Opinion
Case No. 3:03CV7407
April 13, 2004
ORDER
This is a suit brought by the provider of subscription satellite television programming against a defendant alleged to have obtained devices capable of enabling him to obtain television services without payment. Default judgment was entered against the defendant for failure to respond to service of summons. The defendant's pro se motion to vacate the default was denied. Pending is a second motion to vacate the default. For the reasons that follow, the motion shall be denied, but the judgment shall be amended to the amount of $10,734.28.
BACKGROUND
Plaintiff alleges that defendant violated provisions of the Federal Wiretap Act, 18 U.S.C. § 2510 et seq., by purchasing, possessing, and using two pirate devices to intercept DirecTV's signal without authorization or payment. These two devices are known as a Vector SMT programmer and a Vector Super unlooper. The Vector SMT programmer is used to modify a DirecTV access card, which permits the capability to obtain DirecTV programming without payment. DirecTV uses electronic counter measures to disable modified access cards. The Vector Super unlooper is used to repair access cards that are damaged by DirecTV's electronic counter measures. These two pirate access devices work together to allow for unauthorized viewing of satellite television programming without payment.
On October 8, 2003, judgment by default was entered against the defendant in the amount of $20,734.28. On December 5, 2003, the defendant's first motion to vacate the judgment was denied.
DISCUSSION
Plaintiff contends that the issues raised in this motion to vacate could and should have been raised in defendant's first motion for relief under Rule 60(b) of the Federal Rules of Civil Procedure. Plaintiff further contends that defendant should be precluded from filing serial motions for relief from judgment. Although the court agrees that the defendant should have raised all relevant issues in the first Rule 60(b) motion, the court does not rule that defendant is precluded from filing a second motion for relief from judgment. The court will address the motion to vacate on the merits.
A. Excusable Neglect and Extraordinary Circumstances
To prevail on a request to vacate a default, a defendant must show: 1) a timely motion for relief; 2) excusable neglect, mistake, or similar error; and 3) a potentially meritorious defense to the complaint. See, e.g., Acevedo v. Dan Motors, 149 F.2d 1182 (6th Cir. 1998); INVST Financial Group, Inc. v. Chem-Nuclear Systems, Inc., 815 F.2d 391, 398-99 (6th Cir. 1987).
In a prior order, this court ruled that procuring legal advice from an unidentified friend about what to do with a federal court summons and complaint is not excusable neglect. The court still holds that defendant's reckless reliance on the advice of an unidentified friend is neither excusable neglect nor extraordinary circumstances sufficient to relieve the defendant from the judgment by default.
B. Amount of Statutory Damages
Defendant contends that this court should not award statutory damages in the amount of $10,000 for each violation under the statute concerning the purchase, use, and possession of the two pirate access devices. Plaintiff contends that the violations under the statute are distinctly separate violations that justify the court's prior judgment.
18 U.S.C. § 2520 authorizes the recovery of civil damages. This section specifically provides:
(a) In general. — . . . Any person whose wire, oral, or electronic communication is intercepted, disclosed, or intentionally used in violation of this chapter may in a civil action recover from the person or entity which engaged in that violation such relief as may be appropriate.
(b) Relief. — In an action under this section, appropriate relief includes —
. . .
(2) damages under subsection (c) and punitive damages in appropriate cases; . . .
. . .
(c) Computation of damages. —
. . .
(2) In any other action under this section, the court may assess as damages whichever is the greater of —
. . .
(A) the sum of the actual damages suffered by the plaintiff and any profits made by the violator as a result of the violation; or
(B) statutory damages of whichever is the greater of $100 a day for each day of violation or $ 10,000.
The Sixth Circuit has ruled that under § 2520(c)(2)(B), the $10,000 damage amount may not be applied per violation of the act if the violations are "sufficiently interrelated and time compacted." Smoot v. United Transp. Union, 246 F.3d 633 (6th Cir. 2001) (quoting Dorris v. Absher, 179 F.3d 420, 428 (6th Cir. 1999)). "The $10,000 is designed to compensate a plaintiff for all of the transgressor's misdeeds under the [Act] arising out of a closely related course of conduct that takes place over a relatively short period of time." Id.
The court in Dorris did not decide whether violations of the [Act] widely separated by time, place, or people would lead to a different result. 179 F.3d at 428. The court in Smoot provided guidance in cases of widely separated violations of the wiretapping statute to whether the $10,000 damage amount under § 2520(c)(2)(B) is to be applied per violation. Smoot held that the statutory damages are limited to $10,000 unless violations of 18 U.S.C. § 2510 et seq. occurred on more than one hundred separate days. 246 F.3d at 643; see also Desilets v. Wal-Mart Stores, Inc., 171 F.3d 711 (1st Cir. 1999).
The Sixth Circuit has reasoned that the $10,000 "single sum" approach is preferred because the $10,000 amount under § 2520(c)(2)(B), unlike the $100 amount, has no per violation authorization. Smoot, 246 F.3d at 644. "Congress knows how to specify an award that is to be multiplied on the basis of the frequency of the violation, because it did so by providing for damages of $100 per day for each day of violation." Dorris, 179 F.3d at 428. The effect of applying the $10,000 amount per violation would render the $100 per day provision meaningless. Smoot, 246 F.3d at 644.
Plaintiff contends that Smoot and Dorris should not be extended to the circumstances in this case because this case involves distinctly separate violations that did not arise out of a single interception. Instead, plaintiff argues that these pirate access devices are used in different situations to independently intercept DirecTV's signal.
The Sixth Circuit has adopted a preference for "single sum" approach for the computation of statutory damages under 18 U.S.C. § 2520. The plain language and structure of the statute reveal that the "single sum" approach is the most reasonable interpretation. To apply the $10,000 per violation approach would misinterpret the statutory scheme and lead to highly inflated damages. See Dorris, 179 F.3d at 428.
Each of the defendant's violations deriving from the use, purchase, and possession of the two pirate access devices are substantially related to the act of obtaining satellite programming without payment. There is no evidence that these separate violations occurred on more than one hundred separate days. Smoot and Dorris shall be extended to the circumstances in this case. The wiretapping statute was designed to compensate plaintiffs for all of the defendant's misdeeds under the statute arising out of related conduct that occurred within one hundred days. Thus, the "single sum" approach shall be applied and the judgment shall be amended to $10,734.28.
CONCLUSION
It is, therefore,
ORDERED THAT defendant Kruse's motion to vacate the judgment shall be denied, but the judgment shall be amended to the amount of $10,734.28.
So ordered.