Case 1:17-cv-00188-DAD-BAM Document 18 Filed 08/24/17 Page 1 of 9
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`UNITED STATES DISTRICT COURT
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`EASTERN DISTRICT OF CALIFORNIA
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`BROADCAST MUSIC, INC., et al.,
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`v.
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`Case No.: 1:17-cv-00188-DAD-BAM
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`FINDINGS AND RECOMMENDATIONS
`REGARDING PLAINTIFFS’ MOTION FOR
`DEFAULT JUDGMENT
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`(ECF No. 12)
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`JEFFREY ALAN HATHCOCK individually
`and d/b/a ROCK N’ HORSE SALOON; and
`JANET HAYRE, individually and d/b/a
`ROCK N’ HORSE SALOON,
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`Defendants.
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`On June 21, 2017, Plaintiffs Broadcast Music, Inc., Welsh Witch Music, Coral Reefer Music,
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`Sony/ATV Songs LLC, Unichappell Music Inc., Sloopy II Inc. d/b/a Sloopy II Music, Bocephus
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`Music, Inc., Warner-Tamerlane Publishing Corp., Big Yellow Dog LLC d/b/a International Dog
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`Music and Scamporee Music (“Plaintiffs”) filed a motion for default judgment against Defendants
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`Jeffrey Alan Hathcock, individually and d/b/a Rock N’ Horse Saloon and Janet Hayre, individually
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`and d/b/a/ Rock N’ Horse Saloon (“Defendants”). No opposition was filed.
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`The motion was referred to this Court pursuant to 28 U.S.C. § 636(b)(1)(B) and Local Rule
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`302. The Court deemed the matter suitable for decision without oral argument pursuant to Local Rule
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`230(g), and vacated the hearing scheduled for August 25, 2017. Having considered the moving papers
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`and the Court’s file, the Court RECOMMENDS that Plaintiffs’ motion for default judgment be
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`GRANTED.
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`Case 1:17-cv-00188-DAD-BAM Document 18 Filed 08/24/17 Page 2 of 9
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`I.
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`BACKGROUND
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`Plaintiffs allege five claims of willful copyright infringement arising from Defendants’
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`unauthorized public performance of the following musical compositions: (1) Dreams; (2)
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`Margaritaville; (3) Piece of My Heart; (4) Blues Man; and (5) Love Done Gone. Plaintiffs allege that
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`these musical compositions were performed without authorization at Defendants’ business
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`establishment, known as Rock N’ Horse Saloon, on July 12, 2016. Doc. 1, Complaint ¶¶ 20-21 and
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`Schedule.
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`According to Plaintiffs’ moving papers, Plaintiff Broadcast Music, Inc. (“BMI”) is a
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`“performing rights society” which licenses the right to publicly perform a repertoire of nearly 12
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`million copyrighted musical compositions works on behalf of the copyright owners of these works.
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`The remaining Plaintiffs in this action are the copyright owners of the five individual compositions
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`identified above from whom BMI has acquired the right to bring this action. Doc. 12-1, Declaration of
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`John Ellwood (“Ellwood Decl.”), ¶¶ 2, 5.
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`BMI’s main business is to license the right to publicly perform any of the works in BMI’s
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`repertoire by means of “blanket license agreements.” Id. at ¶¶ 2-3. These licenses are available to
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`music users, such as the Defendants, and permit music users to perform any of the nearly 12 million
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`musical compositions in the BMI repertoire. Id. at ¶ 5.
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`BMI operates as a non-profit-making performing rights organization. Id. at ¶ 3. BMI
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`distributes all of the money it collects in license fees from licensees, such as restaurants, hotels and
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`nightclubs, as royalties to its affiliated publishers and composers, after the deduction of operating
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`expenses and reasonable reserves. Id.
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`Between July 2015 and August 2016, BMI repeatedly informed the Defendants of the need to
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`obtain permission for public performances of copyrighted music. Doc. 12-4, Declaration of Brian
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`Mullaney (“Mullaney Decl.”) at ¶¶ 3-8. BMI offered to enter into a blanket license agreement with the
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`Defendants, but Defendants failed to do so. Id. at ¶¶ 3, 8. BMI’s records indicate that BMI licensing
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`personnel telephoned the Defendants on twenty-eight (28) occasions and sent more than twenty-five
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`(25) letters. Id. at ¶¶ 3, 4, 5, 7, 12, 13.
