Summary
holding that "[p]rior to entering default judgment, the court must determine whether the facts alleged in the Complaint are sufficient to state a claim for relief as to each cause of action"
Summary of this case from People's United Equip. Fin. Corp. v. Gotham Logistics, Inc.Opinion
02-CV-839S.
July 27, 2004
DECISION AND ORDER
I. INTRODUCTION
Presently before this Court is Plaintiff's Motion for Default Judgment against Defendants Gregory J. Giambra, SSAGOI, Inc., Christopher C. Daniels and C. Daniels, Inc. (collectively, "Defendants"). Plaintiff filed its motion on February 24, 2004. It seeks both default judgment and a determination of damages against Defendants. For the reasons discussed below, this Court will grant Plaintiff's motion in part and deny it in part.
Gregory J. Giambra is sued as: Gregory J. Giambra, Individually and as Officer director, shareholder and/or principal of SSAGOI, Inc., a/k/a Last Resort. SSAGOI, Inc. is sued as: SSAGOI, Inc. d/b/a Last Resort Night Club a/k/a Last Resort. Christopher C. Daniels is sued as: Christopher C. Daniels, individually and as officer, director, shareholder and/or principal of C. Daniels Inc. d/b/a Timothy J. Daniels a/k/a O'Daniels. C. Daniels, Inc. is sued as: C. Daniels, Inc. d/b/a Timothy J. Daniels a/k/a O'Daniels a/k/a O'Daniels Gin Mill Grill.
Plaintiff's motion also seeks default judgment against Defendants Andrew Pozantides and St. James Place II Restaurant Lounge, Inc. However, Plaintiff subsequently reached a settlement with those two defendants and the case was dismissed against them under Rule 41 of the Federal Rules of Civil Procedure on July 23, 2004. Accordingly, this motion is moot as to Andrew Pozantides and St. James Place II Restaurant Lounge, Inc.
In support of this motion, Plaintiff filed the following submissions: a memorandum of law, the Affidavit of Julie Cohen Lonstein, Esq., with attached exhibits, and a Statement for Judgment. Defendants have not appeared in this action. This Court heard oral argument on Plaintiff's motion on March 11, 2004. At the conclusion of argument, this Court directed Plaintiff to file an additional submission on or before April 1, 2004. Plaintiff failed to file the submission as directed.
II. BACKGROUND
On November 25, 2002, Plaintiff filed its Complaint in this action alleging violations of 47 U.S.C. §§ 533 and 605, et seq. In particular, Plaintiff alleges that Defendants illegally exhibited the June 8, 2002 Lewis/Tyson televised boxing program. Defendants failed to Answer Plaintiff's Complaint or otherwise defend this action.As a result of Defendants' failure to appear, Plaintiff filed a Request for Clerk's Entry of Default on March 3, 2003. On March 5, 2003, the Clerk of the Court entered default against Defendants as requested. Thereafter, on February 24, 2004, Plaintiff filed the instant Motion for Default Judgment.
III. DISCUSSION
A. Default Judgment Standard
Before obtaining default judgment, a party must first secure a Clerk's Entry of Default by demonstrating, by affidavit or otherwise, that the opposing party is in default. FED. R. CIV. P. 55(a). Once default has been entered, the allegations of the Complaint that establish the defendant's liability are accepted as true, except for those relating to the amount of damages.Greyhound Exhibitgroup, Inc. v. E.L.U.L. Realty Corp., 973 F.2d 155, 158 (2d Cir. 1992).
Prior to entering default judgment, the court must determine whether the facts alleged in the Complaint are sufficient to state a claim for relief as to each cause of action for which the plaintiff seeks default judgment. Further, where the damages sought are not for a sum certain, the court must determine the propriety and amount of default judgment. FED. R. CIV. P. 55(b)(2).
B. Statutory Violations
1. 47 U.S.C. §§ 605(a) and 553
Section 605(a) prohibits the unauthorized interception, receipt, exhibition, publication or use of radio communications.See 47 U.S.C. § 605(a). Similarly, § 553 prohibits the unauthorized interception or receipt of communications offered over a cable system. See 47 U.S.C. § 553.
By contract, Plaintiff was granted the right to distribute the Lewis/Tyson program via closed circuit television and encrypted satellite signal. (Complaint, ¶ 38; Lonstein Aff., ¶ 2). Without Plaintiff's authorization, Defendants used an "illegal satellite receiver" or an "illegal cable converter box or device" to "intercept plaintiff's broadcast which originated via satellite uplink." (Complaint, ¶ 42). With full knowledge that the program was not to be received and exhibited by those unauthorized to do so, Defendants unlawfully intercepted, received or de-scrambled the satellite signal and exhibited the Lewis/Tyson program for their direct or indirect commercial advantage or private financial gain. (Complaint, ¶ 41.)
Accepting Plaintiff's allegations as true, this Court finds that Defendants' unauthorized reception and willful exhibition of the programs violated 47 U.S.C. §§ 605(a) and 553. Therefore, this Court will grant Plaintiff's Motion for Default Judgment as to the first and third causes of action in the Complaint.
In relevant part, 47 U.S.C. § 605(e)(4) provides for penalties against:
Any person who manufactures, assembles, modifies, imports, exports, sells, or distributes any electronic, mechanical, or other device or equipment, knowing or having reason to know that the device or equipment is primarily of assistance in the unauthorized decryption of satellite cable programming, or direct-to-home satellite services, or is intended for any other activity prohibited by subsection (a) of this section. . . .
