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02 Civ. 0588 (MBM) (AJP)
May 13, 2002
REPORT AND RECOMMENDATION
On March 12, 2002, Chief Judge Mukasey granted plaintiffs application for entry of a default judgment against all defendants, and on April 1, 2002, entered the default judgment and referred the matter to me for an inquest on damages. (Dkt. No. 7: Order; Dkt. No. 8: Default Judgment.) The complaint in this case seeks damages against defendants under the Federal Communications Act of 1934, 47 U.S.C. § 553 and § 605. (Dkt. No. 1: Compl.)
For the reasons set forth below, the Court recommends an award of $20,000 in statutory damages, and attorneys' fees and costs of $2,515.
FACTS
"Where, as here, 'the court determines that defendant is in default, the factual allegations of the complaint, except those relating to the amount of damages, will be taken as true.'" Chen v. Jenna Lane, Inc., 30 F. Supp.2d 622, 623 (S.D.N.Y. 1998) (Carter, D.J. Peck, M.J.) (quoting 1OA C. Wright, A. Miller M. Kane, Federal Practice Procedure: Civil 2d § 2688 at 58-59 (3d ed. 1998)). The Complaint
Accord, e.g, Ainbinder v. Bernice Mining Contracting, Inc., 01 Civ. 2492, 2002 WL 461576 at 1 (S.D.N.Y. Mar. 26, 2002) (Peck, M.J.);Sterling Nat'l Bank v. A-1 Hotels Int'l, Inc., 00 Civ. 7352, 2002 WL 461574 at 1 (S.D.N.Y. Mar. 26, 2002) (Peck, M.J.); King Vision Pay-Per-View Corp. v. Papacito Lidia Luncheonette, Inc., 01 Civ. 7575, 2001 WL 1558269 at 1 (S.D.N.Y. Dec. 6, 2001) (Peck, M.J.); Trustees of the Pension Welfare Funds of the Moving Picture Mach. Operators Union, Local 306 v. Gordon's Film Co. (New York) Int'l Inc., 00 Civ. 8452, 2001 WL 1415145 at 1 (S.D.N.Y. Nov. 13, 2001) (Peck, M.J.); Coast To Coast Fabrics, Inc. v. Tracy Evans, Ltd., 00 Civ. 4417, 2001 WL 5037 at 1 (S.D.N.Y. Jan. 2, 2001) (Peck, M.J.); Starbucks Corp. v. Morgan, 99 Civ. 1404, 2000 WL 949665 at 1 (S.D.N.Y. July 11, 2000) (Peck, MJ.); King Vision Pay-Per-View, Ltd. v. New Paradise Rest., 99 Civ. 10020, 2000 WL 378053 at 1 (S.D.N.Y. Apr. 11, 2000) (Peck, M.J.); Independent Nat'l Distrib., Inc. v. Black Rain Communications, Inc., 94 Civ. 8464, 1996 WL 238401 at 2 (S.D.N.Y. Apr. 4, 1996) (Keenan, D.J. Peck, M.J.).
Plaintiff Entertainment By JJ, Inc. ("JJ") entered into a closed circuit television license agreement to exhibit the closed-circuit telecast of the June 17, 2000 Oscar de La Hoya — Shane Mosly championship boxing match (the "Event"). (Dkt. No. 1: Compl. ¶ 7.) The scrambled closed-circuit broadcast of the Event could only be exhibited in commercial establishments contractually authorized by JJ to do so. (Compl. ¶¶ 9, 11.) Defendants could have licensed the Event but did not do so, and instead wilfully intercepted and transmitted the Event to the restaurant's customers. (Compl. ¶¶ 12, 14, 15.)
The complaint asserts causes of action for violation of the Federal Communications Act, 47 U.S.C. § 605 (Compl. ¶¶ 26-32) and 47 U.S.C. § 553 (Compl. ¶¶ 19-25).
EVIDENCE ON THE INQUEST AND ANALYSIS
JJ's investigator found 40 people watching the Event at defendant's restaurant, which at the $40 per viewer license fee, would have resulted in a license fee of $800 if defendant had taken a license from JJ. (Klauber Aff. ¶¶ 7-8; JJ Inquest Br. Ex. B: Investigator Report Aff.)
By Order dated April 12, 2002, I directed JJ to submit its inquest damages papers by April 24, 2002 (which it did), and defendants to submit their opposition papers by May 8, 2002, which they did not. (Dkt. No. 10: 4/12/02 Order.) The Court's Order also called the parties' attention to the Court's decision in King Vision Pay-Per-View Corp. v. Papacito Lidia Luncheonette, Inc., 01 Civ. 7575, 2001 WL 1558269 (S.D.N.Y. Dec. 6, 2001) (Peck, M.J.). (Dkt. No. 10:4/12/02 Order.)