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`Case 1:17-cv-00188-DAD-BAM Document 18 Filed 08/24/17 Page 3 of 9
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`Plaintiffs filed the underlying action on February 9, 2017. Doc. 1. Plaintiffs personally served
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`Defendant Jeffrey Alan Hathcock with the summons and complaint on February 16, 2017, and served
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`Defendant Janet Hayre via substituted service on February 18, 2017. Docs. 4, 5, Proofs of Service.
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`Defendants did not respond to the complaint, and on April 3, 2017, Plaintiffs filed a request for entry
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`of default. Doc. 6. The following day, on April 4, 2017, the Clerk of the Court entered default against
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`Defendants. Docs. 7, 8. Thereafter, on June 21, 2017, Plaintiffs filed the instant motion for default
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`judgment. Doc. 12.
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`II.
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`LEGAL STANDARD
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`Pursuant to Federal Rule of Civil Procedure 55(b)(2), a plaintiff can apply to the court for a
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`default judgment against a defendant that has failed to plead or otherwise defend against the action.
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`Fed. R. Civ. P. 55(b)(2). “Upon default, the well-pleaded allegations of a complaint relating to
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`liability are taken as true.” Dundee Cement Co. v. Howard Pipe & Concrete Prods., Inc., 722 F.2d
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`1319, 1323 (7th Cir. 1983); TeleVideo Sys., Inc. v. Heidenthal, 826 F.2d 915, 917-18 (9th Cir. 1987).
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`Factors which may be considered by courts in exercising discretion as to the entry of a default
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`judgment include: (1) the possibility of prejudice to the plaintiff; (2) the merits of plaintiff’s
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`substantive claim; (3) the sufficiency of the complaint; (4) the sum of money at stake in the action; (5)
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`the possibility of a dispute concerning material facts; (6) whether the default was due to excusable
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`neglect; and (7) the strong policy underlying the Federal Rules of Civil Procedure favoring decisions
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`on the merits. PepsiCo, Inc. v. Cal. Sec. Cans, 238 F.Supp.2d 1172, 1174 (C.D. Cal. 2002); Eitel v.
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`McCool, 782 F.2d 1470, 1471-72 (9th Cir. 1986).
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`III. ANALYSIS
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`Applying the factors articulated by the Ninth Circuit in Eitel, the Court finds these factors
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`weigh in favor of granting Plaintiffs’ motion for default judgment.
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`A.
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`Possibility of Prejudice to Plaintiffs
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`The first factor considers whether a plaintiff would suffer prejudice if default judgment is not
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`entered. See Pepsico, Inc., 238 F.Supp.2d at 1177. Generally, where default has been entered against a
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`defendant, a plaintiff has no other means by which to recover damages. Id.; Moroccanoil, Inc. v.
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`Allstate Beauty Prods., 847 F.Supp.2d 1197, 1200-01 (C.D. Cal. 2012). Therefore, the Court finds
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`Case 1:17-cv-00188-DAD-BAM Document 18 Filed 08/24/17 Page 4 of 9
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`Plaintiffs would be prejudiced if default judgment is not granted, and this factor weighs in favor of
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`default judgment.
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`B. Merits of the Plaintiffs’ claims and the Sufficiency of the Complaint
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`The second and third Eitel factors, taken together, “require that [the] plaintiff[s] state a claim
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`on which [they] may recover.” Pepsico, Inc., 238 F. Supp. 2d at 1175. Notably a “defendant is not
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`held to admit facts that are not well-pleaded or to admit conclusions of law.” DIRECTV, Inc. v. Hoa
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`Huynh, 503 F.3d 847, 854 (9th Cir. 2007).
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`Plaintiffs’ complaint alleges violations of the United States Copyright Act. Under that act, the
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`owner of a copyright has the exclusive rights to publicly perform the copyrighted work, and may
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`institute an action against an infringer of that copyright. 17 U.S.C. §§ 106, 501. To establish
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`copyright infringement, plaintiffs must show (2) ownership of the allegedly infringed material and (2)
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`demonstrate that the alleged infringers violated at least one exclusive right granted to copyright
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`holders under 17 U.S.C. § 106. A&M Records, Inc. v. Napster, Inc., 239 F.3d 1004, 1013 (9th Cir.
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`2001), as amended (Apr. 3, 2001), aff'd sub nom. A&M Records, Inc. v. Napster, Inc., 284 F.3d 1091
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`(9th Cir. 2002), and aff'd sub nom. A&M Records, Inc. v. Napster, Inc., 284 F.3d 1091 (9th Cir. 2002).
