Zuffa, LLC v. Scott et al

Filing 19

ORDER granting 15 Motion for Default Judgment. Signed by Judge Samuel H. Mays, Jr on 12/14/2011.

IN THE UNITED STATES DISTRICT COURT
FOR THE WESTERN DISTRICT OF TENNESSEE
WESTERN DIVISION

ZUFFA, LLC, d/b/a THE ULTIMATE
FIGHTING CHAMPIONSHIP (UFC),
Plaintiff,
v.
BLACK DIAMOND, INC. d/b/a THE
BLACK DIAMOND
Defendant.

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No. 10-02844

ORDER GRANTING PLAINTIFF’S MOTION FOR ENTRY OF FINAL DEFAULT
JUDGMENT

Before the Court is the March 2, 2011 Motion for Entry of
Default Judgment Against Defendant filed by Plaintiff Zuffa, LLC
(“Zuffa”),

d/b/a

The

Ultimate

Fighting

(Mot. for Default J., ECF No. 11.)
Inc.

d/b/a

Black

For

responded.

The

the

Diamond
following

Championship

(“UFC”).

Defendant Black Diamond,

(“Black

Diamond”)

has

not

reasons,

Zuffa’s

Motion

is

GRANTED.
I.

Background 1

Zuffa is a Nevada corporation with its principal place of
business in Las Vegas.
1

(See Compl. ¶ 5, ECF No. 1.)

Zuffa is

The background facts come from the factual allegations in Zuffa’s complaint,
ECF No. 1, and other pleadings and incorporated attachments, which are deemed
admitted because of Black Diamond’s default.
See Murray v. Lene, 595 F.3d
868, 871 (8th Cir. 2010); United States v. Conces, 507 F.3d 1028, 1038 (6th
Cir. 2007); Ford Motor Co. v. Cross, 441 F. Supp. 2d 837, 848 (E.D. Mich.
2006).

the owner of the UFC #111 broadcast (“the Broadcast”), which
aired

on

March

27,

encrypted

satellite

Broadcast,

Zuffa

2010,

via

closed

signal.
granted

(Id.

circuit

¶

licenses

16.)
to

television
Prior

several

businesses for the right to exhibit the Broadcast.

and

to

the

Tennessee
(Id. ¶ 17.)

Black Diamond, which is a business entity with its principal
place

of

business

in

Memphis,

Tennessee,

license from Zuffa to exhibit the Broadcast.
Zuffa
received,

alleges
and

March 27, 2010.

that

Black

descrambled
(Id.)

Diamond

the

did

not

a

(Id. ¶¶ 11, 18.)

unlawfully

Broadcast

purchase

intercepted,

satellite

signal

on

Zuffa alleges that Black Diamond either:

(1) spliced a coaxial cable or redirected a wireless signal from
an

adjacent

establishment,

(2)

commercially

misused

a

cable

signal by falsely registering as a residence, or (3) used a
lawfully
residence.

obtained

satellite

(Id. at ¶ 19.)

or

cable

box

from

a

private

Zuffa alleges that Black Diamond

pirated the Broadcast “willfully and for purposes of direct or
indirect commercial advantage or private financial gain.”

(Id.

¶ 26.)
Prior to the Broadcast, Zuffa retained independent auditors
to find establishments that were showing the Broadcast without a
license.

(Ike Lawrence Epstein Dep. ¶ 5, ECF 15-1.)

On March

27, 2010, Ted Scott, an independent auditor, visited The Black
Diamond, a bar in Memphis, Tennessee, and observed the Broadcast
2

playing on two of the three televisions in the bar.
Aff. Ex. C, ECF No. 15-1.)

(Privacy

Scott noted that “Pay Per View”

logos were not visible on the Broadcast and that between 30 and
36

people

were

in

attendance.

(Id.)

occupancy limit was 88 customers.
8, ECF 15-1.)
and

he

spent

The

Black

Diamond’s

(Ike Lawrence Epstein Dep. ¶

Scott paid a $5 cover charge to gain admission,
over

an

hour

in

the

Affidavit Ex. C, ECF No. 15-1.)
affidavit from Ted Scott.

establishment.

(Privacy

Zuffa has submitted a sworn

(Id.)

On November 11, 2010, Zuffa brought this action against
Black Diamond and Francis J. Scott, who allegedly had control of
The Black Diamond on March 27.

(Compl. ¶ 2-3.)

Zuffa’s claims

against Scott were dismissed on March 2, 2011.

