National Satellite Sports v. Time Warner Enter, 02 CIV. 342(JSR).

• Decision Date: 04 April 2003
• Docket Number: No. 02 CIV. 346(JSR).,No. 02 CIV. 342(JSR).,02 CIV. 342(JSR).,02 CIV. 346(JSR).
• Citation: 255 F.Supp.2d 307
• Parties: NATIONAL SATELLITE SPORTS, INC., Plaintiff, v. TIME WARNER ENTERTAINMENT COMPANY, L.P., Defendant. National Satellite Sports, Inc., Plaintiff, v. Time Warner Entertainment Company, L.P., Defendant.
• Court: U.S. District Court — Southern District of New York

255 F.Supp.2d 307

NATIONAL SATELLITE SPORTS, INC., Plaintiff, v. TIME WARNER ENTERTAINMENT COMPANY, L.P., Defendant.

National Satellite Sports, Inc., Plaintiff, v. Time Warner Entertainment Company, L.P., Defendant.

No. 02 CIV. 342(JSR).

No. 02 CIV. 346(JSR).

United States District Court, S.D. New York.

April 4, 2003.

Michael Dell, Lauren Freeman Bosworth, Kramer Levin Naftalis & Frankel LLP, New York City, for Plaintiffs.

Henk J. Brands, Eugene M. Paige, Paul, Weiss, Rifkind, Wharton & Garrison, Washington, DC, John Hearn, Robert P. Parker, Paul, Weiss, Rifkind, Wharton & Garrison, New York, Randolph Frank Iannacone, Forster & Iannacone, Middle Village, Neil Gorsuch, Kellogg, Huber, Hansen, Todd & Evans, P.L.L.C., Washington, DC, for Defendants.

MEMORANDUM ORDER

RAKOFF, District Judge.

Plaintiff National Satellite Sports, Inc. ("NSS") alleges in these consolidated actions ¹

that defendant, Time Warner Entertainment Company L.P. and its affiliates (collectively "Time Warner"), violated the anti-piracy provisions of the Communications Act of 1934 (the "Communications Act"), 47 U.S.C. §§ 553 and 605, by broadcasting without authorization various boxing matches (the "Events"), including the January 16, 1999 boxing match between Mike Tyson and Francois Botha (the "Tyson Event"), the September 18, 1999 boxing match between Oscar De La Hoya and Felix Trinidad (the "De La Hoya Event"), and other, unnamed boxing matches, in violation of NSS' exclusive rights to broadcast the Events. Before the Court are cross-motions for summary judgment seeking, respectively, judgment in favor of Time Warner dismissing the actions and partial judgment in favor of NSS holding Time Warner liable.

By way of background, it is undisputed that NSS held the exclusive rights to market, exhibit, and sell the Tyson Event in the United States in "theaters, arenas, casinos, auditoriums, bars, restaurants or other similar locations of public assembly ... where an admission fee or other consideration is charged and received." See Affidavit of Michael J. Dell, Esq., dated September 17, 2002 ("Dell Aff."), Ex. 19 (Closed-Circuit License Agreement) at 1. NSS also held a regional sublicense from an entity called "Entertainment by J & J, Inc." that conveyed to NSS the exclusive rights to exhibit the De La Hoya Event to similar establishments in Florida, Illinois (exclusive of casinos), New Mexico, Washington, D.C., Utah, Michigan, and Indiana (exclusive of casinos), see Dell Aff., Exh. 20 (Closed Circuit Television License Agreement: Oscar De La Hoya v. Felix Trinidad & Addendum to Closed Circuit Television License Agreement Between Entertainment by J & J, Inc. and National Satellite Sports, Inc.); but the parties dispute whether Entertainment by J & J had the right to issue such a license, see PI. Rule 56.1 Statement, at 112; Def. Rule 56.1 Statement, at 12. NSS also alleges it possessed similar rights as to the other Events.

Conversely, Time Warner held only the rights to transmit the Events (on a payper-view basis) to "persons residing in private dwelling units," and not to "non-residential establishments," such as "(i) any locations open to the public; (ii) locations where an admission fee [was] charged; (iii) hotels, motels, and other places of transient residence; and (iv) commercial establishments such as restaurants and bars." See Dell Aff., Ex. 21 (PPVN Affiliation Agreement) at 3, 15. Nonetheless, Time Warner transmitted the Tyson Event to at least five bars, see PI. Rule 56.1 Statement, at f 13; Def.'s Response to PI. Rule 56.1 Statement, at 1113, and transmitted the De La Hoya Event to at least one bar, see PI. Rule 56.1 Statement, at 1118; Def. Response to PI. Rule 56.1 Statement, at 1118. NSS also suggests that Time Warner permitted similar improper transmission of the other Events.

Notwithstanding these background facts, it is still the the Court indicated at oral argument, see transcript 10/16/02, that genuine issues of material fact remain in dispute pertinent to each of the parties' claims and counterclaims implicated by the instant motions, except with respect to the issue of whether certain of NSS' claims are time-barred. Specifically, Time Warner argues that the applicable limitations period for anti-piracy claims brought under the Communications Act is two years, while NSS argues that it is three years.

