Prostar v. Massachi

• Decision Date: 06 December 1997
• Citation: 239 F.3d 669
• Parties: (5th Cir. 2001) PROSTAR, as Broadcast Licensee of the
• Court: U.S. Court of Appeals — Fifth Circuit

Page 669

239 F.3d 669 (5th Cir. 2001)

PROSTAR, as Broadcast Licensee of the December 6, 1997, De La Hoya/Rivera Program, Plaintiff-Appellant, v. JAMES ALLEN MASSACHI, JR., and TOBY IS DEAD, INC., Defendants-Appellees.

No. 00-30268

IN THE UNITED STATES COURT OF APPEALS, FIFTH CIRCUIT

January 17, 2001

Appeal from the United States District Court For the Eastern District of Louisiana.

Before KING, Chief Judge, and HIGGINBOTHAM and DUHE, Circuit Judges.

PER CURIAM:

This case presents us with the task of determining the appropriate statute of limitations for an action brought under 47 U.S.C. §§ 553 and 605. As these provisions contain no express limitations period, the district court adopted the one-year prescriptive period for delictual actions under Louisiana law.¹ Appellant Prostar argues that the court should have applied the three-year limitations period articulated in the federal Copyright Act.² Alternatively, Prostar requests the application of either the ten-year limitations period for personal actions under Louisiana law³ or the three-year period applicable to actions under Article 3494 of the Louisiana Civil Code. We find that the limitations period governing actions under the Copyright Act is applicable and now reverse.

I

Prostar filed suit against Appellees Massachi and Toby Is Dead, Inc. on April 29, 1999, alleging violations of the Federal Communications Act (FCA).⁴ Prostar, a Texas corporation, had purchased the commercial sales rights to various territories, including Louisiana, for transmission of the December 6, 1997, De La Hoya/Rivera boxing broadcast. Investigation by Prostar allegedly revealed that an establishment known as "Jimani Lounge and Restaurant" had improperly intercepted and exhibited the broadcast on December 6, 1997. Appellees contended that Prostar's suit was time-barred, as it was filed after the one-year limitations period set forth under Article 3492 of the Louisiana Civil Code, which governs delictual actions. The district court granted Appellees' Motion for Judgment on the Pleadings requesting dismissal.

II

Reviewing the district court's decision de novo,⁵ we note that the FCA does not specify a statute of limitations for actions by licensees such as Prostar under 47 U.S.C. §§ 553 and 605⁶ - "a void which is commonplace in federal statutory law."⁷ As a matter of interstitial lawmaking, this Court must adopt the appropriate statute of limitations from either state or federal sources. The Supreme Court has affirmed that state law is the "lender of first resort," and that courts generally are to adopt the closest state-law analogue.⁸ However, in limited circumstances, the Court has countenanced the application of an analogous federal law where application of state law would "frustrate or interfere with the implementation of national policies . . . or be at odds with the purpose or operation of federal substantive law."⁹ Under such circumstances, a court must decide whether "a federal statute of limitations for another cause of action better reflect[s] the balance that Congress would have preferred between the substantive policies underlying the federal claim and the policies of repose."¹⁰ The Supreme Court has emphasized the limited nature of this exception, stating that a federal limitations period should apply only where it "clearly provides a closer analogy than available state statutes, and when the federal policies at stake and the practicalities of litigation make that rule a significantly more appropriate vehicle for interstitial lawmaking."¹¹

Our inquiry therefore entails the following successive levels of analysis. First, courts must "characterize the essence" of the statute in question to determine which state cause of action is most analogous.¹² Second, courts must determine whether application of the state limitations period would frustrate the policies underlying the federal law or impede its practical implementation.¹³ If a state limitations period would not generate such adverse consequences, then the state limitations period applies and our inquiry is concluded.¹⁴ However, if a conflict is apparent, then courts must examine whether the federal interest in uniformity mandates the application of an analogous federal standard. This third level of analysis requires courts to examine whether federal law affords a closer analogy than state law.¹⁵ We now proceed to examine the relevance of the preceding steps to the instant case.

