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DIRECTV, INC. v. CHORBA

November 18, 2005.

DIRECTV, INC. Plaintiff
v.
JACKIE CHORBA, et al. Defendants.



The opinion of the court was delivered by: THOMAS VANASKIE, Chief Judge

MEMORANDUM

At issue in this satellite television piracy case is whether plaintiff DIRECTV, Inc. ("DTV") may procure the Clerk's entry of default judgment against non-appearing defendants pursuant to Rule 55(b)(1) of the Federal Rules of Civil Procedure simply by specifying an amount of statutory damages that DTV will accept as adequate. Stated otherwise, the question presented here is whether DTV must instead move for default judgment pursuant to Fed.R.Civ.P. 55(b)(2) inasmuch as the statutes in question accord to the court discretion as to the award of statutory damages.

Chief Magistrate Judge Thomas M. Blewitt, to whom this matter had been referred, proposed in a Report and Recommendation (Dkt. Entry 356) that entry of judgment by the Clerk of Court was unavailable under the circumstances presented here. He further recommended that judgment be entered in favor of DTV in the amount of $1,000 per defaulting defendant, that amount purportedly being the minimum statutory damages that could be awarded on any of the claims asserted in this action. DTV objected to the Report and Recommendation, asserting that it had the right to have the Clerk of Court enter judgment in its favor in the amount of $10,000 for each defaulting defendant, this amount being the minimum statutory damages awarded for a violation of 47 U.S.C. § 605(e)(4), one of its statutory claims. Contending that the defendants' failure to answer the allegations of the Complaint established liability for a violation of § 605(e)(4), DTV asserts that it has the right to have the Clerk of Court enter judgment in the amount of the minimum statutory damages authorized by law for that alleged violation.

  Having carefully considered the matter, I have concluded that DTV's statutory damage claim is not for a sum certain because, at a minimum, the legislation in question commits to the Court discretion with respect to the amount of statutory damages to be awarded. Accordingly, default judgment may not be entered by the Clerk. I have also concluded that it is inappropriate to determine the amount of damages to be awarded by way of default judgment on the present record. Instead, DTV's motions for default judgment, presented under Fed.R.Civ.P. 55(b)(1), will be denied, without prejudice to its right to move for default judgment under Rule 55(b)(2).

  I. BACKGROUND

  On May 23, 2003, DTV filed 19 separate actions in this Court, naming as defendants 71 individuals who had purportedly acquired and utilized devices that enabled the unlawful interception of DTV's encrypted satellite television programming. The separate actions were consolidated under the above docket number. Defendants in this consolidated case include Savuth You (named as a defendant in the matter docketed to No. 3:03-CV-845); Neal Haslam (named as a defendant in the matter docketed to No. 3:03-CV-855); David Kocher (named as a defendant in the matter docketed to No. 3:03-CV-857); Gerald Kuchwara (named as a defendant in the matter docketed to No. 3:03-CV-858); and Martin O'Malley, Philip L. Rouse, and Mark Williams (named as defendants in the matter docketed to the above number, 3:03-CV-843). As to each defendant, DTV alleged the acquisition of specific pirate access devices. For example, defendant You is alleged to have acquired a "Next Gen & UL Pro X Combo." (Complaint filed under Docket No. 3:03-CV-845 at ¶ 22.) DTV avers that this combination package would enable the illegal programming of a valid DTV access card, and that the "unlooper" repairs DTV access cards that had been rendered unusable by prior illegitimate use.*fn1 Defendant Kocher purchased a combination package invoiced as a "Viper Reader/Writer and Wild Thing 2 Clone Unlooper," which also allegedly enabled the illegal re-programming of DTV access cards and repair of disabled DTV access cards that had been disabled by illegitimate use. (Complaint Docketed to No. 3:03-CV-857 at ¶ 15.) Similar allegations of specifically identified pirate access devices were made as to defendants O'Malley, Rouse, Williams, Kuchwara, and Haslam.

