Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-3_05-cv-00718/USCOURTS-cand-3_05-cv-00718-5/pdf.json

Nature of Suit Code: 690
Nature of Suit: Other Forfeiture and Penalty Suits
Cause of Action: 28:1331 Fed. Question

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United States District Court

For the Northern District of California

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UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF CALIFORNIA

COMCAST OF CALIFORNIA III, INC., a

California Corporation,

Plaintiff,

v.

STEPHANE TARDIF, et al.,

Defendants.

___________________________________/

No. C-05-0718 EMC

REPORT AND RECOMMENDATION

RE PLAINTIFF’S MOTION FOR

DEFAULT JUDGMENT

(Docket Nos. 15, 17)

On June 8, 2005, Plaintiff Comcast of California III, Inc. (“Comcast”) moved for default

judgment against Defendants Stephane Tardif and Jacques Tardif (“the Defendants”). Because

Defendants have not appeared in this action and have not consented to the jurisdiction of the

undersigned, the Court issues this report and recommendation on the motion since it is a dispositive

motion. Having considered all the papers and evidence submitted therewith, the Court hereby

recommends that the motion for default judgment be GRANTED as to Stephane Tardif and

DENIED as to Jacques Tardif for incomplete service of process.

I. FACTUAL & PROCEDURAL BACKGROUND 

On February 17, 2005, Comcast filed a complaint against the Defendants for (1) violation of

the Cable Communications Act, 47 U.S.C. § 553 (“Cable Communications Act” or “the Act”); (2)

unjust enrichment; (3) imposition of a constructive trust; and (4) violation of California Penal Code

§ 593d. In its complaint, Comcast alleged as follows: Comcast, a California corporation with its

principal place of business in Santa Clara, California, is the owner and operator of a cable television

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system. See Compl. ¶¶ 2, 5. Comcast offers subscribers various levels or “packages” of cable

programming; subscribers are authorized to receive only the level of programming which he or she

has purchased. To protects its programming from unauthorized reception, Comcast encodes or

“scrambles” its signal. A device known as a “converter”, which incorporates another device known

as a “decoder”, descrambles the signal, thereby allowing the programming to be viewed clearly on

the subscriber’s television. See id. ¶¶ 3, 4. 

Taking Comcast’s allegations as true on this motion for default judgment, Defendants are

residents of Quebec, Canada. See Compl. ¶¶ 3, 4. Defendants sold electronic equipment used for

the sole purpose of producing and distributing illegal cable descrambling equipment in violation of

the Cable Communications Act. Compl., ¶¶ 19-21. Each of these devices is capable of

circumventing the security system Comcast designed to protect its programming from unauthorized

reception. See id. ¶ 20. Therefore, purchasers of these descrambling devices may access Comcast’s

programming without paying for it. See id.. 

Defendants have advertised these products on at least two websites they operate, both of

which have registered addresses in Berkeley, California. Id., ¶ 22. Defendants have made sales to

customers in California as well as many other states in the United States. Id.

After first discovering Defendants’ online eBay auction site, Comcast’s security manager,

Kevin Sandle, purchased one such descrambler device from Defendants’ website after successfully

bidding for it on November 3, 2003. Sandle Decl. in Support of Pl’s Suppl. Mem., ¶ 3 and Ex. A

(Docket No. 41). Mr. Sandle made a payment of eighty-six dollars ($86) to Defendant Jacques

Tardif by sending a money order payable to Jacques Tardif. Id., Ex. B. Mr. Sandle sent and

received e-mail correspondence with Defendant Stephane Tardif about the descrambler purchase. 

Id., ¶ 4 and Ex. C. Mr. Sandle received the descrambler on December 11, 2003. Id., ¶ 5. 

The e-mail address that Mr. Sandle used to contact Stephane Tardif

[visionseries@hotmail.com] appears on the PayPal account information for Stephane Tardif, which

also lists both Stephane and Jacques Tardif’s mailing addresses. Id., ¶ 4; Sandle Decl. in Support of

Add’l Brief, Ex. 2 (Docket No. 34). The allegations and evidence presented by Comcast

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demonstrate that Defendants Jacques and Stephane were jointly involved in the sale of descrambling

devices.

A Service of Summons and Complaint

Comcast attempted service of the summons and complaint on both Defendants on February

17, 2005. Service of the summons and complaint was attempted via registered, international mail,

addressed to Stephane Tardif at 78 Ch De L’Ile-Claude, Ile-Perrot, Quebec, Canada, and Jacques

Tardif at 70 Ch De L’Ile-Claude, Ile-Perrot, Quebec, Canada. The Court finds that service was

effected only as to Stephane Tardif, but not as to Jacques Tardif.

To establish service of the summons and complaint, Comcast has submitted the return receipt

for the registered international mail delivered to Defendant Stephane Tardif. See Pl’s Response to

Order re Briefing and Evidence, Ex. B (Docket No. 24). Comcast has not received a return receipt

for the mail delivered to Defendant Jacques Tardif. It did receive verification from the United States

Postal Service tracking system that the registered international mail was delivered to Jacques

Tardif’s address on March 12, 2005. Platt Decl., ¶¶ 5-8 and Ex. B (Docket No. 21).

Comcast asserts that service via certified international mail to Canada is proper, citing

California’s long-arm statute and the Hague Convention treaty. Id., ¶ 9. The Ninth Circuit,

however, has delineated the circumstances under which service by international mail may be

effected. The Court finds that Comcast has met the requirements of Rule 4(f) for service of process

on Defendant Jacques Tardif by using registered international mail with return receipt.

