J & J Sports Productions Inc v. Campos, No. 5:2013cv04257 - Document 30 (N.D. Cal. 2014)
Court Description: ORDER Granting 20 MOTION for Default Judgment; 29 Motion for Attorney Fees and Costs. Signed by Hon. Beth Labson Freeman on 7/18/2014. (blflc2, COURT STAFF) (Filed on 7/18/2014)
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1 2 3 UNITED STATES DISTRICT COURT 4 NORTHERN DISTRICT OF CALIFORNIA 5 SAN JOSE DIVISION 6 7 J & J SPORTS PRODUCTIONS, INC., 8 Plaintiff, 10 ORDER GRANTING PLAINTIFF’S MOTION FOR DEFAULT JUDGMENT v. 9 RAUL GONZALEZ CAMPOS, Re: ECF No. 20 Defendant. 11 United States District Court Northern District of California Case No. 5:13-cv-04257-BLF 12 Plaintiff J & J Sports Productions, Inc. (“Plaintiff”) has moved for the entry of default 13 14 judgment against defendant Raul Gonzalez Campos, owner of Taquería Jalisco restaurant. 15 Plaintiff is requesting damages from Defendant’s alleged unlawful interception and broadcast of a 16 boxing match at Defendant’s restaurant. For the following reasons, the motion for default 17 judgment is GRANTED. 18 19 I. BACKGROUND Plaintiff is a commercial distributor and licensor of sporting events. (Compl. ¶ 16, ECF 1) 20 By contract, J & J secured the domestic commercial exhibition rights to broadcast the “Julio Cesar 21 Chavez v. Sergio Martinez, WBC Middleweight Championship Fight Program” (“Program”) 22 telecast nationwide on Saturday, September 15, 2012. (Id. ¶ 14) The interstate transmission of the 23 Program was made available only to J & J’s customers. (Id. ¶ 15) In order to lawfully broadcast 24 the Program, commercial entities were required to enter into a sublicensing agreement with J & J 25 and pay the associated licensing fees. (Id.) 26 27 28 On September 15, 2012, investigator Yolanda Poblete observed the alleged unlawful exhibition of the Program at Defendant’s commercial establishment, Taquería Jalisco, located in Case No. 5:13-cv-04257-BLF ORDER GRANTING PLAINTIFF’S MOTION FOR DEFAULT JUDGMENT 1 Salinas, California. (Decl. of Yolanda Poblete, at 1, ECF 20) Based on Poblete’s observations, J 2 & J alleges that Defendant intercepted the Program unlawfully, and intentionally exhibited it for 3 the purpose of direct and/or indirect commercial advantage and/or private financial gain. (Compl. 4 ¶ 18) In her affidavit, Poblete states that Taquería Jalisco has a capacity of approximately forty- 5 6 five people. (Poblete Decl., at 2) Poblete observed one thirty-two to thirty-six inch television 7 located on the upper right side of the interior wall of the restaurant. (Id., at 1) In the fourteen 8 minutes Poblete spent at Taquería Jalisco she conducted three head counts, counting 9 approximately twenty-four, twenty-seven, and twenty-nine patrons, respectively, inside the establishment. (Id., at 2) Poblete’s affidavit did not expressly describe how many of such patrons 11 United States District Court Northern District of California 10 were watching the Program. Poblete does not provide any testimony indicating whether the 12 interception was via satellite or cable box. (See Decl. of Yolanda Poblete) Poblete testifies that 13 she was not required to pay to enter the establishment. (Poblete Decl., at 1) There are no 14 allegations of increased food or drink prices during the Program. Plaintiff also does not allege that 15 Taquería Jalisco is a repeat offender of the alleged unlawful conduct. Plaintiff filed suit against Defendant on September 13, 2013. (See Compl.) Plaintiff has 16 17 alleged violations of the Federal Communications Act, 47 U.S.C. § 605, Cable and Television 18 Consumer Protection Act § 553, California Civil Code § 3336, and California Business and 19 Professions Code § 17200, et. seq.1 Defendant has failed to appear or otherwise respond to the 20 Summons and Complaint within the time prescribed by the Federal Rules of Civil Procedure. On 21 February 5, 2014 Plaintiff filed a request for entry of default judgment. (Pl.’s Mot. for Entry of 22 Default, at 1, ECF 15) The Court Clerk entered default against Defendant on February 6, 2014. 