(See Order of

Dismissal, ECF No. 17.)
actions

constitute

publication

of

(1)

Zuffa contends that Black Diamond’s
the

unauthorized

communications

in

violation

reception
of

the

and

Federal

Communications Act, 47 U.S.C. § 605(a), (2) the unauthorized
reception, interception, and exhibition of “any communications
service offered over a cable system[,] such as the transmission
for which plaintiff had the distribution rights” in violation of
the Federal Communications Act, 47 U.S.C. § 553, and (3) that
Black Diamond publically exhibited the Broadcast without paying
the appropriate licensing fee to Zuffa in violation of 17 U.S.C.
§ 501(a).

(See id. ¶¶ 15-40.)
3

On

December

20,

2010,

served

Black

Diamond with copies of the summons and the complaint.

(See

Proof of Service, ECF No 10.)

Zuffa

properly

Zuffa filed a Notice of Intention
(See Notice by Zuffa,

to Move for Default on January 25, 2011.
LLC, ECF No. 11.)

On March 1, 2011, the Clerk entered default

against

Black

Diamond

under

Federal

55(a).

(See Default, ECF No. 14.)

Rule

of

Civil

Zuffa filed its Motion for

Entry of Final Default Judgment on March 2, 2011.
Default J.)
II.

Procedure

(Mot. for

Zuffa attached affadavits

Jurisdiction

A court’s default judgment is invalid unless it has proper
jurisdiction.
496,

501

See, e.g., Citizens Bank v. Parnes, 376 F. App’x

(6th

Cir.

2010)

(“Personal

jurisdiction

over

a

defendant is a threshold issue that must be present to support
any subsequent order of the district court, including entry of
the

default

judgment.”)

(citing

Kroger

Co.

v.

Malease

Foods

Corp., 437 F.3d 506, 510 (6th Cir. 2006)).
Courts

are

obligated

to

consider

subject-matter

and

personal jurisdiction, but not defects in venue, before entering
default judgment.

Compare In re Tuli, 172 F.3d 707, 712 (9th

Cir. 1999) (holding that a district court properly raised the
issue of personal jurisdiction sua sponte), and Williams v. Life
Sav. & Loan, 802 F.2d 1200, 1203 (10th Cir. 1986) (per curiam)
(“[W]hen entry of a default judgment is sought against a party
4

who has failed to plead or otherwise defend, the district court
has an affirmative duty to look into its jurisdiction both over
the subject matter and the parties.”), and Columbia Pictures
Indus. v. Fysh, No. 5:06-CV-37, 2007 U.S. Dist. LEXIS 11234, at
*3-4

(W.D.

Mich.

subject-matter

Feb.

and

16,

personal

2007)

(considering

jurisdiction

and

before

finding

entering

a

default judgment), with Rogers v. Hartford Life & Accident Ins.
Co., 167 F.3d 933, 942 (5th Cir. 1999) (“The Supreme Court has
made clear that if a party defaults by failing to appear or file
a

timely

responsive

pleading,

the

party

waives

defects

in

venue.”) (citations omitted), and Williams, 802 F.2d at 1202
(“[I]f a party is in default by failing to appear or to file a
responsive
judgment

pleading,

may

be

defects

validly

in

entered

venue
and

are
the

waived,
judgment

a

default

cannot

be

attacked collaterally for improper venue.” (citing Hoffman v.
Blaski, 363 U.S. 335, 343 (1960)).
A. Subject Matter Jurisdiction
Congress

has

specifically

granted

federal

question

jurisdiction for claims of copyright.

See 28 U.S.C. § 1338(a)

(providing

action

for

jurisdiction

over

any

arising

federal law relating to copyrights and trademarks).

under

a

Federal

question jurisdiction exists for any claims arising under the
laws of the United States.

See 28 U.S.C. § 1331.

Zuffa has

alleged violations of the Federal Communications Act and the
5

Copyright Act.
¶

501(a);

See 47 U.S.C. §§ 605(a), 553; see also 17 U.S.C.

(Compl.

jurisdiction

over

¶¶

15-40).

Zuffa’s

The

claims.

Court
See

has

28

subject-matter

U.S.C.

§§

1331,

1338(a).
B. Personal Jurisdiction
“Personal jurisdiction can be either general or specific,
depending upon the nature of the contacts that the defendant has
with the forum state.”

Bird v. Parsons, 289 F.3d 865, 871 (6th

Cir. 2002); see also Gerber v. Riordan, 649 F.3d 514, 517 (6th
Cir. 2011); Third Nat'l Bank v. WEDGE Group, Inc., 882 F.2d
1087, 1089 (6th Cir. 1989).

