Summary
In Buckeye Cablevision, Inc. v. Sledge, 2004 U.S. Dist. LEXIS 7578 (N.D. Ohio), the court noted that "[t]he Supreme Court has defined 'willful' in the context of civil statutes as conduct showing 'disregard for the governing statute and an indifference to its requirements.'" Id.
Summary of this case from Zuffa v. HoltsberryOpinion
Case No. 3:03CV7561
April 8, 2004
ORDER
This is a case brought by a provider of satellite television programming against a subscriber to such programming who is alleged to have used one or more devices to receive programming without paying for it. This court has federal question jurisdiction under 28 U.S.C. § 1331. Pending is plaintiff's motion for entry of judgment by default in the amount of $110,000, plus interest and litigation expenses. For the following reasons, entry of judgment by default shall be granted in the amount of $2,500, plus interest, attorney fees, and costs.
BACKGROUND
Plaintiff alleges, upon information and belief, that defendant engaged in unauthorized reception and interception of plaintiff's programming services by the use of unauthorized descrambling devices. Plaintiff seeks the maximum amount of damages available under 47 U.S.C. § 605(e), et seq. and 47 U.S.C. § 553(a), et seq.
Defendant has never responded to the complaint or the motion for default. Additionally, the defendant failed to respond to an order that she show cause why judgment by default in the amount of the requested judgment should not be entered.
DISCUSSION
It is unfortunate that the defendant neither answered the complaint nor appeared before this court. It is precisely this type of evasive behavior that Rule 55 of the Federal Rules of Civil Procedure was designed to prevent. Default judgment is the appropriate result given that the defendant never responded to the complaint or this court's orders.
A. Default Judgment
Rule 55 of the Federal Rules of Civil Procedure governs both entry of default and default judgments. Rule 55(a), pertaining to entries of default, provides that: "when a party against whom a judgment for affirmative relief is sought has failed to plead or otherwise defend as provided by these rules and that fact is made to appear by affidavit or otherwise, the clerk shall enter the party's default." Default was entered against the defendant on December 29, 2003.
"Entry of a default is a prerequisite to entry of a default judgment under Rule 55(b)." Systems Industries, Inc. v. Han, 105 F.R.D. 72, 74 (E.D. Pa. 1985). Rule 55(b) provides that judgment by default may be entered either by the court or by the clerk. Rule 55(b)(1) provides that judgment by default may be entered by the clerk "when the plaintiff's claim against a defendant is for a sum certain or for a sum which can by computation be made certain, the clerk upon request of the plaintiff and upon affidavit of the amount due shall enter judgment for that amount and costs against the defendant, if the defendant has been defaulted for failure to appear and is not an infant or incompetent person."
B. Amount of Damages
47 U.S.C. § 553, 605 provide civil and criminal remedies for unauthorized interception and subsequent transmission of satellite and cable signals. Although several courts have held that unauthorized interception and broadcast of either satellite or cable transmissions violates both § 553 and § 605, a majority of courts award damages only under § 605 because that provision allows for greater recovery by the plaintiff. Entm't by J J v. Al-Waha Enters., 219 F. Supp.2d 769 (S.D. Tex. 2002); see also Time Warner Cable of New York City v. Olmo, 977 F. Supp. 585, 588-90 (E.D. N.Y. 1997).
The amount of damages assessed pursuant to § 605 rests within the sound discretion of the court. 47 U.S.C § 605 et seq. Under § 605(e)(3), an aggrieved party may recover either actual damages or "statutory damages for each violation of subsection (a) . . . in a sum not less than $1,000 or more than $10,000, as the court considers just." Where "the court finds that the violation was committed willfully and for purposes of direct and 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).
The Supreme Court has defined "willful" in the context of civil statutes as conduct showing "disregard for the governing statute and an indifference to its requirements." Transworld Airlines, Inc. v. Thurston, 469 U.S. Ill, 127(1985).
For purposes of § 605, courts have identified conduct as "willful" where there were repeated violations over time, or there was a sophisticated understanding of the satellite programming industry and there was a violation of the statutes that regulate the conduct. Cable/Home Communication Corp. v. Network Prod., 902 F.2d 829, 851 (11th Cir. 1990); Home Box Office v. Champs of New Haven, Inc., 837 F. Supp. 480, 484 (D. Conn. 1993).
Other district courts have ruled that a 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 City, 977 F. Supp. at 589; Fallaci v. The New Gazette Literary Corp., 568 F. Supp. 1172, 1173 (S.D. N.Y. 1983) One district court has interpreted 47 U.S.C. § 605(e)(3)(C)(ii) to include substantial unlawful monetary gains by a defendant as an appropriate factor to consider when exercising discretion in increasing the amount of statutory damages. Home Box Office, 837 F. Supp. at 484.
Another district court has required that there must be egregious circumstances before awarding maximum statutory damages. Joe Hand Promotions v. Burg's Lounge, 955 F. Supp. 42, 44 (E.D.Pa. 1997).
Plaintiff seeks the maximum statutory damages, $110,000, pursuant to 47 U.S.C. § 553, 605. The maximum award of $110,000 is, however, excessive under the circumstances presented. Although the plaintiff alleges "on information and belief that the defendant acted willfully and deliberately for the purposes of private financial gain, the plaintiff has failed to establish that the defendant did, in fact, act willfully.
There is no evidence that the defendant repeatedly violated the law over an extended period of time. It is also unlikely that this defendant received a substantial monetary gain by receiving the plaintiffs satellite programming without its authorization. There is no evidence that the defendant attempted to profit from her illegal conduct.
Absent competent evidence that would suggest that this defendant acted egregiously, a court should not award the highest possible damages. See, e.g., Home Box Office, 837 F. Supp. at 484 (holding that under the Communications Act of 1934, maximum statutory damages in the amount of $250,000 imposed on sports bar owner was excessive and would be reduced to $10,000 where there were no allegations of repeated violations, substantial gains by defendants or significant actual damages to the plaintiff); see also Joe Hand Promotions, 955 F. Supp. at 42 (holding that in the absence of evidence suggesting especially egregious circumstances under which tavern owners exhibited copyright broadcast of heavyweight boxing fight without authorization, a $20,000 damage award was unwarranted).
Exercising this court's discretion under 47 U.S.C § 605, I find that $2,500 is an appropriate award based on the circumstances.
CONCLUSION
It is, therefore,
ORDERED THAT plaintiff Buckeye Cablevision's motion for entry of judgment by default shall be granted in the amount of $2,500, plus interest, attorney fees, and costs.
So ordered.