23 (Entry of Default, at 1, ECF 16) 24 II. LEGAL STANDARDS Pursuant to Federal Rule of Civil Procedure 55(b), the Court may enter default judgment 25 26 27 28 1 In the Plaintiff’s Motion for Default Judgment, Plaintiff does not request relief in relation to the alleged violation of Section 17200, therefore no relief will be granted under this statute. 2 Case No. 5:13-cv-04257-BLF ORDER GRANTING PLAINTIFF’S MOTION FOR DEFAULT JUDGMENT 1 against a defendant who has failed to plead or otherwise defend an action. “The district court’s 2 decision whether to enter a default judgment is a discretionary one.” Aldabe v. Aldabe, 616 F.2d 3 1089, 1092 (9th Cir. 1980). The Ninth Circuit has provided seven factors for consideration by the district court in 4 5 exercising its discretion to enter default judgment. These factors, known as the “Eitel factors,” 6 are: (1) the possibility of prejudice to the plaintiff; (2) the merits of plaintiff’s substantive claim; 7 (3) the sufficiency of the complaint; (4) the sum of money at stake in the action; (5) the possibility 8 of dispute concerning material facts; (6) whether default was due to excusable neglect; and (7) the 9 strong policy underlying the Federal Rules of Civil Procedure favoring decisions on the merits. Eitel v. McCool, 782 F.2d 1470, 1471-72 (9th Cir. 1986). When assessing these factors, and after 11 United States District Court Northern District of California 10 entry of default, all factual allegations in the complaint are taken as true, except those with regard 12 to damages. Televideo Sys., Inc. v. Heidenthal, 826 F.2d 915, 917-18 (9th Cir. 1987). 13 III. DISCUSSION 14 A. 15 Six of the seven Eitel factors weigh in favor of default judgment. In respect to the first Eitel Factors 16 factor of prejudice, denying Plaintiff’s request for default judgment would be prejudicial because 17 Plaintiff would be left without a remedy as a result of Defendant’s refusal to litigate this action. 18 Considering the merits of Plaintiff’s substantive claims and the sufficiency of the complaint 19 together (factors two and three), Plaintiff’s substantive claims appear meritorious, and its 20 complaint is sufficiently pled. Plaintiff has stated the applicable laws pursuant to which the Court 21 may provide relief and alleged that Defendant violated 47 U.S.C. §§ 605 and 553 and California 22 Civil Code § 3336. The facts alleged concerning Defendant’s activities appear to support the 23 allegation that Defendant has violated one or more sections of the cited statutes. 24 As to the fifth and sixth Eitel factors, Defendant has failed to respond to this action despite 25 Plaintiff’s satisfaction of all notice requirements. (Summons Issued as to Raul Gonzalez Campos, 26 at 1, Sept. 13, 2013, ECF 3; Proof of Service Summons and Compl., at 1, ECF 12) As such, there 27 is no dispute of material fact because Defendant has not responded (factor five). There is also 28 3 Case No. 5:13-cv-04257-BLF ORDER GRANTING PLAINTIFF’S MOTION FOR DEFAULT JUDGMENT 1 nothing in the record to indicate that Defendant’s default is a result of excusable neglect (factor 2 six). Finally, although federal policy favors decisions on the merits, Rule 55(b)(2) permits entry 3 of default judgment in situations such as this where defendants refuse to litigate. J & J Sports 4 Productions, Inc. v. Deleon, No. 5:13–CV–02030, 2014 WL 121711, at *2 (N.D. Cal. Jan. 13, 5 2014). Therefore, this general policy is outweighed by the more specific considerations in this 6 case, and the seventh Eitel factor also weighs in favor of default. With respect to the sum of money at stake in this action (fourth factor), Plaintiff’s request 7 8 for maximum statutory damages weighs against granting default judgment, as the amount 9 requested appears disproportionate to the harm alleged: a first time offender who did not charge an entrance fee and did not show the broadcast to a packed house. However, a disproportionate 11 United States District Court Northern District of California 10 damages request is not enough on its own to bar default judgment, as it may be addressed by the 12 Court in deciding what damages should be awarded, assuming that a default judgment is otherwise 13 appropriate. Joe Hand Promotions, Inc. v. Mujadidi, No. C–11–5570, 2012 WL 3537036, at *3 14 (N.D. Cal. Aug. 14, 2012). 