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denying the plaintiff's request for damages pursuant to 47 U.S.C. § 605(e) because the plaintiff speculated that the defendants modified equipment, but made no factual allegations concerning that matter.
Summary of this case from Joe Hand Promotions, Inc. v. CarterOpinion
04 Civ. 6566 (DC).
March 9, 2005
LONSTEIN LAW OFFICE, P.C., Julie Cohen Lonstein, Ellenville, NY, Attorneys for Plaintiff.
MEMORANDUM DECISION
Plaintiff Kingvision Pay-Per-View, Ltd. ("Kingvision") filed this action on August 12, 2004, alleging, inter alia, that defendants Adolpho Ruiz, Francisco Ruiz, and 154 East 112 Restaurant Corporation (the "Corporation") violated 47 U.S.C. § 605 by intercepting and displaying a satellite program, the Back to Back to Back boxing match (the "Match"), without authorization. The Match was allegedly exhibited on December 13, 2003, to about 60 patrons in defendants' restaurant.
According to the Court's records, Kingvision served the summons and complaint on defendants Adolpho Ruiz and Francisco Ruiz on August 30, 2004 and on the Corporation on September 1, 2004. Defendants' answers were due on September 20 and 21, 2004 respectively. Defendants have failed to answer or otherwise appear in this action and Kingvision submitted a proposed default judgment on December 20, 2004. Pursuant to Fed.R.Civ.P. 55(b), default judgment is hereby entered against defendants.
The issue is the amount of damages appropriate for single violations of § 605. Kingvision seeks to recover $110,000 in damages, plus interest and costs, from each of the three defendants. I find that defendants are liable to Kingvision, on a joint and several basis, for $5,000 in statutory damages and $10,000 in enhanced damages, plus interest and costs.
DISCUSSION
A. Liability
Section 605(a) prohibits, inter alia, unauthorized interception and publication or dissemination of a broadcast. Section 605(e)(4) prohibits the modification of equipment used to assist in the reception of broadcasts and is "targeted at the distributors of cable interception devices . . . and not at the end-users of such devices." Joe Hand Promotions, Inc. v. Hernandez, No. 03 Civ. 6132, 2004 U.S. Dist. LEXIS 12159, at *3, 11-12 (S.D.N.Y. June 30, 2004) (footnote omitted).
Kingvision claims that defendants violated both § 605(a) and § 605(e)(4). Kingvision does not, however, make any factual assertions that defendants modified equipment. (Compare Lonstein Aff. "Applicable Statutory Authorities" ¶¶ 4-6 with id. "Statutory Claims" ¶¶ A-B). There is no basis in the default papers, aside from speculation that defendants modified equipment to exhibit the Match, to find damages for violations of § 605(e)(4). Therefore, I consider damages for violations of § 605(a) only. B. Damages
Statutory damages for violations of § 605(a) are governed by § 605(e)(3)(C)(i)(II), which provides that:
the party aggrieved may recover an award of statutory damages for each violation of subsection (a) of this section involved in the action in a sum of not less than $1,000 or more than $10,000, as the court considers just. . . .47 U.S.C. § 605(e)(3)(C)(i)(II).
Section 605(e)(3)(C)(ii) allows for an enhancement of damages if a defendant's actions are willful and for commercial advantage. The section provides that:
[i]n any case in which the court finds that the violation was committed willfully and for purposes of direct or indirect commercial advantage or private financial gain, the court in its discretion may increase the award of damages, whether actual or statutory, by an amount of not more than $100,000 for each violation of subsection (a) of this section.47 U.S.C. § 605(e)(3)(C)(ii).
At least one court in the circuit has found that "the court may draw an inference of willfulness from a defendant's failure to appear and defend an action in which the plaintiff demands increased statutory damages based on allegations of willful conduct." Time Warner Cable of New York v. Olmo, 977 F. Supp. 585, 589 (E.D.N.Y. 1997).
Here, even without that inference, the requirements of § 605(e)(3)(C)(ii) are satisfied. A default judgment is considered an admission of well-pleaded facts that are stated in the complaint. See In re Indus. Diamonds Antitrust Litigation, 119 F. Supp. 2d 418, 420 (S.D.N.Y. 2000). If the facts stated in the complaint are taken as true, defendants in this case exhibited the Match on a television screen to about 60 patrons in their restaurant. Defendants were not authorized to broadcast the Match, and it is unlikely that they accidentally gained access to it. I find that defendants acted willfully.