“General jurisdiction is proper

only where a defendant's contacts with the forum state are of
such

a

continuous

and

systematic

nature

that

the

state

may

exercise personal jurisdiction over the defendant even if the
action is unrelated to the defendant's contacts with the state.”
Parsons, 289 F.3d at 871.
sense

has

never

been

“‘Presence’ in the state in this

doubted

when

the

activities

of

the

corporation there have not only been continuous and systematic,
but also give rise to the liabilities sued on, even though no
consent

to

be

sued

or

authorization

service of process has been given.”

to

an

agent

to

accept

Int'l Shoe Co. v. Wash.,

326 U.S. 310, 317 (1945) (quotation omitted).
Black Diamond’s contacts to Tennessee are “continuous and
systematic” because it is organized under Tennessee law and its
6

principal place of business is in Tennessee.
at 871.

Parsons, 289 F.3d

Zuffa has alleged that Black Diamond “has an office in

[Tennessee],

is

licensed

to

do

business

there

.

directs its business operations from [Tennessee].”

.

.

[and]

Id. at 873.

Copies of the Summons and Complaint were served on Black Diamond
at its Tennessee address on December 20, 2010.
Service, ECF No. 10.)

(See Proof of

The Court has personal jurisdiction over

Black Diamond.
III.

Standard of Review

Federal Rule of Civil Procedure 55(b)(2) governs default
judgment.
entered

See

against

Fed.
a

R.

Civ.

defendant,

P.

55(b).

that

party

“Once
is

a

default

deemed

to

is

have

admitted all of the well pleaded allegations in the complaint,
except those relating to damages.”

Microsoft Corp. v. McGee,

490 F. Supp. 2d 874, 878 (S.D. Ohio 2007) (citing Antoine v.
Atlas Turner, Inc., 66 F.3d 105, 110-11 (6th Cir. 1995)); see
also Fed.

R.

Civ.

P.

8(b)(6)

(“An

allegation—other

than

one

relating to the amount of damages—is admitted if a responsive
pleading

is

required

and

the

allegation

is

not

denied.”).

Unlike factual allegations, “legal conclusions are not deemed
admitted as a result of the entry of default.”

Krowtoh II LLC

v. Excelsius Int’l Ltd., No. 04-505-KSF, 2007 WL 5023591, at *3
(E.D. Ky. Dec. 17, 2007) (citations omitted).

7

Because the Clerk entered default against Black Diamond on
March 1, 2011 (see Default, ECF No. 14), Black Diamond is deemed
to have admitted the factual allegations in Zuffa’s complaint,
other

than

those

relating

to

damages.

If

the

factual

allegations provide a sufficient legal basis, the Court will
enter a default judgment and conduct an inquiry to determine
damages and other relief.

See Coach, Inc. v. Cellular Planet,

No. 2:09-cv-00241, 2010 U.S. Dist. LEXIS 45087, at *7 (S.D. Ohio
May 7, 2010) (citing Arista Records, Inc. v. Beker Enters., 298
F. Supp. 2d 1310, 1311-12 (S.D. Fla. 2003)).
IV.

Analysis
A. Liability

Zuffa’s allegations establish that Black Diamond violated
the Federal Communications Act, 47 U.S.C §§ 605(a) and 553, as
well as 17 U.S.C. § 501(a).
1. Section 605(a)
Because a default judgment has been entered, Black Diamond
admits “to receiving the [Broadcast] via satellite transmission
and displaying it at [its] bar consistent with a violation under
605(a).”

Joe Hand Promotions, Inc. v. Easterling, No. 4:08 CV

1259, 2009 U.S. Dist. LEXIS 52517, at *9 (N.D. Ohio June 22,
2009).

Broken up into distinct violations,

The first sentence of § 605(a) prohibits persons
“receiving, assisting in receiving, transmitting, or
assisting in transmitting . . . any interstate or
8

foreign communication by wire or radio” from divulging
or publishing the contents of that communication
except in specified, authorized ways. The second
sentence prohibits any “person not being authorized by
the
sender”
from
“intercept[ing]
any
radio
communication and divulg[ing] . . . [its] contents . .
. to any person.” The third sentence prohibits any
“person not being entitled thereto [from] receiv[ing]
or assist[ing] in receiving any interstate or foreign
communication by radio and us[ing] such communication
(or any information therein contained) for his own
benefit or for the benefit of another not entitled
thereto.”
Id. (quoting International Cablevision, Inc. v. Sykes, 75 F.3d
123, 129-30 (2d Cir. 1996)).

Each distinct sentence in § 605(a)

prohibits the unauthorized publication or use of wire or radio
communications.

J

&

J

Sports

Prods.

v.

Leaghty,

No.

