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Cablevision Systems New York City Corporation v. Guity

United States District Court, E.D. New York
Feb 8, 2006
CV 04-5733 (FB)(VVP) (E.D.N.Y. Feb. 8, 2006)

Opinion

CV 04-5733 (FB)(VVP).

February 8, 2006


REPORT AND RECOMMENDATION


This matter was referred to me by Judge Block for a report and recommendation regarding the amount of damages and attorney's fees to be awarded to the plaintiff as against the defaulting defendant Mario Guity. The court received affidavits in lieu of holding an evidentiary hearing on the damages issues referred to this magistrate judge. See, e.g., Transatlantic Marine Claims Agency, Inc. v. Ace Shipping Corp., 109 F.3d 105, 11 (2d Cir. 1997) ("We have held that, under rule 55(b)(2), `it [is] not necessary for the District Court to hold a hearing, as long as it ensured that there was a basis for the damages specified in the default judgment."); accord, Fustok v. ContiCommodity Serv., Inc., 873 F.2d 38, 40 (2d. Cir. 1989); Tamarin v. Adam Caterers, Inc., 13 F.3d 51, 54 (2d Cir. 1993). As no party has objected to that procedure, the court has considered affidavits submitted by the plaintiff, and concludes that they provide a basis for the damages recommended below. Although given notice, the defendant has not submitted any opposition to the plaintiff's submissions.

1. Liability

By virtue of the defendant's default, the well-pleaded allegations of the Complaint are deemed admitted, except as to the amount of the plaintiff's damages. See, e.g., Greyhound Exhibitgroup v. E.L.U.L. Realty Corp., 973 F.2d 155, 158 (2d Cir. 1992), cert. denied, 113 S. Ct. 1049 (1993); Au Bon Pain Corp. v. Artect, Inc., 653 F.2d 61, 65 (2d Cir. 1981). Thus, the court accepts as true the assertions that the defendant purchased and resold "pirate" cable television decoding devices compatible with the cable television technology used by the plaintiff. See Complaint ¶¶ 18-22. In addition, the defendant used one such pirate device to intercept and receive plaintiff's cable television programming services, including "premium" and "pay-per-view" services, without the plaintiff's authorization and without payment. Id. The court also accepts that the programming services intercepted by the defendant were radio communications within the meaning of the applicable statute, and that the defendant's conduct therefore violated the statute. Id. ¶ 26.

"Premium" programming includes services such as Cinemax, HBO and Showtime, which are sold on a monthly basis. "Pay-per-view" programming includes certain movies and special events which are sold on a per event, rather than monthly, basis.

2. Damages

The plaintiff has elected to seek an award of statutory damages against the defendant under 47 U.S.C. § 605(e)(3)(C)(i)(II), which requires the court to award statutory damages in the amount of not less than $1,000 and not more than $10,000, "as the court considers just," for defendant's unauthorized receipt of plaintiff's programming services. See 47 U.S.C. § 605(e)(3)(C)(i)(II) and (a). Plaintiff also seeks full costs, including reasonable attorney's fees, under 47 U.S.C. § 605(e)(3)(B)(iii), which mandates that the court "shall direct the recovery of full costs, including rewarding reasonable attorneys' fees."

The evidence offered in plaintiff's affidavit establishes the following facts. In August 1995, the defendant subscribed to receive plaintiff's "basic" programming. See Affidavit of Donald Kempton (hereinafter "Kempton Aff.") ¶ 20. In August 2002, the defendant purchased four (4) unauthorized devices. Id. ¶ 21. In the absence of contrary evidence, the court concludes that statutory damages may be computed on the basis that the defendant used all four devices personally. The court further concludes that the defendant used the devices from the date that he purchased them in August 2002 until the filing of this action in December 2004, a period of twenty-eight (28) months.

"Basic" service allows the subscriber to receive enhanced reception of broadcast stations and a limited number of additional programming channels. "Family" service, on the other hand, permits the subscriber to receive all of the plaintiff's programming services, with the exception of premium and pay-per-view services.

In setting the amount of statutory damages within the ranges provided by the statute, the court considers as a starting point the value of the programming services to which the defendant had access without paying the applicable fees. During the period of his use of the unlawful devices, the defendant was paying the plaintiff $15 per month for his subscription. See Kempton Aff. ¶ 20. However, during that period, through the unlawful use of the "pirate" devices the defendant had access to additional services, including "premium" services, for which the plaintiff charged paying customers an average of $65 per month over and above the $15 rate paid by the defendant. Id. ¶¶ 4, 20. The defendant also had access through the unlawful converter-decoder to "pay-per-view" programming which included movies and special events (boxing matches, concerts, entertainment events, etc.) for which the plaintiff charged between $4 and $55 per event. Id. ¶ 5. Because the "pirate" devices were designed to defeat the plaintiff's security protections, the plaintiff had no way of knowing how often the defendant actually used either the "premium" or "pay-per-view" services to which the defendant had access. The plaintiff estimates that, on average, considering the "premium" services and the various "pay-per-view" movies and other special events typically programmed in a given month, the defendant had access to programming worth approximately $400 per month. Id.

