United States District Court, N.D. Illinois
May 26, 2004.
DIRECTV, Inc. Plaintiff,
Sheldon Massey, Kenneth McGill, Darren Meeks, Norman Miller, Robert Minnick, and Aaron Panganiban Defendants
The opinion of the court was delivered by: SAMUEL DER-YEGHIAYAN, District Judge
This matter is before the court on Defendant Aaron Panganiban's
("Panganiban") motion for summary judgment and motion to dismiss Counts
III and V. For the reasons stated below, we deny the motion for summary
judgment and grant the motion to dismiss Counts III and V.
Plaintiff DIRECTV, Inc. ("DIRECTV") alleges that Panganiban purchased a
pirating device that he used to unlawfully intercept DIRECTV satellite
signals. Panganiban claims that he purchased the device known as the "Vector
Super Unlooper with SU2 Code" in order to create a security system for
computers at his place of employment. DIRECTV has brought a five count
complaint and Panganiban has moved to dismiss Count III which is a claim
alleging a violation of 18 U.S.C. § 2512. Panganiban has also moved
to dismiss Count V which is a state conversion claim. Panganiban also
moved for summary judgment despite the fact that the parties have not yet
been given an opportunity to exchange formal discovery.
In ruling on a motion to dismiss, the court must draw all reasonable
inferences that favor the plaintiff, construe the allegations of the
complaint in the light most favorable to the plaintiff, and accept as
true all well-pleaded facts and allegations in the complaint. Thompson
v. Illinois Dep't of Prof'I Regulation, 300 F.3d 750, 753 (7th Cir.
2002); Perkins v. Silverstein, 939 F.2d 463, 466 (7th Cir. 1991). The
allegations of a complaint should not be dismissed for a failure to state
a claim "unless it appears beyond doubt that the plaintiff can prove no
set of facts in support of his claim which would entitle him to relief."
Conley v. Gibson, 355 U.S. 41, 45-46 (1957). Nonetheless, in order to
withstand a motion to dismiss, a complaint must allege the "operative facts" upon which each claim is based. Kyle v.
Morton High School, 144 F.3d 448, 454-55 (7th Cir. 1998); Lucien v.
Preiner, 967 F.2d 1166, 1168 (7th Cir. 1992). The plaintiff need not
allege all of the facts involved in the claim and can plead conclusions.
Higgs v. Carter, 286 F.3d 437, 439 (7th Cir. 2002); Kyle, 144 F.3d at
455. However, any conclusions pled must "provide the defendant with at
least minimal notice of the claim," Id., and the plaintiff cannot satisfy
federal pleading requirements merely "by attaching bare legal conclusions
to narrated facts which fail to outline the bases of [his] claim."
Perkins, 939 F.2d at 466-67.
Summary judgment is appropriate when the record reveals that there is
no genuine issue as to any material fact and the moving party is entitled
to judgment as a matter of law. Fed, R. Civ. P. 56(c). In seeking a grant
of summary judgment the moving party must identify "those portions of
`the pleadings, depositions, answers to interrogatories, and admissions
on file, together with the affidavits, if any,' which it believes
demonstrate the absence of a genuine issue of material fact." Celotex
Corp., v. Catrett, 477 U.S. 317, 323 (1986) (quoting Fed.R.Civ.P. 56(c)).
This initial burden may be satisfied by presenting specific evidence on a
particular issue or by pointing out "an absence of evidence to support the
non-moving party's case." Id. at 325. Once the movant has met this
burden, the non-moving party cannot simply rest on the allegations or denials in the pleadings, but, "by affidavits or as
otherwise provided for in [Rule 56], must set forth specific facts
showing that there is a genuine issue for trial." Fed.R.Civ.P. 56(e). A
"genuine issue" in the context of a motion for summary judgment is not
simply a "metaphysical doubt as to the material facts." Matsushita Elec.
Indus. Co., Ltd. v. Zenith Radio Corp., 475 U.S. 574, 586 (1986).
Rather, a genuine issue of material fact exists when "the evidence is
such that a reasonable jury could return a verdict for the nonmoving
party." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986); Insolia
v. Philip Morris, Inc., 216 F.3d 596, 599 (7th Cir. 2000). The court must
consider the record as a whole, in a light most favorable to the
non-moving party, and draw all reasonable inferences that favor the
non-moving party. Anderson, 477 U.S. at 255; Bay v. Cassens Transport
Co., 212 F.3d 969, 972 (7th Cir. 2000).
