United States District Court, D. South Carolina, Columbia Division
ORDER AND OPINION
Honorable Margaret B. Seymour, Senior United States District
22, 2017, Plaintiff Joe Hand Productions, Inc.
(“Plaintiff”) filed an action in this court
against Defendants Collective Minds, LLC, d/b/a/ Mynt Lounge
& Bistro (the “Establishment”), and Benjamin
Rogers (collectively “Defendants”). Plaintiff
alleges that it owned the exclusive television distribution
rights for the Ultimate Fighting Championship® 201:
Lawler v. Woodley broadcast (the “Program”)
and that Defendants exhibited the Program at a commercial
establishment without paying a licensing fee to Plaintiff.
Plaintiff has asserted claims under the Communications Act,
47 U.S.C. § 605, and the Cable Communications Policy
Act, 47 U.S.C. § 553. Neither Defendant filed an answer
or otherwise responded to Plaintiff's Complaint. On July
7, 2017, in response to Plaintiff's request, the clerk
entered default as to both Defendants. On August 16, 2017,
Plaintiff filed a Motion for Default Judgment.
following facts are alleged in Plaintiff's Complaint (ECF
No. 1), and due to Defendants' default, are accepted as
true: Defendant Collective Minds, LLC is a South Carolina
business that operates, maintains and controls the
establishment known as Mynt Lounge & Bistro located at
2732 Decker Boulevard, Columbia, SC 29206. Id. at
1-2. Defendant Benjamin Rogers is a South Carolina resident
and an officer, director, shareholder, member and/or
principal of the entity owning and operating the
Establishment. Id. at 2. Plaintiff, a Pennsylvania
corporation, held the exclusive commercial distribution
rights to the broadcast of the Program, including all
undercard bouts and the entire television broadcast, which
took place on July 30, 2016. Id. at 1. Since 2001,
Plaintiff has been the exclusive domestic distributor for the
world's premier mixed martial arts company, the Ultimate
Fighting Championship®. Id. at 3. By contract,
Plaintiff was granted the exclusive right to license and
distribute the Program to commercial establishments
throughout the United States. Id. Prior to the
broadcast of the Program, Defendants chose not to contract
with Plaintiff nor pay a fee to Plaintiff to obtain the
proper license or authorization. Id. At no time did
Plaintiff give Defendants license, permission, or authority
to receive and exhibit the Program in their Establishment.
Id. By unauthorized satellite transmission or,
alternatively, by unauthorized receipt over a cable system,
Defendants willfully intercepted or received the interstate
communication of the Program or assisted in such action.
Id. Defendants then unlawfully transmitted,
divulged, and published said communication, or assisted in
unlawfully transmitting, divulging and publishing said
communication to patrons in the Establishment. Id.
At the time of the wrongful conduct, Defendants' agents,
servants and employees were acting within the scope of their
employment and authority. Id.
to a sworn affidavit, Carolyn D. Harding, an auditor for
Plaintiff, went to Mynt Lounge & Bistro on July 30, 2016.
ECF No. 10-5. Upon arriving, Harding paid a cover charge of
$10 to enter the Establishment. Id. Inside, she
observed eight televisions, all of which eventually displayed
the Program. Id. She stated that the approximate
capacity of the establishment was two hundred and fifty
people. Id. Harding avers that on three separate
occasions that night she counted eighty-five (85), one
hundred and ten (110), and one hundred and twenty (120)
patrons in the Establishment, respectively. Id. In
his sworn Affidavit in Support of Plaintiff's Motion for
Default Judgment, Plaintiff's President, Joe Hand, Jr.,
stated that the commercial sublicense fee for a commercial
establishment with a maximum capacity of two hundred and
twenty-six (226) to two hundred and fifty (250) persons would
have been $2, 100. ECF No. 10-2. Plaintiff also noted that
the Establishment advertised the program on its Facebook
page. ECF No.10-1 at 6.
47 U.S.C. § 605(a), “no person receiving . . . any
interstate or foreign communication by wire or radio shall
divulge or publish the existence, contents, substance,
purport, effect, or meaning thereof, except through
authorized channels of transmission or reception . . . to any
person other than the addressee, his agent, or
attorney.” Any person aggrieved by such a violation may
bring a civil action to obtain an injunction and to recover
damages, costs, and attorney fees. 47 U.S.C. §
605(e)(3). The aggrieved party may recover actual damages or
statutory damages between $1, 000 and $10, 000 for each
violation. 47 U.S.C. § 605(e)(3)(C)(i). Furthermore, if
the court finds that “the violation was committed
willfully and for purposes of direct or indirect commercial
advantage or private financial gain, ” the court may
increase the damages by an amount not more than $100, 000 for
each violation. 47 U.S.C. § 605(e)(3)(C)(ii).
