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J&J Sports Productions, Inc. v. Tienda y Taqueiria "La Frontera," LLC

United States District Court, M.D. Louisiana

July 24, 2017

J&J SPORTS PRODUCTIONS, INC.
v.
TIENDA y TAQUEIRIA "LA FRONTERA," LLC d/b/a TIENDA y TAQUEIRIA “LA FRONTERA, ” ET AL.

          RULING AND ORDER

          JOHN W. DEGRAVELLES JUDGE UNITED STATES DISTRICT COURT

         This matter comes before the Court on the Motion to Dismiss Pursuant to Rule 12(b)(6) (Doc. 25) filed by Defendants La Frontera, and the owners and members of La Frontera, Erika Sibley and Todd Sibley (collectively, “La Frontera”). Plaintiff J&J Sports Productions, Inc. (“J&J”) opposes the motion. (Doc. 27.) Also before the Court is Third Party Defendant, Cox Communications Louisiana LLC's (“Cox”) Motion to Dismiss Pursuant to Rule 12(b)(6). (Doc. 14). Defendant La Frontera and Plaintiff J&J have filed separate oppositions to this motion. (Docs. 24, 20.) Cox has filed a reply addressing both oppositions. (Doc. 29.) Oral argument is not necessary. For the following reasons, Defendant La Frontera's motion is DENIED IN PART and GRANTED IN PART, subject to it amending its motion to dismiss as allowed by the Court, and Third Party Defendant Cox's motion to dismiss is GRANTED.

         I. Relevant Factual Background

         This suit arises out of the public broadcast of “The Fight of the Century” Floyd Mayweather, Jr. versus Manny Pacquiao Championship Fight Program (“the Program”) that aired on May 2, 2015. (Doc. 1 at 9.) Plaintiff J&J, a distributor of closed circuit pay-per-view[1] boxing and special events in the United States, asserts it was granted exclusive nationwide commercial distribution and broadcast (closed-circuit) rights to the Program. (Id. at 5, 9.) J&J further asserts it entered into subsequent sub-licensing agreements with various commercial entities, including Louisiana entities, by which it granted these entities sub-licensing rights, specifically the rights to publicly exhibit, broadcast and/or publish the Program within their respective establishments. (Id. at 9-10.)

         Defendant La Frontera is a business that holds a license to sell alcoholic beverages and operates a bar within East Baton Rouge Parish, Louisiana. (Id. at 3.) La Frontera advertised that it was broadcasting the Program, and subsequently did so, allowing for the Program to be publicly broadcasted to its customers during business hours on May 2, 2015. (Id. at 8.) J&J did not grant La Frontera sub-licensing rights or any other rights concerning the Program. (Id. at 10.) Accordingly, J&J initiated this lawsuit against La Frontera and its owners Erika Sibley and Todd Sibley, alleging that La Frontera took steps to unlawfully receive J&J's television signal of the Program and asserting violations of 47 U.S.C. § 553 and 605, as well as 18 U.S.C. § 2511 in connection with §2520. (Id. at 9-14.)

         In its answer, La Frontera conceded that it aired the Program, but denied that its reception and broadcast of the Program was unlawful, further claiming that it legally obtained rights from Cox to air the Program. (Doc. 7 at 2.) Additionally, La Frontera filed a third party demand against Cox, claiming that all actions taken by it were done at the direction of Cox and that it paid Cox to legally air the Program. (Id. at 7.) La Frontera alleges Cox did not own the Program, so it did not have the right to sell the Program to La Frontera. (Id.) Accordingly, La Frontera brings a third party demand for damages in its favor against Cox under the legal theories of breach of contract, fraud, negligence and Louisiana's Unfair Trade Practice Act (LUTPA). (Id. at 7-8.) Additionally, La Frontera seeks indemnification from Cox, should this Court find it liable for claims brought by J&J in the original demand. (Id. at 8-9.)

         II. Standard

         A. Rule 12(b)(6) Standard

         In Johnson v. City of Shelby, Miss., 135 S.Ct. 346 (2014), the Supreme Court explained “Federal pleading rules call for a ‘short and plain statement of the claim showing that the pleader is entitled to relief, ' Fed.R.Civ.P. 8(a)(2); they do not countenance dismissal of a complaint for imperfect statement of the legal theory supporting the claim asserted.” 135 S.Ct. at 346-47 (citation omitted).