15 Accordingly, the Court GRANTS Plaintiff’s Motion for Default Judgment. 16 B. 17 Although Plaintiff has requested statutory damages pursuant to 47 U.S.C. Calculation of Damages 18 § 605(e)(3)(C)(i), the Court finds, for the reasons stated below, that damages should instead be 19 awarded pursuant to Section 553.2 Plaintiff requests $10,000 in statutory damages under Section 20 553(c)(3)(A)(ii), and $50,000 in enhanced damages under Section 553(c)(3)(A)(ii)(B). (Compl., 21 at 9) Plaintiff also seeks $1,600 in conversion damages under California Civil Code § 3336, the 22 amount Defendant allegedly would have been required to pay had Defendant licensed the Program 23 from Plaintiff. (Mot., at 20) 24 i. Statutory Damages Although Plaintiff has alleged Defendant violated 47 U.S.C. § 553, it does not request 25 26 27 28 2 All of Plaintiff’s arguments for damages under Section 605 will now be considered in support of damages under Section 553. 4 Case No. 5:13-cv-04257-BLF ORDER GRANTING PLAINTIFF’S MOTION FOR DEFAULT JUDGMENT 1 damages under this section, which provides a lower statutory award. Plaintiff failed, however, to 2 provide the Court with any evidence of the means by which Defendant allegedly intercepted the 3 Program. (See Decl. of Yolanda Poblete) 4 Plaintiff admits that it cannot determine the precise means that the Defendant used to 5 receive the Program unlawfully. (Mot., at 8) Plaintiff argues that it is “inherently reasonable” to 6 allow recovery under Section 605 under such circumstances. (Id.) Plaintiff argues that Defendant 7 must have intercepted the broadcast in some manner because Defendant did not license the 8 Program from J & J. (Mot., at 9) Plaintiff asserts that due to Defendant’s default, it should not be 9 prejudiced and denied recovery of damages pursuant to Section 605. (Mot., at 8) The Court disagrees. It is much easier to conceal a cable box than a satellite dish. The Court assumes that if 11 United States District Court Northern District of California 10 Poblete saw a satellite dish she would have included it in her declaration, just as the many 12 investigators have done before her. See, e.g., Decl. of Gary Gravelyn, J & J Sports Productions, 13 Inc. v. Salgadobarajas, No. 13-cv-05557, ECF 13 (N.D. Cal. 2013). To afford Plaintiff a 14 fortuitous windfall for its failure to obtain necessary evidence would be unjust. Therefore, the 15 Court will only assess damages pursuant to 47 U.S.C. § 553. 16 “The Cable and Television Consumer Protection Act, 47 U.S.C. § 553, prohibits a person 17 from ‘intercepting or receiving or assisting in intercepting or receiving any communications 18 service offered over a cable system.’” J & J Sports Productions, Inc. v. Ro, No. C 09–02860, 19 2010 WL 668065, at *3 (N.D. Cal. Feb. 19, 2010). Under Section 553(c)(3)(A)(ii), damages are 20 set at a minimum of $250 and a maximum of $10,000. Plaintiff requests $10,000 in statutory 21 damages as a result of the alleged violation of Section 553. (Compl. ¶ 27). 22 The Court finds the award of maximum statutory damages under Section 553 to be unjust. 23 In the instant case, Defendant is a first time offender, only had the Program displayed on one 24 thirty-two to thirty-six inch television in a restaurant that accommodates approximately forty-five 25 people and did not charge a cover fee. (Poblete Decl., at 1-2) There were at most twenty-nine 26 people in Taquería Jalisco in the fourteen minutes Poblete spent in the establishment although her 27 affidavit does not state how many of those patrons were watching the Program. (Id.) There are no 28 5 Case No. 5:13-cv-04257-BLF ORDER GRANTING PLAINTIFF’S MOTION FOR DEFAULT JUDGMENT 1 allegations that Defendant either increased food or drink prices during the exhibition of the 2 Program or promoted itself by advertising the Program. 