Joe Hand Promotions, Inc. v. Scarborough et al

Filing 27

MEMORANDUM OPINION AND ORDER denying 20 Motion for Summary Judgment filed by Joe Hand Promotions, Inc. (Ordered by Chief Judge Sidney A Fitzwater on 6/3/2014) (Chief Judge Sidney A Fitzwater)

IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF TEXAS
DALLAS DIVISION
JOE HAND PROMOTIONS, INC.,
Plaintiff,
VS.
EDITH N. SCARBOROUGH, et al.,
Defendants.

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§ Civil Action No. 3:13-CV-2520-D
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MEMORANDUM OPINION
AND ORDER
Plaintiff Joe Hand Promotions, Inc. (“Joe Hand”) moves for summary judgment
against defendants Edith N. Scarborough (“Scarborough”) and Liquid Lizard, Inc., d/b/a/
Liquid Zoo (“Liquid Lizard”), alleging a violation of the Federal Communications Act of
1934 (“FCA”), 47 U.S.C. § 151 et seq., which prohibits piracy of radio and television signals.
Concluding that Joe Hand has not met its heavy burden of establishing entitlement to
summary judgment beyond peradventure, the court denies the motion.
I
Plaintiff Joe Hand is a family owned and operated business that distributes sports and
entertainment programming to commercial establishments. By contract, Joe Hand was
granted the exclusive domestic commercial distribution rights to the July 3, 2010 broadcast
of UFC 116: Lesnar v. Carwin (the “Event”). Defendants Scarborough and Liquid Lizard
own, manage, operate, and/or control a commercial establishment known as Liquid Zoo.
Prior to July 3, 2010, Joe Hand entered into agreements with entities nationwide, allowing

them to legally exhibit the Event to patrons in their commercial establishments. Joe Hand
alleges that, rather than purchase the proper commercial distribution rights to the Event from
Joe Hand, defendants illegally intercepted and exhibited the Event at Liquid Zoo without
authorization from, or payment to, Joe Hand.
Joe Hand filed this suit against Scarborough and Liquid Lizard alleging that they
willfully violated 47 U.S.C. §§ 553 and 605 by intercepting and broadcasting the Event at
Liquid Zoo without authorization from, or payment to, Joe Hand. Joe Hand also asserts a
common law claim for conversion. It now moves for summary judgment on its claim
brought under 47 U.S.C. § 605. Defendants oppose the motion.
II
Because Joe Hand will have the burden of proof at trial on its FCA claim, to obtain
summary judgment it “must establish ‘beyond peradventure all of the essential elements of
the claim[.]’” Bank One, Tex., N.A. v. Prudential Ins. Co. of Am., 878 F. Supp. 943, 962
(N.D. Tex. 1995) (Fitzwater, J.) (quoting Fontenot v. Upjohn Co., 780 F.2d 1190, 1194 (5th
Cir. 1986)). This means that Joe Hand must demonstrate that there are no genuine and
material fact disputes and that it is entitled to summary judgment as a matter of law. See,
e.g., Martin v. Alamo Cmty. Coll. Dist., 353 F.3d 409, 412 (5th Cir. 2003). “The court has
noted that the ‘beyond peradventure’ standard is ‘heavy.’” Carolina Cas. Ins. Co. v. Sowell,
603 F.Supp.2d 914, 923-24 (N.D. Tex. 2009) (Fitzwater, C.J.) (quoting Cont’l Cas. Co. v.
St. Paul Fire & Marine Ins. Co., 2007 WL 2403656, at *10 (N.D. Tex. Aug. 23, 2007)
(Fitzwater, J.)).
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III
The court considers first whether Joe Hand has established beyond peradventure that
defendants violated § 605.
A
“The FCA is a strict liability statute that imposes serious penalties on those who
intercept, receive and/or broadcast protected communications.” J & J Sports Prods., Inc. v.
Restaurant & Taqueria Cristina, 2013 WL 3878589, at *4 (N.D. Tex. July 3, 2013)
(Stickney, J.) (citation omitted), rec. adopted, 2013 WL 3878589, at *1 (N.D. Tex. July 29,
2013) (Godbey, J.). Section 605(a) prohibits “intercept[ing] any radio communication and
divulg[ing] or publish[ing] the existence, contents, substance, purport, effect, or meaning of
such intercepted communication to any person” without authorization “by the sender[.]” 47
U.S.C. § 605(a). The reference to “any radio communication” includes any transmission of
“satellite cable programming,” where the programming is encrypted and “an agent or agents
have been lawfully designated for the purpose of authorizing private viewing by individuals.”
Id. § 605(b).
To establish liability under § 605, Joe Hand must prove that the Event was shown at
Liquid Zoo and that Joe Hand did not authorize such exhibition of the Event. J & J Sports
Prods., 2013 WL 3878589, at *4; see also Joe Hand Promotions, Inc. v. Macias, 2012 WL
950157, at *2 (S.D. Tex. Mar. 19, 2012) (“The FCA is a strict liability statute, and the
plaintiff is required only to prove the unauthorized exhibition of the intercepted
transmission.”).
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B
Joe Hand contends that it is undisputed that, on the date of the Event, defendants
intercepted and received, without authorization, the transmission of the Event and broadcast
it to the patrons of Liquid Zoo. It relies on the following summary judgment evidence: the
affidavit of Christopher McEwan (“McEwan”), a private investigator whom Joe Hand hired,
who avers that on July 3, 2010 he visited Liquid Zoo and observed the Event being broadcast
to several people on multiple television sets; photographs that McEwan took of the outside
and inside of Liquid Zoo on the night of July 3, 2010 showing Liquid Zoo’s patrons and the
locations of some of Liquid Zoo’s television sets1; and the affidavit of Joe Hand, Jr. (“Joe”),
in which he avers that McEwan observed defendants unlawfully exhibiting the Event at
Liquid Zoo on July 3, 2010.
In their summary judgment response, defendants object to McEwan’s affidavit,
arguing, inter alia, that the “facts” stated are contradicted by the other record evidence. They
object to Joe’s affidavit on the ground that it is not based on personal knowledge and
contains hearsay. In opposition to Joe Hand’s summary judgment motion, defendants submit
the affidavit of Joe Nelson (“Nelson”), an employee of Liquid Lizard, in which he avers that
he was the only employee working at Liquid Zoo on July 3, 2010 and that Liquid Zoo did

