Joe Hand Promotions, Inc. v. Crisis Bar LLC

• Decision Date: 19 January 2023
• Docket Number: 21 Civ. 6563 (PKC) (VMS)
• Parties: JOE HAND PROMOTIONS, INC., Plaintiff, v. THE CRISIS BAR LLC, ROSCOE NEELY, ALICIA RICHARDSON NEELY, Defendants.
• Court: U.S. District Court — Eastern District of New York

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JOE HAND PROMOTIONS, INC., Plaintiff, v. THE CRISIS BAR LLC, ROSCOE NEELY, ALICIA RICHARDSON NEELY, Defendants.

No. 21 Civ. 6563 (PKC) (VMS)

United States District Court, E.D. New York

January 19, 2023

REPORT AND RECOMMENDATION

Vera M. Scanlon, United States Magistrate Judge

Plaintiff Joe Hand Promotions Inc. (“Plaintiff”) brought this action against Defendants The Crisis Bar LLC, Roscoe Neely and Alicia Richardson Neely (collectively “Defendants”), alleging that Defendants violated the Federal Communications Act of 1934 (the “FCA”), 47 U.S.C. §§ 553^[1] and 605,^[2] by broadcasting five pay-per-view fights without paying the requisite sublicensing fee. See ECF No. 1. Defendants failed to appear. Before the Court is Plaintiff's motion for default judgment. See ECF No. 12. The Honorable Pamela K. Chen referred the motion for a report and recommendation. For the following reasons, I respectfully recommend that the District Court grant in part and deny in part the motion and award judgment of $11,400 in statutory damages; $2,700 in enhanced damages; $1,230 in attorney's fees; and $607 in costs, for a total award of $15,937, against The Crisis Bar LLC and in favor of Plaintiff, and that the District Court deny the motion as against the individual Defendants.

I. Background

The following facts are drawn from the docket and Plaintiff's Complaint. See ECF No. 1.

Plaintiff, a Pennsylvania corporation that distributes sports and entertainment programming, held exclusive commercial distribution rights to the broadcast of five pay-per-view fights: (1) Deontay Wilder v. Tyson Fury on December 1, 2018; (2) Manny Pacquiao v. Adrien Broner on January 19, 2019; (3) Errol Spence, Jr. v. Mikey Garcia on March 16, 2019; (4) Deontay Wilder v. Dominic Breazeale on May 18, 2019; and (5) Deontay Wilder v. Tyson Fury II on February 22, 2020 (collectively the “Programs”). ECF No. 1 ¶¶ 1, 8. Plaintiff entered into agreements with commercial establishments in New York whereby Plaintiff would, in exchange for a fee, broadcast the Programs via satellite signal and permit the participating establishments to exhibit the Programs to their patrons. Id. ¶¶ 9-10. Plaintiff “expended substantial monies to market, advertise, promote, administer and transmit the Programs to those establishments in the State of New York.” Id. ¶ 10.

The Crisis Bar LLC is a commercial establishment in Brooklyn, New York. Id. ¶ 2. Defendants Roscoe Neely and Alicia Richardson Neely are officers, directors, shareholders, members and/or principals of The Crisis Bar LLC. Id. ¶¶ 3-4. Neither The Crisis Bar LLC nor either individual Defendant was authorized to exhibit the Programs. Id. ¶ 11. Plaintiff alleges that despite this, Defendants “willfully intercepted or received the interstate communications of the Programs or assisted in such actions” “then unlawfully transmitted, divulged and published said communications, or assisted in unlawfully transmitting, divulging and publishing said communications to patrons” at The Crisis Bar. Id. ¶¶ 12-13.

Plaintiff asserts that Defendants “pirated Plaintiff's licensed exhibition of the Programs and infringed upon Plaintiff's exclusive rights while avoiding proper authorization and payment to Plaintiff,” and that Defendants did so “willfully and with the purpose and intent to secure a commercial advantage and private financial gain.” Id. ¶ 14. Plaintiff seeks statutory damages in the amount of $11,100, pursuant to § 605(e)(3)(C)(i)(II); $33,300 in enhanced statutory damages pursuant to § 605(e)(3)(C)(ii); plus $1,435 in attorney's fees and $607 in costs. SeeECF No 121 at 16.^[3]

II. Procedural History

On November 23, 2021, Plaintiff commenced the action against Defendants. See ECF No. 1. On January 12, 2022, Plaintiff's summons on Defendants was returned executed; Plaintiff provided affidavits of service indicating that it had successfully served the summons and complaint on Defendants on December 30, 2021. See ECF Nos. 8, 8-1, 8-2. Defendants did not answer or otherwise respond to the complaint.

Plaintiff requested a certificate of default, which the Clerk of Court entered. See ECF Nos. 10-11. Plaintiff timely filed the instant motion. See ECF No. 12. In addition to the allegations in the complaint, Plaintiff submitted a report by an auditor whom Plaintiff hired to visit The Crisis Bar on December 1, 2018; this auditor observed 10 television sets displaying one of the Programs, Wilder v. Fury, for approximately 50 patrons. See ECF No. 12-12. The auditor paid a $20 cover charge to enter and observed the operations of The Crisis Bar on December 1. Id. Plaintiff provided screenshots of The Crisis Bar Facebook page in which it advertised screenings of all five Programs live in The Crisis Bar. See ECF No. 12-16. In addition, Plaintiff provided a January 2, 2019 letter that Plaintiff sent to Defendants demanding that they cease playing the Programs without authorization. See ECF No. 12-17. Plaintiff does not show confirmation of Defendants' receipt of this letter or state whether Plaintiff received a reply to this letter.

