Summary
In DIRECTV, Inc. v. Alphus Hooper, Civil Action No. 03-1404-A (W.D.La. Apr. 8, 2004), Judge Drell dismissed as time-barred Counts II and III (claims based on alleged violations of 18 U.S.C. § 2511 and 2512) of a Complaint filed on July 28, 2001.
Summary of this case from Directv, Inc. v. BradyOpinion
Civil Action No. 03-1404-A.
April 8, 2004
RULING
Before the Court is a Motion to Dismiss [Doc. No. 7] by pro se defendant Alphus Hooper ("Defendant"), pursuant to FED. R. CIV. P. 12(b)(6) and 18 U.S.C. § 2520(e). For the reasons set forth below, the Motion to Dismiss is GRANTED in part and DENIED in part.
I. BACKGROUND
This suit involves the alleged possession and use of allegedly illegal devices designed to intercept and decrypt DIRECTV's satellite communications. Plaintiff is a company in the business of selling television broadcasts. This programming is distributed to homes through the use of a fixed outdoor satellite dish. The dish is connected to a receiver inside the patron's home by a cable, which cable is connected to a television.
Not everyone with a satellite dish can receive Plaintiff's programming. Plaintiff uses encryption technology to ensure that there is no illicit interception of the broadcasting. This encryption technology scrambles the broadcasting so that only individuals with a DIRECTV satellite receiver can view the shows. Each satellite receiver contains an access card that tells the receiver what channels to unscramble. Thus, Plaintiff is able to tailor its patrons' programming according to their preferences and the amount of money they are willing to pay.
Despite Plaintiff's extensive measures to protect its assets, there are individuals who, with the help of certain devices, have developed the capacity to intercept and unscramble DIRECTV programming without DIRECTV's permission. Upon suspicion that people were obtaining pirated access cards and equipment to program access cards illicitly, Plaintiff executed Writs of Seizure on July 25, 2001 to seize materials that would lead them to the names of the alleged perpetrators. With the help of local law enforcement, Plaintiff conducted a "raid" at a mail shipping facility, PCE Associates, which it alleges was used by major sources of pirate technologies. "During and subsequent" to the raids, Plaintiff came upon evidence, including orders, invoices, electronic communications, shipping documentation, purchase receipts, credit card receipts, and customer lists, which allegedly prove Defendant purchased illegal pirate access devices.
Specifically, Plaintiff avers that Defendant purchased "MKIII Cobalt Series ISO 7816 Unlooper" ("unlooper") from Canadian Security/PCE Associates on July 5, 2001, using interstate or foreign wire facilities and receiving orders through the United States Postal Service or commercial mail carrier. The unlooper is designed to repair access cards that have been rendered unusable by illegitimate use, and is capable of programming access devices. Plaintiff also avers that Defendant illegally "manufactured" pirate access devices. Plaintiff finally alleges that Defendant displayed satellite programming without its authorization. Based on these beliefs, Plaintiff argues that Defendant has violated federal and state law and brings this suit seeking damages and injunctive relief.
Defendant brings this Motion to Dismiss based on the belief that 1) the statute of limitations provided in 18 U.S.C. § 2520(e) has elapsed, 2) Congress did not provide a private right of action in 18 U.S.C. § 2512, and 3) possession alone of a device capable of communicating with ISO7816 compliant smartcards, such as the unlooper he is alleged to have purchased, is not enough to establish liability.
II. JURISDICTION
This suit was brought pursuant to two federal statutes: the Cable Communications Policy Act of 1984, ( 47 U.S.C. § 521), and the Electronic Communications Policy Act of 1986 ( 18 U.S.C. § 2510). Therefore, this Court has subject matter jurisdiction over both the federal and state law claims under 28 U.S.C. §§ 1331 and 1367.
III. ANALYSIS
A. The Rule 12(b)(6) MotionA plaintiff's complaint must contain a "short and plain statement of the claim showing that the pleader is entitled to relief." FED. R. CIV. P. 8(a)(2). The plaintiff must simply allege all the elements of a right to recover against a defendant. See Tuchman v. DSC Communication Corp., 14 F.3d 1061, 1067 (5th Cir. 1994). When considering a motion to dismiss for failure to state a claim, the district court must take the factual allegations of the complaint as true and resolve any ambiguities or doubts regarding the sufficiency of the claim in favor of the plaintiff. See Fernandez-Montes v. Allied Pilots Ass'n, 987 F.2d 278, 284 (5th Cir. 1993) (citing Doe v. United States Dep't of Justice, 753 F.2d 1092, 1102 (D.C. Cir. 1985)). Unless it appears beyond a doubt that the plaintiff can prove no set of facts in support of his claim that would entitle him to relief, the complaint should not be dismissed for failure to state a claim. See Leffall v. Dallas Indep. Sch. Dist., 28 F.3d 521, 524 (5th Cir. 1994); Fernandez-Montes, 987 F.2d at 285 (citing Conley v. Gibson, 355 U.S. 41, 45-46 (1957)). For that reason, a motion to dismiss for failure to state a claim is viewed with disfavor and rarely is granted. See Kaiser Aluminum Chem. Sales, Inc. v. Avondale Shipyards, Inc., 677 F.2d 1045, 1050 (5th Cir. 1982). With this standard in mind, we embark on our analysis of Defendant's motion and Plaintiff's response. B. Counts 2 and 3: 18 U.S.C. § 2520
Section 2520(e) provides:
A civil action under this section may not be commenced later than two years after the date upon which the claimant first has a reasonable opportunity to discover the violation.18 U.S.C. § 2520(e).
