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J & J Sports Production, Inc. v. AAA Blue Iguana Bar Lounge, Inc.

United States District Court, E.D. New York

September 10, 2014

J & J SPORTS PRODUCTION, INC., Plaintiff,
v.
AAA BLUE IGUANA BAR LOUNGE, INC. d/b/a BLUE IGUANA LOUNGE, and ARVIND P. MANGAL Defendants.

REPORT AND RECOMMENDATION

MARILYN D. GO, Magistrate Judge.

Plaintiff brings this action under Title 47 of the United States Code alleging that defendants AAA Blue Iguana Bar Lounge, Inc. d/b/a Blue Iguana Lounge and Arvind P. Mangal violated sections 605 and 553 by intercepting and displaying to their customers, without plaintiff's authorization, a pay-per-view televison broadcast. After defendants failed to file an answer or any other responsive pleading, plaintiff filed a motion for default judgment, which the Honorable Sterling Johnson, Jr. has referred to me for report and recommendation.

PERTINENT FACTS

The facts pertinent to the determination of this motion are undisputed and are set forth in the Complaint, ct. doc. 1 ("Compl."); the November 1, 2013 affidavit of Joseph M. Gagliardi, President of plaintiffct. doc. 11, Ex. 2 ("Gagliardi Aff."); and the May 11, 2011 affidavit of investigator Earl L. Covington, ct. doc. 11, Ex. 1 ("Covington Aff.").

Plaintiff is a corporation organized and existing under the laws of the State of California, with its principal office and place of business located in San Jose, California. Compl. at ¶ 4. Defendant AAA Blue Iguana Bar Lounge, Inc. is a corporation authorized to transact business as "Blue Iguana Lounge" from its principal place of business located at 3219 Fulton Street, Brooklyn, New York. Id. at ¶ 5. Defendant Arvind P. Mangal is an officer, director, shareholder and/or principal of Blue Iguana Lounge. Id.

Plaintiff owns the rights to distribute via closed-circuit television and encrypted satellite signal the May 7, 2011 boxing match between Manny Pacquiao and Shane Mosley. Id. at ¶ 7. Plaintiff entered into license agreements with various entities to broadcast the boxing match to their patrons. Id. at ¶ 10.

The defendants were not authorized to receive or broadcast the boxing match. Id. at ¶ 12. However, on May 7, 2011, defendant intercepted the Pacquiao/Mosley telecast and broadcast it to patrons within Blue Iguana Lounge. Id. at ¶ 14; Covington Aff. at 1. As set forth in his affidavit, investigator Earl L. Covington entered the establishment at approximately 11:17 p.m. on May 7, 2011 and observed the unauthorized public showing of the boxing match at Blue Iguana Lounge to approximately 25 customers. Covington Aff. at 1-2.

DISCUSSION

I. Legal Standards Governing Default

A default constitutes an admission of all well-pleaded factual allegations in the complaint, except for those relating to damages. Greyhound Exhibitgroup, Inc. v. E.L.U.L. Realty Corp., 973 F.2d 155, 158 (2d Cir. 1992); Au Bon Pain Corp. v. Artect, Inc., 653 F.2d 61, 65 (2d Cir. 1981). A default also effectively constitutes an admission that damages were proximately caused by the defaulting party's conduct; that is, the acts pleaded in a complaint violated the laws upon which a claim is based and caused injuries as alleged. Greyhound, 973 F.2d at 159. The movant need prove "only that the compensation sought relates to the damages that naturally flow from the injuries pleaded." Id.

The court must ensure that there is a reasonable basis for the damages specified in a default judgment. Actual damages or statutory damages may be assessed. In determining damages not susceptible to simple mathematical calculation, Fed.R.Civ.P. 55(b)(2) gives a court the discretion to determine whether an evidentiary hearing is necessary or whether to rely on detailed affidavits or documentary evidence. Action S.A. v. Marc Rich & Co., Inc., 951 F.2d 504, 508 (2d Cir. 1991) (quoting Fustok v. ContiCommodity Servs., Inc., 873 F.2d 38, 40 (2d Cir. 1989)). The moving party is entitled to all reasonable inferences from the evidence it offers. Finkel v. Romanowicz, 577 F.3d 79, 84 (2d Cir. 2009); Au Bon Pain, 653 F.2d at 65; Directv, Inc. v. Hamilton, 215 F.R.D. 460, 462 (S.D.N.Y. 2003).

II. Determination of Damages

A. Liability

Both sections 553 and 605 of Title 47 prohibit the unauthorized reception of cable programming. Section 553(a)(1) specifically applies only to cable transmissions and provides that, "[n]o person shall intercept or receive or assist in intercepting or receiving any communications service offered over a cable system, unless specifically authorized to do so by a cable operator or as may otherwise be specifically authorized by law." Section 605(a) generally provides that, "[n]o person not being authorized by the sender shall intercept any radio communication... or assist in receiving... and use such communication... for his own benefit or the benefit of another not entitled thereto." When television programming is transmitted or intercepted over both cable and satellite mediums, both sections 553 and 605 apply. See Int'l Cablevision, Inc. v. Sykes, 75 F.3d 123, 130 (2nd Cir. 1996) (noting that section 605 ...


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