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J & J Sports Procutions, Inc. v. EL Rodeo Restaurant LLC

United States District Court, D. Maryland

December 12, 2017



          Timothy J. Sullivan United States Magistrate Judge.

         This Report and Recommendation addresses the Motion for Default Judgment (“Motion”) filed by Plaintiff J & J Sports Productions, Inc. against Defendant El Rodeo Restaurant LLC. (ECF No. 11.) Defendant has not filed a response, and the time for doing so has passed. See Loc. R. 105.2(a). On December 11, 2017, in accordance with 28 U.S.C. § 636 and Local Rule 301, Judge Chuang referred this case to me for a report and recommendation on Plaintiff's Motion. (ECF No. 12.) I find that a hearing is unnecessary in this case. See Fed. R. Civ. P. 55(b)(2); Loc. R. 105.6. For the reasons set forth below, I respectfully recommend that Plaintiff's Motion for Default Judgment be granted in part and denied in part.


         On November 4, 2016, Plaintiff commenced this action against Defendant El Rodeo Restaurant LLC, alleging violations of the Communications Act of 1934, as amended, 47 U.S.C. §§ 553 (unauthorized reception of cable services) and 605 (unauthorized publication or use of communications), and conversion. (ECF No. 1.) The Complaint states that Plaintiff held “the exclusive nationwide television distribution rights to . . . the ‘Manny Pacquiao v. Brandon Rios, WBO International Welterweight Championship Fight Program'” that was broadcast on November 23, 2013 (“Broadcast”). (ECF No. 1 ¶ 8.) Plaintiff entered into agreements with various commercial establishments that permitted the businesses to exhibit the Broadcast for their patrons. (Id. ¶ 9.) Defendant did not enter into such an agreement with Plaintiff to exhibit the Broadcast. (Id. ¶ 11.) Despite having “full knowledge that the [Broadcast] was not to be intercepted, received and exhibited by entities unauthorized to do so, ” Plaintiff alleges, “Defendant . . . unlawfully publish[ed], divulge[d] and exhibit[ed]” the Broadcast in Defendant's establishment “for purposes of direct or indirect commercial advantage or private financial gain.” (Id.) Service of process was effected on the Defendant on November 18, 2016. (ECF No. 7.) The Defendant did not file an answer or responsive pleading within the requisite time period. Plaintiff moved for entry of default on February 21, 2017 (ECF No. 8) and the Clerk's Entry of Default was entered on June 29, 2017 (ECF No. 9).


         A. Standard for Entry of Default Judgment

         In determining whether to award a default judgment, the Court accepts as true the well-pleaded factual allegations in the complaint as to liability. See Ryan v. Homecomings Fin. Network, 253 F.3d 778, 780-81 (4th Cir. 2001); United States ex rel. Durrett-Sheppard Steel Co. v. SEF Stainless Steel, Inc., No. RDB-11-2410, 2012 WL 2446151, at *1 (D. Md. June 26, 2012). Nonetheless, the Court must consider whether the unchallenged facts constitute a legitimate cause of action, since a party in default does not admit mere conclusions of law. United States v. Redden, No. WDQ-09-2688, 2010 WL 2651607, at *2 (D. Md. June 30, 2012) (citing Ryan, 253 F.3d at 790). Although the Fourth Circuit has a “strong policy that cases be decided on the merits, ” United States v. Shaffer Equip. Co., 11 F.3d 450, 453 (4th Cir. 1993), default judgment “is appropriate when the adversary process has been halted because of an essentially unresponsive party.” S.E.C. v. Lawbaugh, 359 F.Supp.2d 418, 421 (D. Md. 2005). If the Court determines that liability is established, the Court must then determine the appropriate amount of damages. CGI Finance, Inc., v. Johnson, No. ELH-12-1985, 2013 WL 1192353, at *1 (D. Md. March 21, 2013). The Court does not accept factual allegations regarding damages as true, but rather must make an independent determination regarding such allegations. Durrett-Sheppard Steel Co., 2012 WL 2446151 at *1.