Rule 4(f) authorizes service upon individuals in a foreign country by methods of service

authorized by international agreements: “Unless otherwise provided by federal law, service upon an

individual from whom a waiver has not been obtained and filed, other than an infant or an

incompetent person, may be effected in a place not within any judicial district of the United States:

(1) by any internationally agreed means reasonably calculated to give notice, such as those means

authorized by the Hague Convention on the Service Abroad of Judicial and Extrajudicial Documents

(the ‘Hague Convention’)[.]” Fed. R. Civ. Proc. 4(f)(1).

The Hague Convention, ratified by the United States in 1965, is a multilateral treaty that

applies, between signatory countries, “in all cases, in civil or commercial matters, where there is

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occasion to transmit a judicial or extrajudicial document for service abroad.” Hague Convention,

art. 1. See Brockmeyer v. May, 383 F.3d 798, 801 (9th Cir. 2004). The Convention “was intended

to provide a simpler way to serve process abroad, to assure that defendants sued in foreign

jurisdictions would receive actual and timely notice of suit, and to facilitate proof of service abroad.” 

Volkswagenwerk Aktiengesellschaft v. Schlunk, 486 U.S. 694, 698 (1988). “By virtue of the

Supremacy Clause, U.S. Const., Art. VI, the Convention pre-empts inconsistent methods of service

prescribed by state law in all cases to which it applies.” Id. at 699. The California Code of Civil

Procedure provision cited by Comcast to authorize its use of certified international mail is therefore

not controlling here. See Platt Decl., ¶ 9 (Docket No. 21).

“The primary means by which service is accomplished under the Convention is through a

receiving country’s ‘Central Authority’” to receive requests for service of documents from another

member country. Brockmeyer, 383 F.3d at 801 (citing Hague Convention, art. 2). Comcast did not

seek service through Canada’s central authority.

The Convention also provides, however, that as long as the receiving state does not object,

the Convention “shall not interfere” with “the freedom to send judicial documents, by postal

channels, directly to persons abroad.” Hague Convention, art. 10(a). The Ninth Circuit has held that

Article 10(a) of the Convention permits service of process by international mail if authorized by the

law of the forum state and provided the receiving country does not object. Brockmeyer, 383 F.3d at

804. Both the United States and Canada are signatories to the Hague Convention. Canada has stated

that it does not object to service by postal channels, as referred to in Article 10(a). Hague

Convention, n.3 (Instrument of Accession of Canada, Sept. 26, 1988) at II.A 

Notwithstanding the Hague Convention’s allowance of service by mail, and lack of objection

by Canada to service by mail, this Court must find affirmative authorization in the laws of the

United States, as the forum state, for service by registered international mail. Brockmeyer, 383 F.3d

at 804. In this regard, the Court looks to the Federal Rules of Civil Procedure. Turning to the

methods of service authorized by the Rules, the Ninth Circuit has recognized two authorized

methods of service by international mail: (1) “service abroad by mail for which a signed receipt is

required, when such mail is addressed and mailed by the clerk of the federal district court in which

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 Rule 4(f)(2)(C)(ii) provides for service outside the United States, unless prohibited by the law

of the foreign country, by “any form of mail requiring a signed receipt, to be addressed and dispatched

by the clerk of the court to the party to be served.” Fed. R. Civ. Proc. 4(f)(2)(C)(ii) (emphasis added).

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 Rule 4(f)(3) provides for service abroad “by other means not prohibited by international

agreement as may be directed by the court.” Fed. R. Civ. Proc. 4(f)(3) (emphasis added).

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 Rule 4(f)(2)(A) provides in pertinent part as follows:

(f) [S]ervice . . . may be effected in a place not within any judicial district of the United States: 

***

(2) if there is no internationally agreed means of service or the applicable international

agreement allows other means of service, provided that service is reasonably calculated to give

notice:

(A) in the manner prescribed by the law of the foreign country for service in that country

in an action in any of its courts of general jurisdiction[.]

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the suit is filed” pursuant to Rule 4(f)(2)(C)(ii);1

 or (2) alternative methods of service, such as

ordinary mail or email, where the plaintiff obtains prior court approval for the mailing procedure,

pursuant to Rule 4(f)(3).2

 Here, Comcast did not follow either approved procedure for service by

mail. It did not seek assistance by the Clerk of this Court; nor did Comcast obtain a prior court

order.

The Ninth Circuit also recognized that Rule 4(f)(2)(A)3

 provides an alternative method. It

“affirmatively authorizes service by means used in the receiving country for service by means used

in the receiving country for service in an action in its courts of general jurisdiction.” Brockmeyer,

383 F.3d at 804-06. In Brockmeyer, the Ninth Circuit concluded that Rule 4(f)(2)(A) does not

authorize service on foreign defendants by international mail to England.

In Brockmeyer, the trademark owner served the foreign defendant by sending the summons

and complaint for trademark infringement by ordinary first class mail to a post office box in England

without a return receipt. The Ninth Circuit found that the plaintiffs had neither effected service

through England’s Central Authority under the Hague Convention in accordance with Rule 4(f)(1),

nor effected service by registered mail by the clerk of the court in accordance with Rule

4(f)(2)(C)(ii); nor did it obtain a prior court order in accordance with Rule 4(f)(3). The plaintiffs

“simply dropped the complaint and summons in a mailbox in Los Angeles, to be delivered by

ordinary, international first class mail.” Id. at 809. The Ninth Circuit then held that Rule 4(f)(2)(A)

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does not authorize service of process by ordinary first class international mail upon a defendant in

England. Brockmeyer, 383 F.3d at 808. The court noted that the British government objected to a

proposed revision to Rule 4 that would allow assessment of costs against foreign defendants who

failed to waive service upon receipt via mail. Id. at 807-08. The Ninth Circuit inferred that the

British government understood Rule 4(f) not to permit service by ordinary, international first class

mail against a defendant in England, because if it were so, “a plaintiff would never need to send a

request for waiver of service by international first class mail.” Id. at 808. Given the British

government’s objection to service by mail, the Ninth Circuit concluded that Rule 4(f)(2)(A) does not

permit service by regular international mail, at least to England.

