J & J Sports Productions, Inc v. Matti et al

Filing 18

OPINION AND ORDER granting 16 Motion for Default Judgment. Signed by District Judge Paul D. Borman. (DTof) (Main Document 18 replaced on 1/12/2015) (DTof).

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MICHIGAN
SOUTHERN DIVISION
J & J SPORTS PRODUCTIONS, INC.,
Plaintiff,
v.

Case No. 13-13963
Paul D. Borman
United States District Judge

BADER MATTI,
Defendant.
___________________________/
OPINION AND ORDER GRANTING PLAINTIFF’S CORRECTED MOTION FOR
DEFAULT JUDGMENT AND AWARDING DAMAGES (ECF NO. 16)
This action arises from Plaintiff J & J Sports Production, Inc.’s (“Plaintiff’) allegation that
Defendant Bader Matti violated federal law by illegally broadcasting a boxing match at his bar.
Defendant Matti has failed to defend or otherwise appear in this action and Plaintiff now moves this
Court for entry of a Default Judgment pursuant to Federal Rule of Civil Procedure 55(b)(2). (ECF
No. 16).
Plaintiff previously moved for a default judgment against Defendant Matti on June 16, 2014.
(ECF No. 14). The Court denied that motion without prejudice on August 5, 2014 because
Plaintiff’s motion for default was based on a different and separate transmission of a program that
was not set forth in the complaint (but is the subject of a separate action between the same parties,
see J & J Sports Productions, Inc. v. Bader Matti, case no. 14-12981). (ECF No. 15, Order).
Plaintiff now seeks a judgment against Defendant in the amount of $110,000.00, plus
attorney’s fees and court costs in the amount of $2,540.00, pursuant to 47 U.S.C. §§

605(e)(3)(C)(i)(I)-(II), 605(e)(3)(C)(ii) and 605(e)(3)(C)(iii).1 A hearing on this matter was held on
November 24, 2014 on this issue and for the reasons stated on the record and those set forth below,
the Court GRANTS Plaintiff’s motion for default and awards damages in the amount of $24,540.00.
I. BACKGROUND
On September 16, 2013, Plaintiff filed its complaint against Defendant Matti and also against
150 West Café, LLC. (ECF No. 1, Compl. ¶¶ 6-8). Plaintiff alleges in its complaint that, pursuant
to contract, it has the exclusive nationwide television distribution rights for the “‘Star Power’ Floyd
Mayweather, Jr. v. Victor Ortiz, Championship Fight Program” and its undercard preliminary bouts
(collectively “the Program”) that were telecast nationwide on Saturday, September 17, 2011.
(Compl. ¶ 10). Plaintiff asserts that Defendant Matti is the owner, officer, operator, or otherwise
the person is charge of 150 West Café, LL. (Id. at ¶ 8; Mot. Ex. G, Report of LLC Members,
Managers & Assignees).

Plaintiff, in an attempt to combat piracy of its programs, hires

investigative agencies who retain auditors who visit various commercial locations that have no
record of paying the required fee. For a “commercial fee”, a commercial establishment can receive
an unscrambled signal enabling the business to view the program either through Plaintiff or an
authorized distributor. The fee is determined by the number a “Rate Card” that ties the fee to the
seating capacity of the business. (See Mot., Ex. I, Rate Card). Plaintiff claims Defendants illegally
broadcast the Program to the patrons of 150 West Café on September 17, 2011 in violation of the
Communication Act of 1934, as amended, 47 U.S.C. § 605, et seq., and the Cable & Televison
Consumer Protection and Competition Act of 1992, as amended, 47 U.S.C. § 553, et seq. (Id. at ¶¶

1

The Court notes that Plaintiff does not pursue its state law claim of conversion and
therefore this Court will treat that claim as abandoned.
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9-24; see also Mot. Ex. E, Taylor Aff.). Plaintiff also claims that the broadcast constituted
conversion. (Id. at ¶¶ 24-27).
Plaintiff provides that Defendant Matti was served on November 3, 2013. (Mot. Ex. B). On
January 22, 2014, after discovering 150 West Café, LLC was dissolved following a court-ordered
receivership, Plaintiff voluntarily dismissed Defendant 150 West Café, LLC. (ECF No. 5). The
same day, Plaintiff requested a entry of a Clerk’s default against Defendant Matti which was entered
on January 23, 2014. (ECF Nos. 7, 8).
II. STANDARD OF REVIEW
Pursuant to Federal Rule of Civil Procedure 55(b) a judgment by default may be entered
against a defendant who has failed to plead or otherwise defend against an action. In order to obtain
judgment by default, the proponent must first request the clerk's entry of default pursuant to Rule
55(a). See Hanner v. City of Dearborn Heights, No. 07-15251, 2008 WL 2744860, at *1 (E.D.
Mich. July 14, 2008). Once a default has been entered by the clerk’s office, all of a plaintiff’s wellpleaded allegations, except those relating to damages, are deemed admitted.