4:10CV2982011, 2011 U.S. Dist. LEXIS 87971, at *6-9 (N.D. Ohio
June 23, 2011), adopted by J & J Sports Prods. v. Leaghty, No.
4:10-CV-0298, 2011 U.S. Dist. LEXIS 87972, at *2 (N.D. Ohio Aug.
8, 2011); see also United States v. One Macom Video Cipher II,
SN A6J050073, 985 F.2d 258, 260 (6th Cir. 1993).
The third sentence of § 605(a) provides that “[n]o person
not being authorized by the sender shall intercept any radio
communication and divulge or publish the existence, contents,
substance,

purport,

effect,

or

communication to any person.”

meaning

of

such

intercepted

This language “only applies to

persons who were never authorized to be in possession of the
communication in the first place.”

Nat'l Satellite Sports, Inc.

v. Eliadis, Inc., 253 F.3d 900, 914 (6th Cir. 2001).
9

“[C]ourts

have

applied

[§

605]

to

cases

involving

programming from satellite transmissions.’”

‘encrypted

cable

Leaghty, 2011 U.S.

Dist. LEXIS 87971, at *6-9 (quoting J & & Sports Prods. V.
Lukes, No. 1:10 CV 00535, 2010 U.S. Dist. LEXIS 110421, at *1
(N.D. Ohio Oct. 18, 2011) (additional citations omitted)); see
also

Nat’l

Satellite

Sports,

Inc.,

253

F.3d

at

917

(“[T]he

legislative history of the amendments to the Communications Act
in 1984 and 1988 reveals that Congress intended to bring cable
and satellite communications under the protection of the Act. .
. ”).
In Nat’l Satellite Sports, Inc., 253 F.3d at 916, the Sixth
Circuit held that Time Warner, a major cable conglomerate, did
not

violate

corporation

the
“was

third

sentence

contractually

of

§

605(a)

authorized

to

because

the

receive

the

communication of the event . . . and to further relay that
communication to its residential customers in the area.”
917.

Nevertheless,

Time

Warner

was

liable

under

the

Id. at
first

sentence of § 605(a) “for divulging [a] communication that it
was authorized to distribute on a limited basis only, when one
of

the

recipients

of

that

transmission

addressee of . . . the sender.”
Zuffa’s
under

the

allegations
third

an

unauthorized

Id.

establish

sentence

was

of

§

Black

Diamond’s

605(a).

liability

Although

Zuffa

“contracted with distributors authorized . . . for the right to
10

obtain a transmission of [the Broadcast],” Black Diamond never
purchased a license from Zuffa.
253 F.3d at 915.
illegal

Nat’l Satellite Sports, Inc.,

Black Diamond does not dispute that it used an

satellite

receiver,

misrepresented

its

business

as

a

residence, or removed an authorized receiver from “one location
to a different business location” to intercept the Broadcast.
(Compl. ¶ 19.)

Those undisputed allegations are sufficient to

satisfy § 605(a).
2. Section 553(a)(1)
Subsection 553(a)(1) of Title 47 of the United States Code
provides that "[n]o 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 or as may otherwise be specifically authorized
by law."

Joe Hand Promotions, Inc. v. RPM Mgmt. Co. LLC, No.

1:10 CV 00535, 2011 U.S. Dist. LEXIS 28210, at *5 (S.D. Ohio
Mar.

18,

2011).

Plaintiffs

may

recover

either

actual

or

statutory damages under § 553(c)(3), and if courts find that
violations

were

committed

willfully

and

for

purposes

of

commercial advantage or private financial gain, damages may be
increased by an amount of not more than $50,000.

47 U.S.C. §

553(c)(3).
Whereas

“[section]

605

encompasses

the

interception

of

satellite transmissions 'to the extent reception or interception
11

occurs prior to . . . [the] distribution of the service over a
cable system,’” once a satellite transmission reaches a “cable
system's wire distribution phase, it is subject to § 553 and is
no longer within the purview of § 605."

TKR Cable Co. v. Cable

City Corp., 267 F.3d 196, 207 (3d Cir. 2001) (quoting H. R. Rep.
No.

98-934,

at

83,

reprinted

in

1984

U.S.C.C.A.N.

at

4720);

accord Joe Hand Promotions, Inc., 2011 U.S. Dist. LEXIS 28210,
at *6.

Congress' language “clearly demonstrates that it created

§ 553 to combat significant, novel, and previously unaddressed
threats to the continued growth of the cable industry.”

Id.

Section 553 is a strict liability offense with no good faith
defenses.

J&J Prods. v. Schmalz, 745 F. Supp. 2d 844, 850 (S.D.