Although Kingvision does not claim that customers paid to watch the Match, the restaurant is a commercial establishment that serves food and alcoholic beverages. Defendants clearly gained "indirect commercial advantage" by displaying the Match. As a result, the Court can enhance the award of damages up to an additional $100,000.
Kingvision's request, however, is unreasonable. It seeks $110,000 from each defendant, or the aggregate of the maximum statutory damages under § 605(e)(3)(C)(i)(II) and the maximum enhancement under § 605(e)(3)(C)(ii). I find that a more appropriate amount is $5,000 in statutory damages enhanced by $10,000.
This amount aligns with recent comparable cases in the District. See, e.g., Garden City Boxing Club, Inc. v. Ayisah, 02 Civ. 6673, 2004 U.S. Dist. LEXIS 7867 (S.D.N.Y. Apr. 28, 2004) (awarding $3,000 statutory damages and $5,000 enhanced damages for one-time exhibit of boxing match to 60 customers);Garden City Boxing Club, Inc. v. Deblasio, 02 Civ. 6669,
2003 U.S. Dist. LEXIS 16274 (S.D.N.Y. Sept. 8, 2003) (awarding $5,000 statutory damages and $5,000 enhanced damages for one-time exhibit of boxing match to 23 customers); Joe Hand Promotions, 2004 U.S. Dist. LEXIS 12159 (awarding $1,000 statutory damages and $1,500 enhanced damages for one-time exhibits of boxing match to about twenty customers). Some courts use a per-patron amount to calculate damages, while others award a flat sum. See, e.g., id., at *10-11 (citing cases awarding $50 per patron);Kingvision Pay-Per-View, Ltd. v. New Paradise Rest., No. 99 Civ. 10020, 2000 U.S. Dist. LEXIS 8792, at *6 (S.D.N.Y. Apr. 11, 2000) (citing cases awarding from $50 to $300 per patron).
In a similar case decided in 1996, I found a plaintiff was entitled to $10,000 in statutory damages enhanced by an additional $10,000 plus attorneys' fees. Cablevision Sys. New York City Corp. v. Faschitti, No. 94 Civ. 6830, 1996 U.S. Dist. LEXIS 1212 (S.D.N.Y. Feb. 7, 1996). Like the instant case, default judgment had been entered against the defendant for a single showing of one program. There, however, the customers paid to enter the establishment and watch the program. The defendant in the 1996 case directly profited from the game and customers paid the establishment to watch the program.
Here, any profit as a result of the Match was indirect, and it is not clear from the complaint if customers were in the restaurant to watch the game. Kingvision has not provided specific evidence of defendants' profits or Kingvision's direct or indirect losses as a result of the violation of § 605(a). It has not provided evidence of the fee Kingvision charged other establishments to exhibit the Match. It seems appropriate, as courts have recently found, to reserve the maximum statutory damages for cases where "there is evidence of more substantial injury to the plaintiff or profit by the defendant." See Garden City Boxing Club, 2003 U.S. Dist. LEXIS 16274, at *11.
Accordingly, I find against defendants for $5,000 in statutory damages and $10,000 enhanced damages. This amount is more than enough to cover Kingvision's direct losses for defendants' showing on the night of the Match, and it also serves to deter future violations of the communications law.
The award recognizes that defendants' actions cost Kingvision more than just a fee that it would have charged defendants to legally exhibit the Match. Kingvision has incurred and continues to incur costs associated with investigating and prosecuting a small portion of § 605 violations. It is likely that Kingvision also loses potential customers who view unauthorized programs at commercial establishments. Moreover, defendants have failed to appear in this action, demonstrating indifference to the communications law.
C. Costs and Interest
Pursuant to § 605, Kingvision is entitled to recover attorneys' fees and costs. See § 605(e)(3)(B)(iii). Here, it requests costs of $191.67 against each individual defendant and $231.67 against the Corporation, but does not request attorneys' fees. The request for costs is granted.
Kingvision is also entitled to pre-judgment interest at the rate of 9 percent for the period of time specified in its default papers, December 13, 2003 through October 25, 2004.
CONCLUSION
Default is hereby entered against defendants. Kingvision is entitled to $5,000 statutory damages and $10,000 enhanced damages, for a total damages award of $15,000, plus interest and costs as specified above. A single judgment in the amount of $15,000, plus interest and costs, will be entered against defendants, on a joint and several basis.
SO ORDERED.