The Ninth Circuit did not address the question of whether service by mail is proper where, as

here, it is addressed to the party to be served and is sent by a form of mail requiring a signed return

receipt, and the host nation permits such service.

The Court thus considers whether Comcast has effected service of process under Rule

4(f)(2)(A), which permits service on a foreign defendant “in the manner prescribed by the law of the

foreign country for service in that country in an action in any of its courts of general jurisdiction.” 

The Federal Courts Rules of Canada provide for service by registered mail: “Personal service of a

document on an individual, other than an individual under a legal disability, is effected . . . by

mailing the document by registered mail to the individual’s last known address, if the individual

signs a post office receipt.” Consolidated Regulations of Canada, Federal Courts Rules (Federal

Courts Act) SOR/98-106, Rule 128(1)(e). The Court further notes that in its accession to the Hague

Convention, Canada states that “Canadian law allows the use of postal channels to serve Canadian

documents to persons abroad.” Hague Convention, n.3 at II.B. 

The Court finds that Comcast’s use of registered mail with return receipt signed by the

recipient is “‘likely to give the actual notice required by United States due process concepts.’” 

Brockmeyer, 383 F.3d at 806 (citation omitted). Moreover, the purpose of Rule 4(f)(2)(A) was to

provide an alternative method of service “that is likely to create least objection in the place of

service.” See id. at 808 (citing 1963 Committee Notes to former Rule 4(i)(1)(A), the predecessor to

Rule 4(f)(2)(A)). In light of Canadian Federal Court Rules governing personal service on domestic

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 The Court also notes that Comcast mailed its requests for entry of default and for default

judgment (Docket Nos. 18, 20) to Jacques Tardif at an apparently incorrect address of 78 Ch De L’IleClaude. This underscores the importance of insuring that Jacques Tardif did in fact receive the

summons and complaint. A signed receipt is best proof of that.

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and foreign defendants, the Court finds permitting service by registered international mail with

return receipt would not raise a substantial objection. Cf. Fireman’s Fund Ins. Co. v. Fuji Electric

Systems Co., Ltd., 2005 WL 628034 at *3 (N.D. Cal. 2005) (finding that the law of Japan forbids

service of process by Federal Express delivery, and granting motion to dismiss for insufficient

service of process).

Comcast has therefore effected service of process on Defendant Stephane Tardif, as

evidenced by the return receipt of the registered mail sent to him at 78 Ch De L’Ile-Claude. 

Comcast has not, however, properly effected service on Defendant Jacques Tardif.4

 Though the

Court does not fault Comcast for the absence of a return receipt, the method of service approved by

Canadian law requires that “the individual signs a post office receipt.” Consolidated Regulations of

Canada, Federal Courts Rules SOR/98-106, Rule 128(1)(e), supra. See R. v. Lewko, 2001

CarswellNat 10, 2001 WL 443717 (Fed. Ct. Trial Div.) (dismissing application for default judgment

for lack of proof of service under Rule 128(1)(e) where post office receipt was signed by person

other than defendant). No such signed receipt was obtained from Jacques Tardif. Comcast has not

submitted any legal authorities demonstrating its attempted service -- sending by registered mail but

without having received a signed receipt -- satisfies Canadian law.

B. Request to Enter Default

Comcast filed and served requests for entry of default and for default judgment upon

Defendants’ failure to answer the complaint. Because neither Stephane Tardif nor Jacques Tardif

responded, the Clerk of the Court, upon Comcast’s request, entered default as to both of them on

July 22, 2005. See Docket No. 22. “The general rule of law is that upon default the factual

allegations of the complaint, except those relating to the amount of damages, will be taken as true.” 

Televideo Sys., Inc. v. Heidenthal, 826 F.2d 915, 917-18 (9th Cir. 1987) (internal quotation marks

omitted). 

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On June 8, 2005, Comcast filed this motion for default judgment against the Defendants,

seeking relief only for its Cable Communications Act claim. Specifically, Comcast asks the Court to

award it the profits Defendants earned by selling the unauthorized devices pursuant to 47 U.S.C. §

553(c)(3)(A)(i). See Plaintiff’s Additional Brief in Response to the Court’s “Order Re Further

Briefing in Support of Plaintiff’s Motion for Default Judgment” at 2, Docket No. 32. 

To support its damages calculation based on gross profits, Comcast reviewed Defendants’

electronic sales records produced by PayPal, an internet-based payment service. Comcast located

the occurrences of several keywords reflecting the names of illegal cable descrambling devices from

the “Transaction Download” spreadsheet which details all sales through Defendants’ PayPal

account: “clearview,” “viewtek,” “oz-s,” “ gs2,” “gs3,” “davinci,” “clearmax,” “chip3,” “calibur,”

“ranger and 9000,” “platinum,” “media and 2200,” “viewmax,” “cobra and vision,” “coolsonic,”

“stargate,” “stealth and vision,” and “view and 4000.” Sandle Decl. in Support of Add’l Brief, ¶¶ 4,

5 (Docket No. 34). For each transaction in which the particular keyword appeared, Comcast took

the corresponding dollar amount and then totaled the dollar value of all such transactions, reflecting

all occurrences on the Transaction Download spreadsheet related to the sale of cable descrambling

equipment. Id., ¶ 5 and Ex. 3. Out of total PayPal sales of $1,422,142.12, Defendants’ sales of

descrambling devices yielded gross revenue of $1,009,512.90. Id., ¶ 5.

