Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caed-2_05-cv-00545/USCOURTS-caed-2_05-cv-00545-6/pdf.json

Nature of Suit Code: 820
Nature of Suit: Copyright
Cause of Action: 17:504 Copyright Infringement

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 This motion was filed at the direction of the district court. “No appearance has been 1

made on behalf of defendant Katharsis, LLC. Counsel for plaintiffs shall take the necessary steps

to have the default of defendant Katharsis, LLC, entered and judgment entered upon such

default.” (May 9, 2006 Pretrial Order at 6.)

1

IN THE UNITED STATES DISTRICT COURT

FOR THE EASTERN DISTRICT OF CALIFORNIA

ODNIL MUSIC LIMITED and FIFTY-SIX 

HOPE ROAD MUSIC LIMITED,

Plaintiffs, No. CIV S-05-0545 WBS PAN

vs.

KATHARSIS, LLC, WILLIAM

JOSEPH SCHECK and NATHANIEL 

CHRISTOPHER SCHECK,

Defendants. FINDINGS & RECOMMENDATIONS

 /

Plaintiff's motion for entry of default judgment came on for hearing on shortened

time June 1, 2006. Alan M. Steinberg appeared for plaintiff. William J. Scheck appeared in 1

propria persona. No appearance was made for defendant Katharsis, LLC. Upon review of the

motion and the supporting documents, upon hearing the arguments of counsel and good cause

appearing therefor, THE COURT MAKES THE FOLLOWING FINDINGS AND

RECOMMENDATIONS:

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 On May 23, 2006, defendants Nathaniel Christopher Scheck and William Joseph 2

Scheck filed an opposition to the application for order shortening time. However, the order

shortening time was granted on May 22, 2006. Moreover, as noted in the district court’s pretrial

order, a corporation may appear only by counsel. (May 9, 2006 Pretrial Order at 6.)

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This is an action for infringement of copyright by unauthorized public

performances of four songs by defendants on September 2, 2004, at their place of business

known as the Owl Club Ale House. Defendants William J. Scheck and Nathaniel C. Scheck are

members of Katharsis L.L.C., which, in turn, owns the Owl Club Ale House located in Roseville,

California. 

Plaintiffs Odnil Music Limited and Fifty-Six Hope Road Music allege plaintiffs

own the copyrights to the four songs written by Bob Marley and that defendants did not have a

license from plaintiffs or from the American Society of Composers, Authors, and Publishers

(“ASCAP”) to cause those songs to be performed. Plaintiffs allege defendants William J. Scheck

and Nathaniel C. Scheck were and still are members of defendant Katharsis, L.L.C., with joint

responsibility for the control, management, operation and maintenance of the affairs of said

company. Plaintiffs allege the acts of infringement were done with the active assistance,

cooperation, acquiescence and procurement of the Scheck defendants, and that they derived

financial benefit therefrom. Plaintiffs seek statutory damages, injunctive relief, and attorneys’

fees.

I. Request for Default Judgment

The complaint in this matter was served upon defendant Katharsis, LLC on March

30, 2005. Pacific Atlantic Trading Co. v. M/V Main Express, 758 F.2d 1325, 1331 (9th Cir.

1985)(default judgment void without personal jurisdiction). Defendant Katharsis, LLC, has not

filed an answer. The clerk of the court entered default against this defendant on May 12, 2006. 

Notice of the entry of default as well as plaintiff's present motion for entry of default judgment

were served by mail on defendant at its last known address. Defendant Katharsis, LLC, filed no

opposition to the motion for entry of default judgment and entered no appearance at the hearing. 

2

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 The district court’s denial of summary judgment does not change this result. The 3

complaint stands and defendant Katharsis, L.L.C. has failed to appear. 

 Defendants Nathaniel Christopher Scheck and William Joseph Scheck filed an answer 4

on April 7, 2005. 

3

Entry of default effects an admission of all well-pleaded allegations of the

complaint by the defaulted party. Geddes v. United Financial Group, 559 F.2d 557 (9th Cir.