3 4 5 6 In light of the information presented and the discretion afforded to the undersigned, the Court awards Plaintiff the statutory minimum of $250 in damages under Section 553(c)(3)(A)(ii). ii. Enhanced Damages The Cable and Television Consumer Protection Act, also affords courts the discretion to 7 award enhanced damages up to $50,000 upon finding that the violation “was committed willfully 8 and for the purposes of commercial advantage or private financial gain.” 47 U.S.C. 9 § 553(c)(3)(A)(ii)(B). The statute is conjunctive and therefore the Plaintiff must provide the Court with sufficient evidence to support a finding that Defendant acted both willfully and for the 11 United States District Court Northern District of California 10 purpose of obtaining commercial advantage or private financial gain. 12 Plaintiff argues that it is “clearly established” that actions in cases such as these are 13 “willful.” (Mot., at 14) Plaintiff would like the Court to agree with other district courts that have 14 inferred willfulness by reasoning that the unlawful interception of a satellite signal necessarily 15 involves the defendant taking an affirmative step, thus exhibiting willful conduct. (Mot., at 14-15) 16 The Court agrees that Defendant’s alleged unlawful activity was the result of a deliberate act. See 17 J & J Sports Productions, Inc. v. Garcia, No. H–08–1675, 2009 WL 2567891, at *4 (S.D. Tex. 18 Aug. 14, 2009) (“The Defendant must have engaged in a deliberate act since ‘signals do not 19 descramble spontaneously, nor do television sets connect themselves to cable distribution 20 systems.’”). 21 The Court, however, is unpersuaded that Defendant has acted for the purposes of 22 commercial advantage. Plaintiff would like the Court to make this inference but provides no 23 evidence in support other than citing to Garden City Boxing Club, Inc. v. Batista for the 24 proposition that “[a] defendant who intercepts signals and broadcasts programming without 25 authorization in a place of business where certain events are shown to the public is generally held 26 to have acted willfully and for purposes of commercial advantage.” No. 05-CV-1044, 2007 WL 27 4276836, at *5 (E.D.N.Y. Nov. 30, 2007) (internal quotes omitted). What Plaintiff fails to 28 6 Case No. 5:13-cv-04257-BLF ORDER GRANTING PLAINTIFF’S MOTION FOR DEFAULT JUDGMENT 1 mention is that the Batista court also took into account that Batista had been sued for theft of cable 2 programming in at least one other action prior to the lawsuit. See Batista, No. 05-CV-1044, 2007 3 WL 4276836, at *6 (E.D.N.Y. Nov. 30, 2007). This supported the court’s inference that the 4 defendant “displayed the [Program] for commercial gain in order to attract customers or retain 5 customers who would purchase defendants’ products.” Id. In the instant case Defendant fails to 6 provide the Court with such evidence that would permit such an inference. 7 Even if enhanced damages were warranted, the statutory maximum would not be justified, 8 despite Plaintiff’s argument that nominal damages have proven insufficient to combat piracy. 9 (Mot., at 19-20; see also J & J Affidavit, ¶ 17) The present claim does not appear to be sufficiently egregious to justify maximum enhanced damages. In the instant case, Defendant is a 11 United States District Court Northern District of California 10 first time offender, only had the Program displayed on one thirty-two to thirty-six inch television 12 in a room that accommodates approximately forty-five people and did not charge a cover fee. 13 (Poblete Decl., at 1-2) There were at most twenty-nine people in Taquería Jalisco in the fourteen 14 minutes Poblete spent in the establishment although her affidavit does not state how many of those 15 patrons were watching the Program. (Id.) There are no allegations that Defendant either increased 16 food or drink prices during the exhibition of the Program or promoted itself by advertising the 17 Program. It may very well be the case this action is enough of a deterrent for Defendant. The 18 Court will not consider awarding enhanced damages until Defendant becomes a repeat offender or 19 willfully and egregiously violates the Cable and Television Consumer Protection Act. 20 21 22 For the foregoing reasons, the Court DENIES Plaintiff’s request for enhanced damages. iii. Conversion Plaintiff requests $1,600 in damages for conversion under California Civil Code § 3336. 