To support an alternate damages calculation of statutory damages-per-device under the Cable

Communications Act, Comcast also searched Defendants’ PayPal records for sales of ViewmaxPro

descrambers, and discovered that Defendants distributed at least two thousand one hundred and

twenty-five (2,125) such descrambling devices. Sandle Decl. in Support of Prove Up on Damages, ¶

2 (Docket No. 26). The sole purpose of the ViewmaxPro is to descramble Comcast’s encoded cable

television signal. Id., ¶ 4. Comcast has since waived its request for damages per device under the

California Penal Code. See Add’l Brief, ¶ 3 (Docket No. 32). The Cable Communications Act

provides for statutory damages of $250 to $10,000 “for all violations involved in the action,” but not

per device. 47 U.S.C. § 553(3)(A)(ii).

Since the Defendants are alleged to have violated the Act willfully for purposes of

commercial advance or private financial gain, see Compl. ¶ 31, Comcast also seeks enhanced

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 Under Federal Rule of Civil Procedure 55, a court may not enter a default judgment against

an unrepresented minor, an incompetent person, or a person in military service. See Fed. R. Civ. P.

55(b)(2). Given the sophistication of the Defendants’ business, the volume of transactions, scope of

their marketing and the stability of their residences, the Court infers that none of the disqualifying

factors pertain here. Certainly, neither Defendant has made any attempt to assert any such defenses.

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statutory damages in the amount of $50,000. Thus, Comcast asks for a total damage award of

$1,059,512.90.

II. DISCUSSION

A. Legal Standard

The disposition of a motion for default judgment lies within the discretion of the court.5 See

Aldabe v. Aldabe, 616 F.2d 1089, 1092 (9th Cir. 1980) (“The district court’s decision whether to

enter a default judgment is a discretionary one.”). Factors which inform the exercise of discretion as

to the entry of a default judgment include: (1) the possibility of prejudice to the plaintiff, (2) the

merits of plaintiff’s substantive claim, (3) the sufficiency of the complaint, (4) the sum of money at

stake in the action; (5) the possibility of a dispute concerning material facts; (6) whether the default

was due to excusable neglect, and (7) the 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).

B. Personal Jurisdiction

There is a threshold question as to whether this Court has personal jurisdiction over

Defendant Tardif, a resident of Canada. Where there is no applicable federal statute governing

personal jurisdiction, a court applies the law of the state in which the district court sits. See

Schwarzenegger v. Fred Martin Motor Co., 374 F.3d 797, 800 (9th Cir. 2004). “Because

California’s long-arm jurisdictional statute is coextensive with federal due process requirements, the

jurisdictional analyses under state law and federal due process are the same. For a court to exercise

personal jurisdiction over a nonresident defendant, that defendant must have at least ‘minimum

contacts’ with the relevant forum such that the exercise of jurisdiction ‘does not offend traditional

notions of fair play and substantial justice.’” Id. at 800-01.

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 As no evidentiary hearing has been held on the issue of jurisdiction, Comcast need only make

a prima facie showing of personal jurisdiction. See Brand v. Menlove Dodge, 796 F.2d 1070, 1072 (9th

Cir. 1986).

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 Comcast alleges that “Defendants advertise or have advertised their products on at least two

(2) websites: alldescramberboards.com and originalcablebox.com. Both of these websites have

registered addresses in the United States at 2342 Shattuck Avenue, B400, Berkeley, CA, 94704.”

Compl., ¶ 22. Comcast has submitted supplemental information based on a domain name search

evidencing that the website alldescramberboards.com was registered to Defendants in California. The

register page for the alldescramberboards.com website lists an address of 2342 Shattuck Ave., B400,

Berkeley, CA 94704. Further Suppl. Brief, Ex. A (Docket No. 43). Comcast was unable to locate a

domain search on the originalcablebox.com website, although the PayPal records list the following email addresses related to that website: ocbsales@originalcablebox.com and

sales.ebay@originalcablebox.com. Sandle Decl. in Support of Additional Brief, , Ex. 1 (Docket No.

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There are two kinds of personal jurisdiction: general jurisdiction and specific jurisdiction. “If

a defendant’s activities within the forum state are ‘continuous and systematic’ or ‘substantial,’ the

state has a sufficient relationship with the defendant to assert general jurisdiction.” Lake v. Lake,

817 F.2d 1416, 1420 (9th Cir. 1987) (citing Perkins v. Benguet Consol. Mining Co., 342 U.S. 437,

445, 447 (1952)). “If, however, a forum state cannot assert general jurisdiction over the defendant,

it may still assert specific jurisdiction depending on the quality and nature of the defendant’s

contacts with the forum state in relation to the cause of action.” Id. at 1421 (citation omitted).

Here, the Court need not consider whether Comcast has met the more exacting standard of

general jurisdiction because the allegations and factual submissions support the exercise of specific

jurisdiction over Defendant. Specific jurisdiction exists if the following factors are shown: “(1) the

nonresident defendant must purposefully direct his activities or consummate some transaction with

the forum or residents thereof; or perform some act by which he purposefully avails himself of the

privilege of conducting activities in the forum, thereby invoking the benefits and protections of its

laws; (2) the claim must be one which arises out of or relates to the defendant’s forum-related

activities; and (3) the exercise of jurisdiction must comport with fair play and substantial justice, i.e.

it must be reasonable.” Lake, 817 F.2d at 1421. In the case at bar, Defendant Tardif has had

substantial contacts in California6

 through their joint activity in marketing and selling descrambling

devices: (1) Defendants marketed their products in California through the internet; (2) Defendants

established two websites through which they sold the boxes, which are both registered at an address

in Berkeley, California;7

 (3) Defendants produced decoding boxes from a California source (Compl.,

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¶ 21); (4) they made substantial sales to California. The Court examines the three factors for

specific jurisdiction.