Ohio 2010) (noting that the Sixth Circuit has not “specifically
addressed the issue of whether” § 553 is a strict liability
statute,

but

recognizing

that

persuasive

authority

supports

strict liability); Easterling, 2009 U.S. Dist. LEXIS 52517, at
*4; accord Sykes, 997 F.2d at 1004.

Although not a factor in

establishing liability under § 553, “intent is relevant to the
calculations

of

plaintiff’s

remedies.”

Joe

Hand

Promotions,

Inc. v. Williams, No. 3:07-CV-406-JDM, 2009 U.S. Dist. LEXIS
10654, at *2 (W.D. Ky. Feb. 10, 2009).
Unauthorized interceptions and broadcasts of satellite or
cable transmissions violate § 553.
Waha

Enters.,

219

F.

Supp.

2d
12

See Entm’t by J & J v. Al769,

774

(S.D.

Tex.

2002)

(collecting cases).

In Al-Waha Enters., the plaintiffs relied

on

that

two

affidavits

established

Al-Waha’s

rebroadcasting of a pay-per-view boxing match.
The

district

unauthorized

court

found

interception

Al-Waha’s
and

Zuffa’s
liability

undisputed

under

§

Zuffa

actions

constituted

of

a

cable

Id. at 774-75.

allegations

553(a).

Id. at 774-75.

broadcasting

transmission in violation of § 553.

unauthorized

establish
alleges

Black

that

Diamond’s

Black

Diamond

“willfully and illegally intercepted [the Broadcast] when it was
distributed and shown by cable television systems.”
28.)

(Compl. ¶

Zuffa’s supporting affidavits establish that investigators

“observed a broadcast of [the UFC fight] over [two] television
monitors at [the Black Diamond] in the presence of approximately
[36] patrons.”

Al-Waha Enters., 219 F. Supp. 2d at 775; see

also (Ex. C.)

Zuffa “had the exclusive, proprietary right to

exhibit and sublicense exhibition of [the Broadcast] to close
circuit

locations

in

the

State

of

[Tennessee]

and

[Black

Diamond] did not obtain authorization from [Zuffa] to display
the [Broadcast].”
also

(Ex.

A.)

Al-Waha Enters., 219 F. Supp. 2d at 775; see
Zuffa’s

“uncontroverted

.

evidence

establishes that [Black Diamond] violated” § 553(a).

Al-Waha

Enters., 219 F. Supp. 2d at 775.
3.

17 U.S.C. § 501(a)

13

.

.

Subsection 501(a) of Title 17 of the United States Code
provides that “[a]nyone who violates any of the exclusive rights
of the copyright owner . . . is an infringer of the copyright or
right of the author.”

The Copyright Act protects “proprietary

rights in the context of cable transmissions . . . [because]
infringement encompasses the unauthorized performance or display
of motion pictures or other audiovisual works . . . [and] the
statute

explicitly

prohibits

infringement

secondary transmissions by cable systems.”

in

the

context

of

Prostar v. Massachi,

239 F.3d 669, 677 (5th Cir. 2001) (citations omitted); see also
17 U.S.C. §§ 501(c)-(e).
The Copyright Act provides that “the owner of a copyright .
. . has the exclusive rights to . . . distribute copies of the
copyrighted work.” (Ortiz-Gonzalez v. Fonovisa, 277 F.3d 59, 62
(1st Cir. 2002) (citations omitted); see also Cable/Home Commc’n
Corp. v. Network Prods., Inc., 902 F.2d 829, 843 (11th Cir.
1990) (“Public distribution of a copyrighted work is a right
reserved to the copyright owner, and usurpation of that right
constitutes

infringement.”).

“To

succeed

in

a

copyright

infringement action, a plaintiff must establish that he or she
owns the copyrighted creation, and that the defendant copied
it."
Corp.,

Murray Hill Publ'ns., Inc. v. Twentieth Century Fox Film
361

F.3d

312,

316

(6th

Cir.

2004)

Mariol, 328 F.3d 848, 853 (6th Cir. 2003)).
14

(quoting

Kohus

v.

“The unauthorized

access and retransmission of cable broadcasting . . . [is] mere
copying.”

Prostar, 239 F.3d at 677.

The “damage provision under the Copyright Act in 17 U.S.C.
§ 504(c) provides [] statutory damages ‘for all infringements
involved in the action, with respect to any one work, for which
any

infringer

is

liable.’”

Nat’l

Satellite

Sports,

Inc.

v.

Carrabia, No. 4:01 CV 1474, 2003 U.S. Dist. LEXIS 27198, at *1314 (N.D. Ohio Mar. 11, 2003).

