Joe Hand Promotions, Inc. v. Sorota
| Decision Date | 26 June 2012 |
| Docket Number | CASE NO. 11-80985-CIV-MARRA |
| Parties | JOE HAND PROMOTIONS, INC., Plaintiff, v. JOSEPH SOROTA, et al., Defendant. |
| Court | U.S. District Court — Southern District of Florida |
THIS CAUSE is before the Court upon Defendants', Joseph Sorota ("Sorota") and J&B Motel Corporation (collectively, "Defendants"), Motion to Dismiss Plaintiff's Complaint Pursuant to Federal Rule of Civil Procedure 12(b)(6) (DE 15). The motion is fully briefed and ripe for review. The Court has carefully considered the briefs and is fully advised in the premises.
The Complaint filed in this case alleges that Plaintiff Joe Hand Productions, Inc. ("Plaintiff") entered into a contract for the right to distribute the UFC 118: Edvar v. Penn 2 broadcast scheduled for August 28, 2010, via closed circuit television and encrypted satellite signal. See DE 1at ¶ 14. Plaintiff then entered into subsequent agreements with entities in the State of Florida, which allowed those entities to exhibit the broadcast to their patrons. Id. at ¶15. Defendants or their agents then either intercepted Plaintiff's signal via a cable system, in violation of 47 U.S.C. § 553, or via satellite transmission, in violation of 47 U.S.C. § 605. Id. at ¶ 30. The Complaint alleges violations of 47 U.S.C. § 605 (Count I), violations of 47 U.S.C. § 553 (Count II), and a state law conversion claim (Count III). See DE 1.
Rule 8(a) of the Federal Rules of Civil Procedure "requires only 'a short and plain statement of the claim showing that the pleader is entitled to relief' in order to give the defendant fair notice of what the plaintiff's claim is . . . and the grounds upon which it rests." Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007) (quoting Fed. R. Civ. P. 8(a)(2)). "To survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to 'state a claim to relief that is plausible on its face.'" Ashcroft v. Iqbal, 129 S. Ct. 1937, 1949 (2009) (quoting Twombly, 550 U.S. at 570). Therefore, "only a complaint that states a plausible claim for relief survives a motion to dismiss." Id. at 1950. When considering a motion to dismiss for failure to state a claim, the court must "accept[] the allegations in the complaint as true and constru[e] them in the light most favorable to the plaintiff." Am. Dental Ass'n v. Cigna Corp., 605 F.3d 1283, 1288 (11th Cir. 2010) (internal quotation marks omitted).
Defendants make four challenges to Plaintiff's Complaint: (A) the allegations do not support individual or vicarious liability for Joseph Sorota; (B) Plaintiff fails to state a claim for conversion under Florida law; (C) Plaintiff fails to state a claim under the Cable Communications Policy Act; and (D) Plaintiff fails to join indispensable parties. The Court will address each argument independently.
DE 1. In other parts of the Complaint, Plaintiff alleges that "Defendants and/or their agents, servants, workmen and/or employees" perpetrated the acts that resulted in the statutory violations. Id. at ¶¶ 17-18, 25.
Generally, in order to hold an officer, director or shareholder of a corporation personally liable for the acts of a corporate entity, Florida courts require persuasive evidence that: (1) the shareholder dominated and controlled the corporation to such an extent that the corporation's independent existence was in fact nonexistent and the shareholders were alter egos of the corporation; (2) the corporate form must have been used fraudulently or for an improper purpose; and (3) the fraudulent or improper use of the corporate form caused injury to the claimant. Hillsborough Holdings Corp. v. Celotex Corp., 166 B.R. 461, 468 (M.D. Fla. 1994). The allegations in the Complaint do not satisfy this strict standard.
This Court, however, has held that in order to hold an individual vicariously liable for a violation of 47 U.S.C. § 605, the plaintiff need only show that the individual defendant had the "right and ability to supervise the violations, and that he had a strong financial interest in such activities." Joe Hand Promotions v. Hart, Case No. 11-CIV-80971-KAM (S.D. Fla. 2012). The Court therefore similarly concludes in this case that both 47 U.S.C. §533 and § 605, and the rights they are intended to protect, are analogous to the rights protected under the Copyright Act.