         Interpreting Rule 8(a) of the Federal Rules of Civil Procedure, the Fifth Circuit has explained:

The complaint (1) on its face (2) must contain enough factual matter (taken as true) (3) to raise a reasonable hope or expectation (4) that discovery will reveal relevant evidence of each element of a claim. “Asking for [such] plausible grounds to infer [the element of a claim] does not impose a probability requirement at the pleading stage; it simply calls for enough fact to raise a reasonable expectation that discovery will reveal [that the elements of the claim existed].”

Lormand v. U.S. Unwired, Inc., 565 F.3d 228, 257 (5th Cir. 2009) (quoting Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 556, 127 S.Ct. 1955, 1965 (2007)).

         Applying the above case law, the Western District of Louisiana has stated:

Therefore, while the court is not to give the “assumption of truth” to conclusions, factual allegations remain so entitled. Once those factual allegations are identified, drawing on the court's judicial experience and common sense, the analysis is whether those facts, which need not be detailed or specific, allow “the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” [Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S.Ct. 1937, 1949 (2009)]; Twombly, 55[0] U.S. at 556. This analysis is not substantively different from that set forth in Lormand, supra, nor does this jurisprudence foreclose the option that discovery must be undertaken in order to raise relevant information to support an element of the claim. The standard, under the specific language of Fed.R.Civ.P. 8(a)(2), remains that the defendant be given adequate notice of the claim and the grounds upon which it is based. The standard is met by the “reasonable inference” the court must make that, with or without discovery, the facts set forth a plausible claim for relief under a particular theory of law provided that there is a “reasonable expectation” that “discovery will reveal relevant evidence of each element of the claim.” Lormand, 565 F.3d at 257; Twombly, 55[0] U.S. at 556.

Diamond Servs. Corp. v. Oceanografia, S.A. De C.V., No. 10-00177, 2011 WL 938785, at *3 (W.D. La. Feb. 9, 2011) (citation omitted).

         The Fifth Circuit further explained that all well-pleaded facts must be taken as true and viewed in the light most favorable to the plaintiff. Thompson v. City of Waco, Tex., 764 F.3d 500, 502-03 (5th Cir. 2014). The task of the Court is not to decide if the plaintiff will eventually be successful, but to determine if a “legally cognizable claim” has been asserted. Id. at 503.

         B. Documents that may be relied on by the Court when considering Motions to Dismiss Pursuant to 12(b)(6)

         As an initial matter, the Court must determine what documents can be relied upon when considering both of the 12(b)(6) motions before it.[2] Generally, a district court must limit itself to the contents of the pleadings, including attachments thereto. Collins v. Morgan Stanley Dean Witter, 224 F.3d 496, 498-99 (5th Cir. 2000). “‘If, on a motion under 12(b)(6) or 12(c), matters outside the pleadings are presented to and not excluded by the court, the motion must be treated as one for summary judgment under Rule 56.'” Dix v. Louisiana Health Servs. & Indem. Co., 12-319, 2013 WL 5350829, at *1 (M.D. La. Sept. 23, 2013) (citing Fed.R.Civ.P. 12 (d).)

         Notwithstanding the general rule, the Middle District has utilized a three prong test to determine which documents outside of the complaint may be considered by the Court when considering a motion to dismiss for failure to state a claim. “A court may consider documents outside the complaint when they are: (1) attached to the motion; (2) referenced in the complaint; and (3) central to the plaintiffs' claims.” Dix, 2013 WL 5350829 at *2.[3]

         III. Discussion

         A. La Frontera's Motion to Dismiss (Doc. 25)

         1. Parties Arguments

         J&J brings claims against La Frontera and its owners Erika Sibley and Todd Sibley under: (1) 47 U.S.C. § 605, which prohibits interception and publishing radio communication; (2) 47 U.S.C. § 553, which prohibits interception or reception of any communications service offered over a cable system; and (3) 18 U.S.C. § 2511, the Wiretap Act, which prohibits intentional interception of any wire, oral, or electronic communication, in conjunction with § 2520, which creates a private right of action for violations of the Wiretap Act. (Id. at 9-14.)

         i. La Frontera's Argument in Support of its Motion to Dismiss

         La Frontera moves to dismiss all claims brought against it by Plaintiff J&J. (Doc. 25.) However, the supporting memorandum only addresses two of three claims brought against it. (Doc. 25-1.) La Frontera fails to address the claim made against it under 18 U.S.C. § 2511 and 2520. (Id.) In support of its argument that the claims brought under 47 U.S.C. § 605 and 553 should be dismissed, La Frontera relies on J&J Sports Productions, Inc. v. Mandell Family Ventures, L.L.C., 751 F.3d 346 (5th Cir. 2014), a Fifth Circuit case with facts and allegations similar to those asserted in the instant case. (Id. at 3.)