Antoine v. Atlas

Turner, Inc., 66 F.3d 105, 110 (6th Cir. 1995), see also Ford Motor Co. v. Cross, 441 F. Supp. 2d
837, 846 (E.D. Mich. 2006) (citation omitted). Once a default is obtained, the party may then file
for a default judgment by the clerk or by the court. FED. R. CIV. P. 55(b). If the plaintiff’s wellpleaded allegations are sufficient to support a finding of liability as to the defendant on the asserted
claims, then the Court should enter a judgment in favor of the plaintiff. See Cross, 441 F. Supp. 2d
at 848. Although Rule 55(b)(2) does not provide a standard to determine when a party is entitled
to a judgment by default, the case law sets forth that the court must exercise “sound judicial
discretion” when determining whether to enter the judgment. Wright & Miller, 10A Federal Practice

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& Procedure, § 2685 (3d ed. 1998) (collecting cases). After a court determines that a default
judgment should be entered, it will determine the amount and character of the recovery awarded.
See id. § 2688 (collecting cases).
III. ANALYSIS
A.

Sufficient Service
“Because a party has no duty to plead until properly served, sufficient service of process is

a prerequisite to entry of default. Russell v. Tribley, No. 10-14824, 2011 WL 4387589, at *8 (E.D.
Mich. Aug. 10, 2011) (collecting cases).

In the present action, Plaintiff has evidenced that

Defendant Bader Matti was personally served on November 3, 2013 at 2953 Squire Ct., Troy,
Michigan by providing a notarized proof of service. (Mot. Ex. B, Proof of Service with signature).
This method of service comports with Federal Rule of Civil Procedure 4(e), which provides that an
individual residing within a judicial district of the United States may be served by “delivering a copy
of the summons and of the complaint to the individual personally”. FED. R. CIV. P. 4(e)(2)(A).
Therefore, Plaintiff has established that Defendant Matti was properly served in this action.
Accordingly, the Court should consider all of Plaintiff’s well-pled allegations admitted. See
Cross, 441 F. Supp. 2d at 846. Therefore, the Court’s inquiry becomes whether Plaintiff’s
allegations are sufficient to support his claims and whether an award of damages is appropriate.
B.

Violations of 47 U.S.C. § 605 and § 553
Pursuant to 47 U.S.C. § 553(a)(1), “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”. Section 605(a), on the other hand, applies to
satellite transmissions and provides in relevant part that a person who receives, transmits, or assists

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in transmitting any communication by wire or radio may not divulge or publish that communication.
See Nat’l Satellite Sports, Inc. v. Eliadis, Inc., 253 F.3d 900, 911 (6th Cir. 2001) (noting the Cable
Communications Policy Act of 1984 was enacted to “address a problem which is increasingly
plaguing the cable industry – the theft of cable service.”); see also Joe Hand Promotions, Inc. v.
KSD, Inc., No. 3:13CV951, 2014 WL 4675264, *6-7 n.1 (N.D. Ohio, Sept. 18, 2014) (examining
the legislative histories of both statutes and noting in a footnote that there is some struggle regarding
the interplay between the two statutes). In this current action, where Plaintiff does not know how
the Defendant pirated the signal (via satellite or through over a cable system) it is pro forma to plead
both statutes, however, a Plaintiff cannot collect damages under both statutes. See J & J Sports
Productions, Inc. v. Trier, 2009 U.S. Dist. LEXIS 6415 (E.D. Mich. Jan. 29, 2009); Joe Hand
Promotions, Inc. v. Granada Lounge, Inc., 11-13062, 2012 WL 447272, *2 (E.D. Mich. Feb. 13,
2012).
Plaintiff’s complaint, motion for default, and attached exhibits establish that Defendant
violated both § 605 and § 553 by intercepting and displaying the Program on Saturday, September
17, 2011 at his establishment, 150 West Café, LLC, located at 150 W. Jefferson Avenue, Detroit,
Michigan (“the bar”) for the purpose of direct or indirect commercial advantage and private financial
gain. Specifically, Plaintiff provides that (1) Defendant did not pay to receive or publish the
Program; (2) Defendant is the sole member, owner, person with control over the bar, 150 West Café,
LLC; (3) the commercial rate charged to a business with seating of 101-200 was $4,200 (Mot. Ex.
I, rate card); and (4) an auditor, Darin R. Taylor, hired by Plaintiff visited the bar on September 17,
2011 and observed through an unobstructed window that approximately 110 people were in the bar,
which had four televisions displaying the Program, and that there was a ten dollar cover charge to