23 (Mot., at 20) The Ninth Circuit has held that a claim for conversion in California has three 24 elements: “ownership or right to possession of property, wrongful disposition of the property right 25 and damages.” G.S. Rassmussen & Associates, Inc. v. Kalitta Flying Service Inc., 958 F.2d 896, 26 906 (9th Cir. 1992). Plaintiff has established that it secured the domestic commercial exhibition 27 rights to broadcast the Program. (Compl. ¶ 14) Plaintiff has properly alleged that Defendant 28 7 Case No. 5:13-cv-04257-BLF ORDER GRANTING PLAINTIFF’S MOTION FOR DEFAULT JUDGMENT 1 unlawfully exhibited the Program on September 15, 2012 and that Plaintiff suffered damages from 2 being denied a license fee from Defendant. (Compl. ¶ 11) Therefore, the three elements are met. California Civil Code § 3336 states that a plaintiff is entitled to the value of the property at 3 4 the time of conversion. Here, Plaintiff states that $1,600 is the amount Defendant would have 5 been required to pay Plaintiff had he lawfully licensed the Program. (Mot., at 20) The Court has 6 no reason to question this asserted value. Accordingly, the Court awards $1,600, the value of the 7 Program at the time of conversion. Attorney’s Fees and Costs 8 C. 9 The Court has reviewed the Plaintiff’s request for attorney’s fees and costs. Plaintiff has requested $2,881.25 in attorney’s fees and $1,110 in costs, totaling $3,991.25. (Decl. of Pl.’s 11 United States District Court Northern District of California 10 Attorney’s Fees and Costs, at 9) Section 553 affords the Court discretion in awarding fees and costs stating: “The court may 12 13 direct the recovery of full costs, including awarding reasonable attorneys’ fees to an aggrieved 14 party who prevails.” 47 U.S.C. § 553(c)(2)(C) (emphasis added). The Court finds it just to allow 15 Plaintiff to recover attorney’s fees and costs. 16 Here, Plaintiff is the prevailing party due to Defendant’s refusal to litigate the case. 17 Attorney’s fees will be limited to the work of attorneys and paralegals, therefore the $900 in fees 18 requested for the administrative assistant is denied. An award of fees for time spent by an 19 administrative assistant is not consistent with the practice in the Northern District of California. 20 Such fees should be have been subsumed in firm overhead. Nadarajah v. Holder, 569 F.3d 906, 21 921 (9th Cir. 2009). The Court finds the hourly rates of $500, $275, and $200 to be reasonable for 22 an attorney, associate attorney, and paralegal, respectively, of similar experience in the Northern 23 District of California. The 2.75 hours devoted to this matter by Attorney Thomas P. Riley, the 24 0.75 hours devoted by the associate attorney, and the 3.0 hours by the paralegal also appear 25 reasonable to the Court. 3 The Court finds that costs should be limited to the complaint filing fee 26 27 28 3 Plaintiff utilizes boilerplate filings for the various claims brought before the Court justifying the reduction in fees and costs. See, e.g., J & J Sports Productions, Inc. v. Penalver, No. 13-cv-05551, 8 Case No. 5:13-cv-04257-BLF ORDER GRANTING PLAINTIFF’S MOTION FOR DEFAULT JUDGMENT 1 and the service of process charges. Thus, the request for investigative expenses of $625 is denied. 2 Accordingly, the Court awards $1,981.25 in reasonable attorney’s fees and $485 in costs, totaling 3 $2,466.25. 4 IV. 5 CONCLUSION For the reasons stated above, Plaintiff’s motion for default judgment is GRANTED. 6 Plaintiff shall recover $250 in statutory damages, $1,600 in damages for conversion, and 7 $2,466.25 in reasonable attorney’s fees and costs. Plaintiff’s request for enhanced damages is 8 DENIED. 9 10 United States District Court Northern District of California 11 12 13 IT IS SO ORDERED. Dated: July 18, 2014 ______________________________________ BETH LABSON FREEMAN United States District Judge 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 ECF Nos. 1, 17, 21, 24, 28 (N.D. Cal. 2013) (Complaint and motion papers). 9 Case No. 5:13-cv-04257-BLF ORDER GRANTING PLAINTIFF’S MOTION FOR DEFAULT JUDGMENT
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