1. Purposeful Availment

The purposeful availment requirement is satisfied if the defendant takes some deliberate

action within the forum state or creates continuing obligations to forum residents. Cybersell, Inc. v.

Cybersell, Inc., 130 F.3d 414, 417 (9th Cir. 1997). The defendant’s physical presence in the forum

state is not necessary, “provided that his efforts are purposefully directed toward forum residents.” 

Id. Where the defendant operates a website, courts look to “the level of interactivity and

commercial nature of the exchange of information that occurs on the Website” to determine if

sufficient contacts exist. Id. at 418 (quoting Zippo Mfg. Co. v. Zippo Dot Com, Inc., 952 F. Supp.

1119, 1124 (W.D.Pa. 1997). Here, Defendant did more than create a passive website accessible to

anyone over the Internet, the mere existence of which does not by itself rise to the level of

substantial contacts to warrant specific personal jurisdiction. Cybersell, 130 F.3d at 418. Rather,

Defendant operated an interactive website through which California consumers purchased the

descrambler devices, which were then delivered to California addresses. See Platt Decl., Ex. 2

(PayPal transaction spreadsheet) (Docket Nos. 25 and 45). The fact that consumers purchased the

descramber devices directly from Defendant’s websites through a third-party payor, PayPal,

demonstrates that these were interactive, not passive. See IO Group, Inc. v. Pivotal, Inc., 70

U.S.P.Q.2d 1458, 2004 WL 838164 at *4 (N.D. Cal., April 19, 2004) (finding specific jurisdiction

and denying motion to dismiss). Furthermore, Defendant’s website, alldescramberboards.com, has a 

registered address in the United States at 2342 Shattuck Avenue, B400, Berkeley, CA, 94704. 

Further Suppl. Brief, Ex. A (Docket No. 43).

In addition, it appears that a substantial portion of Defendant’s sale were to California. In

reviewing a sampling of Defendant’s voluminous PayPal transaction records, the Court found that of

those sales with an identifiable shipping address, about one in ten such sales, or roughly ten percent,

were shipped to California. Such sales demonstrate that Defendant had substantial commercial

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contacts with California, purposefully marketing and selling illegal descramblers to a substantial

number of California residents. This is sufficient to warrant the exercise of personal jurisdiction. 

See Stomp, Inc. v. NeatO, LLC, 61 F. Supp. 2d 1074, 1078 (C.D. Cal. 1999) (finding minimum

contacts sufficient for specific personal jurisdiction where Defendant maintained commercial

website and made actual sales to California citizens). 

2. Defendants’ Forum-Related Activities

To show that the contacts constituting purposeful availment gave rise to the current suit, a

plaintiff must also show that “but for” the defendant’s forum-related conduct, the injury would not

have occurred. Bancroft & Masters, Inc. v. Augusta Nat’l Inc., 223 F.3d 1082, 1086 (9th Cir. 2000). 

Defendant sold descramber devices in violation of the Cable Communications Act to a substantial

number of California customers. Defendant’s contacts with California are therefore closely related

to the transactions which comprise the gravamen of the Complaint.

3. Reasonableness

Finally, the Court considers the several factors to determine the reasonableness of exercising

jurisdiction here, i.e., whether it comports with fair play and substantial justice, Bancroft & Masters,

223 F.3d at 1088 (citing Burger King Corp. v. Rudzewicz, 471 U.S. 462 (1985)):

(1) The extent of Defendant’s purposeful injection into the forum state: Defendant made

actual sales of illegal descrambler devices to internet buyers in California, actively

advertising via websites based in California;

(2) The burden on Defendant: although he resides in Canada, Defendant has registered at

least one website to a Berkeley address and made actual sales in California. In view of these

activities and the volume of sales, the burden of defending the suit in California would not be

so great an inconvenience as to deprive Defendant of due process. Panavision Int’l, L.P. v.

Toeppen, 141 F.3d 1316, 1323 (9th Cir. 1998);

(3) The extent of conflict with the sovereignty of Defendant’s nation: the sovereignty

barrier is higher than where the defendant resides in another U.S. state. Pacific Atlantic

Trading Co., Inc. v. M/V Main Express, 758 F.2d 1325, 1330 (9th Cir. 1985). However,

Canada has not stated a sovereign interest in this matter, and being in default, Defendant has

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not raised any such interest. The Court has considered Canada’s terms of accession to the

Hague Convention, which contemplate that Canadian citizens would be served in foreign

lawsuits, and has deferred to the Canadian rules of service of process to find that only

Defendant Stephane Tardif was properly served. As the Court has avoided any objection to

service of process by Canada, and as Defendant has availed himself of California commerce,

any conflict with Canadian sovereignty is either non-existent or substantially outweighed by

the reasonableness of personal jurisdiction;

(4) The interest of the forum state: California has a strong interest in protecting cable

providers doing business in the state from piracy and in providing a forum to remedy harm,

especially where as here Defendant sold a significant portion (roughly ten percent) of its

descramblers to Californians;

(5) The most efficient judicial resolution of the controversy: the courts generally look to

where the injury occurred and where the evidence is located, but this factor is not weighed

heavily in light of modern advances in communication and transportation. Panavision, 141

F.3d at 1323-24. Here, there does not appear to be one single state or forum where an

overwhelming number of witnesses or amount of evidence would be located. This factor is

neutral;

(6) The importance of the forum to the plaintiff’s interest in convenient and effective relief: 

Comcast is a California corporation with its principal place of business in Santa Clara,

California. Compl., ¶ 2. This factor weighs in Comcast’s favor, but is generally given little

weight. Panavision, 141 F.3d at 1324;

(7) The existence of an alternative forum: Comcast has not demonstrated the unavailability

of an alternative forum, and the PayPal records indicate that Defendant sold his products to

buyers in states other than California, as well as in Canada. This factor weighs against

jurisdiction here.

