Countryman Nevada, LLC v. Doe-98.246.54.64
Filing
49
Opinion and Order - Plaintiff's amended motion for default judgment (ECF 38 ) is GRANTED IN PART. Defendant is ordered to (1) pay Countryman statutory damages of $750; (2) cease all activities infringing on Countryman's rights in the motion picture NDCC; and (3) destroy all unauthorized copies of NDCC in the possession of Defendant. Signed on 9/22/2016 by Judge Michael H. Simon. (mja)
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF OREGON
COUNTRYMAN NEVADA, LLC.,
Case No. 6:15-cv-0436-SI
Plaintiff,
OPINION AND ORDER
v.
PETER SUAREZ,
Defendant.
Michael H. Simon, District Judge.
Plaintiff Countryman Nevada, LLC (“Countryman”) brings this action against Defendant
Peter Suarez. Countryman alleges that Defendant copied and distributed Countryman’s motion
picture The Necessary Death of Charlie Countryman (“NDCC”) through a public BitTorrent
network in violation of Countryman’s exclusive rights under the Copyright Act. Before the Court
is Countryman’s amended motion for entry of default judgment under Federal Rule of Civil
Procedure 55(b). ECF 38. For the following reasons, the Court grants in part Countryman’s
motion, and will enter a default judgment against Defendant in the amount of $750, along with
injunctive relief.
PAGE 1 – OPINION AND ORDER
STANDARDS
Under Federal Rule of Civil Procedure 55(a), the Clerk of the Court is required to enter
an order of default if a party against whom affirmative relief is sought fails timely to answer or
otherwise defend an action. Fed. R. Civ. P. 55(a) (“When a party against whom a judgment for
affirmative relief is sought has failed to plead or otherwise defend, and that failure is shown by
affidavit or otherwise, the clerk must enter the party’s default.”). Upon the entry of default, the
Court accepts “the well-pleaded factual allegations” of the complaint “as true.” DIRECTV, Inc. v.
Hoa Huynh, 503 F.3d 847, 854 (9th Cir. 2007) (quoting Cripps v. Life Ins. Co. of N. Am., 980
F.2d 1261, 1267 (9th Cir. 1992)); see also Geddes v. United Fin. Grp., 559 F.2d 557, 560 (9th
Cir. 1977). The court, however, does not accept as admitted facts that are not well-pleaded,
conclusions of law, or facts relating to the amount of damages. DIRECTV, 503 F.3d at 854;
Geddes, 559 F.2d at 560; see also Derek Andrew, Inc. v. Poof Apparel Corp., 528 F.3d 696, 702
(9th Cir. 2008) (“‘The general rule of law is that upon default the factual allegations of the
complaint, except those relating to the amount of damages, will be taken as true.’” (quoting
TeleVideo Sys., Inc. v. Heidenthal, 826 F.2d 915, 917-18 (9th Cir. 1987))).
After default has been entered against a defendant, a court may enter a default judgment
against that defendant. See Fed. R. Civ. P. 55(b). “The district court’s decision whether to enter a
default judgment is a discretionary one.” Aldabe v. Aldabe, 616 F.2d 1089, 1092 (9th Cir. 1980);
see also Dreith v. Nu Image, Inc., 648 F.3d 779, 786 (9th Cir. 2011) (noting that a district’s court
decision whether to enter a default judgment is reviewed for abuse of discretion). In Eitel v.
McCool, 782 F.2d 1470 (9th Cir. 1986), the Ninth Circuit set out factors to guide a district
court’s consideration of whether to enter a default judgment. See DIRECTV , 503 F.3d at 852
(noting that Eitel “set[] out factors to guide district court’s determination regarding the
appropriateness of granting a default judgment”).
PAGE 2 – OPINION AND ORDER
The Ninth Circuit in Eitel held:
Factors which may be considered by courts in exercising discretion
as to the entry of a default judgment include: (1) the possibility of
prejudice to the plaintiff, (2) the merits of plaintiff's substantive
claim, (3) the sufficiency of the complaint, (4) the sum of money at
stake in the action; (5) the possibility of a dispute concerning
material facts; (6) whether the default was due to excusable
neglect, and (7) the strong policy underlying the Federal Rules of
Civil Procedure favoring decisions on the merits.
Eitel, 782 F.2d at 1471-72 (punctuation in original). The “starting point” of the court’s analysis,
however, “is the general rule that default judgments are ordinarily disfavored.” Id. at 1472.