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enter the bar to watch the Program. (Mot. Ex. E, Taylor Aff.).
Courts in this district and elsewhere have held that to state a claim against an individual
under § 605 or §553, a plaintiff must allege facts establishing that the individual had a right and
ability to supervise the infringing activities and that the individual had a direct financial interest in
those same activities. See Joe Hand Prod., Inc. v. Cain, No. 06-12213, 2006 WL 2466266, at *2
(E.D. Mich., Aug. 24, 2006); J & J Sports Productions, Inc. v. Stanley, 2014 WL 2763635 (E.D.
Mich. June 18, 2014) (granting motion for default judgment against individual defendants where the
plaintiff had plead the individual defendant had supervisory control over the activities and received
a financial benefit); J & J Sports Prods., Inc. v. Walia, 2011 WL 902245 *3 (N.D. Cal. Mar. 14,
2011) (collecting cases and observing “[i]ndeed, it appears that all courts addressing the issue have
applied the copyright standard for individual liability to violations of § 553 and § 605.”); J & J
Sports Prods., Inc. v. Ribeiro, 562 F. Supp.2d 498, 501 (S.D.N.Y. 2008). Here, Plaintiff has alleged
that Defendant was the sole member of the 150 West Café, LLC and also the “individual with
dominion, control, oversight and management” of the 150 West Café, and that Defendant received
a private financial gain in relation to the display of the Program. (Compl. ¶¶ 8, 14). Further,
Plaintiff has provided evidence to corroborate that Defendant is indeed the sole member of 150 West
Café, LLC. (Mot., Ex. G). Taking these well pled allegations as true, the Court should find that
Plaintiff has established individual liability as to Defendant pursuant to § 605 and § 553.
As the Plaintiff correctly notes, when a defendant is liable under both § 553 and § 605, the
plaintiff may only recover under one of those sections. See Stanley, 12-14093, 2014 WL 2763635,
*2 (E.D. Mich. June 18, 2014) (citing Trier, 2009 U.S. Dist. LEXIS 6415 (E.D. Mich. Jan. 29,
2009)). In the present case, Plaintiff elects to recover under 47 U.S.C. § 605.

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Pursuant to § 605, the “aggrieved party” may chose between actual or statutory damages.
47 U.S.C. § 605(e)(3)(C)(i). Plaintiff has requested statutory damages. (Mot. at 9). As set forth in
the statute, Plaintiff can recover statutory damages for each violation in the sum of not less than
$1,000 or more than $10,000 as determined by the Court. 47 U.S.C. § 605(e)(3)(C)(i)(II). However,
where the court finds that the violation was committed “willfully and for the purposes of direct or
indirect commercial advantage or private financial gain” the court can increase the award by the
amount of $100,000 per violation. 47 U.S.C. § 605(e)(3)(C)(ii).
Plaintiff asserts that the violation at issue in this case was a wilful violation based on the fact
that the Program was exhibited in a commercial establishment and that according to a second
affidavit by the same auditor, a second unauthorized program was shown at the 150 West Café on
a different date, the “Mayweather vs. Cotto” fight or one of its undercard preliminary bouts on May,
5, 2012. (Mot. Ex. J).2
“The damages awarded by the Court ‘should take into account the proportionality between
the loss suffered by the plaintiff and the profit gained by the defendant.’” Granada Lounge, Inc.,
11-13062, 2012 WL 447272, *2 (quoting Ribeiro, 562 F. Supp. 2d at 501). Courts in this district
have looked to certain relevant facts to determine a damage award including the number of patrons
at the time of the violation, the seating capacity of the establishment, the rate charged by the plaintiff
for the broadcast, whether the defendant charged a cover to patrons or “was likely to have obtained
significant profits in another manner.” Id. (quoting Trier, No. 08-11159, 2009 U.S. Dist. LEXIS
6415, at *3). In Trier, the court explained that

