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DISH Network Wins Injunction against Alleged Online Pirates

Friday, March 2, 2012
DISH Network LLC v. Dillion, No. 12–CV–00157, 2012 BL 31436 (S.D. Cal. Feb. 3, 2012) In an action where plaintiffs claimed unauthorized interception of satellite television programming, the U.S. District Court for the Southern District of California granted plaintiffs' motion for a preliminary injunction, holding that they were likely to succeed on the merits of their claims that defendants violated the Digital Millennium Copyright Act ("DMCA"), 17 U.S.C. § 1201, and other federal statutes. Satellite TV Programming Allegedly Pirated Plaintiffs DISH Network LLC, EchoStar Technologies LLC, and NagraStar LLC respectively provide copyrighted satellite TV programming; receivers and antennas; and smart cards to 14 million subscribers throughout the United States. The receivers and smart cards allow subscribers to decrypt the DISH signal in order to watch the programs. According to the court, "satellite television pirates have developed methods for circumventing DISH's security system and intercepting DISH programming," by loading software containing DISH's proprietary data and keys to its security system into unauthorized receivers, or by having a pirate web-server send descrambling codes to end-users who had downloaded the piracy software onto their receivers, enabling them to view scrambled DISH programming. DISH Network at 2. In April 2010, defendant Miles Dillion registered the domain name www.myfreeneeds.com, which redirected visitors to the website www.myfreeneeds.tv (collectively, "the MFN website"). The MFN website had over 40,000 members, and its only product was software available for download that enabled members to access unlimited amounts of DISH TV programming. Each file on the site could be "used to enable unauthorized devices to intercept, receive, and decrypt DISH satellite television programming by circumventing DISH's security system," the court wrote. Id. at 3. On January 23, 2012, the court granted DISH's ex parte motion for a temporary restraining order, seizure, and impoundment, and ordered defendants to show cause why a preliminary injunction should not be entered. Accordingly, Verisign transferred the both domain names to GoDaddy, which locked them and took them offline. However, the next day, the MFN webmaster informed all members that while DISH had seized their domain names, it was "back 'stronger then [sic] ever;'" the company had re-launched their content at www.myfreeneeds.net; that DISH did not have access to the data on the MFN servers "and never will;" and stated that "Dish is pathetic if they think they can stop the freedom of speech." Id. at 3.

DISH Network Likely to Succeed

Plaintiffs seeking a preliminary injunction must show that (1) they are likely to succeed on the merits, (2) they are likely to suffer irreparable harm in the absence of an injunction, (3) the balance of equities tips in their favor, and (4) an injunction is in the public interest. The court found that plaintiffs met all four elements. Plaintiffs brought claims under the Digital Millennium Copyright Act ("DMCA"), the Communications Act of 1934, and the Electronic Communications Privacy Act ("ECPA"). Under the DMCA, "No person shall circumvent a technological measure that effectively controls access to a work protected under this title," and "No person shall manufacture, import, offer to the public, provide, or otherwise traffic in any technology, product, service, device, component, or part thereof, that . . . is primarily designed or produced for the purpose of circumventing a technological measure that effectively controls access to a work protected under this title." Id. at 4–5 (quoting 17 U.S.C. § 1201(a)(1)(A) and (2)). The court found that plaintiffs were likely to succeed on these claims, having shown that defendants provided their members with software that allowed them to circumvent DISH's security measures and intercept DISH's copyrighted programming. The court also held that plaintiffs were likely to succeed on their Communications Act and ECPA claims. The Communications Act provides, "No person not being entitled thereto shall receive or assist in receiving any interstate or foreign communication by radio and use such communication (or any information therein contained) for his own benefit or for the benefit of another not entitled thereto." Id. at 5 (quoting 47 U.S.C. § 605(a)). According to the court, satellite transmissions meant for fee-paying subscribers are radio communications under the statute. Id. at 6 (citing Cable/Home Communication Corp. v. Network Productions, Inc., 902 F.2d 829 (11th Cir. 1990) and DirecTV, Inc. v. Hendrix, 2005 BL 26814 (N.D. Cal. Apr. 1, 2005)). Plaintiffs showed a likelihood of success on their claim that defendants assisted their members in the unauthorized receipt and decryption of DISH's satellite transmissions. Section 605(e)(4) prohibits distributing any device that is used primarily for unauthorized decryption of satellite programming. Courts have held that piracy software designed to intercept satellite programming is such a device, the court wrote. There was sufficient evidence that defendants distributed such software through the MFN website. The ECPA provides a private right of action against anyone who "intentionally intercepts, endeavors to intercept, or procures any other person to intercept or endeavor to intercept, any wire, oral, or electronic communication." Id. at 6 (quoting 18 U.S.C. § 2511(1)(a)). According to the court, satellite signals are "electronic communication," and their interception violates this section. The court found that there was enough evidence that defendants intercepted or helped others to intercept DISH's satellite transmissions to be likely to succeed on this claim. — Balance of Hardships "Sharply" In Favor of DISH Network The court found that plaintiffs established that they would suffer irreparable harm without an injunction. Defendants' piracy caused plaintiffs not only lost revenue but harm to their reputation, which depended on the delivery of secured content, including premium and pay-per-view channels, losses that would be hard to quantify. The court found that the balance of hardships tipped "sharply" in favor of DISH, which lost revenue and suffered injury to its reputation harm continued while defendants operated their websites. Id. at 7. The public also has a strong interest in enforcing anti-piracy legislation, the court found, and accordingly, granted plaintiffs' motion for preliminary injunction. The court also court wrote: There is no evidence that Defendants websites have any legitimate purpose. Defendants have shown that they have no regard for the law by relaunching their website on myfreeneeds.net after the Court issued the TRO. Defendants have flaunted [sic] the Court's order and have made it clear that they will continue their illegal activities until they are caught. Id. at 7. DisclaimerThis document and any discussions set forth herein are for informational purposes only, and should not be construed as legal advice, which has to be addressed to particular facts and circumstances involved in any given situation. Review or use of the document and any discussions does not create an attorney-client relationship with the author or publisher. To the extent that this document may contain suggested provisions, they will require modification to suit a particular transaction, jurisdiction or situation. Please consult with an attorney with the appropriate level of experience if you have any questions. Any tax information contained in the document or discussions is not intended to be used, and cannot be used, for purposes of avoiding penalties imposed under the United States Internal Revenue Code. Any opinions expressed are those of the author. The Bureau of National Affairs, Inc. and its affiliated entities do not take responsibility for the content in this document or discussions and do not make any representation or warranty as to their completeness or accuracy.©2014 The Bureau of National Affairs, Inc. All rights reserved. Bloomberg Law Reports ® is a registered trademark and service mark of The Bureau of National Affairs, Inc.

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