piercing the corporate veil as to David
Hurley and that under Illinois law no claim for conversion lies under these
circumstances. Plaintiff filed its response on September 22, 2011 (Doc. 15). As the
motion is ripe for determination, the Court turns to address the merits.
II. Motion to Dismiss
Under the Federal Rules of Civil Procedure, a complaint need only contain “a
short and plain statement of the claim showing that the pleader is entitled to relief.”
Fed.R.Civ.P. 8(a)(2). The complaint must “give the defendant fair notice of what the
... claim is and the grounds upon which it rests.” Bell Atl. Corp. v. Twombly, 550
1
As to the defendants, the complaint alleges that “DAVID HURLEY LTD, d/b/a HURLEY’S
DANCE CLUB, was a business entity, having its principal place of business at 1504 W. Broadway,
Johnston City, Illinois 62951" and that “David Hurley is an individual and the principal, alter ego,
officer, director, shareholder, employee, agent, and/or other representative of a business entity,
DAVID HURLEY LTD. d/b/a HURLEY’S DANCE CLUB” (Doc. 2, p. 2).
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U.S. 544, 555, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007) (quoting Conley v. Gibson,
355 U.S. 41, 47, 78 S.Ct. 99, 2 L.Ed.2d 80 (1957)). While “detailed factual
allegations” are not required, “labels and conclusions, and a formulaic recitation of
the elements of a cause of action will not do.” Twombly, 550 U.S. at 555. The
complaint must “include sufficient facts ‘to state a claim for relief that is plausible on
its face.’ “ Cole v. Milwaukee Area Tech. College Dist., 634 F.3d 901, 903 (7th Cir.
2011) (quoting Justice v. Town of Cicero, 577 F.3d 768, 771 (7th Cir. 2009)). “A
claim has facial plausibility when the plaintiff pleads factual content that allows the
court to draw the reasonable inference that the defendant is liable for the misconduct
alleged.” Ashcroft v. Iqbal, 556 U.S. 662, 129 S.Ct. 1937, 1949, 173 L.Ed.2d 868
(2009). In ruling on a Rule 12(b)(6) motion, the court “construe[s] the ... [c]omplaint
in the light most favorable to plaintiff, accepting as true all well-pleaded facts and
drawing all possible inferences in his favor. Id.
III. Analysis
As to the claims against David Hurley, individually, defendants allege that
plaintiff fails to allege facts demonstrating that David Hurley, LTD. is in fact the alter
ego of David W. Hurley, the individual. Plaintiff counters that it has alleged sufficient
facts and that there is a question as to the level of responsibility and control that
David Hurley had over the operations of the establishment. The Court agrees with
plaintiff.
As stated earlier, the allegations against Hurley in the complaint are as follows:
“David Hurley, is an individual and the principal, alter ego, officer,
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director, shareholder, employee, agent, and/or other representative of
a business entity, DAVID HURLEY LTD. d/b/a HURLEY’S DANCE
CLUB” (Doc. 2, p. 2).
Further, the complaint alleges “each and every of the above named defendants and/or
their agents, servants, workmen, or employees did lawfully publish, divulge and
exhibit the Program at the time of its transmission at the address of each of their
respective establishments, as indicated above.
Said unauthorized interception,
publication, exhibition and divulgence by each of the defendants was done wilfully
and for purposes of direct or indirect commercial advantage or private financial
gain.”
Section 553 states that no person shall “intercept or receive or assist in
intercepting or receiving any communications service offered over a cable system.”
47 U.S.C. § 553. Similarly, § 605 prohibits anyone from receiving or assisting in
receiving certain communications without authorization. See 47 U.S.C. § 605.
Courts have held that individual liability for violations of §§ 553 and 605 may arise
under certain circumstances. See e.g., Comcast of Illinois X v. Multi-Vision Elecs.,
Inc., 491 F.3d 938, 947 (8th Cir. 2007) (finding individual liability where there is “no
distinction” between the actions of the individual company); J&J Sports Prods. Inc.
v. Ribeirao, 562 F.Supp.2d 498, 501 (S.D.N.Y. 2008)(“To hold Ribeiro vicariously
liable in her individual capacity under § 605, J & J Sports must show that Ribeiro
had a right and ability to supervise the violations, and that she had a strong financial
interest in such activities.”)
Here, the Court finds that the complaint states a claim of relief against Hurley
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individually that is “plausible on its face.” Iqbal, 129 S..Ct. at 1949. Plaintiff alleges
that Hurley is the individual and the principal, alter ego, officer, director,
shareholder, employee, agent, and/or other representative of DAVID HURLEY LTD.
d/b/a HURLEY’S DANCE CLUB and that he directly unlawfully intercepted and
exhibited the Program, or assisted such activities for commercial advantage or
private financial gain.
Such allegations are sufficient to survive the motion to
dismiss.
As to the conversion claim, the Court finds that Chief Judge Holderman’s
exhaustive survey of the law on this issue in Joe Hand Promotions, Inc. v. Lynch, et
al., 11-C-4607-JFH (N.D. Ill. 2011), 2011 WL 5386358 *3-5 (Nov. 7, 2011) convinces
the Court that plaintiff cannot assert a claim for conversion under these
circumstances. This facts of this case and the facts of the case that Chief Judge
Holderman decided are almost identical. Both cases contain the same plaintiff; the
same three counts alleging the same statutory violations and common law claim of
conversion and involve a program that allegedly was intercepted. As concluded by
Judge Holderman: “Illinois courts have not yet extended the tort of conversion to
intangible property like television programing.” Id. at *5. Thus, the Court dismisses
Count III of plaintiff’s complaint for failure to state a claim for conversion under
Illinois law.
IV. Conclusion
Accordingly, the Court DENIES in part and GRANTS in part defendants’
motion to dismiss pursuant to Federal Rule of Civil Procedure 12(b)(6) (Doc. 9). The
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motion is denied as to the arguments as to David Hurley, individually and the motion
is granted as to Count III, the conversion claim. The Court DISMISSES with
prejudice Count III of plaintiff’s complaint.
IT IS SO ORDERED.
Signed this 21st day of December, 2011.
David R. Herndon
2011.12.21
09:45:42 -06'00'
Chief Judge
United States District Court
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