A

First, we must "characterize the essence" of an action under sections 553 and 605 of the FCA.¹⁶ The legislative history associated with section 553 and the amendments to section 605 reveals that one of Congress's principal objectives was to discourage theft of cable services.¹⁷ To that end, Congress articulated a variety of penalties and remedies to "protect the revenue of television cable companies from unauthorized reception of their transmissions."¹⁸

Section 553(a)(1) provides that "[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."¹⁹ Section 605 similarly states that "[n]o person not being entitled thereto shall receive or assist in receiving any interstate or foreign communication by radio and use such communication (or any information therein contained) for his own benefit or for the benefit of another not entitled thereto."²⁰ In addition, section 605 prohibits anyone unlawfully receiving such communications from divulging or publishing the information or transmission.²¹ Both sections contemplate civil (and criminal) enforcement measures.²²

We recognize that courts are divided as to whether and to what extent section 605 even applies to actions by cable companies.²³ In amending the FCA, Congress in 1984 inserted language referring to "satellite cable programming" in section 605(b), which discusses exceptions to the prohibitions articulated in section 605(a).²⁴ However, Congress did not change the language in section 605(a) to expressly include cable transmissions. In contrast, Congress expressly prohibited the unlawful interception of cable communications in section 553(a). We need not resolve this dispute today, as the limitations period articulated in the Copyright Act applies to actions brought under either provision.

Section 553(a)(1) provides an array of civil and criminal remedies for unauthorized interception of cable signals. Section 553(c)(1) provides "[a]ny person aggrieved by any violation of subsection (a)(1)" a private right of action.²⁵ Prevailing parties may obtain injunctive relief, damages, and attorney's fees and costs.²⁶ Moreover section 553 contemplates the award of either (1) actual damages suffered by the plaintiff, as well as recovery of profits gained by the person violating the Act; or (2) statutory damages of an amount not less than $250 and not more than $10,000, "as the court considers just."²⁷ The statute also gives courts the discretion to increase the actual or statutory damages to up to $50,000 where willful violations are present.²⁸ Conversely, the court may reduce damages to not less than $100 where "the violator was not aware and had no reason to believe that his acts constituted a violation of this section."²⁹

Section 605 also articulates criminal and civil penalties for violations of its prohibition against the unauthorized interception and subsequent publication of transmissions. Like section 553, section 605(e)(3) provides aggrieved parties with the right to obtain injunctive relief, damages, and attorney's fees and costs.³⁰ The statute allows for both kinds of actual damages noted above, as well as statutory damages.³¹ However, an aggrieved party can recover slightly higher statutory damages (between $1,000 and $10,000) than under section 553.³² Finally, courts have the same discretion as under section 553 to raise or lower the damage award according to the intent and knowledge of the violator.³³ Sections 553 and 605 ultimately implicate similar policy objectives and provide similar standards and remedies.

B

In assessing the appropriate state-law analogue to the FCA provisions at issue, we note that the parties have offered three potential candidates from Louisiana law: (1) Article 3492 of the Louisiana Civil Code, which governs delictual actions; (2) Article 3499, outlining the standards applicable to personal actions; and (3) Article 3494, providing for "recovery of compensation." Appellees contend that the one-year limitations period governing delictual actions is the most appropriate analogue. Relying on Joe Hand Promotions, Inc. v. Lott,³⁴ Appellees assert that cable theft is analogous to the tort of conversion, which is prohibited under Article 3492.³⁵ Louisiana law defines conversion as "an act in derogation of the plaintiff's possessory rights, and any wrongful exercise or assumption of authority over another's goods, depriving him of the possession, permanently or for an indefinite time."³⁶ Some district courts have found cable theft to be analogous to conversion, as the defendants in such cases unlawfully "appropriate" the plaintiff's property (i.e., the cable transmission).³⁷ Indeed, Prostar's own complaint described Appellees' conduct as the "interception or tortious conversion" of Prostar's property.³⁸

Conversion is a closer analogy to the relevant provisions of the FCA than Louisiana law governing "personal actions." Article 3499 of the Louisiana Civil Code provides a ten-year statute of limitations for personal actions, which are defined as "those that seek to enforce personal rights."³⁹ Personal actions include, inter alia, actions grounded on a lease; actions for the "recovery of future things;" revocatory actions; and actions sounding in quasi-contract.⁴⁰ However, Article 3499 does not apply to tort actions.⁴¹ Prostar can not find refuge in quasi-contract, as quasi-contractual obligation is based on the principles of unjust enrichment....