Dish Network L.L.C. v. Ellas TV, Inc.

CourtDistrict Court, N.D. Illinois
DecidedMarch 12, 2018
Docket1:16-cv-04813
StatusUnknown

This text of Dish Network L.L.C. v. Ellas TV, Inc. (Dish Network L.L.C. v. Ellas TV, Inc.) is published on Counsel Stack Legal Research, covering District Court, N.D. Illinois primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Dish Network L.L.C. v. Ellas TV, Inc., (N.D. Ill. 2018).

Opinion

UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF ILLINOIS EASTERN DIVISION

DISH NETWORK L.L.C.,

Plaintiff, No. 16 CV 4813 v. Judge Manish S. Shah ELLAS TV, INC., and MARIO PAPPAS,

Defendants.

MEMORANDUM OPINION AND ORDER

Defendants Ellas TV and Mario Pappas redistributed Dish Network signals through their own subscription-based television service for approximately five months, and Dish sued them for willfully violating the Federal Communications Act, 47 U.S.C. § 605(a). Dish moves for summary judgment on its claim and seeks attorneys’ fees and costs, a permanent injunction, as well as statutory and enhanced damages. That motion is granted in part. I. Legal Standards Summary judgment is appropriate if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law. Fed. R. Civ. P. 56(a). A genuine dispute as to any material fact exists if “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). The party seeking summary judgment has the burden of establishing that there is no genuine dispute as to any material fact. See Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). A court must view all facts and reasonable inferences in the light most favorable to the non-moving party. Roh v. Starbucks Corp., 881 F.3d 969, 973 (7th Cir. 2018). II. Background Dish Network, a television service provider, has over thirteen million

subscribers in the United States. [29-3] ¶ 2.1 Dish purchases the distribution rights for programming like movies, sports, and other entertainment from network providers and other rights-holders, and Dish transmits that programming through its direct broadcast satellite system.2 Id. ¶¶ 40–42. Specifically, Dish transmits its programming in a digitized, compressed, and scrambled format to satellites located in geo-synchronous orbit above Earth. Id. ¶ 43. Those satellites relay the encrypted

signal back to Earth where Dish subscribers’ equipment receives the signal. Id. ¶ 44. The subscribers’ equipment, namely a receiver and a smartcard, convert Dish’s encrypted satellite signal into programming that can be viewed on the subscriber’s attached television. Id. ¶ 45.

1 Bracketed numbers refer to entries on the district court docket. Referenced page numbers are taken from the CM/ECF header placed at the top of filings, except in the case of citations to depositions, which use the deposition transcript’s original page number. The facts are largely taken from defendants’ responses to Dish’s Local Rule 56.1(a) statements, [29-3], and Dish’s responses to defendants’ Local Rule 56.1(b)(3)(C) statements, [30-3], where both the asserted fact and the opposing party’s response are set forth in one document. When the parties raised arguments in their statements, included additional facts in their responses or replies, failed to support their statements by admissible evidence, or failed to cite to supporting material in the record, I disregarded those portions of those statements, responses, or replies. Facts that were not properly controverted are deemed admitted. 2 Defendants concede that Dish used state-of-the-art technology to maintain customer satisfaction, and that unauthorized distribution of Dish’s signals causes harm to its ability to control quality assurance and security protocols. [29-3] ¶ 79. Relevant to this case, Dish entered into a licensing agreement in November 2015 to obtain the rights to transmit the Sport Plus channel to Dish subscribers in the United States.3 Id. ¶¶ 70–71. Dish subscribers were able to access the Sport

Plus channel if they purchased the Greek language package for $29.99 per month. Id. ¶ 71. In order to purchase the Greek language package, however, Dish required its subscribers to also purchase another package—subscribers had their choice of either a domestic package ($39.99 per month), an international package ($10.99 per month), or a Chinese package ($10.99 per month). [29-3] ¶¶ 71–72. In reality, that meant that a Dish subscriber had to pay a minimum of $39.99 per month to access the Sport Plus channel. Id. ¶ 72. Dish did not sublicense its distribution rights in

foreign language programming, including the Greek language package, which carried the Sport Plus channel.4 Id. ¶ 77. A former Dish retailer named Mario Pappas founded a rebroadcasting company named Ellas TV in 2010.5 Id. ¶¶ 11–12. One year after founding the company, Pappas publicly launched Ellas with approximately twenty television channels. Id. ¶ 12. Ellas streamed programming over the internet, and its

customers viewed that programming either through television-receiving equipment

3 The Sport Plus channel played primarily soccer games, including Greece’s highest professional soccer league. [29-3] ¶ 62. The Greek matches were televised from November 2015 through May 2016. Id. 4 Defendant objects to this statement of fact, arguing that Dish did not produce discovery regarding its rights to the Sport Plus channel, see [29-3] ¶ 77; but, in its supplemental filing, Dish attached an exhibit of an email from Dish’s counsel to defendants’ counsel attaching Dish’s agreement with Artmer regarding Sport Plus, see [30-2] at 2. 5 From the founding of Ellas, Pappas served as the company’s sole owner and president. [29-3] ¶¶ 6–7. that Ellas provided (“Ellas TV box”) or through an app on any compatible device (“Ellas TV GO”). Id. ¶ 5; [30-3] at 82. Subscriptions to Ellas’s services ranged from $34.99 to $69.99 per month. Id. ¶ 16. According to Ellas’s tax return, its total

income in 2015 was in excess of $1,800,000. [27-11] ¶ 10. As of January 2016, Ellas had approximately two thousand subscribers to its box service and three hundred subscribers to its app service. [29-3] ¶ 15, [27-12] at 86:19–87:3. With Ellas, Pappas sought to provide Greek television channels to individuals outside of Greece. [29-3] ¶ 31. Ellas obtained some channels through over-the-air antennas in Greece and redistributed those channels to its customers in the United States. Id. ¶ 14. Since there were no rights-holders for those channels,

Ellas did not have to obtain permission or purchase distribution rights in order to redistribute those channels. [27-12] at 24:4–25:8. For several other channels, which had rights-holders, Pappas initially paid the distribution rights for those channels.6 [29-3] ¶ 13. When the channel that Ellas had been using to provide its customers access to Greek soccer games stopped carrying those games, Pappas became interested in Sport Plus as an alternative way to show those games. [27-12] at 39:8–

14, 42:11–14. Pappas did not contact Dish about licensing the channel because he did not think that Dish had the rights to that channel. Id. at 65:2–66:9. In November 2015, Pappas began testing the quality of the Sport Plus channel on Ellas’s app service. [30-3] at 84. He did this by tuning a Dish receiver to the Sport Plus channel, using a computer equipped with video cards and encoding

6 Defendants stopped paying for those distribution rights in 2014 due to other litigation. [27-12] at 23:2–14.

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