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King Vision Pay-Per-View, Ltd. v. Lavorico

March 5, 2010

KING VISION PAY-PER-VIEW, LTD., PLAINTIFF,
v.
ALEX JOHN LAVORICO, ET AL., DEFENDANTS.



ORDER AND FINDINGS & RECOMMENDATIONS

This matter came before the court on July 17, 2009, for hearing of plaintiff's motion for default judgment against defendants Ted Villanueva, individually and doing business as Club Coyote, and Club Coyote, LLC.*fn1 (Doc. No. 18). Thomas P. Riley, Esq. appeared telephonically on behalf of plaintiff. No appearance was made by or for the defendants.

Upon hearing argument, the court took plaintiff's motion under submission. For the reasons set forth below, the undersigned recommends that the motion be granted and that default judgment be entered against the defaulted defendants.

BACKGROUND

Plaintiff King Vision Pay-Per-View, Ltd. is an international distributor of sports and entertainment programming. Defendants Ted Villanueva and Club Coyote, LLC operate a food-and-drink establishment called "Club Coyote" in Woodland, California. By contract, plaintiff paid for and was granted exclusive nationwide television distribution rights to the "Felix 'Tito' Trinidad v. Ronald 'Winky' Wright Championship Fight Program," which was telecast nationwide on Saturday, May 14, 2005, via closed-circuit television. Defendants intercepted and exhibited the program in Club Coyote without plaintiff's authorization.

Although service of process was effected on defendants Villanueva and Club Coyote, LLC, each of these defendants failed to appear in this action. On April 8, 2009, plaintiff requested entry of default as to defendant Ted Villanueva, individually and doing business as Club Coyote, and defendant Club Coyote, LLC. (Doc. No. 16.) The Clerk entered default against both defendants on April 9, 2009. (Doc. No. 17.) On June 4, 2009, plaintiff filed its notice of motion and motion for default judgment with a proof of service reflecting service of the motion on the defaulted defendants.

LEGAL STANDARDS

Federal Rule of Civil Procedure 55(b)(2) governs applications to the court for entry of default judgment. Upon entry of default, the complaint's factual allegations regarding liability are taken as true, while allegations regarding the amount of damages must be proven. Dundee Cement Co. v. Howard Pipe & Concrete Prods., 722 F.2d 1319, 1323 (7th Cir. 1983) (citing Pope v. United States, 323 U.S. 1 (1944); Geddes v. United Fin. Group, 559 F.2d 557 (9th Cir. 1977)); see also DirectTV v. Huynh, 503 F.3d 847, 851 (9th Cir. 2007); TeleVideo Sys., Inc. v. Heidenthal, 826 F.2d 915, 917-18 (9th Cir. 1987).

Where damages are liquidated, i.e., capable of ascertainment from definite figures contained in documentary evidence or in detailed affidavits, judgment by default may be entered without a damages hearing. Dundee, 722 F.2d at 1323; see also Rule 55(b)(2). Unliquidated and punitive damages, however, require "proving up" at an evidentiary hearing or through other means. Dundee, 722 F.2d at 1323-24; see also James v. Frame, 6 F.3d 307, 310-11 (5th Cir. 1993).

Granting or denying default judgment is within the court's sound discretion. Draper v. Coombs, 792 F.2d 915, 924-25 (9th Cir. 1986); Aldabe v. Aldabe, 616 F.2d. 1089, 1092 (9th Cir. 1980). The court is free to consider a variety of factors in exercising its discretion. Eitel v. McCool, 782 F.2d 1470, 1471-72 (9th Cir. 1986). Among the factors that may be considered by the court are (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, 782 F.2d at 1471-72 (citing 6 Moore's Federal Practice ¶ 55-05[2], at 55-24 to 55-26).

ANALYSIS

I. Whether Default Judgment Should Be Entered

The factual allegations of plaintiff's complaint, taken as true pursuant to the entry of defaults against defendants Villanueva and Club Coyote, LLC, establish the following circumstances: (1) defendant Ted Villanueva is an owner, operator, licensee, permitee, person in charge, or person with control over a commercial establishment doing business as Club Coyote in Woodland, California; (2) defendant Club Coyote, LLC is also an owner, operator, licensee, permitee, person in charge, or person with control over the commercial establishment doing business as Club Coyote; (3) by contract, plaintiff paid for and was granted exclusive nationwide television distribution rights to the "Felix 'Tito' Trinidad v. Ronald 'Winky' Wright Championship Fight Program" that took place on May 14, 2005; (4) pursuant to the contract, plaintiff entered into sublicensing agreements with various commercial entities throughout North America by which it granted those entities limited sublicensing rights to exhibit the Trinidad v. Wright championship fight to their patrons within their establishments; (5) as a commercial distributor of sporting events, plaintiff expended substantial monies marketing, advertising, promoting, administering, and transmitting the program to its customers; (6) with full knowledge that the program was not to be intercepted, received, and exhibited by unauthorized entities, defendants exhibited the Trinidad v. Wright fight at the time of its transmission and did so willfully and for purposes of commercial or private gain; (7) each defendant violated 47 U.S.C. § 605, et seq., which prohibits the unauthorized publication or use of communications; (8) each defendant violated 47 U.S.C. § 553, et seq., which prohibits the unauthorized exhibition, publication, and divulgence of programs; (9) by reason of defendants' violations of §§ 553 and 605, plaintiff has a private right of action against them pursuant to both statutes; (10) defendants also tortiously obtained possession of plaintiff's program and wrongfully converted it to their own use and benefit; and (11) by reason of defendants' tortious conversion, plaintiff is entitled to compensatory and punitive damages. (Doc. No. 1 at 2-6.)

In its complaint, plaintiff prays for statutory damages of $100,000.00 for each willful violation of 47 U.S.C. § 605 and for recovery of all costs and reasonable attorney's fees. In addition, plaintiff prays for statutory damages of $50,000.00 for each willful violation of 47 U.S.C. § 553 and for recovery of all costs and reasonable attorney's fees. Plaintiff seeks compensatory damages, reasonable attorney ...


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