UFC Piracy Lawsuit Seeks Significant Damages; Falls Short of the Mark

In my ongoing efforts to highlight legal action taken against those accused of unlawfully accessing MMA Pay Per View products, reasons for judgement were released last week by the United States District Court, N.D. New York, assessing damages for the unlawful display of a UFC PPV Event by a commercial establishment.

In last week’s case (Joe Hand Promotions, Inc. v. Duke Bazzel Tobacco and Lounge, LLC) the Plaintiff, who held the “exclusive nationwide commercial distribution (closed-circuit) rights” to UFC 128 sued the Defendant alleging that they “unlawfully intercepted, received and displayed the Program at the time of its transmission at their commercial establishment“.  The Defendant failed to respond to the lawsuit and the Plaintiff received default judgement.

The Plaintiff sought over $160,000 in damages broken down as follows:

  • damages pursuant to 47 U.S.C. § 605(e)(3)(C)(ii) in the amount of $100,000
  • an award of statutory damages pursuant to 47 U.S.C. § 553(c)(3)(A)(ii) in the amount of $10,000,
  • additional damages pursuant to 47 U.S.C. § 553(c)(3)(B) in the amount of $50,000,
  • an unspecified amount of damages for conversion.

The Court awarded damages far below the sought amount, at only $3,000 and did not award the Plaintiff their attorney fees.  In finding these far more modest damages were appropriate Senior District Judge Norman Mordue provided the following reasons:

Here, the evidence indicates that five individuals were in the establishment at the time of the Program. The total per-patron fee is therefore $274.75 ($54.95 × 5). According to plaintiff, based on a maximum occupancy of fifteen, the sub-license fee for the establishment would have been $900. Both amounts are less than basic statutory damages: $1,000. The Court therefore finds that an award of $1,000 reasonably reflects the injuries plaintiff suffered and achieves the deterrent purposes of the Federal Communications Act…

n this case, while there is no evidence of repeated violations or substantial monetary gains, the evidence shows that defendants never paid the required fees to receive or display the Program, charged its patrons an admission fee and displayed the Program illegally. Thus, the Court concludes defendants’ actions were willful. The most readily identifiable loss plaintiff sustained was the sub-license fee it would have received had defendants legitimately obtained rights to display the Program: $900. Therefore, plaintiff is entitled to an enhancement of the basic statutory damages.

In circumstances demonstrating such willful and purposeful violation, “`it is appropriate to assess enhanced damages in conjunction with statutory damages.'”135 Hunt Station Billiard, Inc., 2012 WL 4328355, at *5 (quoting J & J Sports Prods., Inc. v. Welch, No. 10-CV-159 (KAM), 2010 WL 4683744, at *5 (E.D.N.Y. Nov.10, 2010)). Courts in the Second Circuit typically fix the amount of enhanced damages as a multiple of two or three times the basic statutory damages award. Id.; see also, J & J Sports Prods., Inc. v. Zevallos, No. 10-CV-4049, 2011 WL 1810140, at *4 (E.D.N.Y. Apr.22, 2011) (recommending an enhanced damages award of two times the basic statutory damages), adopted by 2011 WL 1807243 (E.D.N.Y. May 11, 2011); Joe Hand Promotions, Inc. v. La Nortena Rest. Inc., No. 10-CV-4965, 2011 WL 1594827, at *5 (E.D.N.Y. Mar.28, 2011) (same), adopted by 2011 WL 1598945 (E.D.N.Y. Apr.27, 2011). “When determining a proper amount of enhanced statutory damages, `courts have borne in mind that although the amount of damages should be an adequate deterrent, a single violation is not so serious as to warrant putting the restaurant out of business.'” Joe Hand Productions, Inc. v. Zafaranloo, NO. 12-CV-3828, 2013 WL 1330842, at *4 (E.D.N.Y. Apr. 1, 2013) (quoting Kingvision Pay Per-View Ltd. v. Autar, 426 F. Supp.2d 59, 64 (E.D.N.Y. 2006) (internal quotation marks and alteration omitted)). Accordingly, the Court awards plaintiff $1,000 in basic statutory damages and $2,000 in enhanced statutory damages, for a total award of $3,000.

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