on the allegations or denials in the pleadings, but, “by affidavits or as otherwise
provided for in (Rule 56], must set forth specific facts showing that there is a
genuine issue for trial.” Fed. R. Civ. P. 56(e). A “genuine issue” in the context of a
motion for summary judgment is not simply a “metaphysical doubt as to the material
facts.” Matsushita Elec. Indus. Co., Ltd. v. Zenith Radio Corp, 475 U.S. 574, 586
(1986). Rather, a genuine issue of material fact exists when "the evidence is such
that a reasonable jury could return a verdict for the nonmoving party." Anderson v.
Liberty Lobby, Inc., 477 U.S. 242, 248 (1986); Insolia v. Philip Morris, Inc., 216
F.3d 596, 599 (7th Cir. 2000). The court must consider the record as a whole, in a
light most favorable to the non-moving party, and draw all reasonable inferences that
favor the non-moving party. Anderson, 477 U.S, at 255; Bay v. Cassens Transport

Co,, 212 F.3d 969, 972 (7th Cir. 2000).

DISCUSSION

J. Summary Judgment Motion

Panganiban has moved for summary judgment on all counts. He contends that
he purchased the “Vector Super Uniooper with SU2 Code” in order to create a
security system for computers at his workplace. According to Panganiban, when he

received the device there were no instructions included or any type of software that


note that DIRECTV is already seeking to recover from Panganiban under 18 U.S.C.
§ 2511 in Count II of its complaint. Therefore, we grant the motion to dismiss

Count II] against Panganiban.

IIL. Conversion Claim (Count V)

Panganiban also seeks the dismissal of Count V which alleges a claim for

conversion. Panganiban argues that the conversion claim cannot be based upon his
alleged use of satellite signals because such signals are not a tangible object.
Panganiban cites to Liberty Mut. Ins. Co. v. Construction Mgmt Servs., Inc., which
states that “[g]enerally, a conversion action lies only for ‘personal property which is
tangible, or at least represented by or connected with something tangible.”” 2001
WL 1159203, at *5 (N.D. Ill. 2001)(quoting Jn re Thebus, 483 N.E.2d 1258, 1260
(Ill. 1985)).

To state a conversion claim in Illinois a plaintiff must allege that “(1) it has a
right to the property at issue; (2) it has an absolute and unconditional right to the
immediate possession of that property; (3) it made a demand on the defendant for
possession of the property; and (4) the defendant wrongfully and without
authorization assumed control, dominion, or ownership over the property.”
Castillo, 2004 WL 783066 at *2 (citing Cirrincione v. Johnson, 703 N.E.2d 67, 70

(11.1998)). The Supreme Court of Illinois has defined conversion as “any


for go to the heart of this case and therefore, in the interest of judicial efficiency, at
this point the proper course is for the parties to conduct full discovery. If, after
discovery, a party believes that the evidence is overwhelmingly in their favor or that
the other side lacks evidence to support its contentions and that no reasonable trier of
fact could find for the other side, then the party may move for summary judgment at

that point. Therefore, we deny the motion for summary judgment without prejudice.

I. Violation of 18 U.S.C. § 2512 (Count IIT)

In Count Ill of the complaint DIRECTV alleges a violation of 18 U.S.C. §
2512 of the Electronic Communications Privacy Act which states in part as follows:

(1) Except as otherwise specifically provided in this chapter, any person who
intentionally—

(a) sends through the mail, or sends or carries in interstate or foreign
commerce, any electronic, mechanical, or other device, knowing or having
reason to know that the design of such device renders it primarily useful for
the purpose of the surreptitious interception of wire, oral, or electronic
communications;

(b) manufactures, assembles, possesses, or sells any electronic, mechanical,
or other device, knowing or having reason to know that the design of such
device renders it primarily useful for the purpose of the surreptitious
interception of wire, oral, or electronic communications, and that such device
or any component thereof has been or will be sent through the mail or
transported in interstate or foreign commerce; or

(c) places in any newspaper, magazine, handbill, or other publication or
disseminates by electronic means any advertisement of--