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`Here, Plaintiffs allege that they own valid copyrights for the musical compositions in the BMI
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`Repertoire: (1) Dreams; (2) Margaritaville; (3) Piece of My Heart; (4) Blues Man; and (5) Love Done
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`Gone. Complaint at ¶¶ 4-13 and Schedule. Plaintiffs further allege that Defendants are liable for the
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`unauthorized public performance of these musical compositions, and the Defendants were not licensed
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`or otherwise authorized to publicly perform these musical compositions even though they were
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`previously and repeatedly admonished regarding the need for a license. Complaint ¶¶ 19, 20, 26.
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`The Court finds that Plaintiffs’ complaint sufficiently states a claim for copyright infringement,
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`and this factor weighs in favor of default judgment.
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`C.
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`The Sum of Money at Stake in the Action
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`Under the fourth factor cited in Eitel, “the court must consider the amount of money at stake in
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`relation to the seriousness of Defendant’s conduct.” PepsiCo, Inc., 238 F Supp.2d at 1176; see also
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`Philip Morris USA, Inc. v. Castworld Prods., Inc., 219 F.R.D. 494, 500 (C.D. Cal. 2003).
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`Case 1:17-cv-00188-DAD-BAM Document 18 Filed 08/24/17 Page 5 of 9
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`Here, Plaintiffs seek a total judgment of $20,830.00, which includes statutory damages of
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`$15,000.00, attorneys’ fees in the amount of $5,000.00 and costs in the amount of $830.00. Doc. 12.
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`The Court finds the amount at stake is proportional to the harm caused by Defendants’ conduct and,
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`therefore, this factor does not weigh against entry of default judgment.
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`D.
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`The Possibility of a Dispute Concerning Material Facts
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`The facts of this case are straightforward, and Plaintiffs have provided the Court with well-
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`plead allegations and a declaration with exhibits in support. Here, the Court may assume the truth of
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`well-plead facts in the complaint following the clerk’s entry of default and, thus, there is no likelihood
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`that any genuine issue of material fact exists. Defendants’ failure to file an answer in this case or a
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`response to the instant motion further supports the conclusion that the possibility of a dispute as to
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`material facts is minimal. See, e.g., Elektra Entm’t Grp. Inc. v. Crawford, 226 F.R.D. 388, 393 (C.D.
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`Cal. 2005) (“Because all allegations in a well-pleaded complaint are taken as true after the court clerk
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`enters default judgment, there is no likelihood that any genuine issue of material fact exists.”).
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`E. Whether the Default Was Due to Excusable Neglect
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`The sixth Eitel factor considers the possibility that Defendants’ default resulted from excusable
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`neglect. PepsiCo, Inc., 238 F.Supp.2d at 1177. Courts have found that where defendants were
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`“properly served with the complaint, the notice of entry of default, as well as the paper in support of
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`the [default judgment] motion,” there is no evidence of excusable neglect. Shanghai Automation
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`Instrument Co. v. Kuei, 194 F.Supp.2d 995, 1005 (N.D. Cal. 2001). Upon review of the record, the
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`Court finds that the default was not the result of excusable neglect. See PepsiCo, Inc., 238 F. Supp. 2d
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`at 1177. According to the Court’s docket, it appears that Plaintiffs properly served Defendant Jeffrey
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`Alan Hathcock by personally delivering a copy of the summons and complaint to him on February 16,
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`2017. Doc. 5. Plaintiffs also properly served Defendant Janet Hayre by substituted service on
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`February 18, 2017, by leaving copies with Defendant Hathcock, her son, on February 18, 2017, and by
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`mailing copies on February 21, 2017. Doc. 4. Service of process was therefore sufficient.1
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`Relevant here, Federal Rule of Civil Procedure 4(e) permits an individual to be served by delivering a copy of the
`summons of the complaint to the individual personally or by following state law where the district court is located. Fed. R.
`Civ. P. 4(e)(1), (2)(A). Under California law, if the summons and complaint cannot with reasonable diligence be
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`Case 1:17-cv-00188-DAD-BAM Document 18 Filed 08/24/17 Page 6 of 9
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`Moreover, Plaintiffs served Defendants with notice of the Clerk’s entry of default and the
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`motion for default judgment. Doc. 10 and Doc. 11 at p. 20. Despite ample notice of this lawsuit and
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`Plaintiffs’ intention to seek a default judgment, Defendants have not appeared in this action to date.
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`Thus, the record suggests that they have chosen not to defend this action, and not that the default
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`resulted from any excusable neglect. Accordingly, this factor weighs in favor of the entry of a default
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`judgment.
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`F.