         La Frontera contends that in Mandell, a Dallas restaurant that maintained a commercial cable television account with a cable provider, purchased a pay-per-view fight program and displayed it during normal business hours. (Id.) J&J, same plaintiff as in the instant case, brought suit against the restaurant claiming it violated Sections 553 and 605. (Id.) La Frontera claims the Fifth Circuit held that the Section 553 claim failed because the safe harbor provision of that same section applied. (Id. (citing Mandell, 751 F.3d at 348.)) Applying the Mandell holding to the instant case, La Frontera argues that it falls within the safe harbor provision and therefore cannot be held liable under Section 553 because it was a commercial account holder with Cox and purchased the program via pay-per-view like the Mandell defendant. (Id.)

         Furthermore, La Frontera claims the Fifth Circuit held Section 605 did not apply to a restaurant's receipt of communications by wire from their cable provider's cable system, concluding that Section 605 merely applies to satellite and radio transmissions and interception of the same. (Id.) Therefore, La Frontera argues, it cannot be held liable under Section 605, as Mandell establishes that it is inapplicable to the facts of the instant case. (Id. at 4.)

         ii. Plaintiff J&J's opposition to La Frontera's Motion to Dismiss (Doc. 27)

         In its opposition to La Frontera's motion to dismiss, J&J asserts that, for purposes of this motion, the Court can only look to the allegations contained in J&J's complaint to determine if a claim has been stated. (Doc. 27-1 at 1).[4] J&J argues “[e]xtrinsic evidence such as exhibits filed by any other party may not be considered by the Court because that would be considering facts not forming a part of the complaint and would undermine the purpose of the rule.” (Id. (citing Scanlan v. Texas A&M University, 343 F.3d 533, 536 (5th Cir. 2003)); see also Khurana v. Innovative Health Care Sys., Inc., 130 F.3d 143, 147 (5th Cir. 1997); Capital Parks, Inc. v. Southeastern Adver. & Sales Sys., Inc. 30 F.3d 627, 629 (5th Cir. 1994). J&J does not specifically address whether or not the exhibit attached to La Frontera's answer can be considered by the Court, but it does contend the exhibit attached to Cox's motion cannot be reviewed by the Court when considering La Frontera's motion because it is extrinsic evidence. J&J argues this factor alone is sufficient to deny La Frontera's motion. (Id.)

         Additionally, J&J argues La Frontera did not plead the Section 553 “safe harbor” affirmative defense and thus cannot assert the defense by way of this motion. (Id. at 2 (citing Fed. R. Civ. Pro. 12(b)(6), (h)(2).))[5] Alternatively, if the Court decides to hear the merits of the motion, J&J asserts that the safe harbor provision and Mandell do not apply because Cox was not authorized to transmit the Program to La Frontera. (Id.)[6]

         2. Analysis

         i. Consideration of the Commercial Services Agreement and La Frontera's Cox Bill

         As a threshold matter, the Court must determine what documents it can rely upon when considering La Frontera's motion to dismiss. The Court's decision with regards to this motion heavily depends upon the method in which the Program was transmitted to La Frontera. More specifically, if La Frontera purchased the Program from its cable service provider Cox -and therefore received the Program through cable communications- the law provides La Frontera with a full defense against the claims J&J brings under 47 U.S.C. § 553 and 605. However, J&J's complaint fails to identify the manner in which the Program was transmitted, so the Court must apply the three prong test articulated by the Court in Dix, 2013 WL 5350829 at *2, to determine which documents outside of the complaint can be relied upon when considering La Frontera's motion to dismiss. As urged by J&J in its opposition, the Court will not rely upon the exhibit attached to Cox's motion to dismiss when considering La Frontera's motion to dismiss. However, the Court finds J&J's argument that this factor alone is sufficient to warrant the Court's denial of La Frontera's motion to dismiss unpersuasive.

         J&J alleges La Frontera took steps to unlawfully receive its television signal transmitting the Program. (Doc. 1 at 7). The mere assertion of legal conclusions is not sufficient to survive a motion to dismiss; therefore, the assertion that La Frontera's reception of the Program was unlawful is of no consequence. (Id.) The specific “steps” that La Frontera took to receive the Program are central to J&J's claim and the Court's determination of whether La Frontera's reception of the Program was, in fact, unlawful. However, J&J merely listed numerous ways in which the Program may have been ...


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