(i) any electronic, mechanical, or other device knowing the content of the



explained how the device worked. Panganiban claims that he never connected the
device to a DIRECTV system and never used the device to intercept DIRECTV
satellite signals. Panganiban has attached an affidavit to his motion for summary
judgment attesting to these facts. DIRECTV states that in order for it to adequately
respond to the motion for summary judgment it needs to be allowed to conduct
discovery in this case and in particular that it needs to take the deposition of
Panganiban. We agree. DIRECTV does claim that it has evidence regarding
Panganiban’s membership in various pirating websites. DIRECTV also correctly
points out that Panganiban’s affidavit is silent regarding some of the unlawful
activity alleged in the complaint. However, we need not address such allegations at
this juncture. The purpose of a summary judgment review is to determine if there is
sufficient evidence that a reasonable trier of fact could find in the non-movant’s
favor. A summary judgment review should not be based solely on allegations and
speculation.

After reviewing the summary judgment briefs, we have concluded that this
summary judgment motion is premature. Therefore, we shall allow the parties fo
conduct discovery. It would not make sense to allow only limited discovery and
then conduct another summary judgment review only to discover that the parties

need some additional discovery. The disputed issues that DIRECTV seeks discovery


plain language of § 2520 that the scope of the civil action is more limited than a
violation of the entire chapter. It specifically states that § 2520 is limited to a
communication that is “intercepted, disclosed, or intentionally used in violation of
this chapter” 18 U.S.C. § 2520. Congress expressly created a private cause of
action in § 2520 and it is not appropriate to infer a broader cause of action than is
stated without a clear indication of Congressional intent to support such an
inference. Hinton, 2004 WL 856555 at *3. It is also clear from 18 U.S.C. § 2511
that Congress did not intend the interpretation of 18 U.S.C.A. § 2520 proposed by
DIRECTV because 18 U.S.C. § 2511 provides the same protection that DIRECTV
seeks to create from its overly broad interpretation of 18 U.S.C.A. § 2520.
DIRECTV has in fact filed a claim based upon 18 U.S.C. § 2511 against
Panganiban for intercepting DIRECTV signals. Under 18 U.S.C. § 2511, which is
entitled “§ 2511. Interception and disclosure of wire, oral, or electronic
communications prohibited” an individual violates the act if he “intentionally
intercepts, endeavors to intercept, or procures any other person to intercept or
endeavor to intercept, any wire, oral, or electronic communication . . . for}
intentionally uses, endeavors to use, or procures any other person to use or endeavor
to use any electronic, mechanical, or other device to intercept any oral
communication ....” 18 U.S.C. § 2511. This would go hand in hand with § 2520's
authorization of a civil action for communications that are “intercepted, disclosed,

or intentionally used in violation of this chapter.” 18 U.S.C.A. § 2520. We also


Minute Order Form (06/97)

United States District Court, Northern District of Illinois

Name of Assigned Jud _ i T sitting suage i oth
ope Magistrate Judge | __ S27uel Der-Yeghiayan ‘than Assigned Judge
CASE NUMBER 03 C 3492 DATE 5/26/2004
CASE Directv vs. Massey
TITLE
[ln the following box (a) indicate the party filing the motion, e.g., plaintiff, defendant, 3rd party plaintiff, and (b) state briefly thenature

MOTION: of the motion being presented.]

DOCKET ENTRY:

(1) og Filed motion of [ use listing in “Motion” box above,]

(2) ia) Brief in support of motion due

(3) a Answer brief to motion due. . Reply to answer brief due. :

(4) oO Ruling/Hearing on set for at

(5) ao Status hearing[held/continued to] [set for/re-set for] on set for at

(6) im Pretrial conference[held/continued to] (set for/re-set for] on set for at :

(7) ia Trial{set for/re-set for] on at

~) oO [Bench/Jury trial] [Hearing] held/continued to at

(9) Oo This case is dismissed [with/without] prejudice and without costs[by/agreement/pursuant to]

COFRCP4(m) Local Rule 41.1 CFRCP41(a)(1) CO FRCP41(a)(2).

ao) {Other docket entry] Status hearing held and continued to 08/19/04 at 9:00 a.m. Plaintiff’s oral
motion to dismiss as party defendants Darren, Meeks and Minnick with leave to move for reinstatement
within 30 days is granted. Defendant’s Panganiban’s motion for summary judgment is denied without
prejudice. Defendant Panganiban’s motion to dismiss Count II] and V are granted. Discovery is authorized
for the remaining claims against defendant Panganiban only and ail discovery must be completed by
08/16/04. Dispositive motions are to be filed by 08/31/04. Responses to the dispositive motions, if any,
are to be filed by 09/15/04 and replies, if any, are to be filed by 09/22/04. Counsel for the plaintiff and
defendant McGill are directed to meet and confer to try and resolve this matter. Enter Memorandum
Opinion.

ai) [For further detail see order attached to the original minute order.]