  Each defendant was duly served with the pertinent complaint and summons. Each defendant failed to respond to the complaint or otherwise appear in this action. In accordance with Rule 55(a) of the Federal Rules of Civil Procedure, DTV caused the Clerk of Court to enter each defendant's default.*fn2

  DTV asserted a common law cause of action for civil conversion against each defendant.*fn3 It also asserted against each defendant the following federal statutory claims:

  (1) Unlawful interception of DTV satellite programming, in violation of 47 U.S.C. § 605(a), with monetary relief provided under 47 U.S.C. § 605(e)(3)(C).

  (2) Unlawful interception of electronic communications from DTV in violation of 18 U.S.C. § 2511, for which monetary damages may be awarded under 18 U.S.C. § 2520(c). (3) Unlawful possession of a device with knowledge that the device is used for the purpose of the surreptitious interception of electronic communications, in violation of 18 U.S.C. § 2512, with recovery of damages sought under 18 U.S.C. § 2520.*fn4

  (4) Unlawful assembly or modification of a device with knowledge that the device is used primarily in the unauthorized decryption of satellite programming or direct-to-home satellite services, in violation of 47 U.S.C. § 605(e)(4), for which damages may be awarded under 47 U.S.C. § 605(e)(3)(C).

  With respect to the viable statutory claims presented in this matter, Congress has specified that the court may award damages. See 18 U.S.C. § 2520(c)(2); 47 U.S.C. § 605(e)(3)(B)(ii). Congress has also provided that an aggrieved party may elect to recover either actual damages or specifically prescribed statutory damages. The statutory award for a violation of 18 U.S.C. § 2511 "is the greater of $100 a day for each day of violation or $10,000." 18 U.S.C. § 2520(c)(2)(B). For a violation of 47 U.S.C. § 605(a), the statutory damages for each violation are "not less than $1,000 or more than $10,000, as the court considers just." 47 U.S.C. § 605(e)(3)(C)(i)(II). If, however, a violation of § 605(a) is willful "and for purposes of direct or indirect commercial advantage or private financial gain," the court may award up to $100,000. 47 U.S.C. § 605(e)(3)(C)(ii). For a violation of § 605(e)(4), the statutory damages are prescribed to be "not less than $10,000, or more than $100,000, as the court considers just." 47 U.S.C. § 605(e)(3)(C)(i)(II). The statute also provides that "[i]n any case where the court finds that the violator was not aware and had no reason to believe that his acts constituted a violation of [§ 605], the court in its discretion may reduce the award of damages to a sum of not less than $250." 47 U.S.C. § 605(e)(3)(C)(iii).

  Following the Clerk's entry of default for each defendant, DTV requested the Clerk of Court to enter judgment by default in accordance with Rule 55(b)(1) of the Federal Rules of Civil Procedure.*fn5 DTV's Requests for Default Judgment did not specify the counts on which judgment was to be entered against a defendant. Instead, accompanying each request for default judgment was an affidavit of DTV's attorney, asserting that "the amount due to Plaintiff DIRECTV, Inc. from Defendant . . . is $10,000, pursuant to 47 U.S.C. § 605(e)(4) and 18 U.S.C. § 2520(c)(2)(B), plus costs." (Affidavit for Default Judgment accompanying the request for Default Judgment against Defendant Rouse, Dkt. Entry 255.)*fn6

  The Clerk of Court entered judgment against each defendant as requested by DTV. Each judgment was essentially identical and provided:
Defendant . . ., having failed to plead or otherwise defend in this action, and default having been entered,
NOW, upon application of the Plaintiff and upon affidavit that Defendant . . . is indebted to the Plaintiff in the sum of $10,000, that Defendant is not an infant or incompetent person and not in the military of the United States, it is hereby
ORDERED, ADJUDGED, and DECREED, that Plaintiff DIRECTV, Inc. recover from Defendant the sum of $10,000, plus costs of this suit.*fn7
  Concerned that entry of judgment by the Clerk of Court pursuant to Rule 55(b)(1) may have been inappropriate, I issued an Order on December 22, 2003, directing DTV to show cause why the default judgments entered by the Clerk of Court should not be vacated.*fn8 The Order, filed three (3) days after ...

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