In its second cause of action, Plaintiff alleges that: "defendants and/or their agents, servants, workmen or employees . . . knowingly, modified a device or utilized equipment, knowing or having reason to know that the device or equipment is used primarily in the assistance of the unauthorized decryption of satellite cable programming, or direct-to-home satellite services, or is intended for any other prohibited activity." (Complaint, ¶ 49).
However, the facts alleged in the Complaint do not support an allegation that Defendants modified a device. The alleged facts demonstrate only that Defendants exhibited the televised boxing programs. Plaintiff thus does not allege facts that support a claim under 47 U.S.C. § 605(e)(4). Plaintiff's allegation on this point simply tracks the language of § 605(e)(4). Beyond this recitation of the statute, there are no factual allegations included in the Complaint that support a finding that Defendants modified any device, let alone distributed, manufactured, or sold such a device.
Further, Plaintiff has provided no legal support for the proposition that exhibiting a program without obtaining a license establishes a violation of § 605(e)(4) without more supporting evidence. As this Court has held in the past, in order to assert a violation of § 605(e)(4), a plaintiff must do more than allege that a televised event was exhibited without a license using a modified device. See, e.g., Joe Hand Promotions, Inc. v. James E. Hurliman, et al., 02-CV-271S, Docket 25 (November 5, 2003); Joe Hand Promotions v. David A. Rulli, et al., 00-CV-624S, Docket 10 (March 26, 2001); Kingvision Pay-Per-View, Ltd v. Thomas Groff, et al., 99-CV-747S, Docket No. 27 (November 29, 2000).
For these reasons, Plaintiff's Motion for Default Judgment on its second cause of action is denied, and Plaintiff's second cause of action is dismissed with prejudice.
C. Damages
As this Court discussed above, it finds that Defendants violated 47 U.S.C. §§ 605(a) and 553. Both §§ 605 and 553 permit a plaintiff to recover either actual damages and lost profits or statutory damages. See 47 U.S.C. §§ 605(e)(3)(C)(i) and 553(c)(3)(A). When the defendant is liable under both sections, the plaintiff is entitled to have damages awarded under § 605, which provides for greater recovery than § 553. See Int'l Cablevision, Inc. v. Sykes, 75 F.3d 123, 127 (2d Cir. 1996). Here, Plaintiff opts for statutory damages under 47 U.S.C. § 605. (See Lonstein Aff, ¶ 11.)
Section 605(e)(3)(C)(i)(II) states that "the party aggrieved may recover an award of statutory damages for each violation . . . involved in the action in a sum of not less than $1,000 or more than $10,000, as the court considers just. . . ." In addition, § 605(e)(3)(C)(ii) provides that where "the court finds that the violation was committed willfully and for the purposes of direct or 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. . . ." Section 605 does not, however, provide guidelines for determining statutory damages and relies instead on the court's discretion.
Considering all the circumstances in this case, this Court finds that an award of $1,250 in statutory damages against each defendant is appropriate under § 605(e)(3)(C)(i)(II). Further, accepting the Complaint as true, this Court finds that Plaintiff has established that Defendants' violations were willful. An additional award of $3,750 will therefore be awarded against each defendant pursuant to § 605(e)(3)(C)(ii). See Time Warner Cable v. Goodies Luncheonette, Inc., 77 F. Supp.2d 485, 490-491 (S.D.N.Y. 1999) (where no special circumstances are shown, a trebling of damages is a "reasonable deterrent against future violations").
Finally, § 605(e)(3)(B)(iii) states that the court "shall direct the recovery of full costs, including awarding reasonable attorneys' fees to an aggrieved party who prevails." In its Statement for Judgment, Plaintiff itemizes $204.04 in costs each as against Defendants Gregory J. Giambra and Christopher C. Daniels, and $239.04 in costs each as against Defendants SSAGOI, Inc., and C. Daniels, Inc. (See also Lonstein Aff., ¶ 8.) There is no request for attorney's fees. This Court finds Plaintiff's costs to be reasonable, and shall therefore award them pursuant to § 605(e)(3)(B)(iii).
IV. CONCLUSION
For the foregoing reasons, this Court will grant in part and deny in part Plaintiff's Motion for Default Judgment. Further, this Court will award statutory damages and costs to Plaintiff.
V. ORDER
IT HEREBY IS ORDERED, that Plaintiff's Motion for Default Judgment (Docket No. 33) is GRANTED in part as to the first and third causes of action, and DENIED in part as to the second cause of action.
FURTHER, that Plaintiff's second cause of action is dismissed with prejudice.
FURTHER, that Plaintiff is awarded a total of $5204.04 in statutory damages and costs against Gregory J. Giambra, individually and as officer, director, shareholder and/or principal of SSAGOI, Inc.
FURTHER, that Plaintiff is awarded a total of $5,239.04 in statutory damages and costs against SSAGOI, Inc. d/b/a Last Resort Night Club a/k/a Last Resort.
FURTHER, that Plaintiff is awarded a total of $5204.04 in statutory damages and costs against Christopher C. Daniels, individually and as officer, director, shareholder and/or principal of C. Daniels, Inc. d/b/a Timothy J. Daniels a/k/a O'Daniels.
FURTHER, that Plaintiff is awarded a total of $5,239.04 in statutory damages and costs against C. Daniels, Inc. d/b/a Timothy J. Daniels a/k/a O'Daniels a/k/a O'Daniels Gin Mill Grill.
FURTHER, that the action against Timothy J. Daniels, individually and as officer, director, shareholder and/or principal of C. Daniels, Inc. d/b/a Timothy J. Daniels a/k/a O'Daniels a/k/a O'Daniels Gin Mill Grill, is hereby dismissed without prejudice for failure to prosecute.
FURTHER, that the Clerk of the Court is directed to take the steps necessary to close this case.
SO ORDERED.