HAYNES, Circuit Judge:
Defendants Mandell Family Ventures, L.L.C. and Samuel J. Mandell, III (collectively, the "Defendants") appeal the district court's grant of summary judgment in favor of Plaintiff J&J Sports Productions, Inc. ("J&J") on J&J's Federal Communication Act ("FCA") claims pursuant to 47 U.S.C. §§ 553 & 605. We REVERSE and REMAND.
This case concerns the live broadcast of the Floyd "Money" Mayweather, Jr. v. Ricky Hatton WBC Welterweight Championship Fight (the "fight") on December 8, 2007. The rights to broadcast the fight were held by various entities, including Time Warner Cable ("TWC") and J&J. TWC was granted the rights to broadcast the fight by means of pay-per-view to only those venues "not accessible to the public in general." The agreement granting TWC these rights contemplated that TWC might inadvertently broadcast the event to "commercial subscribers" and provided for a liquidated-damages fee to be paid by TWC under such circumstances. Conversely, J&J was granted the rights to broadcast the fight to only "commercial closed-circuit television exhibition outlets."
Greenville Avenue Pizza Company ("GAPC") is a restaurant in Dallas, Texas, which is owned by the Defendants. At all times relevant to this case, GAPC received commercial cable television services from TWC pursuant to a "Commercial Services Agreement." On December 8, 2007, GAPC purchased the pay-per-view broadcast of the fight from TWC for $54.95 and displayed the fight in its restaurant during business hours. GAPC did not advertise the fight or charge an entry fee or any other fee to view the fight. Representatives of both GAPC and TWC attest that TWC authorized GAPC's receipt of the broadcast. A representative of TWC described the authorization as an inadvertent error on its part.
On December 7, 2010, J&J initiated this action against the Defendants, alleging that they violated §§ 553 and 605 by receiving and displaying the fight without first paying a licensing fee to J&J. At the conclusion of discovery, J&J filed a motion for summary judgment, which the district court granted, awarding J&J statutory damages of $350 and costs and attorney's fees of $26,780.30. Defendants timely appealed.
Summary judgment is appropriate when "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). We review a district court's grant of summary judgment de novo, construing all facts and evidence in the light most favorable to the non-moving party. See EEOC v. Chevron Phillips Chem. Co., 570 F.3d 606, 615 (5th Cir. 2009).
J&J alleged below that the Defendants violated both §§ 553 and 605. While granting judgment in J&J's favor, the district court refrained from deciding which of the two sections applied to the Defendants' conduct, implicitly finding that J&J was entitled to judgment as a matter of law under at least one of the two sections. As explained more fully below, because we find a dispute of material fact exists as to J&J's § 553 claim, we must determine whether § 605 applies to the facts of this case. We hold that it does not.
Section 553(a)(1) imposes civil and criminal liability for "intercepting or receiving any communications service offered over a cable system." 47 U.S.C. § 553(a)(1) (2006). But it includes an essential exclusion, often referred to as a "safe harbor," that precludes the imposition of liability on the majority of cable recipients — customers of cable providers. This exclusion constrains the reach of the statute by exempting from liability those individuals who receive authorization from a cable operator:
Id. (emphasis added).
The Defendants maintain that they fall within this safe harbor. To support their argument, they provided evidence that GAPC (1) was a paying commercial customer of TWC; (2) paid a separate fee for the pay-per-view broadcast of the fight; and (3) was authorized by TWC, a cable operator,
We conclude that this ruling misconstrues § 553(a)(1). The text of the statute unambiguously states that liability extends only to the receipt of cable services not authorized by a cable operator. Therefore, in order for a cable customer to ensure that it is not criminally or civilly liable under § 553(a)(1), it need only receive authorization from a cable operator for the cable services it receives. J&J's argument, in essence, is that a cable customer who receives such authorization may still face liability under § 553 unless it takes the additional step of ensuring that the cable operator itself is licensed to distribute the various broadcasts that the customer views.