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`The Strong Policy Favoring Decisions on the Merits
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`“Cases should be decided upon their merits whenever reasonably possible.” Eitel, 782 F.2d at
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`1472. However, district courts have concluded with regularity that this policy, standing alone, is not
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`dispositive, especially where a defendant fails to appear or defend itself in an action. PepsiCo, Inc.,
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`238 F.Supp.2d at 1177; see also Craigslist, Inc. v. Naturemarket, Inc., 694 F.Supp.2d 1039, 1061
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`(N.D. Cal. Mar. 5, 2010). Although the Court is cognizant of the policy favoring decisions on the
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`merits, that policy is unavailable here because Defendants have not responded. Accordingly, the
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`Court finds that this factor does not weigh against entry of default judgment.
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`Upon consideration of the Eitel factors, the Court concludes that Plaintiffs are entitled to the
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`entry of default judgment against Defendants. The Court therefore will recommend that Plaintiffs’
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`Motion for Default Judgment be granted.
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`IV. Requested Relief
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`A. Injunctive Relief
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`Plaintiffs seek an injunction permanently enjoining Defendants from engaging in any acts
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`infringing on Plaintiffs’ rights in any of their copyright musical compositions. The Copyright Act
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`authorizes the court to grant “final injunctions on such terms as it may deem reasonable to prevent or
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`restrain infringement of a copyright.” 17 U.S.C. § 502.
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`A plaintiff seeking a permanent injunction “must demonstrate: (1) that it has suffered an
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`irreparable injury; (2) that remedies available at law, such as monetary damages, are inadequate to
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`personally delivered to the person to be served, the summons and complaint may be served by leaving a copy at the
`person’s usual place of business in the presence of a person apparently in charge and by thereafter mailing a copy of the
`summons and complaint by first-class mail to the place where a copy was left. Cal. Civ. Proc. 415.20(b).
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`Case 1:17-cv-00188-DAD-BAM Document 18 Filed 08/24/17 Page 7 of 9
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`compensate for that injury; (3) that, considering the balance of hardships between the plaintiff and
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`defendant, a remedy in equity is warranted; and (4) that the public interest would not be disserved by a
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`permanent injunction.” Ebay Inc. v. MercExchange, L.L.C., 547 U.S. 388, 391 (2006).
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`Plaintiffs have made the requisite showing for a permanent injunction. First, Plaintiffs have
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`suffered an irreparable injury because, despite repeated warnings by BMI, Defendants continued to
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`infringe on Plaintiffs’ copyrights. Second, monetary damages are inadequate to compensate for the
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`injury because Defendants have failed to respond to BMI’s warnings and there is no assurance that
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`they will stop any infringing activity. Third, as Plaintiffs point out, Defendants cannot claim any
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`legitimate hardships as a result of being enjoined from committing unlawful copyright infringement,
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`and thus the balance of the hardships weighs in favor of Plaintiffs. Fourth, and finally, the public
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`interest would not be disserved by a permanent injunction restraining Defendants from infringing
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`Plaintiffs’ copyrights.
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`B. Statutory Damages
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`Plaintiffs seek $15,000.00 in statutory damages for five instances of copyright infringement.
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`Under the Copyright Act, a plaintiff may recover: (1) actual damages and any additional profits of the
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`infringer, or (2) statutory damages of not less than $750 or more than $30,000 as the court considers
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`just. 17 U.S.C. § 504(a), (c)(1). However, if the infringement was committed willfully, the court
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`“may increase the award of statutory damages to an award of not more than $150,000.” Id. §
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`504(c)(2).
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`In this case, Plaintiffs contend that the infringement was willful, and request damages in the
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`amount of $15,000, which represents an award of $3,000 for each of the five infringements. Doc. 12 at
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`12. Plaintiffs indicate that the lost license fees in this action would have been approximately $5,075.
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`Doc. 12 at p. 14, Doc. 12-4, Mullaney Decl. at ¶ 17. Plaintiffs are therefore seeking approximately
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`three times that amount in damages. The Court finds this amount reasonable. See, e.g., Broadcast
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`Music, Inc. v. JMN Restaurant Management Corp., No. 14-cv-01190-JD, 2014 WL 5106421, at *3
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`(N.D. Cal. Oct. 10, 2014) (finding statutory damage award of slightly more than three times the
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`license fees to be reasonable); Broadcast Music, Inc. v. Hynes Enterprises, Inc., No. CV 13-7957-GAF
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`(Ex), 2014 WL 12607835, at *4-5 C.D Cal. Apr. 30, 2014) (awarding statutory damages award in
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`Case 1:17-cv-00188-DAD-BAM Document 18 Filed 08/24/17 Page 8 of 9
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`amount of three times the licensing fee); Broadcast Music, Inc. v. Crawford, No. 1:12-cv-01903-JLT,
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`2014 WL 1285660, at *7-8 (E.D. Cal. Mar. 28, 2014) (“Several courts have calculated statutory
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`damages by tripling the amount of unpaid licensing, or that an amount approximately three times the
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`licensing fee is appropriate;” finding an award three times the amount of the unpaid licensing fees to
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`be appropriate).