The above evidence establishes that the defendant had access to premium service programming worth $65 per month for approximately 28 months for which he did not pay, a total of some $1,820. As for unauthorized pay-per-view usage, the plaintiff has suggested that the court assume usage on the average of $100 per month, an amount equivalent to one quarter of the programming the defendant could access. Id. ¶¶ 5, 26. The assumption is entirely plausible. Given that the price range for these services is between $4 and $55 per viewing, a total of $100 per month in unlawful pay-per-view usage is a conservative estimate of the services stolen by the defendant. Accordingly the court finds it appropriate to calculate unlawful pay-per-view usage at $100 per month, or $2,800 over the 28-month period in which the defendant possessed the "pirate" converter-decoders. Thus, the value of the services reasonably assumed to have been stolen by the defendant totals approximately $4,620.

The plaintiff also seeks an additional $1,000 in damages for each of the "extra" devices purchased by the defendant. As that is the minimum that the court may award in statutory damages, an additional $3,000 of damages is entirely appropriate, and indeed is probably mandated. See 47 U.S.C. § 605(e)(3)(C)(i)(II) and (a). In light of the foregoing considerations, the court recommends that the plaintiff be awarded $4,620 in statutory damages for the use of on device, as well as an additional $3,000 for the use of the other three devices, for a total award of $7,620. 3. Attorney's Fees and Costs

The plaintiff also submitted an affidavit and time sheets to establish the amount of attorneys' fees it had incurred up through July 2005 in prosecuting this action. The submissions establish that a portion of the fees incurred were determined on a traditional hourly-rate basis, and the remaining fees were charged on a flat-fee basis for particular tasks. As to that portion of the fees calculated on the basis of hourly rates, the court finds that the time billed and the rates charged are appropriate, and that a total of $256.50 should be awarded to the plaintiff. As to that portion of the fees calculated on a flat-fee basis, however, although the fees charged do not appear to the court to be unreasonable, the court is unable to recommend that they be paid. The plaintiff's submission is insufficient under the standards set by the Second Circuit, because it does not provide a breakdown of the hours spent on the tasks for which flat fees were charged. See New York State Ass'n for Retarded Children, Inc. v. Carey, 711 F.2d 1136, 1147-48 (2nd Cir. 1983) (mandatory that attorneys applying for court-ordered compensation document the application with contemporaneous time records specifying, for each attorney, the date, the hours expended, and the nature of the work done). The plaintiff's affidavit also established that the plaintiff incurred $150 in filing fees and $39 in service of process fees, which are properly reimbursable.

The records reflect only that a paralegal billed 2.7 hours at $95.00/hour.

The flat fees included fees of $300 for the drafting of the complaint, $200 for the drafting of the default papers, and $600 for the preparation of the damages submissions.

The court does note however, that the fees requested by counsel are reasonable, and are within the range normally requested by these attorneys in similar actions. Cablevision Sys N.Y. City Corp v. Collins, 2004 WL 1490307, at 6 (S.D.N.Y. June 29, 2004). The court is also mindful of the recent decision in CSC Holdings, Inc. v. Khrisat, Dkt. No. 04 CV 8592, 2005 WL 3030838, at *5 (S.D.N.Y. Nov. 8, 2005), which recommended that an award be made for fees charged on a flat-fee basis. In that case, however, the court was provided with substantial contemporaneous time records concerning other fees that had been charged on a per-hour basis in the same case from which it was able to extrapolate a reasonable lodestar amount that included the flat-fee portion of the award. The records submitted here are far more limited. In the future, should counsel provide the court with contemporaneous records that show the amount of time spent on flat-fee work and the persons who performed it, this court would find that sufficient to assess the reasonableness of, and to award, fees charged on a flat-fee basis.

In accordance with the above considerations, the undersigned hereby RECOMMENDS that statutory damages in the amount of $7,620, and that attorneys' fees and costs in the amount of $445.50, be awarded in favor of the plaintiff and against the defendant Mario Guity.

* * * * * *

Any objections to the Report and Recommendation above must be filed with the Clerk of the Court within 10 days of receipt of this report. Failure to file objections within the specified time waives the right to appeal any judgment or order entered by the District Court in reliance on this Report and Recommendation. 28 U.S.C. § 636(b)(1); Fed.R.Civ.P. 72(b); see, e.g., Thomas v. Arn, 474 U.S. 140, 155, 106 S. Ct. 466, 474, 88 L.Ed.2d 435 (1985); IUE AFL-CIO Pension Fund v. Herrmann, 9 F.3d 1049, 1054 (2d Cir. 1993); Frank v. Johnson, 968 F.2d 298 (2d Cir.), cert. denied, 113 S. Ct. 825 (1992); Small v. Secretary of Health and Human Serv., 892 F.2d 15, 16 (2d Cir. 1989) (per curiam).

Counsel for the plaintiff shall serve a copy of this Report and Recommendation on the defendant by regular mail and file proof of such service in the record.


Summaries of

Cablevision Systems New York City Corporation v. Guity

United States District Court, E.D. New York
Feb 8, 2006
CV 04-5733 (FB)(VVP) (E.D.N.Y. Feb. 8, 2006)
Case details for

Cablevision Systems New York City Corporation v. Guity

Case Details

Full title:CABLEVISION SYSTEMS NEW YORK CITY CORPORATION, Plaintiff, v. MARIO GUITY…

Court:United States District Court, E.D. New York

Date published: Feb 8, 2006

Citations

CV 04-5733 (FB)(VVP) (E.D.N.Y. Feb. 8, 2006)