No notices required, advised in open court.

s required,
No notices require ‘number of notices

MAY 27 2004

Notices mailed by judge's staff.

Notified counse! by telephone.

wv | Docketing to mail notices.

Mail AO 450 form.

Copy to judge/magistrate judge.

courtroom
deputy’s
initials

MW6

Date/time received in
central Clerk's Office

trailing deputy initials



Therefore, we grant the motion to dismiss Count V against Panganiban.

CONCLUSION
Based on the foregoing analysis, we deny Panganiban’s motion for summary
judgment without prejudice. We grant the motion to dismiss Count III against
Panganiban and grant the motion to dismiss Count V against Panganiban.
Discovery is authorized for the remaining claims against Panganiban only and all
discovery must be completed by August 16, 2004. Dispositive motions are due

August 31, 2004. Answers are due September 15, 2004. Replies are due September

22, 2004. Next status hearing is set for August 19, 2004.

Samuel Der-Yeghiayan
United States District Court Judge

Dated: May 26, 2004

i


unauthorized act, which deprives a man of his property permanently or for an
indefinite time” and has stated that the “essence of conversion is the wrongful
deprivation of one who has a right to the immediate possession of the object
unlawfully held." In re Thebus, 483 N.E.2d at 1260(quoting Union Stock Yard &
Transit Co. v. Mallory, Son & Zimmerman Co, 41 N.E. 888 (Ill. 1985) and Jensen v.
Chicago & Western Indiana R.R. Co, 419 N.E.2d 578 (Ill. App. 1981)). The
Supreme Court of Illinois also has stated that traditionally conversion is defined as
“an intentional exercise of dominion or control over a chattel which so seriously
interferes with the right of another to control it that the actor may justly be required

to pay the other the full value of the chattel." Id.

We do not need to decide whether the intangible nature of satellite signals
makes conversion an improper claim in this action because DIRECTV has failed to
establish that it was in any way denied the use of or control over the signals. The
satellite signals are broadcast into the open air and there are no allegations that
Panganiban exercised such dominion and control over the signals as to deprive
DIRECTV, the rightful owner of the signals, the use of them. See Hinton, 2004 WL
856555 at *3-*4 (dismissing conversion claim); Frey, 2004 WL 813539 at *4
(dismissing conversion claim); Castillo, 2004 WL 783066 at *2 (dismissing
conversion claim). DIRECTV has not alleged that any of the signals sent to its
paying customers were disrupted as a result of Panganiban’s interception or that

DIRECTV was somehow unable to enjoy the benefit of those signals sent out.

10


advertisement and knowing or having reason to know that the design of such
device renders it primarily useful for the purpose of the surreptitious
interception of wire, oral, or electronic communications; or

(ii) any other electronic, mechanical, or other device, where such
advertisement promotes the use of such device for the purpose of the
surreptitious interception of wire, oral, or electronic communications,
knowing the content of the advertisement and knowing or having reason to
know that such advertisement will be sent through the mail or transported in
interstate or foreign commerce,

shall be fined under this title or imprisoned not more than five years, or both.

18 U.S.C. § 2512. While 18 U.S.C. § 2512 is criminal in nature, 18 U.S.C. § 2520
provides the following thus allowing for a civil claim:

(a) In general.--Except as provided in section 2511(2)(a)(ii), any person
whose wire, oral, or electronic communication is intercepted, disclosed, or
intentionally used in violation of this chapter may in a civil action recover
from the person or entity, other than the United States, which engaged in that
violation such relief as may be appropriate.

18 U.S.C, § 2520. Panganiban claims that 18 U.S.C. § 2520 does not provide for a

private civil cause of action under 18 U.S.C. § 2512.