The Court concludes that, on balance, the reasonableness factors favor the exercise of

personal jurisdiction over Defendant Stephane Tardif. All the requirements for the exercise of

specific, personal jurisdiction are therefore satisfied.

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C. The Eitel Factors

The Court now turns to an analysis of the Eitel factors to determine whether Comcast’s

motion for default judgment should be granted. In its complaint, Comcast has alleged that it is a

“person aggrieved” for purposes of the Act. See Compl. ¶ 33. It provides the programming that is

impermissibly intercepted by the devices sold by Defendant. 

For purposes of this motion, Comcast asserts only violation of the Cable Communications

Act. The Act provides that “[n]o person shall intercept or receive or assist in intercepting or

receiving any communications service offered over a cable system, unless specifically authorized to

do so by a cable operator or as may otherwise be specifically authorized by law.” 47 U.S.C. §

553(a)(1). The Act’s prohibition on assisting in intercepting or receiving any such communications

service extends to “the manufacture or distribution of equipment intended by the manufacturer or

distributor (as the case may be) for unauthorized reception of any communications service offered

over a cable system in violation of subparagraph (1).” 47 U.S.C. § 553(a)(2). A “person aggrieved”

by a violation of the Act may bring a civil action for damages under its provisions. See 47 U.S.C. §

553(c)(1). 

Comcast has alleged that the Defendant manufactured or distributed the descrambling

devices with knowledge that the devices will be used to receive Comcast’s programming without

authorization. See id. ¶ 27; § 553(a)(1)-(2). Taking these and other allegations as true, the Court

finds that Comcast has stated a valid claim for a violation of § 553. The complaint meets the

pleading standard of Federal Rule of Civil Procedure 8(a) in that it contains a “short and plain

statement of the claim showing that the pleader is entitled to relief,” and “give[s] the defendant fair

notice of what the plaintiff’s claim is and the grounds upon which it rests.” Swierkiewicz v. Sorema

N.A., 534 U.S. 506, 512 (2002) (citations omitted). Furthermore, as noted above, Comcast has

submitted substantial evidence of Defendant’s PayPal sales records to support its allegations that

Defendant sold or distributed descrambling devices. See Sandle Decl. in Support of Prove Up on

Damages ¶ 3 (Docket No. 26). Comcast has also submitted evidence of an actual sale of a

descrambling device by the Tardifs. The evidence establishes that Defendant Stephane Tardif is

centrally involved in these sales and is generally and jointly responsible therefor: the PayPal

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account is registered in his name, and he was personally corresponding by e-mail with Mr. Sandle

about the sale of a descrambler device. Sandle Decl. in Support of Add’l Brief, Ex. 2 (Docket No.

34); Sandle Decl. in Support of Pl’s Suppl. Mem., Ex. C (Docket No. 41). Consequently, the second

(merits of plaintiff’s substantive claim) and third (sufficiency of the complaint) Eitel factors weigh

in favor of a default judgment against Stephane Tardif.

Consideration of the other Eitel factors also weighs in favor of granting default judgment. If

default judgment is not granted in this case, then Comcast will likely suffer prejudice because it will

have no other avenue for relief. See Pepsico, Inc. v. Cal. Sec. Cans, 238 F. Supp. 2d 1172, 1177

(C.D.Cal. 2002) (“If Plaintiffs’ motion for default judgment is not granted, Plaintiffs will likely be

without other recourse for recovery.”). Without the deterrence value of a large money judgment

against them, Defendant would likely continue selling the descrambling devices, thereby causing

further prejudice to Comcast. The sum of money at stake here is significant (over one million

dollars), which would typically weigh against granting default judgment. See Bd. of Trustees of the

N. Cal. Sheet Metal Workers v. Peters, No. C-00-0395 VRW, 2000 U.S. Dist. LEXIS 19065, *5

(N.D. Cal. Dec. 29, 2000) (holding that default judgment is favored where “[t]he amount at stake is

minor in comparison to the potential loss . . . as a result of defendants’ conduct.”). However, the

Defendant Stephane Tardif was given proper notice that Comcast would be seeking the Defendant’s

profits as damages, a potentially substantial sum. See Compl. at 11. Moreover, the damages sought

are based on actual sales. Furthermore, there is little to suggest a dispute concerning material facts. 

Defendant Tardif was given proper notice of the complaint and has not responded. Thus, the Court

can only conclude that the Defendant does not contest Comcast’s allegations. In any event, the

documentary evidence appears rather conclusive that descrambler boxes were sold jointly by the

Tardifs.

Finally, there is no evidence suggesting that the failure to answer is due to excusable neglect. 

Although the Court acknowledges that “[c]ases should be decided upon their merits whenever

reasonably possible,” Eitel, 782 F.2d at 1472, it appears that a merits-based decision in this case is

not reasonably possible because the Defendant Stephane Tardif has never come forward to defend

himself against Comcast’s allegations. He has been served with the complaint, and the request for

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entry of default and motion to enter default judgment were mailed to him. Therefore, the Court

concludes that the majority of the Eitel factors weigh in favor of granting default judgment here. 

D. Proof of Damages

Because default judgment should be granted for the reasons stated above, the Court must

next decide the amount of damages to award Comcast. As noted above, in a motion for default

judgment, the factual allegations, except those relating to the amount of damages, are taken as true. 

Two measures of damages are available under the Act: (1) actual damages plus the defendant’s

profits which are not taken into account in computing the actual damages, or (2) statutory damages. 