2

This second alleged infraction is currently a separate action pending before this Court,
see J & J Productions, Inc. v. Matti, case no. 14-12981).
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When the exact number of patrons is unknown, courts will award a flat sum based
on considerations of justice. When the exact number of patrons is known, the court
will based the award on the number of patrons in the establishment who viewed the
unauthorized showing multiplied by a number set by the court. This number varies
widely from $20 to $300, although most courts set a number around $50.
Id., No. 08-11159, 2009 U.S. Dist. LEXIS 6415, at *3 (quoting Ribeiro, 562 F. Supp. 2d at 501-02)
(internal citation and quotation marks removed)).
In this case, Plaintiff submitted evidence that there were approximately 110 patrons at the
bar and a $10 cover was being charged to view the Program. Plaintiff’s commercial rate based on
the number of people in the bar at the time of the fight was $4200 pursuant to its rate card. (Mot.,
Ex. I). The Plaintiff does not provide what residential rate would have charged for the fight,
although it is logical to assume it would be much less than the commercial rate.
In the present case, the number of patrons in bar is known - 110. Therefore, the Court will
follow the direction of other courts in this district who have found Trier and Ribeiro instructive, and
award damages based on the “head count” and then multiplying by dollar amount somewhere
between $20 and $300. See Ribeiro, 562 F. Supp. 2d at 501-02 (ultimately multiplying the number
of patrons by the pay-per-view residential rate of $54.95 and then doubling that amount to $1,500
to meet the statutory minimum, and then multiplying that amount by three because the violation was
wilful); see also Granada Lounge, 2012 WL 447272, at *2-3 (finding that the commercial rate
defendant would have been charged (rounded up to the statutory minimum) was appropriate while
the higher base award of $10,000 was not justified because a cover was not charged and there were
only 68 to 79 people in attendance, but then multiplying the $1,000 base award by three for
wilfulness.); Trier, 2009 U.S. Dist. LEXIS 6415 at *3 (finding that where there were only 21 people
at the establishment, where no cover was charged, and the commercial rate would have been $1600,

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the court found that $1600 was an appropriate base award and multiplied by three based on the
wilfulness of the violation.). Here, there were a little more than 100 people in attendance and
Defendant was collecting a cover charge. Further, Defendant also displayed at least one other
unauthorized program. Therefore, the Defendant in this case is distinguishable from the defendants
in Ribeiro, Trier, or Granada Lounge, none of whom charged their patrons a cover charge and none
of whom have one other instance of displaying an unauthorized Program. Therefore, the Court will
award a flat $50 fee per patron in attendance, for a total of $5,500, as an appropriate base award.
Plaintiff’s allegations and evidence also establish that the violation was wilful and therefore,
the Court will also multiply the base award by four (4) in light of the fact that a cover was charged
and because Defendant later broadcast a similarly unauthorized program in May 2012. See 47
U.S.C. § 605(e)(3)(C)(ii). This results in a total statutory award of $22,000.00.
Pursuant to 47 U.S.C. § 605(e)(3)(B)(iii), the court “shall direct the recovery of full costs,
including awarding reasonably attorneys’ fees to an aggrieved party who prevails.” In the present
case, Plaintiff has submitted an affidavit requesting a total of $2,540.00 in fees and costs. (Mot. Ex.
K, Invoice). Plaintiffs’ counsel requests a billable rate of $200.00 per hour for a total of 10.4
billable hours and $460 in costs ($400 filing fee and $60 service process fee). Plaintiff has
submitted the economics of law practice in Michigan Report to support its contention that a $200.00
billable rate is reasonable. (Mot., Ex. K). The Court concludes that $200 is a reasonable billing rate,
as the median billable rate for an attorney in private practice in Michigan in 2010 was $215, and
finds that the request of attorney fees and costs in the amount of $2,540.00 is reasonable. (Ex. K at
*7). Therefore, the Court will award Plaintiff a total award, including attorney fees and costs, of
$24,540.00.

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IV. CONCLUSION
For these reasons and those stated on the record, the Court GRANTS Plaintiff’s Corrected
Motion for Default Judgment and AWARDS damages in the amount of $24,450.00. (ECF No. 16).
IT IS SO ORDERED.

s/Paul D. Borman
PAUL D. BORMAN
UNITED STATES DISTRICT JUDGE
Dated: January 12, 2015

CERTIFICATE OF SERVICE
The undersigned certifies that a copy of the foregoing order was served upon each attorney or party
of record herein by electronic means or first class U.S. mail on January 12, 2015.

s/Deborah Tofil
Case Manager

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