The well-established standard for establishing vicarious liability in cases involving violations of the Copyright Act is whether an individual had the right and ability to supervise the wrongful conduct and had a direct financial interest in the activities undertaken. See Klein & Heuchan, Inc. v. Costar Realty Info., Inc., 707 F.Supp.2d 1287, 1296 (M.D.Fla. 2010) (citing Shapiro, Bernstein & Co. v. H.L. Green Co., 316 F.2d 304, 307 (2d Cir.1963)). Therefore, the Court concludes that the standard for vicarious liability based on a violation of 47 U.S.C. § 533 or 47 U.S.C. § 605 is the same standard imposed in copyright infringement cases. Plaintiff has properly alleged vicarious liability under the correct standard and was not required to allege facts sufficient to pierce the corporate veil. Accordingly, the Court denies Defendants motion to dismiss Joseph Sorota.
Defendants challenge both the underlying merits of Plaintiff's conversion claim and the punitive damages sought under that claim. Under Florida law, the elements of conversion are "(1) an act of dominion wrongfully asserted; (2) over another's property; and (3) inconsistent with his ownership therein." Special Purpose v. Prime One, 125 F.Supp.2d 1093, 1099-1100 (S.D.Fla. 2000) (citing Warshall v. Price, 629 So.2d 903, 904 (Fla. 4th DCA 1993)). The Complaint allegesthat "Defendants[] tortuously obtained possession of the Program and wrongfully converted it to its own use and benefit." Complaint at ¶ 32. Defendants claim that Plaintiff has failed to define the word "Program" or allege that it is the property owner of the "Program." Specifically, Defendants assert that Plaintiff's allegation that it possessed the exclusive right to the broadcast in question is insufficient to support a conversion claim.
Under Florida law, a conversion claim "may extend to the wrongful taking of intangible business interests." Total Mktg. Techs., Inc. v. Angel Medflight Worldwide Air Ambulance Servs., LLC, No. 8: 10-cv-2680-T-33TBM, 2012 WL 33150, at *3 (M.D.Fla. Jan. 6, 2012) (citing In re Corbin's Estate, 391 So.2d 731, 732 (Fla. 3d DCA 1980)). In Intelsat Corp. v. Multivision TV LLC, No. 10-21982-CIV, 2010 WL 5437261 (S.D. Fla. Dec. 27, 2010), the court specifically permitted a claim for conversion of satellite services. This Court agrees with the reasoning articulated in Intelsat Corp. and concludes that the broadcast at issue may be the basis of a conversion claim.
Defendants also allege that Plaintiff has not adequately pled a claim of conversion that warrants an award of punitive damages. "In suits for conversion, punitive damages are allowable where the circumstances surrounding the conversion are such as to show fraud, actual malice, deliberate violence, or oppression, such gross negligence as to indicate a wanton disregard of the rights of others, or where the wrong partakes of a criminal character." Foley v. Dick, 436 So. 2d 139, 141 (Fla. 2nd DCA 1983)). The Complaint, however, explicitly alleges that the conversion was "willful, malicious, and intentionally designed to harm Plaintiff . . . and to subject Plaintiff to economic duress." Complaint at ¶ 33. The Court finds this allegation to be sufficient to survive dismissal at this stage.
Accordingly, Defendants motion to dismiss Plaintiff's conversion claim is denied.
Next, Defendants claim that Plaintiffs have failed to adequately plead a claim under the Cable Communications Pay Act, 47 U.S.C. § 605(a). That statute governs the "receiving, assisting in receiving, transmitting, or assisting in transmitting, [of] any interstate or foreign communication by wire or radio." 47 U.S.C. § 605(a). Also at issue is 47 U.S.C. § 553, which governs the interception, receiving, or assisting to intercept or receive "any communications service offered over a cable system."
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