The initial date Plaintiff was able to discover the possibility that it had a cause of action against Defendant was July 25, 2001. Two years and three days later, Plaintiff brought this suit. Defendant contends that this is clearly outside the statute of limitations. Plaintiff responds that the statute requires "real knowledge" before the clock begins to tick. See Doc. No. 11 at 2. Plaintiff further avers that it is
not apparent that DIRECTV had a reasonable opportunity to discover Hooper's violation on or before July 28, 2001 given the volume of records it had to review to discover Hooper's violation. It took time for DIRECTV to simply obtain and copy the records which, once received, included thousands of pages of documents, devices and invoices. After obtaining the information, DIRECTV went through the process of organizing the information that was obtained in hard copy. The process of organizing the hard documents took several months.Id. at 3. Implicit in Plaintiff's argument is the notion that the statute should not begin to toll until Plaintiff had all of its information from the raid "organized." In support of its arguments, Plaintiff cites to several cases, none of which addresses the relevant statute, but rather interpret other statutes of limitations; so they were not helpful in this case. Sparshot v. Feld Entertainement, Inc., discussed the statute of limitations for 18 U.S.C. § 2520, 311 F.3d 425 (D.C. Cir. 2002), rehearing and rehearing en banc denied (Jan. 10, 2003). The court there said:
[T]he statute bars a suit if the plaintiff had such notice as would lead a reasonable person either to sue or to launch an investigation that would likely recover the requisite facts. . . . [Plaintiff's] subjective state of mind is irrelevant. Additionally, there is no need that someone actually "discover" or be aware of the violation. Rather, the question is whether the person had a reasonable opportunity to discover the wiretapping. . . . A plaintiff need not even know the perpetrators of an illicit wiretapping if knowledge of the wiretapping itself would lead to discovery of the perpetrators.Id. at 429 (emphasis added). In Davis v. Zirkelbach, a case also interpreting § 2520, the court held that "[l]ike many statutes of limitation, this one does not require the claimant to have actual knowledge of the violation; it demands only that the claimant have had a reasonable opportunity to discover it." 149 F.3d 614, 618 (7th Cir. 1998). The court further opined that so long as a plaintiff has inquiry notice that its rights have been violated, the clock begins to run. Id.
We find these opinions persuasive. Plaintiff has not given this Court any reason to believe that Defendant's name was not discovered within the first three days after the raid. Furthermore, the fact that it took Plaintiff several months to organize the information so that it might bring suit is not relevant. Starting from the date of the raid, July 25, 2001, Plaintiff had a reasonable opportunity to discover Defendant's alleged offense. It was on inquiry notice that a violation of its rights had occurred, as evinced by the fact that it executed writs of seizure. The two years provided by the statute were ample to discover this defendant's name, and bring this suit. The statute of limitations will not be extended because Plaintiff suffers the logistical task of attempting to bring massive litigation against numerous defendants, needing more time to do so. Counts 2 and 3 of Plaintiff's complaint are time-barred. Therefore, this Court need not determine whether Plaintiff has stated claims upon which relief can be granted under 18 U.S.C. § 2511 and 2512.
C. Counts 1 and 4: 47 U.S.C. § 605
Defendant brings a Motion to Dismiss Counts 1 and 4 based on the assertion that these "charges are based only on the alleged purchase of an electronic device that may have the capability of communicating with ISO7816 compliant smartcards. The court has found in many cases, such as Flowers v. Tandy Corp. that mere possession of a device is not evidence of use or intent." Doc. No. 7 at 1.
