Opinion ID: 764700
Heading Depth: 4
Heading Rank: 2

Heading: The single sum approach

Text: 36 The question before us is whether the district court erred in holding that the $10,000 statutory award available under 18 U.S.C. § 2520(c)(2)(B) may be multiplied by each violation of the statute. Our research has revealed that the only appellate case directly addressing the issue of the proper calculation of damages under § 2520(c)(2) is Jacobson v. Rose, 592 F.2d 515 (9th Cir.1978). Jacobson analyzed Congress's intent and held that the liquidated damage award (then $1,000) under § 2520(c)(2) should be imposed against all defendants jointly, not against each defendant individually. See id. at 520-21. Because we have concluded that Della Absher has no liability under the facts of this case, and because Jacobson did not deal with multiple violations (as opposed to multiple defendants), the holding in Jacobson provides no guidance on the damage issue before us. 37 Although there are a few other circuit court cases that appear on the surface to allow the $10,000 figure to be used as a multiplier, close analysis reveals that the question was either not an issue on appeal (see, e.g., Deal v. Spears, 980 F.2d 1153, 1156 n. 5 (8th Cir.1992)), or that the case was decided on other grounds by the court (see, e.g., Rodgers v. Wood, 910 F.2d 444, 446 (7th Cir.1990)). Two district court opinions have squarely ruled on the issue, however, and both have concluded that the $10,000 figure may be used as a multiplier for repeated violations of the statute. See Romano v. Terdik, 939 F.Supp. 144, 150 (D.Conn.1996) (holding that $10,000 may be awarded for interception and $10,000 for disclosure, but awarding only $10,000 because there was no disclosure); Menda Biton v. Menda, 812 F.Supp. 283, 285 (D.P.R.1993) (awarding $10,000 for illegally recording a conversation, and $10,000 more for its disclosure). But these district court cases present neither significant discussion nor persuasive reasoning in support of their holdings. Instead, they rely exclusively on four appellate cases, including the Seventh and Eight Circuit cases cited above, none of which directly addresses the issue of § 2520(c)(2)'s proper interpretation. 38 We also note that this circuit's only previous case interpreting the wiretapping statute has no bearing on the issue before us. In Fultz v. Gilliam, 942 F.2d 396 (6th Cir.1991), this court held that each time a wiretap communication is disclosed, the clock is reset for the purposes of the statute of limitations. Fultz stated that [t]he text of the Wiretapping Act plainly indicates, and its purpose necessitates, that a new and discrete cause of action accrue[s] ... each time the statute is violated. Id. at 402. In contrast, the issue in the present case is not when a particular cause of action accrues, but the amount of damages that may be imposed if the plaintiff prevails. Because Fultz was remanded for further proceedings on the merits, the court never reached the issue of whether the $10,000 statutory damage award was to apply to each violation. 39 We therefore find ourselves without persuasive precedent to aid in our interpretation of the statute. As a result, we begin with the plain language of the statute itself. The only statutory authorization for damages per violation is the $100 a day for each day of violation. See 18 U.S.C. § 2520(c)(2)(B). The $10,000, in contrast, stands alone, and is not accompanied by any language authorizing multiplication per violation. See id. Congress knows how to specify an award that is to be multiplied on the basis of the frequency of the violation, because it did so by providing for damages of $100 per day for each day of violation. Thus, if a violation continues for several days because the defendant keeps using or disclosing an illegally intercepted communication, the plaintiff's damages will increase by that amount per day. The $10,000, on the other hand, is a measure of liquidated damages when neither the actual harm nor the per diem calculation exceeds this fixed sum. We thus conclude that the $10,000 is designed to compensate a plaintiff for all of the transgressor's misdeeds under the wiretapping statute arising out of a closely related course of conduct that takes place over a relatively short period of time. 40 Congress could quite reasonably have determined that a $10,000 liquidated damage award to the plaintiff is sufficiently sizable to deter violators of the wiretapping statute, especially in light of the fact that punitive damages are available under subsection (b) of the statute to punish egregious offenders. See 18 U.S.C. § 2520(b)(2). Because Congress provided no legislative history when § 2520 was amended, its intent must be inferred from the language of the statute itself. We believe that the $10,000 single sum approach is the most reasonable inference based on the language and structure of subsection (c). 41 The district court's $10,000 per violation approach, on the other hand, appears to misinterpret the statutory scheme and leads to highly inflated damage awards. If every detailed violation resulted in a $10,000 award to each plaintiff, the total would bankrupt most transgressors. For example, if a one-time illegal wiretap were to intercept a conference call between 20 parties, and the recording was then played on two different occasions, the district court's approach would require a $600,000 damage award (one award for intercepting the communication and two for disclosing it, multiplied by 20 plaintiffs). 42 In the present case, we are satisfied that the recordings, disclosures, and use of the illegally intercepted communications are sufficiently interrelated and time-compacted so as to not invoke multiple applications of the $10,000 statutory award. We need not decide whether violations of the statute widely separated by time, place, or people would lead to a different result, because that question is not currently before us. Instead, we will leave such variations for future cases to decide. 43