Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-azd-4_12-cv-00548/USCOURTS-azd-4_12-cv-00548-0/pdf.json

Nature of Suit Code: 490
Nature of Suit: Cable/ Satellite TV
Cause of Action: 47:0605 Communications Act of 1934

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IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF ARIZONA

J & J Sports Productions, Inc., 

Plaintiff, 

v.

Etelberto Gonzalez Vega and Carmen

Barbuzon Vega, individually and d//b/a

Mariscos 7 Mares Restaurant & Bar a/k/a

M7M Mariscos 7 Mares, 

Defendants. 

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No. CV-12-00548-TUC-RCC (HCE)

REPORT AND RECOMMENDATION

At issue is Plaintiff’s Notice of Application and Application for Default Judgment by

the Court (“Pl.’s Application”) (Doc. 16). Plaintiff has supported the Application with a

Memorandum of Points and Authorities (“Pl.’s Mem.”) (Doc. 16-1). This matter has been

referred to the Magistrate Judge for a Report and Recommendation. (Doc. 9). 

I. Background

Plaintiff J & J Sports Productions, Inc., a California corporation, was granted the

exclusive nationwide commercial distribution (closed-circuit) rights to “Fight of the Year:

The Rematch!”: Juan Manuel Marquez v. Juan Diaz,Championship Fight Program, that was

telecast on July 31, 2010 (“Program”). (Doc. 1, Compl. ¶¶ 6, 18). Plaintiff’s exclusive

distribution rights included all under-card bouts and fight commentary encompassed in the

television broadcast of the Program. (Id. ¶ 18). Plaintiff entered into sublicensing agreements

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with various entitiesin North America, including within the State of Arizona, affording them

rights to publicly exhibit the Program at their commercial establishments, such as hotels,

casinos, bars, taverns, restaurants, social clubs, etc. (Id. ¶ 19). Although not authorized

pursuant to any agreement with Plaintiff, Defendants, through the direct or indirect actions

of their employees or agents, intercepted and displayed the Program during its broadcast at

their establishment, the Mariscos 7 Mares Restaurant & Bar, in Nogales, Arizona. (Id. ¶¶ 21-

22; Doc. 16-3, Affiant Decl.). Plaintiff’s Affiant investigator reported that the Mariscos 7

Mares Restaurant & Bar has the capacity for 130 patrons and that between 52 and 63 patrons

were present at the time of the broadcast. (Affiant Decl.). 

Plaintiff has asserted claims based on a violation of the Federal Communications Act

of 1934, as amended, 47 U.S.C. § 605 (Count I), a violation of the Cable & Television

Consumer Protection and Competition Act of 1992, as amended, 47 U.S.C. § 553 (Count II),

and for conversion under Arizona law (Count III). (Compl. ¶¶ 1, 17-34). Plaintiff’s

Complaint seeks $110,000 in statutory damages as to Count I, $60,000 in damages as to Count

II, compensatory and punitive damages in unspecified amounts as to Count III, attorneys’ fees

and costs. (Compl. at pp. 8-9).

Plaintiff filed the Complaint on July 23, 2012. (Doc. 1). Defendants were served with

the summons and complaint on August 29, 2012. (Doc. 11-12). Defendants have not filed

an Answer or otherwise responded to the Complaint and the time for doing so has expired.

A Clerk’s Entry of Default was entered on November 19, 2012. (Doc. 14). Plaintiff filed the

Application for Default Judgment on June 28, 2013. (Doc. 16). Defendants have not filed

a response. Jurisdiction is based on federal question and supplemental jurisdiction. 28 U.S.C.

§§ 1331, 1367. (Compl. ¶ 2). 

II. Discussion

The court in its discretion may grant default judgment against a party after the clerk

has entered default. Rule 55(b)(2), Federal Rules of Civil Procedure. See Aldabe v. Aldabe,

616 F.2d 1089, 1092 (9th Cir. 1980). The well-pleaded factual allegations of the complaint

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1

 Plaintiff states that because Defendants defaulted, it cannot isolate Defendants’

precise method of interception, such as signal transmission. (Pl.’s Mem. at 3). 

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are taken as true except those relating to the amount of damages. DIRECTV, Inc. v. Hoa

Huynh, 503 F.3d 847, 851 (9th Cir. 2007).

Plaintiff seeks liability and damages based on its § 605 and conversion claims only.