Offenders are liable in “the sum

of not less than $750 or more than $30,000.00 as the court
considers just.”
sustains

the

Id.

burden

infringement

was

“In a case where the copyright owner
of

proving,

committed

and

the

willfully,

court

the

finds,

court

in

that
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); see also Joe

Hand Promotions Inc. v. Orim, Inc., No. 1:10 CV 00743, 2010 U.S.
Dist. LEXIS 107212, at *5-6 (N.D. Ohio Oct. 5, 2010).
Zuffa

has

established

Black

Diamond’s

liability

for

copyright infringement under 17 U.S.C. § 501(a).

Zuffa alleges

that

including

it

owns

“undercard”

the

copyright

matches

and

to

the

television

Broadcast,

programming

circuit television and encrypted satellite signal.
32.)

via

all

closed

(Compl. ¶

According to Zuffa, the Broadcast originated via satellite

uplink and was subsequently retransmitted to cable systems and
satellite companies.

(Id.)

Zuffa alleges that, as the holder
15

of proprietary rights for the Broadcast, it had the right to
distribute the Broadcast in the manner it saw fit.

(Id.)

Black

Diamond never obtained a license from Zuffa or its authorized
agents

to

publicly

exhibit

the

Broadcast.

(Id.

¶

34.)

Zuffa alleges that the unauthorized exhibition of its Broadcast
at The Black Diamond, where the bar charged a $5 cover charge
and advertised the fight in its window, constituted “willful”
violation of Zuffa’s proprietary rights.

(Id. ¶ 37; see also

Privacy Affidavit Ex. C, ECF No. 15-1.)
B.

Statutory Damages

Zuffa seeks statutory damages for Black Diamond’s Federal
Communication Act violations, 47 U.S.C. §605(e)(3).
Mem. of Law 15-17.) 2

(See Pl.’s

Although Black Diamond is liable under 47

U.S.C. §§ 650(a) and 553, Zuffa may only recover (and only seeks
to recover) under § 605(a).

See J&J Sports Prods., Inc. v.

Trier et al., No. 08-11159-BC, 2009 U.S. Dist. LEXIS 6415 (E.D.
Mich.

Jan.

29,

2009)

(“Although

Plaintiff

brings

causes

of

action under both § 605 and § 553, Plaintiff can only recover
damages under one or the other.”) (citing J&J Sports Prods.,
Inc.

v.

Ribeiro,

562

F.

Supp.

2d

498,

501

(S.D.N.Y.

2008)

(“Where a defendant is found liable under both § 553 and § 605,
2
In its complaint, Zuffa requests statutory penalties for Black Diamond’s
allegedly willful violations of 47 U.S.C § 605(a), 47 U.S.C. § 553, and 17
U.S.C. § 501(a), as well as attorney’s fees, interest, and costs. (Compl. ¶
40.) In its Memorandum of Law, however, Zuffa requests damages for Black
Diamond’s allegedly willful violation of 47 U.S.C. § 605(a) and full costs,
including attorney’s fees. (Pl.’s Mem. of Law 16.)

16

a plaintiff is entitled to have damages awarded under § 605,
which provides for greater recovery.”)); (see also Pl.’s Mem.
9)(“Plaintiff elects to recover under [§] 605(a).”).
47 U.S.C. § 605(e)(3) provides that “[a]ny person aggrieved
by any violation of [§ 605(a)] . . . may bring a civil action in
United States district court.”

The term “any person aggrieved”

includes “any person with proprietary rights in the intercepted
communication by wire or radio, including wholesale or retail
distributors

of

satellite

cable

programming.”

§

605(d)(6)

(emphasis added); see also Nat'l Satellite Sports, Inc., 253
F.3d at 914 (finding that two parties had proprietary rights to
a cable broadcast and could therefore sue under § 605).
“In determining the amount of [statutory] damages to award
under §605, the Court possesses wide discretion.”

Leaghty, 2011

U.S. Dist. LEXIS 87971, at *8 (citing Buckeye Cablevision, Inc.
v. Sledge, No. 3:03CV7561, 2004 U.S. Dist. LEXIS 7578, at *4
(N.D. Ohio Apr. 8, 2004)); see also Willis, 2009 U.S. Dist.
LEXIS 10071, at *2.
statutory
just.”

damages

Within the limits established by Congress,

may

be

any

sum

that

“the

court

considers

See 47 U.S.C. § 605(e)(3)(C)(i)(II).

By electing statutory damages, Zuffa may recover “in a sum
of not less than $1,000 or more than $10,000.”
605(e)(3)(C)(i)(II).