1977). Entry of default judgment is proper where, as in the present case, the facts established by

the default support the causes of action pled in the complaint. The complaint and the affidavits

filed in support of the motion for entry of default judgment also support the finding that plaintiff

is entitled to the relief requested in the prayer for default judgment, which does not differ in kind

from the relief requested in the complaint. Henry v. Sneiders, 490 F.2d 315, 317 (9th Cir.), cert.

denied, 419 U.S. 832 (1974). There are no policy considerations which preclude the entry of

default judgment of the type requested. See Eitel v. McCool, 782 F.2d 1470, 1471-1472 (9th Cir.

1986). 

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However, because other defendants have answered the complaint and are not in 4

default, the question arises as to whether the court has the discretion under Federal Rule of Civil

Procedure 54(b) to enter a default judgment against less than all the defendants.

Rule 54(b) states, in pertinent part: 

when multiple parties are involved, the court may direct the entry

of a final judgment as to one or more but fewer than all of the

claims or parties only upon an express determination that there is

no just reason for delay and upon an express direction for the entry

of judgment. In the absence of such determination and direction,

any order or other form of decision, however designated, which

adjudicates fewer than all the claims or the rights and liabilities of

fewer than all the parties shall not terminate the action as to any of

the claims or parties, and the order or other form of decision is

subject to revision at any time before the entry of judgment

adjudicating all the claims and the rights and liabilities of all the

parties.

Fed. R. Civ. P. 54(b). 

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 While it is appropriate for the court clerk to enter the default of whichever of the jointly

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liable defendants fails to defend, no judgment will be entered until the other defendants are

dismissed or the case comes to trial. If the other defendants prevail at trial, no judgment can be

entered against the defaulting defendant; if the other defendants lose at trial, the ultimate

judgment will be binding on all defendants. Bastien v. R. Rowland & Co., 631 F.Supp. 1554,

1561 (E.D. MO 1986); Pfanenstiel Architects, Inc. v. Chouteau Petroleum Co., 978 F2d at 433. 

 On the other hand, the court may find there is 'no just reason for delay' and order a 6

default judgment against a codefendant whose liability is joint and several (or exclusively

several). Farzetta v. Turner & Newall, Ltd., 797 F.2d 151, 154 (3rd Cir. 1986); In re Uranium

Antitrust Litig., 617 F.2d 1248, 1262 (7th Cir. 1980). Similarly, a default judgment may be

entered immediately where the defaulting party's liability is based on independent wrongful acts

or a legal theory distinct from the one asserted against the other defendants. Angelo Iafrate

Const., LLC v. Potashnick Const., Inc., 370 F.3d 715, 722 (8th Cir. 2004).

4

When a default has been entered, the factual allegations of the complaint together

with other competent evidence submitted must be taken as true. See TeleVideo Systems, Inc. v.

Heidenthal, 826 F.2d 915, 917 (9th Cir.1987); Danning v. Lavine, 572 F.2d 1386, 1388 (9th

Cir.1978). However, where less than all defendants have defaulted, the allegations are only true

as to those defaulting defendants.

A default judgment against one of several defendants while the action continues

against the others is ordinarily improper where their liability is joint rather than several. Frow v.

De La Vega, 82 U.S. 552, 554 (1872); In re First T.D. & Invest., Inc., 253 F.3d 520, 532 (9th Cir.

2001)(where complaint alleges defendants are jointly liable and one of them defaults, judgment

should not be entered against defaulting defendant until matter has been adjudicated as to all

defendants; if answering defendants prevail, action should be dismissed against both answering

and defaulting defendants). Otherwise, there might be one judgment upholding a charge of joint

tort liability and another judgment declaring it to be nonexistent. Pfanenstiel Architects, Inc. v.