BACKGROUND
Beginning in 2014, counsel for Plaintiff has filed hundreds of cases in this District
asserting that Doe defendants, originally identified only by their Internet Protocol (“IP”)
addresses, violated the Copyright Act by downloading movies on the internet using a peer-topeer BitTorrent file sharing protocol. On March 17, 2015, Countryman filed its complaint in this
case, identifying Defendant only by his IP address as a person who illegally downloaded NDCC
using the BitTorrent network. After the Court granted Countryman’s motion to subpoena
Defendant’s internet service provider, Countryman identified Defendant as the subscriber
associated with the infringing IP address. On April 2, 2015, Defendant telephoned Plaintiff’s
counsel, identified himself as Peter Suarez, refused to provide a contact phone number or
address, and indicated that his internet service provider may have been “hacked” or an overnight
guest may have engaged in the infringing activity. After this telephone conversation, Defendant
ceased all communications with Plaintiff’s counsel.
On June 18, 2015, Plaintiff filed an amended complaint, naming Peter Suarez as the
defendant. Plaintiff was unable to personally serve Defendant, and on September 15, 2015, the
Court permitted Plaintiff to serve Defendant via publication and first class mail to Defendant’s
PAGE 3 – OPINION AND ORDER
last known address. On January 20, 2016, the Court entered an order of default against
Defendant.
On February 18, 2016, Plaintiff filed a motion for default judgment. Plaintiff sought
statutory damages in the amount of $7,500. The Court ordered Plaintiff to supplement its filing
with further factual and legal information supporting higher statutory damages, particularly in
light of the fact that judges in this District regularly award much lower statutory damages. On
April 22 2016, Plaintiff filed the pending amended motion for default judgment, seeking
statutory damages in the amount of $5,000.
After this case was filed, the District of Oregon issued Standing Order 2016-7, which
notifies defendants in BitTorrent cases of their right to request pro bono counsel, and Standing
order 2016-8, which requires attorneys for plaintiffs in these cases to forward Standing
Order 2016-7 to potential defendants. Because this requirement was not in place when Plaintiff
filed its complaint against Defendant, on May 25, 2016, the Court ordered Plaintiff to provide
Defendant with a copy of Standing Order 2016-7. On June 30, 2016, the Court appointed pro
bono counsel to assist Defendant. On August 10, 2016, appointed pro bono counsel requested
that the appointment be terminated because counsel was unable to contact Defendant.
DISCUSSION
To establish a claim of copyright infringement, a “plaintiff must show ownership of the
copyright and copying by the defendant.” Fox Broad. Co. v. Dish Network L.L.C., 747
F.3d 1060, 1066-67 (9th Cir. 2013) (quotation marks omitted). The factual allegations of
Plaintiff’s Amended Complaint, which the Court accepts as true upon default, establish these
elements. Accordingly, a judgment of default is appropriate in this case. See Glacier Films
(USA), Inc. v. Tenorio, 2016 WL 3766465, at *2 (D. Or. June 22, 2016); Voltage Pictures, LLC
v. Martinez, 2015 WL 4772856, at *2 (D. Or. Aug. 11, 2015).
PAGE 4 – OPINION AND ORDER
Under the Copyright Act, a plaintiff may elect an award of statutory damages “in a sum
of not less than $750 or more than $30,000” per infringement, in lieu of an award representing
actual damages. 17 U.S.C. § 504(c)(1). If a court finds the infringement to be willful, “the court
in its discretion may increase the award of statutory damages to a sum of not more than
$150,000.” 17 U.S.C. § 504(c)(2). The court has broad discretion in setting the amount of
statutory damages. See Columbia Pictures Television, Inc. v. Krypton Broad. of Birmingham,
Inc., 259 F.3d 1186, 1194 (9th Cir. 2001) (“If statutory damages are elected, the court has wide
discretion in determining the amount of statutory damages to be awarded, constrained only by
the specified maxima and minima.”) (quotation marks and alteration omitted).
Plaintiff concedes that the amount of economic damages suffered as a result of
Defendant’s infringing activity is highly speculative and incalculable. Thus Plaintiff seeks only
statutory damages. Plaintiff argues that Defendant’s conduct was willful and that because he has
refused to participate in the legal process, statutory damages of $5,000 are warranted. The Court
disagrees.
The Court has awarded statutory damages of greater than $750 under certain
circumstances, such as a when a defendant expressly admits to the infringing behavior, is
personally served with the lawsuit yet refuses to participate in the lawsuit, and Plaintiff provides
evidence of ongoing infringing conduct. See Automata Prods., Inc. v. Spicher, 2016
WL 4621198 (D. Or. Sept. 6, 2016). Such facts are not present here. Although the Court deems
the factual allegations of Plaintiff’s Amended Complaint true because of Defendant’s default, in
the only conversation between Defendant and Plaintiff’s counsel, Defendant did not expressly
admit to being the person who downloaded Plaintiff’s movies. To the contrary, Defendant
verbally denied that claim. Additionally, Defendant was not personally served with service.