The Court scheduled a telephone conference to discuss the default judgment motion, invited Defendants to attend by mailing the notice to 913 Broadway, Brooklyn, NY 11206 and 510 Kosciusko Street, Brooklyn, NY 11221, and warned Defendants that failure to participate in the lawsuit may result in a judgment against Defendants. See ECF No. 13. Plaintiff filed a certificate of service stating that they served copies of the complaint, docket and Order on the Defendants. See ECF No. 14. Defendants did not attend the conference. See Dkt. Entry 5/31/2022.

III. Discussion

a. Legal Standard

Rule 55 of the Federal Rules of Civil Procedure establishes a two-step procedure by which a party may obtain a default judgment. See Bricklayers & Allied Craftworkers Local 2, Albany, N.Y. Pension Fund v. Moulton Masonry & Constr., LLC, 779 F.3d 182, 186 (2d Cir. 2015) (citing Fed.R.Civ.P. 55); Enron Oil Corp. v. Diakuhara, 10 F.3d 90, 95-96 (2d Cir. 1993). First, if a party has failed to plead or otherwise defend against an action, the Clerk of Court must enter a certificate of default by making a notation on the record. See Fed.R.Civ.P. 55(a). Second, after this entry of default, if the defaulting party still fails to appear or move to set aside the default, the court may enter a default judgment if the complaint is well-pleaded. See Fed.R.Civ.P. 55(b). The trial court has the “sound discretion” to grant or deny a motion for default judgment. See Enron Oil, 10 F.3d at 95. In light of the Second Circuit's “oft-stated preference for resolving disputes on the merits,” default judgments are “generally disfavored,” and doubts should be resolved in favor of the defaulting party. Id. at 95-96 (recognizing “the responsibility of the trial court to maintain a balance between clearing its calendar and affording litigants a reasonable chance to be heard”). The court must therefore ensure that (1) the plaintiff satisfied all required procedural steps in moving for default judgment, see Local Civ. R. 55.2; and (2) the plaintiff's allegations, when accepted as true, establish liability as a matter of law, see Finkel v. Romanowicz, 577 F.3d 79, 84 (2d Cir. 2009).

In considering a motion for default judgment, “the [c]ourt accept[s] as true all of the factual allegations of the complaint, except those relating to damages.” G & G Closed Circuit Events, LLC v. Batista, No. 21 Civ. 7352 (AKH) (SDA), 2022 WL 1571987, at *3 (S.D.N.Y. May 3, 2022) (internal citations omitted). Once liability has been established, a court must “conduct an inquiry in order to ascertain the amount of damages with reasonable certainty.” Am. Jewish Comm. v. Berman, No. 15 Civ. 5983 (LAK) (JLC), 2016 WL 3365313, at *3 (S.D.N.Y. June 15, 2016) (quoting Credit Lyonnais Sec. (USA), Inc. v. Alcantara, 183 F.3d 151, 155 (2d Cir. 1999)), report & recommendation adopted, 2016 WL 4532201 (S.D.N.Y. Aug. 29, 2016). A plaintiff “bears the burden of establishing [its] entitlement to recovery and thus must substantiate [its] claim with evidence to prove the extent of damages.” Dunn v. Advanced Credit Recovery Inc., No. 11 Civ. 4023 (PAE) (JLC), 2012 WL 676350, at *2 (S.D.N.Y. Mar. 1, 2012). The evidence the plaintiff submits must be admissible. See Poulos v. City of New York, No. 14 Civ. 3023 (LTS) (BCM), 2018 WL 3750508, at *2 (S.D.N.Y. July 13, 2018), report & recommendation adopted, 2018 WL 3745661 (S.D.N.Y. Aug. 6, 2018). If plaintiffs submitted evidence provides a sufficient basis from which to evaluate the fairness of the requested damages, the court need not conduct an evidentiary hearing. See Fustock v. ContiCommodity Servs. Inc., 873 F.2d 38, 40 (2d Cir. 1989); see also Transatlantic Marine Claims Agency, Inc. v. Ace Shipping Corp., 109 F.3d 105, 111 (2d Cir. 1997) (explaining that court may determine appropriate damages based on affidavits and documentary evidence “as long as [the court has] ensured that there [is] a basis for the damages specified in the default judgment”) (citation omitted)).

b. Service Of The Summons And Complaint

“A plaintiff seeking a default judgment must offer proof of proper service,” J&J Sports Prod., Inc. v Dowling, No. 18 Civ. 5086 (EK) (RML), 2020 WL 7090205, at *2 (E.D.N.Y. Dec. 3, 2020) (citing Fed.R.Civ.P. 4(1)(1)); N.Y. C.P.L.R. § 3215(f)), “which requires the server to ‘disclose enough facts to demonstrate validity of service.'” Dowling, 2020 WL 7090205, at *2 (quoting Wright & Miller § 1130 Return of Service, 4B Fed. Prac. & Proc. Civ. § 1130 (4th Ed.)). Both federal and New York state law provide that a summons and complaint must both be served for service to be proper. See Fed.R.Civ.P. 4(c)(1) (“A summons must be served with a copy of the...