47 U.S.C. §

“In any case in which the court finds that

the violation was committed willfully and for purposes of direct
17

or indirect commercial advantage or private financial gain, the
court

in

its

discretion

whether

actual

$100,000

for

or

a

increase

statutory,

each

violation

605(e)(3)(C)(ii).
evaluated

may

In

number

of

by
of

an

the

amount

subsection

determining
factors,

award
of

of

not

(a).”

the

more
Id.

willfulness,

including

damages,
than
at

courts
size

§

have

of

the

commercial establishment, whether the commercial establishment
advertised

or

charged

an

admittance

fee,

the

number

of

televisions that showed the transmissions, and increases in food
or

beverage

Dist.

LEXIS

prices

during

107212,

at

exhibitions.

*7-8;

Lukes,

See
2010

Orim,
U.S.

2010

Dist.

U.S.
LEXIS

110421, at *6-8; Carrabia, 2003 U.S. Dist. LEXIS 27198, at *4;
Easterling, 2009 U.S. Dist. LEXIS 52517, at *15-16; Joe Hand
Promotions, Inc. v. Willis, No. 5:08 CV 2786, 2009 U.S. Dist.
LEXIS 10071, at *2 (N.D. Ohio Feb. 11, 2009); Lukes, 2010 U.S.
Dist. LEXIS 110421, at *6-8.
Zuffa requests $55,000 in damages, which includes $10,000
in statutory damages under § 605(e)(3)(C)(i)(II) and $45,000 in
enhanced statutory damages under § 605(e)(3)(C)(ii).
Mem.

13.)

Zuffa

asks

for

the

statutory

maximum

(See Pl.’s
of

$10,000

because “the licensing of sporting events to establishments that
want to exhibit [] events as they occur[] is less valuable when
pirates exhibit the events [] to patrons who would otherwise be
in the establishments of [Zuffa’s] legitimate licensees.”
18

(Id.

11-12.)
should

Although Zuffa does not explain why the maximum amount
be

licensing

awarded,
fee

it

is

urges

“that

appropriate”

a

sum

because

greater

Zuffa

has

than

the

lost

the

licensing fee that it would have otherwise received from Black
Diamond and surrounding establishments.

(Id. at 12.)

Plaintiff’s request for $10,000 in statutory damages is not
well

taken.

There

must

be

“egregious

awarding maximum statutory damages.”
LEXIS 7578, at *6.
the

company

before

Sledge, 2004 U.S. Dist.

Based on the rate card provided by Zuffa,

would

have

received

purchased the Broadcast properly.
A, ECF No. 15-1.)

circumstances

$1,100

if

Black

Diamond

had

(Pl.’s Mem. 12) (citing Ex.

Other factually similar decisions from within

this Circuit support awarding damages based on a company’s rate
card.

Lukes, 2010 U.S. Dist. LEXIS 110421, at *6 (awarding the

plaintiff $1,500 in statutory damages based on the rate card);
Leaghty,

2011

U.S.

Dist.

LEXIS

87971,

at

9

(awarding

the

plaintiff $1,200 in statutory damages based on the rate card);
Willis,

2009

U.S.

Dist.

LEXIS

10071,

at

*2

(awarding

the

plaintiff $875 in statutory damages based on the rate card).
The Court awards Zuffa $1,100 in statutory damages for Black
Diamond’s one unauthorized interception of the Broadcast.

See

Lukes, 2010 U.S. Dist. LEXIS 110421, at *6.
Zuffa

requests

$45,000

in

enhanced

statutory

damages

because Black Diamond exacted a cover charge from patrons and
19

publicly advertised the Broadcast.
that neither

the

public

(Id. at 13.)

exhibition

of

the

Zuffa contends

Broadcast

nor

the

descrambling of its satellite signal could have occurred without
Black Diamond’s conduct.

See Time Warner Cable of New York City

v. Googies Luncheonette, Inc., 77 F. Supp. 2d 485, 490 (S.D.N.Y.
1999) (“Signals do not descramble spontaneously” and television
sets

do

not

systems.”).

“connect
Black

themselves

Diamond’s

to

cable

commercial

distribution

advantage,

Zuffa

alleges, can be fairly and reasonably inferred from its status
(Pl.’s Mem. 14); see also Joe

as a commercial establishment.

Hand Promotions, Inc. v. Cat’s Bar, Inc., 2009 U.S. Dist. LEXIS
20961 (C.D. Il. March 16, 2009).