We interpret the statute in accordance with its plain language: liability under § 553(a)(1) does not extend to those who are "specifically authorized ... by a cable operator" to receive a broadcast. 47 U.S.C. § 553(a)(1) (emphasis added); see Hartford Underwriters, 530 U.S. at 6, 120 S.Ct. 1942 ("[W]hen the statute's language is plain, the sole function of the courts — at least where the disposition required by the text is not absurd — is to enforce it according to its terms." (citation and internal quotation marks omitted)).
Even under this interpretation, J&J alternatively argues that TWC did not authorize the Defendants' receipt of the broadcast of the fight because it was distributed by HBO, and the "Business Class Service Agreement" ("Service Agreement") between GAPC and TWC included the following language:
However, this language does not unambiguously encompass this situation because the fight was not shown on a traditional HBO subscription channel, but was delivered via a pay-per-view broadcast that the Defendants requested and purchased separately from TWC.
The Defendants submitted uncontroverted affidavits by representatives of the two parties to the Service Agreement (TWC and GAPC) stating that TWC authorized the receipt of the broadcast despite the language in the Service Agreement. The affidavits show that the Defendants did not steal, intercept, or obtain the broadcast under false pretenses. They further show that TWC: (1) was aware that GAPC was a commercial establishment holding a commercial cable account; (2) sold the broadcast of the fight to GAPC for $54.95; and (3) affirmatively delivered the broadcast of the fight to GAPC via pay-per-view broadcast.
In light of this evidence, there is at least a dispute of material fact as to whether the Defendants violated § 553. Accordingly, J&J failed to meet its summary judgment burden under § 553. See FED.R.CIV.P. 56(a).
J&J also sought summary judgment pursuant to § 605(a). The Defendants argued
Because of our ruling on § 553, we must determine whether the Defendants may be held liable under § 605, which does not contain the same safe harbor exception. This is an issue of first impression for our circuit, and our sister circuits are not uniform in their approach. See Prostar v. Massachi, 239 F.3d 669, 673 (5th Cir.2001). We now join the majority of circuits in holding that § 605 does not encompass the conduct presented here: the receipt or interception of communications by wire from a cable system.
The relevant portions of § 605(a) address only the unauthorized interception or receipt of radio communications:
47 U.S.C. § 605(a) (2006). Radio communications are defined as "the transmission by radio of [communications] of all kinds, including all instrumentalities, facilities, apparatus, and services ... incidental to such transmission." 47 U.S.C. § 153(40) (emphasis added). Here, it is undisputed that the communications were not transferred to the Defendants by radio, but by
J&J argues, however, that § 605(a) applies to the Defendants' receipt of wire communications because the definition for radio communications extends to "all instrumentalities, facilities, apparatus, and services (among other things, the receipt, forwarding, and delivery of communications) incidental to [radio] transmission[s]," and the broadcast of the fight originated as a radio communication prior to TWC retransmitting the broadcast by cable to GAPC. § 153(40) (emphasis added). While this interpretation has been adopted by the Second Circuit, see Int'l Cablevision, 75 F.3d at 131, we agree with the Third and Seventh Circuits that it "`unacceptably blurs the line between radio and wire communications,'" which are separately defined terms that both refer to instrumentalities incidental to transmission of the communication. TKR Cable Co., 267 F.3d at 202 (quoting Norris, 88 F.3d at 467); see also § 153(40), (59). Moreover, J&J's interpretation ignores the plain meaning of the terms by "demand[ing] undue contortion of the phrase `instrumentalities [or] facilities ... incidental to such transmission.'" TKR Cable Co., 267 F.3d at 202 (quoting § 153(40)). As the Third Circuit has recognized, "the entire cable transmission infrastructure of a city or suburban area, a structure that provides a foundation for a significant business, ... cannot be considered a mere instrumentality to transmission." Id.
The statutory framework of the FCA as a whole also confirms that § 605 does not apply to Defendants' receipt of cable communications. Section 553 covers the interception or receipt of cable communications without mentioning radio communications, just as § 605 covers the interception or receipt of radio communications without mentioning cable communications. A logical reading of the two provisions reveals a clear demarcation whereby "[§] 605 deals
Accordingly, based on the plain meaning of § 605 and the statutory framework of the FCA, we hold that § 605 does not apply to the Defendants' receipt of communications by wire from TWC's cable system.
Given our ruling, we need not reach the Defendants' additional arguments against summary judgment.