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

Filing 12

MEMORANDUM OPINION AND ORDER GRANTING 11 MOTION for Default Judgment against All Defendants. (Signed by Judge Gray H Miller) Parties notified.(rkonieczny, 4)

United States District Court
Southern District of Texas

ENTERED
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF TEXAS
HOUSTON DIVISION
J&J SPORTS PRODUCTIONS, INC.,
Plaintiff,
v.
WILLIAM DADSON, individually, and d/b/a
H2O NIGHT CLUB a/k/a H2O; and
LORPU MAWOELO MATTHEWS, individually,
and d/b/a H2O NIGHT CLUB a/k/a H2O,
Defendants.

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August 09, 2017
David J. Bradley, Clerk

CIVIL ACTION H-16-2789

MEMORANDUM OPINION & ORDER
Pending before the court is plaintiff J&J Sports Productions, Inc.’s (“J&J”) motion for default
judgment against defendant William Dadson, individually and d/b/a H2O Night Club a/k/a H2O
(“Dadson”), and defendant Lorpu Mawoelo Matthews, individually, and d/b/a H2O Night Club a/k/a
H2O (“Matthews”) (collectively, the “Defendants”). Dkt. 11. After considering the complaint,
motion, evidentiary record, and relevant law the court is of the opinion that the motion should be
GRANTED.
I. BACKGROUND
J&J is a broadcast licensee authorized exclusively to sublicense the closed-circuit telecast
of the September 14, 2013 “The One”: Floyd Mayweather, Jr. v. Saul Alvarez WBC Middleweight
Championship Fight Program, including undercard and preliminary bouts (collectively, the “Event”).
Dkt. 1 at 3. J&J was licensed to exhibit the Event at closed-circuit locations, such as theaters,
arenas, bars, clubs, lounges, restaurants, and other commercial establishments throughout Texas.
Id. The closed-circuit broadcast of the Event may be exhibited in a commercial establishment only

if the establishment is contractually authorized by J&J.

Id.

J&J contracted with various

establishments throughout the state and granted those establishments the right to broadcast the Event
in exchange for sublicense fees.

Id.

After receiving sublicense fees, J&J provided these

establishments with the electronic decoding capability or satellite coordinates necessary to receive
the satellite transmission of the Event. Id. at 3–4.
On September 14, 2016, J&J brought this lawsuit, alleging that the Defendants violated the
Federal Communications Act of 1934, 47 U.S.C. §§ 553 or 605, by willfully and unlawfully
intercepting the interstate communication of the Event and exhibiting the Event to patrons at H2O
Night Club without paying the required sublicense fee. Id. at 4–5. On October 21, 2016, Dadson
was properly served with process. Dkt. 5. On December 21, 2016, J&J filed a motion for substitute
service as the process server did not successfully serve Matthews. Dkt. 6. On December 22, 2016,
J&J filed a motion for extension of time to allow J&J to serve Matthews and, thereafter, allow both
Dadson and Matthews the opportunity to answer J&J’s original complaint. Dkt. 7. On January 4,
2017, the court granted both J&J’s motion for extension of time and motion for substitute service.
Dkt. 8. On January 25, 2017, Matthews was properly served with process. Dkt. 9. The Defendants
were informed that their deadline to answer or otherwise respond was February 6, 2017. See Fed.
R. Civ. P. 12(a). To date, the Defendants have not answered or otherwise responded to this lawsuit.
Dkt. 10 at 6 (Diaz Aff.).
On February 9, 2017, J&J moved for default judgment against the Defendants. Dkt. 11.
Pursuant to the Local Rules of the Southern District of Texas, J&J served the motion for default
judgment upon the Defendants via certified mail, with return receipt requested. Id., Ex. 1 at 3, see
also S.D. Tex. L.R. 5.5. The Defendants failed to respond to the motion for default judgment.
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II. LEGAL STANDARD AND ANALYSIS
Under Federal Rule of Civil Procedure 55(a), “[w]hen 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.” Fed. R. Civ. P. 55(a). The
Defendants have failed to plead or otherwise defend against this lawsuit. Further, J&J properly
served the Defendants with this lawsuit under the Federal Rules and with the motion for default
judgment under the Local Rules. Given the Defendants’ failure to answer the complaint in a timely
manner, the court: (1) has the authority to enter default against them, (2) accept all well-pleaded facts
in J&J’s complaint as true, and (3) award the relief sought by J&J in this action. See Nishimatsu
Constr. Co. v. Hous. Nat’l Bank, 515 F.2d 1200, 1206 (5th Cir. 1975).
J&J initially alleged that the Defendants violated either 47 U.S.C. § 553 or 47 U.S.C. § 605.
Dkt. 1 at 5. J&J now moves for default judgment under 47 U.S.C. § 605. Dkt. 11 at 10–11. Section
605 is applicable here because transmission of the Event originated via satellite. Dkt. 11 at 2–3; see
also J&J Sports Prods., Inc. v. Flor De Cuba, TX, Inc., No. 13-CV-3282, 2014 WL 6851943, at *2
(S.D. Tex. Dec. 3, 2014) (Rosenthal, J.) (noting that Section 605 applies to the theft of radio and
satellite communications, whereas Section 553 applies to the theft of communications from a cable
network). Section 605 is a strict liability statute. Joe Hand Promotions, Inc. v. 152 Bronx, L.P., 11
F. Supp. 3d 747, 753 (S.D. Tex. 2014) (Harmon, J.). To establish liability, J&J must show that (1)
the Event was exhibited in H2O Night Club and (2) J&J did not authorize the particular exhibition
of the Event. Id. J&J’s well-pleaded complaint and affidavits establish both of these elements.
Dkt. 1 at 3–4; Dkt. 11, Exs. A, A-2.