47 U.S.C. § 553(c)(3)(A)(i)-(ii). In addition, a court has discretion to increase damages by no more

than $50,000 if it finds that the defendant acted willfully and for purposes of commercial advantage

or private financial gain. See 47 U.S.C. § 553(c)(3)(B). 

1. Defendant’s Profits

Where, as here, a plaintiff seeks the actual damages plus defendant’s profits measure, the

method for computing defendant’s profits is as follows:

[I]n determining the violator’s profits, the party aggrieved shall be

required to prove only the violator’s gross revenue, and the violator

shall be required to prove his deductible expenses and the elements of

profit attributable to factors other than the violation[.]

47 U.S.C. § 553(c)(3)(A)(i).

To meet its burden under the statute, Comcast has come forward with proof of the

Defendants’ gross revenue in the form of Kevin Sandle’s declaration. Mr. Sandle is employed by

Comcast as a Market Security Manager with ten years of experience investigating cases of cable

television theft. See Sandle Decl. in Support of Additional Brief ¶¶ 1, 2. As discussed above, Mr.

Sandle calculated the Defendants’ gross revenues for the sale of descrambling devices by analyzing

Stephane Tardif’s PayPal account records. These records were queried with a keyword reader using

the names of recognized descrambler boxes. Mr. Sandle declares that he has reviewed the spread

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 This amount comports with the applicable statute of limitations. Section 553(c) [providing

for civil actions] of the Cable Communications Act does not contain an express statute of limitations.

Some courts have held that the limitation period of the most analogous state law analog should apply.

Kingvision Pay-Per-View, Corp., Ltd. v. 898 Belmont, Inc., 366 F.3d 217, 224 (3rd Cir. 2004). Others

have applied the three year limitation period of the federal Copyright Act. Prostar v. Massachi, 239

F.3d 669, 676 (5th Cir. 2001). In this case, it makes no difference since the three year period for

statutory claims under California Code of Civil Procedure § 338 applies to the closest analog California

Penal Code § 593d (prohibiting, inter alia, manufacturing and distribution of any “device” designed to

decode or descramble nonstandard signals carried by a subscription television system). Since the

complaint herein was filed on February 17, 2005, Comcast can recover profits on sales made on

February 17, 2002 or later. See Sandle Decl. in Support of Pl’s Further Suppl. Brief, ¶ 4 (Docket No.

44). That figure comes to $1,009,512.90.

9

 In support of its motion for default judgment, Comcast submitted the PayPal transaction

download spreadsheet, both in electronic and hard copy formats. Comcast did not, however, highlight

or identify which sales were in California. For example, Comcast has identified the sales of 2,125

ViewmaxPro descrambling devices as the basis of their claim for damages, but hasn’t shown how many

of those were sold in California. Sandle Decl. in Support of Prove Up on Damages, ¶ 3 (Docket No. 26).

A cursory sampling of the sales entries on the transaction download spreadsheet with identifiable

shipping addresses indicates that about 10% of the sales were shipped to California.

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sheet and each item is an illegal descrambler which serves no other purpose. The revenue from

those sales amounts to $1,009,512.90.8

However, not all these sales are within the geographic area of Comcast’s cable system. They

include sales to virtually all states.9

 Some courts have interpreted the Cable Communications Act to

permit cable companies to recover all profits attributable to a violation of the Act even if it occurred

outside the local area of the plaintiff’s service area on the theory that plaintiff may act as a private

attorney general and broadly recover damages having a deterrent effect. See CSC Holdings, Inc. v.

KDE Elecs. Corp., 2000 WL 284005 (N.D. Ill. 3/13/00) at *16; Time Warner Entertainment

/Advance-Newhouse Partnership v. Worldwide Electronics, L.C., 50 F. Supp. 2d 1288, 1300-01

(S.D. Fla. 1999). However, in a more closely reasoned analysis of the statute, the district court in

CSC Holdings, Inc. v. New Information Technologies, Inc., 148 F. Supp. 2d 755, 761-62 (N.D. Tex.

2001) reached a contrary conclusion.

Nevertheless, plaintiff maintains that it is entitled to $393,497.25 in

gross revenues received by defendants from the sale of decoders

outside of its franchise area. (Plf. Exh. 6).[FN6]

FN6. The statute provides that “in determining the

violator’s profits, the party aggrieved shall be required

to prove only the violator’s gross revenue, and the

violator shall be required to prove his deductible

expenses and the elements of profit attributable to

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factors other than the violation . . .” 47 U.S.C. §

553(c)(3)(A)(i). Defendants did not offer any evidence

of their deductible expenses. Therefore, the gross

revenue received by defendants equals their profit.

This argument is based on the legislative history of section

553(c)(3)(A), which states in relevant part:

The aggrieved party, pursuant to (3)(A)(i), may recover actual

damages and all profits of the violator attributable to the

violation, including those profits attributable to the violation

where it also occurred outside of the local area of the

individual cable system, that are not taken into account in

calculating actual damages.

H.R. 98-934, 98th Cong., 2d Sess. 85 (1984), reprinted in 1984

U.S.C.C.A.N. 4655, 4722 (emphasis added). Based on this italicized

language, some courts have allowed aggrieved parties to recover all

profits derived from the sale of pirate decoder devices regardless of

whether the sale was made in the cable operator’s franchise area. See

CSC Holdings, Inc. v. KDE Electronics Corp., 2000 WL 284005 at *5

(N.D. Ill. March 13, 2000); Time Warner Entertainment/AdvanceNewhouse Partnership v. Worldwide Electronics, L.C., 50 F. Supp. 2d

1288, 1300-01 (S.D. Fla. 1999); Time Warner Cable of New York City

v. Cable Box Wholesalers, 920 F. Supp. 1048 (1996) (unreported). 