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`C. Attorneys’ Fees and Costs
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`Plaintiffs also request attorneys’ fees and costs incurred in this action. In a copyright
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`infringement action, the Court has the discretion to “allow the recovery of full costs” and “may also
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`award a reasonable attorney’s fee to the prevailing party as part of the costs.” 17 U.S.C. § 505.
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`As to attorneys’ fees, counsel has not billed on an hourly basis, and declares only that BMI was
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`charged a flat fee of $5,000 to handle this action through default judgment. Doc. 12-2, Declaration of
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`AnnMarie Mori (“Mori Decl.”) at ¶ 9. Counsel does not detail the number of hours worked, but does
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`indicate that she has been a member of the California Bar since 2001. Id.
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`Prevailing hourly rates in the Fresno Division of this district, for competent, experienced
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`attorneys range between $250-$380 per hour with the highest rates generally reserved for those
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`attorneys who possess in excess of 20 years of experience. See Singh v. Hancock Nat. Res. Grp., No.
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`1:15-cv-01435-LJO-JLT, 2017 WL 2275029, at *7 (E.D. Cal. May 25, 2017) (noting that hourly rates
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`generally accepted in the Fresno Division for competent, experienced attorneys are between $250 and
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`$380, with the highest rates generally reserved for those attorneys who are regarded as competent and
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`reputable and who possess in excess of 20 years of experience; applying hourly rate of $400 for
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`attorney with more than 20 years of experience and hourly rate of $225 for attorney with less than ten
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`years of experience), findings and recommendations adopted by 2017 WL 2630082 (E.D. Cal. Jun. 19,
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`2017); Trujillo v. Singh, No. 1:16-cv-01640-LJO-EPG, 2017 WL 1831941, at *3 (E.D. Cal. May 8,
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`2017) (applying hourly rate of $300 for attorney with more than 15 years of experience).
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`At an hourly rate of $350, less than 14.5 hours would be compensated in this case. At an
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`hourly rate of $300, less than 17 hours would be compensated in this case. The Court therefore finds
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`the amount of $5000 to be reasonable for the filing of a complaint, request for entry of default and
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`motion for default judgment.
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`Case 1:17-cv-00188-DAD-BAM Document 18 Filed 08/24/17 Page 9 of 9
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`Plaintiffs additionally request an award of costs incurred in the amount of $830, which
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`includes the filing fee of $400 and fees for service of process in the amount of $430. Doc. 12-2, Mori
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`Decl. at ¶ 11. The Court finds the requested costs reasonable.
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`V.
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`CONCLUSION AND RECOMMENDATION
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`Based on the foregoing, IT IS HEREBY RECOMMENDED that:
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`1.
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`2.
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`3.
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`4.
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`5.
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`Plaintiffs’ motion for default judgment (Doc. 12) be GRANTED;
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`Defendants Jeffrey Alan Hathcock and Janet Hayre and their agents, servants,
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`employees and all persons acting under their permission or authority be permanently
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`enjoined and restrained from infringing, in any manner, the copyrighted musical
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`compositions licensed by Broadcast Music, Inc.;
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`Plaintiffs be awarded $15,000 in statutory damages;
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`Plaintiffs’ request for attorney’s fees in the amount of $5,000 be granted; and
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`Plaintiffs’ request for costs in the amount of $830 be granted.
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`These Findings and Recommendations will be submitted to the United States District Judge
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`assigned to the case, pursuant to the provisions of Title 28 U.S.C. § 636(b)(l). Within fourteen (14)
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`days after being served with these Findings and Recommendations, the parties may file written
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`objections with the Court. The document should be captioned “Objections to Magistrate Judge’s
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`Findings and Recommendations.” The parties are advised that failure to file objections within the
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`specified time may result in the waiver of the “right to challenge the magistrate’s factual findings” on
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`appeal. Wilkerson v. Wheeler, 772 F.3d 834, 839 (9th Cir. 2014) (citing Baxter v. Sullivan, 923 F.2d
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`1391, 1394 (9th Cir. 1991)).
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`IT IS SO ORDERED.
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` Dated: August 23, 2017
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` /s/ Barbara A. McAuliffe _
`UNITED STATES MAGISTRATE JUDGE
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