(Pl.’s Mem. at 3).1

 Plaintiff’s Application is supported by sworn Declarations of the amount

due. (Doc. 16-4, Riley Supplemental Decl.; Doc. 17, Gagliardi Aff.). Plaintiff asserts that

Defendants are repeat offenders and has requested $110,000 in enhanced statutory damages

based on its § 605 claim and $1,600 in damages based on the conversion claim. (Doc. 16-4,

Riley Supplemental Decl. ¶¶ 4-7 & Ex. 1, Joe Hand Promotions Inc. v. Etelberto Gonzalez

Vega individually and d/b/a Mariscos 7 Mares a/k/a M7M Mariscos 7 Mares et al., No. 4:12-

cv-00447-TUC-RCC (docket sheet) (“Joe Hand Promotions”)).

 To establish a § 605 violation, the plaintiff must show that the defendant (1)

intercepted and (2) “divulged or published . . . a communication transmitted by” plaintiff.

Nat’l Subscription Television v. S & H TV, 644 F.2d 820, 826 (9th Cir. 1981). The aggrieved

party may be awarded statutory damages for each violation in a sum not less than $1,000 or

more than $10,000, “as the court considers just.” 47 U.S.C. § 605(e)(3)(C)(i)(II). The award

of actual or statutory damages may be increased by an amount of not more than $100,000 for

each violation if the violation “was committed willfully and for purposes of direct or indirect

commercial advantage or private financial gain.” 47 U.S.C. § 605(e)(3)(C)(ii). To prevail on

a conversion claim, the plaintiff must demonstrate “an act of wrongful dominion or control

over personal property in denial of or inconsistent with the rights of another.” Dayka &

Hackett, LLC v. Del Monte Fresh Produce N.A., Inc., 269 P.3d 709, 715 (Ariz. App. 2012).

Defendants have defaulted and therefore have admitted that they published the

Program to their customers and that they acted “willfully and for purposes of direct and/or

indirect commercial advantage and/or private financial gain.” (Compl. ¶ 22). The Court has

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considered the Affidavit provided by Plaintiff’s President Joseph M. Gagliardi who states that

the company noticed an erosion in sales and retained auditors and investigators at

considerable expense to detect and identify signal pirates. (Doc. 17, Gagliardi Aff. ¶¶ 4-6).

In requesting an award of the maximum statutory amount, Affiant Gagliardi has asked the

Court to note that signal pirates do not generally advertise that they intend to exhibit

Plaintiff’s programming and that it is unlikely that a pirate establishment would increase the

costs of food or drink or charge a cover or door charge regarding the programming. (Id. ¶¶ 15-

17). 

The circumstances show that Defendants displayed the Program on three television sets

to between 52 and 63 patrons. (Affiant Decl.). The record does not contain any information

regarding the financial gain to Defendants. There has been no determination of Defendants’

liability in the Joe Hand Promotions case as would indicate that Defendants are repeat

offenders. The Magistrate Judge recommends a maximum award of $10,000 for the violation

under § 605(e)(3)(C)(i)(II). The maximum enhancement of $100,000 is not warranted under

the circumstances. However, an additional $1,000 enhancement under § 605(e)(3)(C)(ii) is

appropriate. The total damages award of $11,000 under § 605 will serve as a sufficient

deterrent against future violations.

Plaintiff has demonstrated that the Program could have been purchased for $1,600 by

an establishment with 101 to 200 in minimum seating. (Doc. 17, Gagliardi Aff. ¶ 8, Ex. 1).

The Magistrate Judge therefore recommends an award of $1,600 to Plaintiff on its conversion

claim.

Plaintiff additionally seeks recovery of its attorneys’ fees and costs as authorized under

47 U.S.C. § 605. (Pl.’s Application ¶ 6; Pl.’s Mem. at 14). Plaintiff’s request for costs and

fees may be filed as allowed under appropriate authority.

III. Recommendation

It is recommended that Plaintiff’s Application for Default Judgment by the Court (Doc.

16) should be granted. It is further recommended that Plaintiff should be awarded $10,000

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pursuant to 47 U.S.C. § 605(e)(3)(C)(i)(II), $1,000 pursuant to 47 U.S.C. § 605(e)(3)(C)(ii),

and $1,600 for conversion. Plaintiff’s request for costs and fees may be filed as allowed under

appropriate authority. 

Pursuant to 28 U.S.C. § 636(b) and Rule 72(b)(2) of the Federal Rules of Civil

Procedure, any party may serve and file written objections within fourteen (14) days after

being served with a copy of this Report and Recommendation. See also LRCiv 7.2(e) (setting

forth page limit for objections). A party may respond to another party’s objections within

fourteen (14) days after being served with a copy. Fed.R.Civ.P. 72(b)(2). 

Failure to file timely objections to any factual or legal determination of the Magistrate

Judge may be deemed a waiver of the party’s right to de novo review of the issues. See

United States v. Reyna-Tapia, 328 F.3d 1114, 1121 (9th Cir.) (en banc), cert. denied, 540

U.S. 900 (2003). 

DATED this 5th day of November, 2013.

 

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