But see CSC Holdings, Inc. v. J.R.C. Products Ind., 2001 WL 315189

at *11-12 (N.D. Ill. Mar. 29, 2001) (refusing to follow Worldwide

Electronics on grounds that actual damages and profits are primarily

alternative measures of damages). These courts reason that “Congress

intended that a cable pirate’s profits were to serve as an incentive to an

aggrieved cable operator who acted in the interests of all cable

operators by civil prosecution of such decoder seller.” Worldwide

Electronics, 50 F. Supp. 2d at 1300.

This Court declines to give the statute such a broad

interpretation. Nowhere in the legislative history to section 553

(c)(3)(A) does it appear that Congress intended to give cable operators

added incentive to act as “private attorneys general” by allowing the

recovery of all profits realized by a violator without regard to the

specific conduct at issue. To the contrary, Congress expressly

indicated that an aggrieved party may recover “all profits of the

violator attributable to the violation, including those profits

attributable to the violation where it also occurred outside the local

area of the individual cable system . . .” 1984 U.S.C.C.A.N. at 4722

(emphasis added). It is the “violation” that makes a party “aggrieved”

under statute. Stated differently, a cable operator cannot be

“aggrieved” by the sale of a decoder that did not result in the loss of

revenue. The “violation” referred to in the legislative history as a

precondition to the recovery of profits is further qualified by the

requirement that it “also occur[ ] outside of the local area of the

individual cable system.” This suggests that a violation outside a

cable operator’s local service area is not separate and distinct from a

violation within the area. It might encompass a situation, for example,

in which a defendant who sold pirate decoder devices in a service area

also sold decoders outside the area knowing they would be brought

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into the local area for use. Under such circumstances, an aggrieved

cable operator would be entitled to recover all profits realized from the

sale of decoders both inside and outside its local service area. In any

event, the Court is unwilling to countenance the recovery of profits

that have absolutely no connection to the violations made the basis of

the underlying suit. Accordingly, plaintiff is not entitled to these

damages.

148 F. Supp. 2d at 761-62 & n.6.

In addition to CSC’s persuasive reasoning, this Court further notes that permitting recovery

of profits earned from sales of devices outside the plaintiff’s service area could result in double or

multiple recovery. If multiple cable companies brought similar suits against the same defendant,

each recovering the totality of all sales, defendant would be saddled with damages exceeding actual

sales/profits by several fold. Since the statute already specifically provides for enhancement of

damages under certain circumstances (sought herein as well), the Court is reluctant to conclude

Congress intended to impose upon violators liability for multiple damages (the extent of which turns

by happenstance on the number of suits by cable companies) absent a cleared indication that such a

result was so intended.

Accordingly, this Court concludes Comcast may recover only profits attributable to sales

within its service area. In the instant case, Comcast has not submitted specific evidence as to the

precise number of sales needed within its service area. Instead, Comcast has submitted a cable

industry overview showing that Comcast is the top provider with 34.71% of all cable subscribers

(21,409,000 out of 61,677,000 total subscribers) throughout the United States. Further Suppl. Brief,

Ex. B (Docket No. 43). Such an apportionment would render a fair result, affording Comcast a fair

proportion of damages for sales made on a nationwide basis, while avoiding multiple damage

liability. Comcast shall therefore recover 34.71% of Defendants’ total gross profits.

Since Defendant Tardif defaulted, there is no proof in this case of their “deductible expenses

and the elements of profit attributable to factors other than the violation.” See 47 U.S.C. §

553(c)(3)(A)(i). Therefore, Defendant has not met his burden to prove how much, if any, should be

deducted from gross revenue in order to determine its profits. The Court therefore awards Comcast

$350,401.93 (34.71% of $1,009,512.90 in gross revenues) as lost profits.

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2. Statutory Damages Under § 553

Under Section 553(3)(A)(ii), as an alternative to electing to recover actual damages, “the

party aggrieved may recover an award of statutory damages for all violations involved in the action,

in a sum of not less than $250 or more than $10,000 as the court considers just.” Statutory devices

under § 553 are not awarded per device. As the gross revenue, adjusted for market share, exceeds

the statutory maximum of $10,000, the Court recommends an award of actual, rather than statutory,

damages.

3. Enhanced Statutory Damages

Comcast, in addition, seeks enhanced statutory damages. The Court may also, in its

discretion, award enhanced statutory damages in the amount of $50,000 pursuant to Section 553

(c)(3)(B). Taking Comcast’s well-pleaded allegation that the Defendant Tardif violated the Act

willfully and for purposes of commercial advantage or private financial gain as true, the Court finds

that an award of enhanced statutory damages is appropriate. Given the magnitude of sales made by

the Tardifs and the sophisticated nature of their enterprise, the Court finds that the full enhancement

of $50,000 is appropriate. See 47 U.S.C. § 553(c)(3)(B) (providing that court has discretion to

award not more than $50,000 in enhanced statutory damages).

III. CONCLUSION

For the foregoing reasons, the Court recommends that Comcast’s motion for default

judgment be granted as to Defendant Stephane Tardif. Since Comcast has established violations of

the Cable Communications Act and has proven lost profits as calculated herein, the Court finds that

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enhanced statutory damages of $50,000 is appropriate. The Court hereby recommends entry of

judgment against Stephane Tardif in favor of Comcast in the amount of $400,401.93. Because

satisfactory service of process upon Jacques Tardif has not been demonstrated, the Court

recommends that the motion for default judgment as to Jacques Tardif be denied without prejudice

to permit Comcast an opportunity to re-serve that Defendant.

Dated: March 8, 2006

_________________________ EDWARD M. CHEN

United States Magistrate Judge

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