United States District Court, E.D. California
FINDINGS AND RECOMMENDATIONS
CAROLYN K. DELANEY, Magistrate Judge.
Presently before the court is plaintiff's application for default judgment. This matter was submitted without oral argument. The undersigned has fully considered the briefs and record in this case and, for the reasons stated below, will recommend that plaintiff's application for default judgment be granted.
Plaintiff J&J Sports Productions, Inc. is a closed-circuit distributor of sports and entertainment programming. Defendant operates an establishment called "Moy's Cantina" located on Wilson Way in Stockton, California. Plaintiff purchased and retains the commercial exhibition licensing rights to "Manny Pacquiao v. Timothy Bradley, WBO Welterweight Championship, " which was broadcast on Saturday, June 9, 2012 ("The Program"). Defendant intercepted and exhibited the program in the commercial establishment referred to above without authorization to do so.
The record reflects that defendant Mireles was properly served with process by substituted service on July 24, 2013. ECF No. 6. Default was entered against defendant on September 20, 2013. ECF No. 8. On April 8, 2014, plaintiff filed its motion for default judgment with a proof of service reflecting service of the motion on defendant at the address where defendant was served with process.
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. 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, at 55-24 to 55-26).
I. Whether Default Judgment Should Be Entered
The factual allegations of plaintiff's complaint, taken as true pursuant to the entry of default against defendant, and the affidavits submitted in support of the motion for default judgment establish the following circumstances: (1) defendant is the owner, operator, licensee, permitee, person in charge, or person with control over the commercial establishment at issue in this action; (2) plaintiff purchased and retains the commercial exhibition licensing rights to the Program; (3) plaintiff entered into sublicensing agreements with various commercial entities by which it granted those entities limited sublicensing rights to exhibit the Program to their patrons within their establishments; (4) as a commercial distributor of sporting events, plaintiff expended substantial monies marketing, advertising, promoting, administering, and transmitting the program to its customers; (5) with full knowledge that the program was not to be intercepted, received, and exhibited by unauthorized entities, defendant exhibited the program and did so willfully and for purposes of commercial or private gain at both locations; and (6) defendant violated either 47 U.S.C. § 553 or 47 U.S.C. § 605.
In the motion for default judgment, plaintiff seeks enhanced statutory damages for willful violation of the Communications Act, 47 U.S.C. § 605. Under section 605, statutory damages may be awarded between $1, 000 and $10, 000 for violation of the Federal Communications Act and up to $100, 000 when the violation "was committed willfully and for purposes of direct or indirect commercial advantage or financial gain." 47 U.S.C. § 605(e)(3)(C)(ii). Because defendant has not appeared in this action and plaintiff has been precluded from conducting discovery, the precise means of transmission cannot be ascertained. At a minimum, however, plaintiff's complaint and evidence support a conclusion that defendant intercepted, without authorization, a transmission of the Program and broadcast it to its patrons. Plaintiff should not be prejudiced by defendant's failure to appear or defend itself in this action and the court concludes, therefore, that statutory damages should be awarded under section 605.
After weighing the Eitel factors, the undersigned finds that the material allegations of the complaint support plaintiff's claims. Plaintiff will be prejudiced if default judgment is denied because plaintiff has no other recourse for recovery of the damages suffered due ...