1

Although the photographs purport to show certain television sets at Liquid Zoo, Joe
Hand does not argue that they establish what was being shown on the television sets. The
photographs are blurry and of poor resolution and do not establish, beyond peradventure, that
the Event was shown at Liquid Zoo on July 3, 2010.
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not, on July 3, 2010 or on any other date, illegally intercept and broadcast the Event.2 Nelson
also avers that Liquid Zoo was a subscriber of DirecTV, for which it had a satellite dish, and
that it was never the practice of Liquid Zoo to exhibit any events for which a charge was
made separate and apart from the monthly DirecTV charges.3 Defendants also rely on the
affidavit of Scarborough, who avers, inter alia, that the only programming shown at Liquid
Zoo was programming received through Liquid Zoo’s subscription and contract with
DirecTV, and that “[n]either myself, nor anyone known to me to be associated with [Liquid
Zoo], would have any knowledge as to how to accomplish any such illegal interception of
the sort which Plaintiff is claiming in this case.”4 Ds. App. 2.
2

Joe Hand argues that Nelson’s affidavit should be stricken because defendants
refused to provide, in their interrogatory responses, the work schedules for Liquid Zoo’s five
employees on July 3, 2010, and because one of the pictures McEwan took shows, “when
reviewed closely,” a female bartender standing behind the bar of Liquid Zoo on the night of
the Event. P. Reply 7. The photograph on which Joe Hand relies, however, does not
establish that a female bartender was working at Liquid Zoo on the night of the Event. It
shows a figure that appears to be a woman (although even this is speculation because all but
the figure’s hair and shoulder are covered by the man sitting at the bar) standing near the wall
in an area that could be behind the bar or could be beside the bar. Neither defendants’
interrogatory responses nor Joe Hand’s photographic evidence requires the court to strike
Nelson’s affidavit.
3

After the briefing of Joe Hand’s motion was completed, the Fifth Circuit decided J&J
Sports Productions, Inc. v. Mandell Family Ventures, L.L.C., ___ F.3d ___, 2014 WL
1757307 (5th Cir. May 2, 2014). Because the court is denying summary judgment on the
grounds explained in this memorandum opinion and order, it need not address whether the
conclusion in J&J Sports that § 605 does not apply to the receipt or interception of
communications by wire from a cable system in any way affects Joe Hand’s motion. Id. at
*5.
4

Joe Hand objects to Scarborough’s affidavit, contending that defendants’
interrogatory response stating that Scarborough was not present at Liquid Zoo on the date of
the Event “contradicts and impeaches” the statement in her affidavit that on July 3, 2010
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Joe Hand has not established beyond peradventure that the Event was broadcast at
Liquid Zoo on July 3, 2010.5 Although it presents evidence that its private investigator
personally observed the Event being broadcast at Liquid Zoo on July 3, 2010, defendants
have presented competing evidence that contradicts the averments in McEwan’s affidavit.
Nor is Joe Hand’s photographic evidence determinative of whether the Event was broadcast
at Liquid Zoo on the night in question. Accordingly, because a genuine issue of material fact
exists regarding whether the Event was illegally broadcast at Liquid Zoo on July 3, 2010, Joe
Hand cannot satisfy the heavy beyond peradventure standard, and its motion for summary
judgment on its claim under 47 U.S.C. § 605 is denied.6

“neither [Liquid Zoo] nor anyone associated with or employed by [Liquid Zoo], intercepted,
received, or assisted in the receipt of, or the unauthorized transmission of the Event to the
patrons of [Liquid Zoo] and absolutely NO acts were committed to wrongfully intercept,
receive and/or exhibit any telecast of the Event.” P. Reply 3-4 (quoting Ds. App. 1-2). In
deciding Joe Hand’s motion, the court relies primarily on the affidavit of Nelson, who avers
that he was present at Liquid Zoo on July 3, 2010 and that Liquid Zoo did not broadcast the
Event on that date. Accordingly, the court need not address Joe Hand’s objections to
Scarborough’s affidavit.
5

“When this court denies rather than grants summary judgment, it typically does not
set out in detail the evidence that creates a genuine issue of material fact.” Valcho v. Dall.
Cnty. Hosp. Dist., 658 F.Supp.2d 802, 812 n.8 (N.D. Tex. 2009) (Fitzwater, C.J.) (citing
Swicegood v. Med. Protective Co., 2003 WL 22234928, at *17 n.25 (N.D. Tex. Sept. 19,
2003) (Fitzwater, J.)).
6

Because Joe Hand has not established a violation of the FCA beyond peradventure,
the court need not address its arguments regarding damages or defendants’ argument that Joe
Hand’s claim is barred by the statute of limitations.
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For the foregoing reasons, Joe Hand’s motion for summary judgment is denied.
SO ORDERED.
June 3, 2014.

_________________________________
SIDNEY A. FITZWATER
CHIEF JUDGE

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