Chouteau Petroleum Co., 978 F2d 430, 433 (8th Cir. 1992); Stafford v. Mesnik, 63 F.3d 1445,

1451 (7th Cir. 1995)(default improper if double recovery possible).5 6

Although evaluation of the case on the Eitel factors favor entering a default

judgment, supporting the theory that “there is no just reason for delay," the Supreme Court has

held that the court should not enter a default judgment against one or more defendants which is

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or may be inconsistent with judgment on the merits in favor of the answering defendants. Frow

v. De La Vega, 82 U.S. (15 Wall.) 552, 21 L.Ed. 60 (1872). Frow stands for the proposition that

"when one of several defendants who is alleged to be jointly liable defaults, judgment should not

be entered against that defendant until the matter has been adjudicated with regard to all

defendants, or all defendants have defaulted." 10A Charles Alan Wright, Arthur R. Miller &

Mary Kay Kane, Federal Practice and Procedure: Civil 3D § 2690 (2001). “Frow's applicability

turns not on labels such as ‘joint liability’ or ‘joint and several liability,’ but rather on the key

question of whether under the theory of the complaint, liability of all the defendants must be

uniform.” Shanghai Automation Instrument Co. v. Kuei, 194 F.Supp.2d 995, 1008 (9th Cir.

N.D. Cal. 2001). “The avoidance of logically inconsistent judgments in the same action and

factually meritless default judgments provide 'just reason' [for the delay within the meaning of

Fed. R. Civ. P. 54(b).] '” Phoenix Renovation Corp. v. Gulf Coast Software, Inc., 197 F.R.D.

580, 582 (E.D. Va. 2000).

The complaint herein alleges defendants are jointly liable. Because defendants

Nathaniel C. Scheck and Will J. Scheck are members of Katharsis L.L.C., which, in turn, owns

the Owl Club Ale House located in Roseville, California, and are scheduled to go to trial in this

case on July 18, 2006, the entry of default judgment should be deferred until after trial has been

completed.

II. Relief Requested

A. Injunctive Relief

Title 17 U.S.C. § 502(a) permits the court to grant final injunctions "to prevent

and restrain infringement of a copyright." The court in Broadcast Music, Inc. v. Niro's Palace,

Inc., 619 F.Supp. 958, 963 (N.D.Ill.1985), held:

A permanent injunction is especially appropriate where a threat of

continuing infringement exists . . . The threat of continuing

infringement is substantial in the present case. Niro's provided

unauthorized performances of copyrighted musical compositions

on its premises after receiving oral and written notices of

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 Although ASCAP is not a party hereto, courts have recognized that plaintiffs are 7

representative of all of ASCAP’s members. See Pedrosillo Music, Inc. v. Radio Musical, Inc.,

815 F.Supp 511, 516 (1993); Southern Nights Music Co. v. Moses, 669 F.Supp. 305 (C.D. Cal.

1987).

 The court may grant a permanent injunction to plaintiffs even though it enjoins a 8

defendant from infringing any of plaintiffs' copyrighted works, existing or created in the future,

including, but not limited to, those listed in Schedule A to the complaint. Sony Music Entm't,

Inc., 45 F.Supp.2d 1345, 1347-48 (S.D.Fla.1999); Princeton Univ. Press v. Michigan Document

Serv., Inc., 99 F.3d 1381, 1392-93 (6th Cir.1996) (holding the weight of authority supports the

extension of injunctive relief to future works).

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infringement and demands to stop such infringement from BMI.

This behavior indicates a willful disregard of copyrights held by

BMI and should be permanently enjoined.

Id.

In this case, plaintiffs have provided sufficient evidence that defendant has

continued to infringe the copyrights of certain musical compositions after repeated notice and

requests that it stop and defendant Katharsis, L.L.C. has failed to provide any evidence proving

non-infringement. Accordingly, defendant Katharsis, L.L.C. should be enjoined from performing

any ASCAP songs without prior authorization. 7 8

B. Statutory Damages.

Title 17 U.S.C. § 504(c)(1) states that a plaintiff may elect to receive an award of

statutory damages "in a sum of not less than $750 or more than $30,000" in lieu of an award of

the plaintiff's actual damages and the defendant's profits. In addition, "[i]n a case where the

copyright owner sustains the burden of proving . . . that infringement was committed willfully,

the court in its discretion may increase the award of statutory damages to a sum of not more than

$150,000." 17 U.S.C. § 504(c)(2).