PAGE 5 – OPINION AND ORDER
Although there is no evidence indicating that Defendant does not reside at the address to which
service was mailed, the Court is reluctant to impose heightened statutory damages upon default
when a defendant was not personally served.
Further, the Court agrees with the reasoning of U.S. Magistrate Judge Stacie Beckerman
in Glacier Films. In her opinion dated June 22, 2016, Judge Beckerman declined to award
statutory damages of $2,500 and instead awarded the minimum statutory damages of $750.
Glacier Films, 2016 WL 3766465, at *3. Judge Beckerman explained:
[C]ommon sense supports a conclusion that a $750 financial
penalty for illegal downloading one movie is more than
sufficiently punitive to deter others from illegally downloading
free movies on the BitTorrent network. With knowledge that it will
now cost $750 to watch a single movie on the BitTorrent network,
consumers should be motivated instead to spend a few dollars to
rent the same move legally. This Court believes that the problem is
not with the magnitude of the damages awarded, but the fact that
the general public does not appear to be aware of the dozens of
BitTorrent copyright infringement actions filed by Plaintiffs’
counsel in this district alone. The Court declines Plaintiffs’
invitation to punish Defendant with a statutory damages award
higher than $750 because he chose not to defend against this
copyright infringement action. The Court is not aware of the
reasons why Defendant chose not to appear and present a defense
in this case, but notes that some individuals may choose to default
merely due to the cost of federal court litigation, not for any
nefarious reason that would support the award of enhanced
statutory damages. In sum, Plaintiffs have failed to present
evidence to demonstrate that the infringing conduct in this action
differs from the several other actions in which judges in this
district have awarded the minimum statutory damages.
Id. (citations and footnote omitted) (alteration in original). The considerations noted by Judge
Beckerman apply in this case and the Court similarly declines to award greater than the
minimum statutory damages in this case.
Plaintiff states in its motion for entry of default judgment that if the Court does not award
damages of $5,000 or greater, then Plaintiff will seek to exercise its Seventh Amendment right to
PAGE 6 – OPINION AND ORDER
a jury trial on damages. Plaintiff cites to Feltner v. Columbia Pictures, 523 U.S. 340 (1998), for
the proposition that there is a Seventh Amendment right to a jury trial for statutory damages
under the Copyright Act. This is correct, as far it goes.
Feltner, however, did not involve a case in which the Court had granted a plaintiff’s
motion for default. Plaintiff offers no legal authority for the proposition that the right to a jury
trial on damages survives the entry of default. There is, however, substantial case law holding
that there is no right to a jury trial for damages after an entry of default, including under the
Copyright Act, and including precedent from the Ninth Circuit. See, e.g., Olcott v. Delaware
Flood Co., 327 F.3d 1115, 1124 (10th Cir. 2003) (finding that a party bears no constitutional
right to a jury trial following the entry of default); Sells v. Berry, 24 F. App’x. 568, 572 (7th
Cir. 2001) (“In the case of a default, only 28 U.S.C. § 1874 may guarantee a right to a jury
trial . . . .”); Graham v. Malone Freight Lines, 314 F.3d 7, 16 (1st Cir. 1999) (“Neither the
Seventh Amendment nor the Federal Rules of Civil Procedure require a jury trial to assess
damages after entry of default . . . .”); Matter of Dierschke, 975 F.2d 181, 185 (5th Cir. 1992)
(“It is also ‘clear . . . that in a default case neither the plaintiff nor the defendant has a
constitutional right to a jury trial on the issue of damages.’” (citing 5 Moore’s Federal Practice
§ 38.19[3] (1992)) (emphasis added)); Adriana Int'l Corp. v. Lewis & Co., 913 F.2d 1406, 1414
(9th Cir. 1990) (holding in a copyright case that after default, “a party has no right to jury trial
under either Fed. R. Civ. P. 55(b)(2), which authorizes a district court to hold an evidentiary
hearing to determine the amount of damages, or the Seventh Amendment”); Henry v.
Sneiders, 490 F.2d 315, 318 (9th Cir. 1974) (“[T]he Seventh Amendment right to trial by jury
does not survive a default judgment.”); Ballard v. RCM Constr., Inc., 2015 WL 4392955, at *2
(S.D. Ind. June 26, 2015), report and recommendation adopted, 2015 WL 4393522 (S.D. Ind.