I. Summary Judgment Motion
Panganiban has moved for summary judgment on all counts. He contends
that he purchased the "Vector Super Unlooper with SU2 Code" in order to
create a security system for computers at his workplace. According to
Panganiban, when he received the device there were no instructions
included or any type of software that explained how the device worked. Panganiban claims that he never
connected the device to a DIRECTV system and never used the device to
intercept DIRECTV satellite signals. Panganiban has attached an affidavit
to his motion for summary judgment attesting to these facts. DIRECTV
states that in order for it to adequately respond to the motion for
summary judgment it needs to be allowed to conduct discovery in this case
and in particular that it needs to take the deposition of Panganiban. We
agree. DIRECTV does claim that it has evidence regarding Panganiban's
membership in various pirating websites. DIRECTV also correctly points
out that Panganiban's affidavit is silent regarding some of the unlawful
activity alleged in the complaint. However, we need not address such
allegations at this juncture. The purpose of a summary judgment review is
to determine if there is sufficient evidence that a reasonable trier of
fact could find in the non-movant's favor. A summary judgment review
should not be based solely on allegations and speculation.
After reviewing the summary judgment briefs, we have concluded that
this summary judgment motion is premature. Therefore, we shall allow the
parties to conduct discovery. It would not make sense to allow only
limited discovery arid then conduct another summary judgment review only
to discover that the parties need some additional discovery. The disputed
issues that DIRECTV seeks discovery for go to the heart of this case and therefore, in the interest of
judicial efficiency, at this point the proper course is for the parties
to conduct full discovery. If, after discovery, a party believes that the
evidence is overwhelmingly in their favor or that the other side lacks
evidence to support its contentions and that no reasonable trier of fact
could find for the other side, then the party may move for summary
judgment at that point. Therefore, we deny the motion for summary
judgment without prejudice.
II. Violation of 18 U.S.C. § 2512 (Count III)
In Count III of the complaint DIRECTV alleges a violation of
18 U.S.C. § 2512 of the Electronic Communications Privacy Act which
states in part as follows:
(1) Except as otherwise specifically provided in
this chapter, any person who intentionally
(a) sends through the mail, or sends or carries in
interstate or foreign commerce, any electronic,
mechanical, or other device, knowing or having reason
to know that the design of such device renders it
primarily useful for the purpose of the surreptitious
interception of wire, oral, or electronic
(b) manufactures, assembles, possesses, or sells any
electronic, mechanical, or other device, knowing or
having reason to know that the design of such device
renders it primarily useful for the purpose of the
surreptitious interception of wire, oral, or
electronic communications, and that such device or any
component thereof has been or will be sent through the
mail or transported in interstate or foreign
(c) places in any newspaper, magazine, handbill,
or other publication or disseminates by electronic
means any advertisement of
(i) any electronic, mechanical, or other device
knowing the content of the advertisement and knowing or having reason to know
that the design of such device renders it primarily
useful for the purpose of the surreptitious
interception of wire, oral, or electronic
(ii) any other electronic, mechanical, or other
device, where such advertisement promotes the use of
such device for the purpose of the surreptitious
interception of wire, oral, or electronic
communications, knowing the content of the
advertisement and knowing or having reason to know
that such advertisement will be sent through the mail
or transported in interstate or foreign commerce,
shall be fined under this title or imprisoned not
more than five years, or both. . . .
18 U.S.C. § 2512. While 18 U.S.C. § 2512 is criminal in nature,
18 U.S.C. § 2520 provides the following thus allowing for a civil claim:
(a) In general. Except as provided in section 251
1(2)(a)(ii), any person whose wire, oral, or
electronic communication is intercepted, disclosed, or
intentionally used in violation of this chapter may in
a civil action recover from the person or entity,
other than the United States, which engaged in that
violation such relief as may be appropriate.
18 U.S.C. § 2520. Panganiban claims that 18 U.S.C. § 2520 does not
provide for a private civil cause of action under 18 U.S.C. § 2512.
We agree with the reasoning in regards to this precise issue set out in
DIRECTV, Inc. v. Hinton, 2004 WL 856555, at *2-*3 (N.D. Ill. 2004)(J.
Darrah), DIRECTV, Inc. v. Frey, 2004 WL 813539, at *1-*4 (N.D. Ill.