Where a defendant has ignored or disregarded notices of the need for licensing,

willful infringement has been found. In International Korwin Corp. v. Kowalczyk, 855 F.2d 375,

380 (7th Cir.1988), the court upheld the district court's finding of willful infringement due to

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substantial evidence that the defendant repeatedly ignored notices of the infringement. The trial

court stated: 

In the present case, defendant violated the copyright laws despite

ASCAP's repeated efforts--by letter, telephone, and personal

visits--to license defendant's establishment. Defendant's initial

refusal may have come from ignorance of the intricacies of

copyright law. However, defendant certainly came to understand

his obligations under the law. Yet, his answer, time and time

again, was essentially--"Sue me. I am never going to join." Given

this cavalier attitude, the defendant's infringing conduct can only

be described as willful. 

International Korwin Corp. v. Kowalczyk, 665 F.Supp. 652, 659 (N.D.Ill.1987)($1,500.00 per

infringement); see also Chi-Boy Music v. Charlie Club, Inc., 930 F.2d 1224, 1227-28 (7th

Cir.1991) (approximately $3,100.00 per infringement).

The evidence presented by plaintiffs in this case indicates that defendant willfully

and intentionally violated plaintiffs' copyrights. Despite repeated attempts by plaintiffs to get

defendant to stop using the copyrighted materials or to take a license for their use, defendant

persisted in playing the musical compositions and ignoring plaintiffs' requests. Defendant

Katharsis L.L.C. has failed to present any evidence refuting this argument.

The court therefore finds an increase in statutory damages due to willful

infringement to be appropriate. Accordingly, plaintiffs' request that a statutory award in the

amount of $3,000.00 per infringement should be granted, for a total award of $12,000.00 in

statutory damages.

C. Attorneys' Fees and Costs.

Plaintiffs request that the court award $19,859.00 attorneys' fees and $889.45 in

costs as well as their investigative fees of $1,352.02 incurred in this action totaling $22,100.47,

which appear to be plaintiffs’ total fees and costs with regard to the entire action (to date), not

those attributable solely to the defaulting defendant. 

Title 17 U.S.C. § 505 provides that the court "in its discretion may allow the

recovery of full costs . . . [and] may also award a reasonable attorney's fee to the prevailing party

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as part of the costs." The United States Supreme Court confirmed this discretion: “Prevailing

plaintiffs and prevailing defendants are to be treated alike, but attorney’s fees are to be awarded

to prevailing parties only as a matter of the court’s discretion.” Fogerty v. Fantasy, Inc., 510 U.S.

517 (1994). While there is no exact formula for how courts should exercise their discretion to

grant attorney fees, courts must make their determinations based on equitable circumstances. Id.

at 527-533. 

In Fogerty, the Supreme Court noted that courts may consider awarding attorney's

fees upon review of such nonexclusive factors as “frivolousness, motivation, objective

unreasonableness (both in the factual and legal components of the case) and the need in particular

circumstances to advance considerations of compensation and deterrence.” Id., 510 U.S. at 535.

Courts may use these factors “so long as such factors are faithful to the purposes of the Copyright

Act and are applied to prevailing plaintiffs in an evenhanded manner.” Id. The purpose of the

Copyright Act “is not merely to discourage copyright infringement. Fantasy Inc., v. Fogerty, 94

F.3d 553, 558 (9th Cir.1996). “The policies served by the Copyright Act are more complex,

more measured, than simply maximizing the number of meritorious suits for copyright

infringement.” Id. at 559. 

The court finds that in light of these factors and defendant’s willful and

intentional infringement of the copyrights, an award of reasonable attorneys' fees and costs to

plaintiffs is appropriate. As the court in Broadcast Music, Inc., 619 F.Supp. at 963-64 (citations

omitted), stated: 

A plaintiff is entitled to recover costs and attorney's fees for willful

copyright infringement. . . . In the present case, an award of costs

and reasonable attorney's fees is justified because if Niro's had

heeded BMI's warnings either to enter a license agreement or to

stop playing copyrighted music, this litigation would have been

wholly unnecessary. In addition, Niro's repeatedly rebuffed offers

to resolve this dispute prior to the commencement of litigation. . . .

Thus, Niro's was not an innocent infringer, and costs and

reasonable attorney's fees are appropriate. 