The Second Circuit has approved the holding of an inquest by affidavit, without an in-person court hearing, "'as long as [the Court has] ensured that there was a basis for the damages specified in the default judgment.'" Transatlantic Marine Claims Agency, Inc. v. Ace Shipping Corp., 109 F.3d 105, 111 (2d Cir. 1997) (quoting Fustok v. Conti Commodity Servs., Inc., 873 F.2d 38, 40 (2d Cir. 1989))
Accord, e.g., Ainbinder v. Bernice Mining Contracting, Inc., 01 Civ. 2492, 2002 WL 461576 at 2 (S.D.N.Y. Mar. 26, 2002); Sterling Nat'l Bank v. A-1 Hotels Int'l, Inc., 00 Civ. 7352, 2002 WL 461574 at 3 (S.D.N.Y. Mr. 26, 2002); King Vision Pay-Per-View Corp. v. Papacito Lidia Luncheonette, Inc., 2001 WL 1558269 at 1; Trustees of the Pension Welfare Funds of the Moving Pictures Mach. Operators Union. Local 306 v. Gordon's Film Co. (New York) Int'l Inc., 00 Civ. 8452, 2001 WL 1415145 at 1 (S.D.N.Y. Nov. 13, 2001) (Peck, M.J.); Coast To Coast Fabrics, Inc. v. Tracy Evans, Ltd., 00 Civ. 4417, 2001 WL 5037 at 1 (S.D.N.Y. Jan. 2, 2001) (Peck, M.J.); Starbucks Corp. v. Morgan, 99 Civ. 1404, 2000 WL 949665 at 2 (S.D.N.Y. July 11, 2000) (Peck, M.J.); King Vision Pay-Per-View, Ltd. v. New Paradise Rest., 99 Civ. 10020, 2000 WL 378053 at 1 (S.D.N.Y. Apr. 11, 2000) (Peck, M.J.); Chen v. Jenna Lane, Inc., 30 F. Supp.2d 622, 624 (S.D.N.Y. 1998) (Carter, D.J. Peck, M.J.); see also, e.g., Semi Conductor Materials, Inc. v. Agriculture Inputs Corp., 96 Civ. 7902, 1998 WL 388503 at 8 (S.D.N.Y. June 23, 1998) (Kaplan, D.J. Peck, M.J.).
Pursuant to 47 U.S.C. § 605(e)(3)(C)(i)-(ii), the Court may award statutory damages of between $1,000 and $10,000, and where the violation is willful and for purposes of commercial advantage, additional damages of up to $100,000. For violation of 47 U.S.C. § 553, the Court may award statutory damages of $250 to $10,000, and may increase the amount to up to $50,000 for willful violations committed for purposes of commercial advantage. 47 U.S.C. § 553(c)(3)(A)(ii), (B).See generally, e.g., King Vision Pay-Per-View Corp. v. Papacito Lidia Luncheonette, Inc., 2001 WL 1558269 at 2; King Vision Pay-Per-View, Ltd. v. New Paradise Rest., 2000 WL 378053 at 2.
Plaintiff JJ sought to cumulate all of these damages for a total of $170,000 in statutory damages. (See, e.g., Dkt. No. 1: Compl. ¶¶ 25, 32.) However, this Court, in two prior cases involving a similar plaintiff, King Vision, made clear that a plaintiff cannot recover under both 47 U.S.C. § 605 and § 553. King Vision Pay-Per-View Corp. v. Papacito Lidia Luncheonette, Inc., 2001 WL 1558269 at 2; King Vision v. New Paradise Rest., 2000 WL 378053 at 2; accord, e.g., Int'l Cablevision Inc. v. Sykes, 75 F.3d 123, 129 (2d Cir.), cert. denied, 519 U.S. 929, 117 S.Ct. 298 (1996); Time Warner Cable v. Evans, 00 Civ. 1385, 2001 WL 1241756 at 4 (S.D.N.Y. Oct. 9, 2001) ("When a court determines that a defendant's conduct has violated both § 605 and § 553 of the Communications Act, a plaintiff may recover damages only under one of those sections."); Cablevision Sys. New York City Corp. v. Cruz, 00 Civ. 5931, 2001 WL 1388155 at 3 (S.D.N Y July 23, 2001), report rec. adopted, 2001 WL 951730 (S.D.N.Y. Aug. 21, 2001); Kingvision Pay-Per-View, Ltd. v. Jasper Grocery, 152 F. Supp.2d 438, 441 (S.D.N.Y. 2001); Cablevision Sys. New York City Corp. v. Flores, 00 Civ. 5935, 2001 WL 761085 at 3 (S.D.N.Y. July 6, 2001); Time Warner Cable v. Barbosa, 98 Civ. 3522, 2001 WL 118608 at 5 (S.D.N.Y. Jan. 2, 2001), report rec. adopted, 2001 WL 180366 (S.D.N.Y. Jan. 19, 2001).