The issue arises because, even though the Communications Act provides a two year statute of limitation for certain actions brought against common carriers, it is silent as to the period of limitations applicable to private suits brought for violations of the Act's anti-piracy provisions against companies that do not qualify as common carriers. Ordinarily, in such circumstances, a court should "apply the limitations period of the state-law cause of action most analogous to the federal claim." Corcoran v. N.Y. Power Auth., 202 F.3d 530, 542 (2d Cir.1999), quoting Sandberg v. KPMG Peat Marwick, LLP, 111 F.3d 331, 333 (2d Cir.1997). But "where (1) a federal rule of limitations clearly provides a closer analogy than state alternatives, and (2) the federal policies at stake and the practicalities of the litigation render the federal limitation a significantly more appropriate vehicle for interstitial lawmaking," courts are to apply the analogous federal, rather than state, limitations period. Manning v. Utils. Mut. Ins. Co., 254 F.3d 387, 394 (2d Cir. 2001) (internal quotations omitted), quoting Phelan v. Local 305, 973 F.2d 1050, 1058 (2d Cir.1992), cert, denied, 507 U.S. 972, 113 S.Ct. 1415, 122 L.Ed.2d 785 (1993).

Applying these standards to the instant issue, the initial inquiry is as to whether the two-year limitations period provided for other purposes in the Communications Act itself, 47 U.S.C. § 415(b), should also be applied here. Time Warner argues that, while § 415(b) only expressly applies to common carriers, which Time Warner is not, see United States v. Southwestern Cable Co., 392 U.S. 157, 169 n. 29, 88 S.Ct. 1994, 20 L.Ed.2d 1001 (1968) (finding that cable companies are not common carriers), it would be "illogical and unfair to expose cable operators to liability under a statute originally intended to apply to common carriers ... while denying cable operators the protection of the accompanying statute of limitations." Memorandum in Support of Time Warner's Motion for Summary Judgment, at 15.

Both the premise and conclusion of this argument are, however, belied by the legislative history of the Communications Act and its predecessors. To begin with as noted by the court in Home Box Office, Inc. v. Advanced Consumer Tech. Movie Antenna, Inc., 549 F.Supp. 14, 17 (S.D.N.Y.1981), § 605 of the Act, the first of the anti-piracy provisions here involved, derives from an earlier provision, ie. Regulation 19, § 4, of an Act to Regulate Radio Communication, Act of Aug. 13, 1912, Pub.L. No. 62-264, § 4, reg. 19, 37 Stat. 302, which provided in relevant part:

No person or persons engaged in or having knowledge of the operation of any station or stations, shall divulge or publish the contents of any messages transmitted or received by such station, except to the person or persons to whom the same may be directed, or their authorized agent, or to another station employed to forward such message to its destination, unless legally required to so do by the court of competent jurisdiction or other competent authority.

Id. Neither that provision—nor the 1912 Act as a whole, which applied to "any system of electrical communication by telegraphy or telephony without the aid of any wire connecting the points from and at which the radiograms, signals, or other communications are sent or received," id. § 6,—was limited to common carriers.

Fifteen years later, when Congress superseded the 1912 Act with the Radio Act of 1927, Pub.L. No. 69-632, 44, Stat. 1162, it included the language of Regulation 19 as § 27 of the new Act, but added new, broad restrictions on the unauthorized interception or reception of radio communications. Id. See Home Box Office, Inc., 549 F.Supp. at 18-19. Overall coverage of the Act was likewise broadened to include "any intelligence, message, signal, power, pictures, or communication of any nature transferred by electrical energy from one point to another without the aid of any wire connecting the points from and at which the electrical energy is sent or received and any system by means of which such transfer of energy is effected." Radio Act of 1927 § 31. Thus, even more clearly than in 1912, the Radio Act of 1927, both as a whole and with particular reference to piracy, extended well beyond regulation of common carriers.

Section 27 of the Radio Act of 1927, in turn, became § 605 of the Communications Act of 1934, Pub.L. No. 73^16, 48 Stat. 1064, but was extended still further to apply to both wire and radio transmissions. See Home Box Office, 549 F.Supp. at 19-20. Specifically, the provision now prohibited "(1) the unauthorized divulging or publishing of wire or radio communications by the operators responsible for receiving such communications; (2) the unauthorized interception and divulging of wire or radio communications; (3) the unauthorized receipt and use of wire or radio communications for the benefit of the unauthorized receiver or someone else not entitled to the communication; and (4) the divulging, publication, or use of unlawfully intercepted information by anyone knowing that the information was wrongfully obtained." United States v. Norris, 88 F.3d 462, 465 (7th Cir.1996). See also Communications Act § 605. The wire and radio communications to which the provision applied were defined, in § 3 of the Act, as follows:

For purposes of this Act, unless the context otherwise requires—

(a) "Wire communication" or "communication by wire" means the transmission of writing, signs, signals, pictures, and sounds of all kinds by aid of wire, cable, or other like connection between the points of...