         Rule 55 of the Federal Rules of Civil Procedure provides that “[i]f, after entry of default, the Plaintiff's Complaint does not specify a ‘sum certain' amount of damages, the court may enter a default judgment against the defendant pursuant to Fed.R.Civ.P. 55(b)(2).” A plaintiff's assertion of a sum in a complaint does not make the sum “certain” unless the plaintiff claims liquidated damages; otherwise, the complaint must be supported by affidavit or documentary evidence. United States v. Redden, No. WDQ-09-2688, 2010 WL 2651607, at *2 (D. Md. June 30, 2012). Rule 55(b)(2) provides that “the court may conduct hearings or make referrals . . . when, to enter or effectuate judgment, it needs to . . . determine the amount of damages.” The Court is not required to conduct an evidentiary hearing to determine damages, however; it may rely instead on affidavits or documentary evidence in the record to determine the appropriate sum. See, e.g., Mongue v. Portofino Ristorante, 751 F.Supp.2d 789, 795 (D. Md. 2010).

         B. Liability

         Plaintiff's Complaint seeks damages under two statutes, 47 U.S.C. § 605 and 47 U.S.C. § 553. As Plaintiff concedes, however (see ECF No. 11-2 at 5), courts in this district have previously held that plaintiffs cannot recover under both statues for the same conduct, and generally allow for recovery under § 605 as it provides for the greater recovery. See J & J Sports Productions, Inc. v. Royster, et al., No. RWT-11-1597, 2014 WL 992779, at *3 (D. Md. Mar. 13, 2014); J & J Sports Productions, Inc. v. Frank Little Enterprises, LLC, No. DKC-12-0997, 2012 WL 6019366, at *2 (D. Md. Nov. 30, 2012).

         Taking as true the well-pleaded allegations of the Complaint (ECF No. 1), Defendant's liability is readily established in this case. To prove a violation of § 605(a), Plaintiff must show that Defendant, without authorization, received and divulged the Broadcast. See That's Entm't, Inc. v. J.P.T., Inc., 843 F.Supp. 995, 999 (D. Md. 1993). Plaintiff entered into a contract that granted it the right to distribute the Broadcast. (ECF No. 1 ¶ 8.) Defendant willfully exhibited the Broadcast to its patrons without having obtained Plaintiff's authorization. (Id. ¶ 11). Accordingly, I find that Plaintiff has stated a claim for relief under 47 U.S.C. § 605 (Count I). Because Plaintiff cannot recover under both Count I and Count II of the Complaint, I recommend that Plaintiff's Motion for Default Judgment be granted as to Count I (47 U.S.C. § 605) and denied as to Count II (47 U.S.C. § 553). I also recommend that Plaintiff's Motion be denied as to Count III (conversion). See J & J Sports Productions, Inc. v. Plaza Del Alamo, Inc., No. TDC-15-0173, 2016 WL 153037, at *2 (D. Md. Jan. 12, 2016) (denying default judgment as to conversion claim because plaintiff had not alleged that defendant had “unlawfully taken any of J & J's tangible property or tangible documents that evidence J & J's intangible rights”); see also J & J Sports Productions, Inc. v. Henriquez Batres, Inc., No. GJH-16-2385, 2017 WL 2937936, at *3 (D. Md. July 10, 2017).

         C. Damages

         1. Statutory damages

         Having determined that Plaintiff has established liability, it is now appropriate to determine the damages to which Plaintiff is entitled. Plaintiff acknowledges that it “cannot recover under both statutes for the same conduct, ” and elects to recover under only 47 U.S.C. § 605. (ECF No. 11-2 at 5.) Specifically, Plaintiff requests statutory damages pursuant to § 605(e)(3)(C)(i)(II). (Id.) Judge Nickerson set forth the relevant considerations in the statutory damages analysis under 47 U.S.C. ยง ...

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