47 U.S.C. § 553(a)(1), “[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.”
47 U.S.C. § 553(a)(1). Any person aggrieved by such a
violation may bring a civil action to obtain an injunction
and to recover damages, costs, and attorney fees. 47 U.S.C.
§ 553(c). The aggrieved party may recover actual damages
or statutory damages between $250 and $10, 000 for all
violations involved in the action. 47 U.S.C. §
553(c)(3)(A). Furthermore, if the court finds that “the
violation was committed willfully and for purposes of
commercial advantage or private financial gain, ” the
court may increase the damages by an amount not more than
$50, 000. 47 U.S.C. § 553(c)(3)(B).
Seventh Circuit has held that § 605 and § 553
employ mutually exclusive categories, specifically that a
“communications service offered over a cable
system” is not a “radio communication.”
United States v. Norris, 88 F.3d 462, 469 (7th Cir.
1996). In other words, a person who steals cable services at
the point of delivery is liable only under § 553, even
if the signals were transmitted by radio at some earlier
point. On the other hand, the Second Circuit has disagreed
and held that some cable transmissions may also constitute
“radio communications” under § 605.
International Cablevision, Inc. v. Sykes, 75 F.3d
123, 133 (2d Cir. 1996). The Fourth Circuit has not
considered the question. Consistent with other courts in the
District of South Carolina, this court finds that the
reasoning of Norris is more persuasive. See
Columbia Cable TV Co., Inc. v. McCary, 954 F.Supp. 124,
128 (D.S.C. 1996).
result, Defendants are liable under § 605 only if they
exhibited radio communications without authorization and
liable under § 553 only if they received cable
communications without authorization. Plaintiff has alleged
that the Program was received and exhibited without
authorization. ECF No. 10-1 at 5. However, Plaintiff notes
that the Program could have been received through various
media, including radio, satellite, or cable. See ECF
No. 1 at 3; ECF No. 10-2 at 3-4. Having been denied the
benefit of discovery, Plaintiff requests to proceed under
§ 605. ECF No. 10-1 at 5. The court finds this
to be a reasonable solution. The court finds that Defendants
violated 47 U.S.C. § 605 by exhibiting interstate radio
communications without authorization to customers at a
commercial establishment. Furthermore, based on
Plaintiff's well- pleaded allegations, the court finds
that the violation was committed willfully and for the
purposes of commercial advantage or financial gain.
elects to recover statutory damages under 47 U.S.C. §
605(e)(3)(C)(i)(II). Plaintiff seeks an award of $5, 000.
South Carolina district courts have often used an iteration
of the license fee to calculate appropriate damages. Joe
Hand Promotions, Inc. v. Double Down Entm't, LLC,
No. 0:11-CV-02438-MBS, 2014 WL 994382, at *7 (D.S.C. Mar. 13,
2014) (citing Joe Hand Promotions, Inc. v. Precint
Bar-DAXLAM, Ltd., No. 3:10-CV-00199-CMC, 2010 WL
3420189, at *3 (D.S.C. Aug.23, 2010) (determining that an
award of $5, 000 was appropriate, which equaled five to six
times the license fee of $875, as such award “is a
sufficient deterrent”); Joe Hand Promotions, Inc.
v. Sheedy, No. 4:08-CV-1797-TLW-TER, 2011 WL 4089534, at
*4 (D.S.C. July 29, 2011) (determining that an award of $5,
000 was appropriate, which equaled approximately 5 times the
license fee of $975)). As explained above, it would have cost
$2, 100 for Defendants to purchase the rights to exhibit the
Program at the Establishment. The court finds that an award
totaling approximately three times the applicable license fee
effectively promotes deterrence in this instance.
Accordingly, the court finds that an award of $5, 000 fairly
approximates the actual harm to Plaintiff resulting from
Defendants' unauthorized exhibition of the Program.
also seeks enhanced damages under 47 U.S.C. §
605(e)(3)(C)(ii) because Defendants' violation was
committed willfully and for the purposes of commercial
advantage or financial gain. ECF No. 10-1 at 11. Plaintiff
requests $25, 000. Id. Plaintiff explains that their
primary source of revenue is the sublicense fee charged to
authorized commercial establishments for the right to
broadcast closed circuit sports and entertainment
programming, such as the Program. ECF No. 10-1 at 8.
Plaintiff argues that much of its revenue is lost due to
unauthorized commercial exhibition of its programs because
legitimate bars and restaurants cannot afford to compete with
“pirate” bars and restaurants. See ECF
No. 10-2 at 4. Plaintiff further asserts that authorized
commercial establishments suffer financial loss from such
illegal activities as well. ECF 10-1 at 10; ECF No. 10 at ...