CBS Broadcasting Inc. et al v. Filmon.Com, Inc.

Filing 37

ENDORSED LETTER addressed to Judge Naomi Reice Buchwald from Toby M. J. Butterfield dated 8/4/2011 re: Counsel requests a pre-motion conference as soon as possible. ENDORSEMENT: Application Denied. (Signed by Judge Naomi Reice Buchwald on 8/11/2011) (ft) Modified on 8/15/2011 (ad).

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August 4,2011

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VIA lFACSIMllLE (2112) 805-7927
DOCUMENT
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Hon. Naomi Reice Buchwald, U.S.D.l.
Daniel Patrick Moynihan United States Court (fMQC #:
500 Pearl Street, Room 2270
FILED:

CEIVED IN CHAMBERS
AOMI REICE BUCHWALD

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ED STATES COURT JUDGE

New York, NY 10007-1312
Re:

CBS Broadcasting, Inc. v. FilmOn.cam Inc., 1:10-cv-7S32-NRB

Dear Judge Buchwald:

MEMO END'ORSED

Late last week, approximately Wednesday, July 27, our office received a copy ofthe Court's
July 21 letter (the "Letter") responding to the parties' letters dated July 5, 14, 19 and 20. On behalf of
our client defendant FilmOn.com, Inc., we respectfully request a pre-motion conference as soon as
possible, as we wish to move pursuant to 28 U.S.C. §1292(b) for an order certifying to the COUlt a
Appeals whether current Second Circuit law permits the defendant in a copyright action to be denied tl1~~t,.e....A-'""1.
right to documentary discovery concerning the factors relevant in an assessment of statutory damages
a copyright action.
We recognize that the Letter indicates that Plaintiffs' refusal to produce such documents will
impact what the Court would allow as damages if Plaintiffs establish liability. However that is far fro
being a ruling sufficient to protect our client on the point. Rather, the Court's Letter denies our client
the right to challenge the blanket allegations of harm which Plaintiffs have claimed throughout this
action. In their initial response to Defendant's Request No. 23 seeking documents about the categories
of damages allegedly suffered, Plaintiffs stated objections but indicated they "will produce such
infonnation as is found at a time and place and subject to terms and conditions agreed upon by counsel
for all parties." Yet they now refuse to produce any documents, despite seeking the maximum statutory
damages for willful infringement. The Court's Letter permits Plaintiffs to change their position, evade
their discovery obligations and denies Defendant the right to examine what facts exist (or, as we believe,
contradict) Plaintiffs' claims.
The Court's Letter also denies Defendant the opportunity to obtain any discovery whatsoever
concerning the most important issue in this case: whether Defendant's business falls outside the Section
111 statutory licensing scheme, as Plaintiffs maintain, and if so how. Plaintiffs asserted in their mo
papers that there are many unspecified differences between Defendant's system and other distribution
systems used by Plaintiffs' licensees, including cable systems licensed pursuant to the Section 111
statutory scheme. Defendant is entitled to seek documents concerning those alleged differences in order
to defend itself on the merits. Such documents are vital to Defendant's ability to demonstrate that it too
falls within the Section 111 statutory scheme enacted by Congress. Plaintiffs' claims that they cannot
provide such documents because they are confidential and contain sensitive business information is
belied by the existence of the Court's StipUlated Protective Order; plaintiffs' litigation of claims against

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August 4, 2011
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other cable systems concerning the scope of the rights; and obviously conduct business in the regular
course with dozens if not hundreds of counterparties in business notwithstanding any oftheir
confidentiality concerns.
We submit these are grounds for the Court to reconsider and modify or vacate its rulings in the
Letter. We certainly believe our client should be entitled to discovery targeted towards plaintiffs'
licensing to others pursuant to Section 111, and concerning plaintiffs' assertion that defendants
consumer tracking, authentication, and antipiracy procedures are inadequate. Depositions are simply
inadequate to gather that infonnation. If the Court believes otherwise, it should fonnally prohibit
plaintiffs from submitting evidence of such alleged hann. The Court's admonition that "plaintiffs will
have to bear the consequences of [their] decision" not to produce documents leaves completely up in the
air how defendant can and should challenge plaintiffs' unsupported assertions of harm. Without the
opportunity to cross-examine witnesses with contrary documents, Defendant will be denied a fair
opportunity to defend itself at trial or otherwise.
Because the Court's Letter is inconsistent with law and threatens to require Defendant to engage
in substantial deposition practice, summary judgment and conduct trial without the benefit ofrelevant
discovery permitted by law, the Court of Appeals should resolve the question of the scope of discovery
in this action now, before all those proceedings take place. Plaintiffs would not be prejudiced, as
Defendant has agreed to continue the TRO while the case is heard. Without an interlocutory appeal of
this issue, Defendant will be relegated to challenging the result of the Court's ultimate detennination of
the claims, at which time the parties will face a reversal and remand for a repeat of discovery and trial
using the discovery to which defendant is entitled under the Copyright Act and binding Second Circuit
authority. " ... [T]here is noting in section 504 to prevent a court from taking account of evidence
concerning actual damages and profits in making an awar of statutory damages within the range set out
in subsections (c)." H.R. Rep. 94-1476, 94th Congo 2ND Sess. 1976, *161; quoted in Patry on Copyright,
§ 22: 174 (adding: "At the same time, courts have held that the absence of actual damages is a mitigating
factor for defendant.")
We would appreciate the Court hearing this pre-motion conference as soon as possible, as
discovery is currently scheduled to end soon. We will be writing separately shortly about a proposal to
extend the deadline for completion of discovery, which counsel for all parties believe is necessary in the
circumstances, once we have completed our discussions with opposing counsel on that topic.
Respectfully submitted,

~~
Toby M. J. Butterfield

cc (via E-Mail):

{A070992.DOC/l}

Hadrian R. Katz, Esq.
Scott Morrow, Esq.
Al J. Daniel, Esq.
Christopher J. Marino, Esq.