Zuffa’s request for enhanced

statutory damages is well taken, but $45,000 is excessive.
Willfulness
governing

has

statute

been

and

an

defined

as

the

indifference

“disregard

to

Sledge, 2004 U.S. Dist. LEXIS 7578, at *4.

its

for

the

requirements.”

“For purposes of §

605, courts have identified conduct as ‘willful’ where there
were repeated violations over time, or there was a sophisticated
understanding of the satellite programming industry and there
was a violation of the statutes that regulate the conduct.”

Id.

at *5.
At

least

two

facts

weigh

against

finding

willfulness.

Although The Black Diamond’s capacity is eighty-eight patrons,
Zuffa’s auditors counted no more than thirty-six patrons at any
20

given time.

See Lukes, 2010 U.S. Dist. LEXIS 110421, at *7.

There is no evidence of “increased food and/or drink prices . .
.

which

would

have

presented

advantage or financial gain.”
at *12.
[Black

some

evidence

of

commercial

Leaghty, 2011 U.S. Dist. LEXIS,

Based on these facts, it would appear “unlikely that
Diamond]

receiving

the

authorization.”

received
plaintiff’s

a

substantial
satellite

monetary

gain

programming

by

without

[]
its

Sledge, 2004 U.S. Dist. LEXIS 7578, at *7.

Two facts in this case warrant a finding of willfulness.
First,

courts

make

clear

that

charging

direct evidence of willfulness.
Dist. LEXIS, at *12.

an

admittance

Black Diamond charged a $5 “cover charge”
Second, Black

Diamond advertised its exhibition of the Broadcast.
distinguish

is

See, e.g., Leaghty, 2011 U.S.

for admission on the night of the Broadcast.

facts

fee

this

case

from

where willfulness was not found.

others

within

These two

this

circuit

See Lukes, 2010 U.S. Dist.

LEXIS 110421, at *7; Leaghty, 2011 U.S. Dist. LEXIS, at *12;
Sledge, 2004 U.S. Dist. LEXIS 7578, at *7.

Black Diamond’s

actions were willful.
Zuffa seeks $45,000 in enhanced statutory damages based on
Black Diamond’s willful conduct.
support

that

amount.

Zuffa provides no authority to

Forty-five

thousand

dollars

is

approximately forty times the revenue Zuffa would have received
had

Black

Diamond

paid

Zuffa’s
21

licensing

fee.

Although

deterring future violations is a goal in awarding damages under
§605,

Al-Waha

Enters,

219

F.

Supp.

2d

at

776,

excessive in light of the facts of this case.

$45,000

is

Black Diamond

charged a $5 cover charge for a clientele that did not exceed 36
on the night of the Broadcast.
ECF No. 15-1.)

(See Ex. A, ECF No. 15-1; Ex. C,

Black Diamond’s minimum profit was $150, an

amount that does not include fluctuations in attendance during
the evening or increases in food and drink sales that may have
occurred.
The Court has considerable discretion in imposing proper
damages.

After

evaluating

the

reasonable statutory enhancement.

entire

record,

$7,500

is

a

Zuffa’s statutory damages of

$1,100 will be increased by $7,500 for a total of $8,600.
C. Costs and Attorney’s Fees
Zuffa seeks to recover $2,200.75 in costs and attorney’s
fees.

(See Pl.’s Mot. 3.)

Under 47 U.S.C. § 605(e)(3)(B)(iii),

the district court “shall direct the recovery of full costs,
including awarding reasonable attorneys' fees to an aggrieved
party who prevails.”

Zuffa supports the amount of its proposed

award with an affidavit from its attorney.

(See Att’y Aff. In

Supp. of Default and Costs and Fees at 4-5, ECF No. 15-3.)
Having reviewed the affidavit and other supporting materials,
the Court is satisfied that the requested fees and costs are
reasonable.

Zuffa is awarded $2,200.75 in costs and attorney’s
22

fees.

See Lukes, 2010 U.S. Dist. LEXIS 110421, at *8 (awarding

$1,900 in costs and attorney’s fees).
V.

Conclusion

For the foregoing reasons, Zuffa’s Motion is GRANTED.
It is therefore ORDERED that:
(1)

Black

Diamond

is

liable

to

Zuffa

for

$1,100

in

is

liable

to

Zuffa

for

$7,500

in

$2,200.75

in

statutory damages.
(2)

Black

Diamond

enhanced statutory damages.
(3)

Black

Diamond

is

liable

to

Zuffa

for

costs and attorney’s fees.
So ordered this 14th day of December, 2011.

s/ Samuel H. Mays, Jr.__
SAMUEL H. MAYS, JR.
UNITED STATES DISTRICT JUDGE

23