PAGE 7 – OPINION AND ORDER
July 15, 2015) (noting that after an entry of default, “[r]egardless of the nature of the asserted
claims, neither a plaintiff nor a defaulted defendant has a constitutional, statutory, or rule-based
right to a jury trial on the issue of damages”); Teri Woods Publ'g, L.L.C. v. Williams, 2013 WL
6179182, at *4–5 (E.D. Pa. Nov. 25, 2013) (distinguishing Feltner because it did not involve a
default and citing to “a broad, cross-section of courts” finding that the right to a jury trial does
not survive default); Verizon California Inc. v. Onlinenic, Inc., 2009 WL 2706393, at *1–2 (N.D.
Cal. Aug. 25, 2009) (distinguishing Feltner because it did not involve a default and noting that
Rule 55(b)(2) presupposes that a default extinguishes the constitutional right to a jury trial and
only preserves the right to a jury trial if that right is protected by federal statute, which has been
interpreted as preserving the right only for cases brought under 28 U.S.C. § 1874 (citing
numerous cases)); Hornsby v. Three Dollar Cafe, III, Inc., 2007 WL 2106304, at *5 (N.D. Ga.
July 17, 2007) (“There is no right to a jury trial on damages following the entry of a default.”);
Shepherd v. Am. Broad. Cos., Inc., 862 F. Supp. 486, 491 n.4 (D.D.C. 1994), vacated on other
grounds, 62 F.3d 1469 (D.C. Cir. 1995) (“The parties are clearly not entitled to a jury trial on the
damages question. The sole federal statute that entitles defaulted parties to a jury damages trial
is 28 U.S.C. § 1874 . . . .”); Benz v. Skiba, Skiba & Glomski, 164 F.R.D. 115, 116 (D. Me. 1995)
(“Caselaw dating back to the eighteenth century . . . makes clear that the constitutional right to
jury trial does not survive the entry of default.” (citing Brown v. Van Bramm, 3 Dall. [U.S.] 344,
355 (1797))).
The Court follows these cases and finds that Plaintiff is not entitled to a jury trial on the
issue of damages. Further, even if the right to a jury trial on damages did survive the entry of
default, it would not be permissible under these circumstances. Plaintiff may not request that the
Court resolve the question of damages with the caveat that if Plaintiff is not satisfied with the
PAGE 8 – OPINION AND ORDER
Court’s award, Plaintiff will then demand a jury trial. Awarding damages in a default judgment
is at the Court’s discretion, and Plaintiff cannot demand an award of any specific amount of
damages. Nor can Plaintiff wait and see how much the Court will award in statutory damages
and then demand a jury trial if Plaintiff is not satisfied by the amount awarded. As the Ninth
Circuit has explained in a similar context, “A party cannot fairly be permitted to gain two
chances at victory by waiting until after it is advised of the judge’s decision to decide whether to
waive its right to a jury. . . . This unsupportable result is akin to allowing a gambler to switch his
bet as the horses reach the home stretch.” Fuller v. City of Oakland, 47 F.3d 1522, 1532 (9th
Cir. 1995). Accordingly, Plaintiff’s contingent request for a jury trial on damages if the Court
awards below $5,000 in statutory damages is denied.
Plaintiff also seeks injunctive relief preventing Defendant from future infringing activity
against Plaintiff’s motion picture NDCC. The Court agrees that this case merits injunctive relief
under 17 U.S.C. §§ 502 and 503. Under these sections, the Court may “grant temporary and final
injunctions on such terms as it may deem reasonable to prevent or restrain infringement of a
copyright.” § 502(a). The Court may also “order the destruction or other reasonable disposition
of all copies or phonorecords found to have been made or used in violation of the copyright
owner’s exclusive rights.” § 503(b). Accordingly, the Court orders a permanent injunction
enjoining Defendant from directly, indirectly, or contributorily infringing on Countryman’s
rights, including without limitation by using the internet to reproduce or copy Countryman’s
motion picture NDCC, to distribute NDCC, or to make NDCC available for distribution to the
public except pursuant to a lawful license or with the express authority of Countryman. The
Court also orders Defendant to destroy all unauthorized copies of NDCC.
PAGE 9 – OPINION AND ORDER
CONCLUSION
Plaintiff’s amended motion for default judgment (ECF 38) is GRANTED IN PART.
Defendant is ordered to (1) pay Countryman statutory damages of $750; (2) cease all activities
infringing on Countryman’s rights in the motion picture NDCC; and (3) destroy all unauthorized
copies of NDCC in the possession of Defendant.
IT IS SO ORDERED.
DATED this 22nd day of September, 2016.
/s/ Michael H. Simon
Michael H. Simon
United States District Judge
PAGE 10 – OPINION AND ORDER
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