Id. See also Chi-Boy Music v. Charlie Club, Inc., 930 F.2d 1224 (7th Cir. 1991)(ASCAP case

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where statutory damages of $40,000.00 and attorneys fees and costs of $48,633.37 awarded);

Rockford Map Publishers, Inc. v. Directory Service Co., 768 Fl2d 145, 150 (7th Cir. 1985)

(statutory damages of $250 and over $20,000 in attorneys fees); Rilting Music, Inc. v. Speakeasy

Enterprises, Inc., 706 F.Supp. 550, 558 (S.D.Ohio1988) (awarded $3,000.00 in attorneys’ fees);

Hulex Music v. Santy, 698 F.Supp.1024, 1032 (D.N.H.1988)(awarded $7,612.50 in attorneys’

fees). 

Plaintiffs seek attorneys fees in the amount of $19,859.00. The affidavit provided

by counsel as to attorneys fees is detailed and supported, with the exception of two entries billed

without explanation:

March 28, 2006 1.20 hours at 235.00 per hour = $235.00

March 29, 2006 .5 hour at 235.00 per hour = 117.50

$352.50

Thus, the sum of $352.50 will be deducted from the total $19,958.00 sought. The balance of

$19,605.50 in attorneys fees is reasonable and should be awarded plaintiffs.

Title 17 U.S.C. § 505 allows the court in its discretion to award full costs. This

court finds litigation expenses in the amount of $889.45 and investigation expenses in the

amount of $1,352.02 were necessarily incurred in the prosecution of this action, and should be

awarded in the total amount of $2,241.47.

However, liability for attorneys’ fees and costs is also joint and several among

defendants. See Childress v. Taylor, 835 F.Supp. 739 (S.D. N.Y. 1993). In the instant action,

appearing defendants William and Nathaniel Scheck own Katharsis, L.L.C., and may also be

found jointly liable for the attorneys’ fees incurred in defending this action. Conversely, should

appearing defendants prevail at trial, no award of attorneys’ fees should be issued against either

appearing defendants or defaulting Katharsis, L.L.C. Thus, this court recommends deferring its

order awarding attorneys’ fees pending resolution of trial in the instant matter.

Accordingly, IT IS HEREBY RECOMMENDED that plaintiff's May 18, 2006

motion for entry of default judgment be GRANTED. A proposed judgment was filed by plaintiff

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 The proposed judgment has been edited to reflect the changes in the attorneys fee 9

amount as well as to reflect review by the district court, and the revised proposed judgment will

be forwarded to the district court following issuance of these findings and recommendations.

10

on June 1, 2006 (docket no. 61) and is approved as to form and substance, except for the $352.50 

reduction in attorneys fees as noted above.

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In view of the foregoing findings, IT IS HEREBY RECOMMENDED that:

1. Plaintiffs’ May 18, 2006 motion for entry of default judgment be granted;

2. Defendant Katharsis, L.L.C., and any persons acting by or on behalf of

defendant, be enjoined from performing publicly, or causing or permitting to be performed

publicly, any copyrighted musical compositions owned by any of the plaintiffs, and any other

copyrighted musical compositions in the repertory of the American Society of Composers,

Authors and Publishers (“ASCAP”) at any establishment owned, controlled, operated or

managed by defendant, without permission obtained directly from the copyright owners of such

compositions in advance of such performances, or license from ASCAP.

3. Plaintiffs be granted $12,000.00 in statutory damages, $2,241.47 in

investigative fees and costs, $19,605.50 in attorneys fees, for a total judgment in the amount of

$33,846.97.

4. Entry of default judgment be deferred pending resolution of trial. 

These findings and recommendations are submitted to the United States District

Judge assigned to the case, pursuant to the provisions of 28 U.S.C. § 636(b)(l). Within ten days

after being served with these findings and recommendations, any party may file written

objections with the court and serve a copy on all parties. Such a document should be captioned

“Objections to Magistrate Judge's Findings and Recommendations.” The parties are advised that

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failure to file objections within the specified time may waive the right to appeal the District

Court's order. Martinez v. Ylst, 951 F.2d 1153 (9th Cir. 1991).

DATED: June 12, 2006.

001;odnil.def

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