We agree with the reasoning in regards to this precise issue set out in
DIRECTY, Inc. v. Hinton, 2004 WL 856555, at *2-*3 (N.D. Ill. 2004)(J. Darrah),
DIRECTY, Inc. y. Frey, 2004 WL 813539, at *1-*4 (N.D. Ill. 2004)(J. Zagel), and
DIRECTV, Inc. v Castillo, 2004 WL 783066, at *1 (N.D. Ill. 2004). St. Eve).
DIRECTV argues that § 2520 creates a civil cause of action for all violations of the

chapter, focusing on the word “chapter” in § 2520. However, it is clear from the



allege the “operative facts” upon which each claim is based. Kyle v. Morton High
School, 144 F.3d 448, 454-55 (7th Cir. 1998);Lucien v. Preiner, 967 F.2d 1166,
1168 (7th Cir. 1992). The plaintiff need not allege all of the facts involved in the
claim and can plead conclusions. Higgs v. Carter, 286 F.3d 437, 439 (7th Cir.
2002); Kyle, 144 F.3d at 455. However, any conclusions pled must “provide the
defendant with at least minimal notice of the claim,”/d., and the plaintiff cannot
satisfy federal pleading requirements merely “by attaching bare legal conclusions to
narrated facts which fail to outline the bases of [his] claim.” Perkins, 939 F.2d at
466-67.

Summary judgment is appropriate when the record reveals that there is no
genuine issue as to any material fact and the moving party is entitled to judgment as
a matter of law. Fed. R. Civ. P. 56(c). In seeking a grant of summary judgment the
moving party must identify “those portions of ‘the pleadings, depositions, answers to
interrogatories, and admissions on file, together with the affidavits, if any,’ which it
believes demonstrate the absence of a genuine issue of material fact.” Celotex Corp.
v. Catrett, 477 U.S. 317, 323 (1986) (quoting Fed. R. Civ. P. 56(c)). This initial
burden may be satisfied by presenting specific evidence on a particular issue or by
pointing out “an absence of evidence to support the non-moving party’s case.”/d. at

325. Once the movant has met this burden, the non-moving party cannot simply rest


Panganiban claims that he purchased the device known as the “Vector Super
Unlooper with SU2 Code” in order to create a security system for computers at his
place of employment. DIRECTV has brought a five count complaint and
Panganiban has moved to dismiss Count III which is a claim alleging a violation of
18 U.S.C. § 2512. Panganiban has also moved to dismiss Count V which is a state
conversion claim. Panganiban also moved for summary judgment despite the fact
that the parties have not yet been given an opportunity to exchange formal

discovery.

LEGAL STANDARD

In ruling on a motion to dismiss, the court must draw all reasonable inferences
that favor the plaintiff, construe the allegations of the complaint in the light most
favorable to the plaintiff, and accept as true all well-pleaded facts and allegations in
the complaint. Thompson v. Illinois Dep’t of Prof’'l Regulation 300 F.3d 750, 753
(7th Cir. 2002); Perkins v. Silverstein, 939 F.2d 463, 466 (7th Cir. 1991). The
allegations of a complaint should not be dismissed for a failure to state a claim
“unless it appears beyond doubt that the plaintiff can prove no set of facts in support
of his claim which would entitle him to relief.” Conley v. Gibson, 355 U.S. 41, 45-

46 (1957). Nonetheless, in order to withstand a motion to dismiss, a complaint must


IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ILLINOIS

EASTERN DIVISION
DIRECTV, Inc. ate ae ot
Plaintiff, ) yan BE
)
v. ) No. 03 C3492
)
Sheldon Massey, Kenneth McGill, )
Darren Meeks, Norman Miller, )
Robert Minnick, and )
Aaron Panganiban )
)
Defendants. )
MEMORANDUM OPINION

SAMUEL DER-YEGHIAYAN, District Judge

This matter is before the court on Defendant Aaron Panganiban’s
(“Panganiban”) motion for summary judgment and motion to dismiss Counts III and
V. For the reasons stated below, we deny the motion for summary judgment and

grant the motion to dismiss Counts III and V.

BACKGROUND
Plaintiff DIRECTV, Inc. (“DIRECTV”) alleges that Panganiban purchased a

pirating device that he used to unlawfully intercept DIRECTV satellite signals.

1

a