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DISH Network L.L.C. v. Dima Furniture Inc.

United States District Court, D. Maryland

June 17, 2019

DISH NETWORK, L.L.C., Plaintiff,
v.
DIMA FURNITURE INC., et al., Defendants.

          REPORT AND RECOMMENDATION

          Timothy J. Sullivan United States Magistrate Judge.

         This Report and Recommendation addresses the Motion for Default Judgment (“Motion”) (ECF No. 35) filed by Plaintiff DISH Network L.L.C. (“DISH”) against Defendant Tareq Hasweh (“Hasweh”). Hasweh has not filed a response and the time for doing so has passed. See Loc. R. 105.2(a). On March 21, 2019, in accordance with 28 U.S.C. § 636 and pursuant to Local Rule 301.6, Judge Chuang referred this case to me for a report and recommendation on DISH's Motion. (ECF No. 38.) 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 the DISH's Motion be granted.

         I. FACTUAL AND PROCEDURAL HISTORY

         In DISH's First Amended Complaint (ECF No. 17), it sued Defendants Dima Furniture, Inc. (“Dima”), Mohammad Yusif (“Yusif”), and Hasweh, individually and collectively doing business as Spider-TV (collectively, the “Defendants”). In Count I, DISH brought a claim for Direct Copyright Infringement, in violation of 17 U.S.C. § 501, against Hasweh. In Count II, DISH brought a claim for Contributory Copyright Infringement, in violation of 17 U.S.C. § 501, against Dima and Yusif. On May 23, 2018, based upon the joint stipulation of DISH, Dima, and Yusif, the Court entered a Final Judgment and Permanent Injunction awarding judgment to DISH on Count II of its First Amended Complaint against Dima and Yusif. (ECF No. 23.) Because of the Final Judgment and Permanent Injunction, DISH's only remaining claim in this case is the claim that it asserted against Hasweh.

         Hasweh was personally served with the First Amended Complaint and summons (see ECF No. 28), but he did not file an answer or responsive pleading within the requisite time period.[1] On October 2, 2018, DISH moved for the Clerk's entry of default (ECF No. 31), and the Clerk entered default against Hasweh on October 10, 2018 (ECF No. 32.) Thereafter, DISH sought leave of Court to file a motion for default judgment against Hasweh, as required by the Case Management Order. (ECF No. 33.) The Court granted DISH leave to file its proposed motion (ECF No. 34), and on November 6, 2018, DISH filed the Motion. Hasweh has not responded.

         II. LEGAL ANALYSIS

         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. Ryan, 253 F.3d at 780. 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.

         If, 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

         “To establish copyright infringement liability, a plaintiff must prove two elements: (1) ownership of the copyright; and (2) copying of original constituent elements by the defendant.” Malibu Media, LLC v. Redacted, No. DKC-15-0750, 2016 WL 3668034, at *2 (D. Md. July 11, 2016) (citing 17 U.S.C. § 501(a) and Feist Publ'ns, Inc. v. Rural Tel. Serv. Co., 499 U.S. 340, 361 (1991)). “[T]he Copyright Act does not require that the infringer know that he is infringing or that his conduct amount to a willful violation of the copyright owner's rights.” CoStar Grp., Inc. v. LoopNet, Inc., 373 F.3d 544, 549 (4th Cir. 2004) (noting that while copyright infringement is a strict liability tort, “it nonetheless requires conduct by a person who causes in some meaningful way an infringement”).

         The following facts are taken from the First Amended Complaint (ECF No. 17) and DISH's Memorandum in support of its Motion (ECF No. 35-1). DISH alleges that it is the “fourth largest pay-television provider in the United States.” (ECF No. 17 ¶ 11.) It delivers copyrighted programming to its subscribers throughout the United States “by means of satellite delivery and over-the-top (“OTT”) services whereby programming is delivered using a public Internet infrastructure.” (Id.) DISH contracts for and purchases rights for the international channels that it distributes from networks and their agents, including MBC FZ LLC, International Media Distribution (Luxembourg) S.A.R.L., World Span Media Consulting, Inc., Peninsula Production Company, and Dream Media (collectively, the “Networks”). (Id. ¶ 12.) Among other channels, DISH distributes Arabic-language channels owned by the Networks, including Al Arabiya, Al Hayah 1, Al Jazeera Arabic News, Al Jazeera Mubasher, Al Nahar, Al Nahar Drama, Al Nahar Sport, ART Cinema, Dream 2, Future TV, Hekayat, Iqraa, LBC, LDC, MBC1, MBC Drama, MBC Kids (a/k/a MBC3), MBC Masr, Murr TV (a/k/a MTV Lebanon), NBN, New TV (a/k/a Al Jadeed), Noursat, ONTV, and OTV (collectively, the “Protected Channels”). (Id.) The Networks own the copyrights for the works that air on their respective channels. (Id.)