2004)(J. Zagel), and DIRECTV, Inc. v. Castillo, 2004 WL 783066, at *1
(N.D. Ill. 2004)(J. St. Eve). DIRECTV argues that § 2520 creates a civil
cause of action for all violations of the chapter, focusing on the word
"chapter" in § 2520. However, it is clear from the plain language of § 2520 that the scope of the civil action is more
limited than a violation of the entire chapter. It specifically states
that § 2520 is limited to a communication that is "intercepted,
disclosed, or intentionally used in violation of this chapter"
18 U.S.C. § 2520. Congress expressly created a private cause of action in
§ 2520 and it is not appropriate to infer a broader cause of action than
is stated without a clear indication of Congressional intent to support
such an inference. Hinton, 2004 WL 856555 at *3. It is also clear from
18 U.S.C. § 2511 that Congress did not intend the interpretation of 18
U.S.C.A. § 2520 proposed by DIRECTV because 18 U.S.C. § 2511 provides the
same protection that DIRECTV seeks to create from its overly broad
interpretation of 18 U.S.C.A. § 2520. DIRECTV has in fact filed a claim
based upon 18 U.S.C. § 2511 against Panganiban for intercepting DIRECTV
signals. Under 18 U.S.C. § 2511, which is entitled " § 2511. Interception
and disclosure of wire, oral, or electronic communications prohibited" an
individual violates the act if he "intentionally intercepts, endeavors to
intercept, or procures any other person to intercept or endeavor to
intercept, any wire, oral, or electronic communication . . . [or]
intentionally uses, endeavors to use, or procures any other person to use
or endeavor to use any electronic, mechanical, or other device to
intercept any oral communication" 18 U.S.C. § 2511. This would go hand in
hand with § 2520's authorization of a civil action for communications
that are "intercepted, disclosed, or intentionally used in violation of
this chapter." 18 U.S.C.A. § 2520. We also note that DIRECTV is already seeking to recover from Panganiban under
18 U.S.C. § 2511 in Count II of its complaint. Therefore, we grant the
motion to dismiss Count III against Panganiban.
III. Conversion Claim (Count V)
Panganiban also seeks the dismissal of Count V which alleges a claim
for conversion. Panganiban argues that the conversion claim cannot be
based upon his alleged use of satellite signals because such signals are
not a tangible object. Panganiban cites to Liberty Mut. Ins. Co. v.
Construction Mgmt Servs., Inc., which states that "[g]enerally, a
conversion action lies only for `personal property which is tangible, or
at least represented by or connected with something tangible.'" 2001 WL
1159203, at *5 (N.D. Ill. 2001)(quoting In re Thebus, 483 N.E.2d 1258,
1260 (Ill. 1985)).
To state a conversion claim in Illinois a plaintiff must allege that
"(1) it has a right to the property at issue; (2) it has an absolute and
unconditional right to the immediate possession of that property; (3) it
made a demand on the defendant for possession of the property; and (4)
the defendant wrongfully and without authorization assumed control,
dominion, or ownership over the property," Castillo, 2004 WL 783066 at *2
(citing Cirrincione v. Johnson, 703 N.E.2d 67, 70 (Ill. 1998)). The
Supreme Court of Illinois has defined conversion as "any unauthorized act, which deprives a man of his property permanently or for
an indefinite time" and has stated that the "essence of conversion is the
wrongful deprivation of one who has a right to the immediate possession
of the object unlawfully held." In re Thebus, 483 N.E.2d at 1260(quoting
Union Stock Yard & Transit Co. v. Mallory, Son & Zimmerman Co.,
41 N.E. 888 (Ill. 1985) and Jensen v. Chicago & Western Indiana R.R.
Co., 419 N.E.2d 578 (Ill.App. 1981)). The Supreme Court of Illinois also
has stated that traditionally conversion is defined as "an intentional
exercise of dominion or control over a chattel which so seriously
interferes with the right of another to control it that the actor may
justly be required to pay the other the full value of the chattel." Id.
We do not need to decide whether the intangible nature of satellite
signals makes conversion an improper claim in this action because DIRECTV
has failed to establish that it was in any way denied the use of or
control over the signals. The satellite signals are broadcast into the
open air and there are no allegations that Panganiban exercised such
dominion and control over the signals as to deprive DIRECTV, the rightful
owner of the signals, the use of them. See Hinton, 2004 WL 856555 at
*3-*4 (dismissing conversion claim); Frey, 2004 WL 813539 at *4
(dismissing conversion claim); Castillo, 2004 WL 783066 at *2 (dismissing
conversion claim). DIRECTV has not alleged that any of the signals sent
to its paying customers were disrupted as a result of Panganiban's
interception or that DIRECTV was somehow unable to enjoy the benefit of
those signals sent out. Therefore, we grant the motion to dismiss Count V against Panganiban.
Based on the foregoing analysis, we deny Panganiban's motion for
summary judgment without prejudice. We grant the motion to dismiss Count
III against Panganiban and grant the motion to dismiss Count V against
Panganiban. Discovery is authorized for the remaining claims against
Panganiban only and all discovery must be completed by August 16, 2004.
Dispositive motions are due August 31, 2004. Answers are due September
15, 2004. Replies are due September 22, 2004. Next status hearing is set
for August 19, 2004.
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