Summary
reasoning that in evaluating whether to award enhanced damages, courts can consider factors such as repeated violations, the intent to profit and actual profit derived from the violations
Summary of this case from Joe Hand Promotions, Inc. v. KhanOpinion
No. C 02-2716 SI
December 13, 2002
ORDER GRANTING APPLICATION FOR DEFAULT JUDGEMENT
On December 13, 2002 the Court heard argument on plaintiff's motion for default judgment. Having carefully considered the plaintiff's arguments and the papers submitted, the Court GRANTS plaintiff's motion for default judgment.
BACKGROUND
Plaintiff, the exclusive licensor of rights to exhibit certain closed circuit and pay-per-view sports programming, brought suit against defendants for showing the Trinidad v. Joppy boxing match in their restaurant without a license. Plaintiff's complaint alleged that defendants are liable under the Communication Act, 47 U.S.C. § 553 and 605 for receiving, intercepting and assisting in the receipt or interception of licensed programming. Plaintiff's hired private investigator was present on the evening of the fight, May 12, 2002, in defendants' restaurant and saw the Trinidad v. Joppy fight being broadcast. See Declaration of Andrew M. Golds in Support of Application for Default and Attorneys' Fees, Exh. A.
Plaintiff filed a complaint against defendants, who never responded. The motion for default judgment states that the complaint was filed on June 6, 2002; the complaint was served on defendants on June 23, 2002; plaintiff filed for default on July 30, 2002; and default was entered on August 1, 2002. Motion at 1-7.
LEGAL STANDARD
1. Default Judgment
Under Federal Rule of Civil Procedure 55, the Court may enter a default judgment against a defendant who has failed to file an answer or motion to dismiss within twenty days from the date that the complaint was filed, or within such additional time as the Court has granted. The default rule serves to protect a diligent party "lest he be faced with interminable delay and continued uncertainty as to his rights." 10 C. Wright, A. Miller, M. Kane, Federal Practice and Procedure: Civil § 2681, at 402 (2d ed. 1983).
Rule 55(b), which governs motions for entry of default judgment, states:
(b)(1) 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 defendant, if the defendant has defaulted by failure to appear. . . .
(b)(2) In all other cases the party entitled to a judgment by default shall apply to the court. . . If, in order to enable the court to enter judgment or to carry it into effect, it is necessary to take an account or to determine the amount of damages. . . the court may conduct such hearings or order such references as it deems proper. . . .
2. Federal Communications Act
The Federal Communications Act of 1934, 47 U.S.C. § 605 et seq. prohibits commercial establishments from intercepting and broadcasting satellite cable programming without a license. It provides a private right of action in federal court. Plaintiffs may request that courts award actual or statutory damages between $1000 and $10,000 for each violation of section 605. 47 U.S.C. § 605(e)(3)(C)(i). Damages of up to $100,000 may be awarded for willful violations. 47 U.S.C. § 605(e)(3)(C)(ii).
The Cable Television Consumer Protection Act of 1992, 47 U.S.C. § 553, which amended the Federal Communications Act, prohibits unauthorized interception or reception of communications over a cable system. It provides a private right of action in federal court. Plaintiffs may request that courts award actual or statutory damages of $250 to $10,000. 47 U.S.C. § 553(c)(3)(A). Damages of up to $50,000 may be awarded for willful violations that are intended to confer "indirect commercial advantage or private financial gain." 47 U.S.C. § 553(c)(3)(B).
DISCUSSION
Plaintiff's application for default judgment alleges that defendants' violations of 47 U.S.C. § 605 et seq. and 47 U.S.C. § 553 were willful and that this Court should enter default judgment in the amount of the statutory maximum, $100,000. The Act provides for an enhanced damage award of up to $100,000 when "a violation was committed willfully and for purposes of direct or indirect commercial advantage or financial gain." 47 U.S.C. § 605(e)(3)(C)(ii).
This Court declines to grant plaintiff's request for the statutory maximum. The allegations in a complaint regarding the monetary amount of damages that should be granted in a default judgment are not controlling, and "the mere assertion that defendants acted willfully is insufficient to justify enhanced damages." Kingvision Pay-Per-View Ltd. v. Backman, 102 F. Supp. 1196, 1198 (N.D. Cal. 2000). Courts that have awarded enhanced damage awards due to willful violations of the Communications Act have cited such factors as the repeated violation of the Act, the intent to profit from the violations and actual profit derived from the violation. Id., at 1197-1198. Here there is no evidence that the violation occurred multiple times, that the establishment intended to directly profit from the violation or that it actually profited from the violation. "Courts in this district have considered several cases involving pirating of closed-circuit sports broadcasts and, absent a showing of egregious wrongdoing, generally have awarded damages slightly over the statutory minimum." Universal Sports Network v. Jimenez, 2002 U.S. Dist. Lexis 17709, *3 (N.D. Cal. 2002). Therefore the Court finds that an enhanced damage award is not warranted under the statute.
Plaintiff alleges that it should be compensated because of the deleterious effect that cable piracy has on its business. Plaintiff's Memorandum at 4:14-23. The statute provides for such compensation; however, the "principle of proportionality governs[.] [D]istributors should not be overcompensated and statutory awards should be proportional to the violation." Kingvision Pay-Per-View Ltd. v. Backman, 102 F. Supp. at 1199.
Under 47 U.S.C. § 605(e)(3) the Court may award statutory damages between $1000 and $10,000 for a violation of the Act. This Court awards $1000 in damages to plaintiff. In cases in which plaintiffs have proven violations under both § 605 and § 553 courts in this district have declined to award cumulative damages, and have awarded the higher statutory award permitted under § 605. Therefore this Court declines to award damages pursuant to § 553. See. Kingvision Pay-Per-View. Ltd. v. Chavez, 2002 U.S.Dist. Lexis 18078, *68 (N.D. Cal. 2000).
Plaintiff has requested attorney's fees pursuant to 47 U.S.C. § 605(e)(3)(B)(ii) which authorizes the Court to award fees and costs to the prevailing party in an action such as this. Plaintiff requests that this Court award $2600 in attorney's fees for 8 hours of work at the rate of $325 per hour. Plaintiff also requests $260 in costs. Declaration of Andrew M. Gold at 2: 8-12. The Court finds that such an award is justified.
CONCLUSION
Plaintiff's motion for default judgment is GRANTED. For the foregoing reasons this Court awards $1000 in damages, $2600 in attorney's fees and $260 in costs.