         DISH entered into contracts with the Networks for “the exclusive right to distribute and publicly perform the works that air on the Protected Channels in the United States by means including satellite, OTT, Internet protocol television (‘IPTV'), and Internet.” (Id. ¶ 13.) In addition to the unregistered copyrighted works that aired on the Protected Channels during the relevant times, at least eight works that aired on the Protected Channels are registered with the United States Copyright Office. (Id.)

         During all relevant times, Defendants owned and operated a streaming television service called Spider-TV (the “Service”). (Id. ¶ 14.) Hasweh established the Service and continues to own and control it, as well as the computer servers that retransmit the Protected Channels, and the Service's website. (Id. ¶ 15.) Hasweh arranged for set-top boxes for the Service to be shipped to the United States and sought out vendors to distribute the set-top boxes for him within the United States. (Id.) Yusif, the founder of Dima, advertised, sold, and distributed set-top boxes and service plans for the Service in the United States. (Id. ¶ 16.) Yusif registered “Spider-TV” as a trade name of Dima with Maryland's Department of Assessments and Taxation Charter Division on July 8, 2015.

         Defendants use the Service to unlawfully retransmit DISH's Protected Channels to customers of Spider-TV in the United States. To do so, Hasweh captures live broadcast signals of the Protected Channels and transmits the Protected Channels to Spider-TV users in the United States through OTT delivery. (Id. ¶ 18.) Hasweh has advertised his service on Facebook and on the official website for the Service, located at www.spider-tv.com. (Id. ¶¶ 19-21.) Users of the Service may view the Protected Channels by purchasing a set-top box on the Service's website for $199, which includes 13 months of access to the Service. (Id. 23.) Defendants also sell service plan extensions. (Id. ¶ 24.)

         Defendants have actual knowledge that their retransmission of the Protected Channels through the Service infringes the copyrights that DISH acquired through its contracts with the Networks. (Id. ¶ 27.) DISH and the Networks sent at least 32 notices of infringement to the Defendants in 2017, demanding that the Defendants cease the retransmission of the Protected Channels. (Id. ¶ 27.) Defendants did not respond to the notices of infringement or cease violating DISH's copyrights as requested. (Id.) DISH also sent at least 33 notices of infringement to the Internet service providers associated with the service in 2017. (Id. ¶ 28.) At least some of the notices were forwarded to the Defendants. (Id.) Rather than complying with DISH's requests, the Defendants interfered with the efforts of the Internet service providers to remove the unauthorized content by transmitting the Protected Channels from different locations. (Id.)

         1. Ownership of Valid Copyright

         The works shown on the Protected Cannels were authored and first published in the United Arab Emirates, Qatar, Egypt, and Lebanon, which are all parties to copyright treaties with the United States.[2] (Id. ¶ 31.) These works are therefore subject to the protections afforded by the Copyright Act pursuant to 17 U.S.C. 104(b)(2).[3] By its agreements with the Networks, DISH held the exclusive right to distribute and publicly perform the works shown on the Protected Channels at all relevant times. See 17 U.S.C. §§ 201(d), 204(a) (authorizing transfer of rights protected under the Copyright Act by signed, written agreement). As the exclusive licensee, DISH is permitted to sue for Hasweh's infringement of its rights under the Copyright Act. See 17 U.S.C. § 501(b) (“The legal or beneficial owner of an exclusive right under a copyright is entitled . . . to institute an action for any infringement of that particular right committed while he or she is the owner of it.”). Accepting the allegations in DISH's First Amended Complaint as true, DISH has established that it held the exclusive right to distribute and publicly perform the works shown on the Protected Channels in the United States at all relevant times, and that it therefore holds the copyrights in the protected works.

         2.Infringement

         Hasweh violated DISH's exclusive rights under 17 U.S.C. § 106 by distributing and performing the copyrighted programs that air on the Protected Channels in the United States through use of the Service. (ECF No. 17 ¶ 32.) DISH has not authorized Hasweh to distribute or publicly perform the protected works. (Id.) Hasweh's distribution and performance of the copyrighted programs render him a direct infringer of DISH's copyrights pursuant to 17 U.S.C. 501 (“Anyone who violates any of the exclusive rights of the copyright owner . . . is an infringer of the copyright or right of the author.”). Accepting the allegations in DISH's First Amended Complaint as true, DISH has established that Hasweh infringed its copyrights in works airing on the Protected Channels.

         DISH has established that it owned valid copyrights and that Hasweh directly infringed on these copyrights by distributing the Protected Works without authorization. DISH has therefore established Hasweh's liability for direct copyright infringement under Count I of its First Amended Complaint.

         C. Damages

         Having determined that DISH has established Hasweh's liability, it is now appropriate to determine the damages to which DISH is entitled. The damages that DISH seeks in its Motion are appropriate under Rule 54(c) so long as “the record supports the damages requested.” See Laborers' Dist. Council Pension v. E.G.S., Inc., No. WDQ-09-3174, 2010 WL 1568595, at *3 (D. Md. Apr. 16, ...


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