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J&J seeks (1) statutory damages of $10,000; (2) additional damages of $50,000; (3)
attorneys’ fees of either a one-third contingent fee or $1,000; (4) costs; (5) post-judgment interest;
and (6) a permanent injunction against the Defendants. Dkt. 11 at 10–11; Dkt. 11, Ex. B at 3–5.
The court may award statutory damages between $1,000 and $10,000. 47 U.S.C.
§ 605(e)(3)(C)(i)(II). The court finds that a statutory damages award of $5,000 is appropriate in this
case. Here, J&J could have charged $2,200 for a venue comparable to H2O Night Club. See Dkt.
11, Ex. A-2 (stating that H2O Night Club has a capacity of approximately 60 people); Dkt. 11, Ex.
A-3 (advertising a charge of $2,200 for a venue seating 0-100 people). An additional $2,800 is
reasonable to deter future violations.
The court may award additional damages of up to $100,000 where the violation was
committed willfully and for the purposes of private financial gain or commercial advantage.
47 U.S.C. § 605(e)(3)(C)(ii). An award of additional damages is warranted here because the
Defendants must have acted willfully and for the purposes of private financial gain in receiving the
unauthorized satellite signal and displaying the Event to its customers. See Time Warner Cable of
N.Y.C. v. Googies Luncheonette, Inc., 77 F. Supp. 2d 485, 490 (S.D.N.Y. 1999) (“There can be no
doubt that the violations were willful and committed for purposes of commercial advantage and
private gain. Signals do not descramble spontaneously, nor do television sets connect themselves to
cable distribution systems.”). The court finds that an award of additional damages that is double the
statutory damages is appropriate. See Joe Hand Promotions, Inc. v. Chios, Inc., No. 4:11-CV-2411,
2012 WL 3069935, at *5 (S.D. Tex. July 27, 2012) (Hoyt, J.) (“Generally, it is reasonable to increase
an actual or statutory damages award by a multiplier to penalize Defendants for willful acts.”), aff’d,
544 F. App’x 444 (5th Cir. 2013). Therefore, the court awards $10,000 in additional damages.
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The court is required to award full costs, including reasonable attorneys’ fees. 47 U.S.C.
§ 605(e)(3)(B)(iii). Attorneys’ fees will be awarded in the amount of $1,000 because the court finds
that four hours of work at a blended rate of $250 is reasonable. Dkt. 11, Ex. B at 3–5. Costs will
be taxed in favor of J&J.
J&J is entitled to recover damages against the Defendants as detailed above, plus postjudgment interest at the rate of 1.23% per annum. There shall be no award of pre-judgment interest.
Furthermore, J&J is entitled to recover the following conditional awards of attorneys’ fees
from the Defendants in the following circumstances:
a.

Ten Thousand Dollars ($10,000.00) in the event the Defendants file a motion to
vacate, Rule 60 motion, motion for new trial, motion for reconsideration or
other post-judgment, pre-appeal motion that does not result in a reversal of
the judgment obtained in this action;

b.

Fifteen Thousand Dollars ($15,000.00) in the event the Defendants file an appeal
to the Fifth Circuit Court of Appeals that does not result in a reversal of the
judgment obtained in this action;

c.

Five Thousand Dollars ($5,000.00) for making and/or responding to a petition
for certiorari to the U.S. Supreme Court that does not result in a reversal of
judgment obtained in this action;

d.

Ten Thousand Dollars ($10,000.00) for an appeal to the U.S. Supreme Court
in the event a petition for certiorari review is granted and does not result in
a reversal of judgment obtained in this action; and

e.

Two Thousand Five Hundred Dollars ($2,500.00) for collection of the judgment
rendered in this case, should J&J obtain a writ of execution, writ of garnishment, writ
of attachment, or other process.

Finally, the court may award a temporary or permanent injunction to “prevent or restrain”
violations of the statute. 47 U.S.C. § 605(e)(3)(B)(i). The court finds that an injunction is warranted
in these circumstances and GRANTS J&J’s request for a permanent injunction against the
Defendants.
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III. CONCLUSION
For the foregoing reasons, J&J’s motion for default judgment (Dkt. 11) is GRANTED. The
court will enter a separate final judgment against the Defendants consistent with this order.
Signed at Houston, Texas on August 9, 2017.

___________________________________
Gray H. Miller
United States District Judge

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