Plaintiff, however, does not merely allege in this action possession of the unlooper, but rather also alleges that Defendant was using and/or manufacturing the device illicitly, in violation of 47 U.S.C. § 605. Specifically, Plaintiff stated ". . . DIRECTV brings this lawsuit against the defendant for his purchase, possession, modification, manufacture, assembly, and/or use of Pirate Access Devices." Doc. No. 1 at 4. Also, Plaintiff further avers that "Defendant, illegally and without authorization, intercepted, received and exhibited, or otherwise assisted in the unauthorized interception, reception, and exhibition of Satellite Programming transmitted by DIRECTV."Id. at 9. Finally, Plaintiff alleges:
47 U.S.C. § 605(a) provides:
Except as authorized by chapter 119, Title 18, no person receiving, assisting in receiving, transmitting, or assisting in transmitting, any interstate or foreign communication by wire or radio shall divulge or publish the existence, contents, substance, purport, effect, or meaning thereof, except through authorized channels of transmission or reception, (1) to any person other than the addressee, his agent, or attorney, (2) to a person employed or authorized to forward such communication to its destination, (3) to proper accounting or distributing officers of the various communicating centers over which the communication may be passed, (4) to the master of a ship under whom he is serving, (5) in response to a subpoena issued by a court of competent jurisdiction, or (6) on demand of other lawful authority. No person not being authorized by the sender shall intercept any radio communication and divulge or publish the existence, contents, substance, purport, effect, or meaning of such intercepted communication to any person. No person not being entitled thereto shall receive or assist in receiving any interstate or foreign communication by radio and use such communication (or any information therein contained) for his own benefit or for the benefit of another not entitled thereto. No person having received any intercepted radio communication or having become acquainted with the contents, substance, purport, effect, or meaning of such communication (or any part thereof) knowing that such communication was intercepted, shall divulge or publish the existence, contents, substance, purport, effect, or meaning of such communication (or any part thereof) or use such communication (or any information therein contained) for his own benefit or for the benefit of another not entitled thereto. This section shall not apply to the receiving, divulging, publishing, or utilizing the contents of any radio communication which is transmitted by any station for the use of the general public, which relates to ships, aircraft, vehicles, or persons in distress, or which is transmitted by an amateur radio station operator or by a citizens band radio operator.47 U.S.C. § 605(e)(3)(C)(4) provides:
Any person who manufactures, assembles, modifies, imports, exports, sells, or distributes any electronic, mechanical, or other device or equipment, knowing or having reason to know that the device or equipment is primarily of assistance in the unauthorized decryption of satellite cable programming, or direct-to-home satellite services, or is intended for any other activity prohibited by subsection (a) of this section, shall be fined not more than $500,000 for each violation, or imprisoned for not more than 5 years for each violation, or both. For purposes of all penalties and remedies established for violations of this paragraph, the prohibited activity established herein as it applies to each such device shall be deemed a separate violation.
. . . Defendant actively programmed and reprogrammed DIRECTV Access Cards and designed electronic systems for use in surreptitiously obtaining DIRECTV Satellite Programming. Further, by removing and inserting Pirate Access Devices and/or inserting illegally programmed Access Cards into valid DIRECTV Receivers, Defendant engaged in the unlawful assembly and/or modification of devices primarily of assistance in the unauthorized decryption of Satellite Programming.Id. at 11.
Plaintiff has made sufficient allegations under 47 U.S.C. § 605 to state a claim upon which relief can be granted. Because, when considering a motion to dismiss for failure to state a claim, the district court must take the factual allegations of the complaint as true and resolve any ambiguities or doubts regarding the sufficiency of the claim in favor of the plaintiff,Fernandez-Montes v. Allied Pilots Ass'n, 987 F.2d 278, 284 (5th Cir. 1993), we must give Plaintiff the opportunity to prove its case. At this early stage in the pleading, no evidence is required. Rule 8(a)(2) requires that a complaint include only "a short and plain statement of the claim showing that the pleader is entitled to relief." The Supreme Court held in Conley v. Gibson, 355 U.S. 41, 78 S.Ct. 99 (1957), that
the Federal Rules of Civil Procedure do not require a claimant to set out in detail the facts upon which he bases his claim. To the contrary, all the Rules require is 'a short and plain statement of the claim' that will give the defendant a fair notice of what the plaintiff's claim is and the grounds upon which it rests. Id. at 47, 78 S.Ct., at 103 (footnote omitted). Whether Plaintiff can prove all of the elements of its complaint will, no doubt, be determined during discovery and later, on dispositive motion, or at trial. Accordingly, the Motion to Dismiss is DENIED as to Counts 1 and 4.
D. Count 5: Civil Conversion
"A conversion consists of an act in derogation of the plaintiff's possessory rights, and any wrongful exercise or assumption of authority over another's goods, depriving him of the possession, permanently or for an indefinite time, is a conversion." Labbe v. Premier Bank, 618 So.2d 45, 46 (La.App. 3d Cir. 1993) cited in Charbonnet v. Spalitta, 98-1321 (La.App. 5th Cir. 11/10/99), 747 So.2d 1155. "The tort of conversion is governed by La.C.C. art. 3492, which sets forth a prescriptive period of one year for delictual actions. Prescription commences on the date the injured party discovers or should have discovered the facts that would entitle him to bring suit. " Charbonnet 98-1321 (La.App. 5th Cir. 11/10/99) (emphasis added). As we observed above, the date upon which Plaintiff discovered that its rights were being allegedly violated was July 25, 2001. This suit was brought two years and 3 days later, a year and three days after the prescriptive period in state law. This is obviously greater than one year after Plaintiff "discover[ed] or should have discovered the facts that would entitle [it] to bring suit." Accordingly, this cause of action has prescribed. The Motion to Dismiss as to Count 5 is GRANTED.