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KINGVISION PAY PER VIEW v. BOOM TOWN SALOON

April 28, 2000

KINGVISION PAY PER VIEW, LTD., A DELAWARE CORPORATION, PLAINTIFF,
V.
BOOM TOWN SALOON, INC., AN ILLINOIS CORPORATION D/B/A BOOM TOWN SALOON AND EUGENE PERRY, INDIVIDUALLY, DEFENDANT.



The opinion of the court was delivered by: Schenkier, United States Magistrate Judge.

MEMORANDUM OPINION AND ORDER

This case arises out of a dispute concerning the closed-circuit telecast of a professional prizefight between Evander Holyfield and Michael Moorer on November 8, 1997, and associated under-card and preliminary bouts. Plaintiff KingVision Pay Per View, Ltd. ("KingVision") claims that it had the exclusive rights to exhibit and distribute that telecast, and that defendants Boom Town Saloon, Inc. ("Boom Town") and its owner/manager, Eugene Perry, violated those exclusive rights by willfully intercepting or receiving the signal for those fights, and then telecasting them without making proper payment to KingVision. Plaintiff alleges that in so doing, defendants have violated 47 U.S.C. § 553 and 605 of the Cable Communications Policy Act (the "Cable Act"), and seeks statutory damages, attorneys' fees and other relief.

Defendants seek a technical knockout of KingVision's claim, arguing that this complaint comes too late. Defendants claim that KingVision's Cable Act claims are governed by the Illinois two-year statute of limitations covering statutory penalties, codified at 735 ILCS 5/13-202. Accordingly, defendants have filed a motion to dismiss [doc. # 11-1] on the ground that the action is time-barred, as this complaint was filed slightly more than two years after the acts in question. Plaintiff counters that this Court should apply either the three-year statute of limitations found in the Copyright Act, 17 U.S.C. § 507(b), or the five-year statute of limitations provided by Illinois law for actions claiming conversion, codified at 735 ILCS 5/13-205, under either of which this action would be timely. The Court finds that KingVision has the better of this argument, and accordingly denies the motion to dismiss.*fn1

I.

We begin with the observation that the only reason that there is any dispute about the applicable statute of limitations is that when enacting Sections 553 and 605 of the Cable Act, Congress failed to provide a statute of limitations. When that occurs, courts must look elsewhere to borrow a limitations period. See Dell v. Board of Educ., 32 F.3d 1053, 1058 (7th Cir. 1994). Generally, a federal court will look to the state in which the conduct occurred in order to borrow the most analogous state-law statute of limitations period. See Lampf, Pleva, Lipkind, Prupis & Petigrow v. Gilbertson, 501 U.S. 350, 355-56, 111 S.Ct. 2773, 115 L.Ed.2d 321 (1991). However, a federal court instead may borrow a statute of limitations from federal law if it is "clearly more analogous to the legislation than the state statutes, . . . and if the state statutes of limitation are `unsatisfactory vehicles' for enforcing the federal law." Dell, 32 F.3d at 1058 (quoting DelCostello v. International Bhd. of Teamsters, 462 U.S. 151, 161, 171-72, 103 S.Ct. 2281, 76 L.Ed.2d 476 (1983)).

In determining whether to select a federal rather than state statute of limitations, courts apply a "hierarchical inquiry" that asks three questions:

(1) whether a uniform statute of limitations is required, because the federal cause of action in question may "`encompass numerous and diverse topics and subtopics'";
(2) whether such a uniform limitations period should be derived from a state or federal source, an inquiry that requires consideration of whether the multistate character of the federal cause of action might give rise to application of multiple state statute of limitations periods, which would present the danger of forum shopping and would "`virtually guarantee . . . complex and expensive litigation over what should be a straightforward matter'"; and
(3) whether there is an analogous federal statute of limitations that "truly affords a `closer fit' with the cause of action at issue than does any available state-law source."

Lampf, 501 U.S. at 356-58, 111 S.Ct. 2773 (citations omitted). In applying this analysis, federal courts must be mindful of the presumption that by its silence Congress ordinarily intends that state law be borrowed, and that resort to a federal statute of limitations is a "`closely circumscribed exception'" to that presumption. Dell, 32 F.3d at 1058 (quoting Lampf, 501 U.S. at 356, 111 S.Ct. 2773 (citations omitted)).

In order to apply these principles to borrow the appropriate statute of limitations, we begin with an examination of the structure and purpose of Sections 553 and 605 of the Cable Act.*fn2

II.

The legislative history reveals that "[o]ne of the primary purposes behind the enactment of [Sections 553 and 605] was to discourage the theft of cable services." Kingvision Pay Per View, Ltd. v. Wilson, 83 F. Supp.2d 914, 918 (W.D.Tenn. 2000) (citing H.R. REP. NO. 98-934, at 84 (1984), U.S.Code Cong. & Admin.News 1984, p. 4655). To that end, Congress provided for a variety of penalties and remedies, designed "to protect the revenue of television cable companies from unauthorized reception of their transmissions." Time Warner Entertainment/Advance-Newhouse Partnership v. Worldwide Elec., L.C., 50 F. Supp.2d 1288, 1293 (S.D.Fla. 1999) (quoting United States v. Coyle, 943 F.2d 424, 427 (4th Cir. 1991)).

Section 553(a)(1) of the Cable Act 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 by a cable operator or as may otherwise be specifically authorized by law." 47 U.S.C. § 553(a)(1). Congress provided an array of criminal sanctions and civil remedies for violations of that provision. In Section 553(b), which is entitled "Penalties for Willful Violation," Congress provided a range of terms of imprisonment and fines. 47 U.S.C. § 553(b). In Section 553(c)(1), entitled "Civil Action in District Court; Injunctions; Damages; Attorneys' Fees and Costs; Regulation by States or Franchising Authorities," Congress granted a private right of action to "[a]ny person aggrieved by any violation of subsection (a)(1)." 47 U.S.C. § 553(c)(1). Section 553(c)(2) provides that a prevailing party may obtain injunctive relief, damages, and attorneys' fees and costs. 47 U.S.C. § 553(c)(2). Congress then went on to define the types of damages that may be recovered: either (1) actual damages suffered by the plaintiff as well as recovery of profits gained by the person who unlawfully intercepted the communications, or (2) statutory damages of an amount not less than $250 and not more than $10,000, "as the Court considers just." 47 U.S.C. § 553(c)(3)(A). Moreover, Congress provided the Court with the discretion to increase any damage award — "whether actual or statutory" — by an amount ...


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