See also, e.g., Time Warner Cable v. Barnes, 13 F. Supp.2d 543, 548 (S.D.N.Y. 1998); TWC Cable Partners v. Multipurpose Elec. Int'l, Inc., No. CV-97-2568, 1997 WL 833471 at 1 (E.D.N.Y. Oct. 6, 1997); New Contenders, Inc. v. Diaz Seafood Corp., 96 Civ. 4701, 1997 WL 538827 at 1 (S.D.N.Y. Sept. 2, 1997); Time Warner Cable v. Olmo, 977 F. Supp. 585, 589 (E.D.N.Y. 1997); Time Warner Cable v. Taco Rapido Rest., 988 F. Supp. 107, 111 (E.D.N.Y. 1997). But see King Vision Pay-Per-View v. Las Cazuelas Mexican Rest., 99 Civ. 10041, 2000 WL 264004 at 3 (S.D.N.Y. Mar. 9, 2000) (awarding damages under both § 553 and § 605). Even if the Court could award damages under both § 605 and § 553, the Court would decline to do so here, since it would result in an award that is excessive under the circumstances.
In both King Vision v. Papacito Lidia and King Vision v. New Paradise Rest., this Court awarded King Vision — a company similarly situated to JJ — $20,000 in statutory damages. The Court believes that is an appropriate measure of statutory damages in this case as well.
Other cases have resulted in similar awards. See, e.g., King Vision Pay-Per-View, Ltd. v. Jasper Grocery, 152 F. Supp. 2d at 441-43 ($15,000); King Vision Pay-Per-View, Ltd. v. Scott E's Pub, Inc., 146 F. Supp.2d 955, 961 (E.D. Wis. 2001) ($18,375); King Vision Pay Per-View, Ltd. v. Las Cazuelas Mexican Rest., 99 Civ. 10041, 2000 WL 264004 at 3 (S.D.N.Y. Mar. 9, 2000) ($12,500); Time Warner Cable v. Googies Luncheonette, 77 F. Supp.2d 485, 492 (S.D.N.Y. 1999) ($4,000, $9,000 and $15,000 as to each of three defendants).
Some decisions, instead of a flat amount, have awarded a per customer based damages award of $50 to $300 per patron. See, e.g., New Contenders, Inc. v. Diaz Seafood Corp., 1997 WL 538827 at 2 ($300 per customer); Cablevision v. Faschitti, 1996 WL 48689 at 2 (citing cases with awards of $50 and $250 per customer). Since JJ's investigator reported only 40 patrons during the Event (see page 3 above), JJ would get even less under this method.
JJ also seeks costs of $265 ($150 court filing fee and $115 process server fees) and attorney fees of $2,250. (Rubin 4/15/02 Aff. ¶¶ 2-4 Exs. 1-2.) JJ should be awarded those amounts.
CONCLUSION
For the reasons stated above, the Court should award plaintiff JJ statutory damages of $20,000 plus $2,515 in attorneys' fees and costs.
FILING OF OBJECTIONS TO THIS REPORT AND RECOMMENDATION
Pursuant to 28 U.S.C. § 636(b)(1) and Rule 72(b) of the Federal Rules of Civil Procedure, the parties shall have ten (10) days from service of this Report to file written objections. See also Fed.R.Civ.P. 6. Such objections (and any responses to objections) shall be filed with the Clerk of the Court, with courtesy copies delivered to the chambers of the Honorable Michael B. Mukasey, 500 Pearl Street, Room 2240, and to my chambers, 500 Pearl Street, Room 1370. Any requests for an extension of time for filing objections must be directed to Chief Judge Mukasey. Failure to file objections will result in a waiver of those objections for purposes of appeal. Thomas v. Arn 474 U.S. 140, 106 S.Ct. 466 (1985); IUE AFL-CIO Pension Fund v. Herrmann, 9 F.3d 1049, 1054 (2d Cir. 1993), cert. denied, 513 U.S. 822, 115 S.Ct. 86 (1994); Roldan v. Racette, 984 F.2d 85, 89 (2d Cir. 1993); Frank v. Johnson, 968 F.2d 298, 300 (2d Cir.), cert. denied, 506 U.S. 1038, 113 S.Ct. 825 (1992); Small v. Secretary of Health Human Servs., 892 F.2d 15, 16 (2d Cir. 1989);Wesolek v. Canadair Ltd., 838 F.2d 55, 57-59 (2d Cir. 1988); McCarthy v. Manson, 714 F.2d 234, 237-38 (2d Cir. 1983); 28 U.S.C. § 636(b)(1); Fed.R.Civ.P. 72, 6(a), 6(e).