Nfl Enterprises L.P. v. 1019491 Ontario Ltd., docket T-2328-95

     T-2328-95

BETWEEN:

     NFL ENTERPRISES L.P.

     Plaintiff

     - and -

     1019491 ONTARIO LTD. c.o.b.a. WRIGLEY'S FIELD

     SPORTS BAR & GRILL, 1099659 ONTARIO INC.

     c.o.b.a. GILMOUR'S SPORTS BAR & LOUNGE,

     358820 ONTARIO LTD. c.o.b.a. ROOKIE'S SPORTS CAFE,

     555858 ONTARIO INC. c.o.b.a. DUSTY'S SPORTS BAR,

     ROMAN COURT MOTOR INN LTD. c.o.b.a. HALFTIME SPORTS LOUNGE,      750125 ONTARIO LTD. c.o.b.a. PURE PLATINUM,

     1104045 ONTARIO INC. c.o.b.a. TAILGATE CHARLIE'S ALLSTAR CAFE,

     1071005 ONTARIO LTD. c.o.b.a. RYAN'S NITE CLUB

     and/or ROADHOUSE SPORTS BAR & RESTAURANT,

     MARIO MARCELLO TORELLI c.o.b.a. THE OTHER SIDE SPORT BAR

     1090362 ONTARIO LTD. c.o.b.a.

     CARTOONZ and/or CRAZY 8'S BILLIARD CLUB,

     1093884 ONTARIO LTD. c.o.b.a. CAHOOTS BAR & GRILLE,

     GORAN MALJKOVIC and MILICA MALJKOVIC c.o.b.a.

     SNEAKER'S BEACH TAVERN, SHIRLEY RUTH ENNIS and

     TRACY ELIZABETH ENNIS c.o.b.a.

     BLACK CREEK RESTAURANT & TAVERN,

     816178 ONTARIO LTD. c.o.b.a. STUMPY'S PIER 44, and

     1006035 ONTARIO INC. c.o.b.a. HOGAN'S ROADHOUSE

     Defendants

     T-230-96

AND BETWEEN:

     NFL ENTERPRISES L.P.

     Plaintiff

     - and -

     SOTIRIOS AND PETER RESTAURANT COMPANY LTD.

     c.o.b.a. J.J. KAPPS PASTA BAR & GRILL,

     774367 ONTARIO INC. c.o.b.a.

     LINO'S PIZZA PARLOUR RESTAURANT,

     719879 ONTARIO INC. c.o.b.a. PALMWOOD HOTEL,

     and RIVERSIDE TAVERN (NIAGARA) LTD.

     c.o.b.a. RIVERSIDE TAVERN

     Defendants

     REASONS FOR ORDER

JEROME, A.C.J.:

     This is an application by the plaintiff for summary judgment on the issues of the defendants' alleged infringement of the Copyright Act, R.S.C. 1985 c. C-42 and the Radiocommunications Act, R.S.C. 1985, c. R-2, and for a permanent injunction restraining the defendants from further breach.

     The plaintiff, NFL Enterprises L.P., is a limited partnership constituted under the laws of the State of Delaware. It is a separate and distinct entity from the National Football League which is an unincorporated, not for profit association, constituted under the laws of the State of New York. The NFL is a joint enterprise of thirty member clubs distributed throughout the United States which are engaged in the business of exhibiting football games. The plaintiff has been assigned the right by the National Football League to rebroadcast certain games and related programming to be initially produced and broadcast by the National Broadcasting Company ("NBC") and the Fox Broadcasting Company ("FOX").

     The defendants are bars and restaurants in the Niagara peninsula. As is the common practice, they have television monitors which, from time to time, display various programs. The defendants admit that they have a satellite receiver for the reception of television signals transmitted over the public airwaves and that they purchased from their satellite supplier a package known as the "Sunday Ticket", which allowed them to receive all NFL games telecast during the regular season.

     The specific subject matter of this law suit relates to certain home games played by one of the member clubs, namely the Buffalo Bills, which were blacked out within a particular geographical region, including the area where the defendants' businesses are located. The black out is a term of the contract between the NFL and the networks. It essentially binds the networks not to broadcast the blacked out games through the local affiliate servicing the relevant area. The defendants admit that some, or part of some, of the blacked out games were shown at their business establishments. However, they maintain that the advertisements for the Sunday Ticket package, as supplied by the plaintiff, confirmed that subscribers to the service could receive up to thirteen games per week. The advertisements made no reference to either restrictions on availability of games because of any "blackout" rule or the existence of copyright.

     The plaintiff commenced an action in this Court by way of Statement of Claim alleging that it is the holder of the copyright in these games with respect to Canada and that the broadcast by the defendants constituted an infringement of its copyright. It also maintains that the defendants engaged in unauthorized decryption of the games contrary to the provisions of the Radiocommunications Act. It now seeks summary judgment for a declaration that the unauthorized public performance of any and all Sunday afternoon NFL game telecasts, and the unauthorized decryption of the games by the defendants constitute an infringement of its copyright and a breach of the Radiocommunications Act. In addition, it seeks a permanent injunction against the defendants prohibiting them from performing publicly, or decrypting without authorization, any Sunday afternoon NFL game telecast.

     Rules 432.1, 432.2 and 432.3 of the Federal Court Rules provide as follows:

432.1      (1) A plaintiff may, after the defendant has filed a defence, or earlier with leave of the Court, and at any time prior to the fixing of the time and date for trial, make a motion to a judge, with supporting affidavit material or other evidence, for summary judgment on all or part of the claim in the statement of claim.

(2) A defendant may, after filing and serving a defence and at any time prior to the fixing of the time and date for trial, make a motion to a judge, with supporting affidavit material or other evidence, for summary judgment dismissing all or part of the claim in the statement of claim.

432.2      (1) In response to affidavit material or other evidence supporting a motion for summary judgment, a responding party may not rest on the mere allegations or denials of the party's pleadings, but must set out, in affidavit material or other evidence, specific facts showing that there is a genuine issue for trial.

(2) An affidavit for use on a motion for summary judgment may be made on information and belief as provided in subsection 332(1), but on the hearing of the motion, an adverse inference may be drawn, if appropriate, from the failure of a party to provide the evidence of persons having personal knowledge of material facts.

432.3      (1) Where a judge is satisfied that there is no genuine issue for trial with respect to a claim or defence, the judge shall grant summary judgment accordingly.

(2) Where a judge is satisfied that the only genuine issue is the amount to which the moving party is entitled, the judge may order a trial of that issue or grant summary judgment with a reference to determine the amount.

(3) Where a judge is satisfied that the only genuine issue is a question of law, the judge may determine the question and grant summary judgment accordingly.

(4) Where a judge decides that there is a genuine issue with respect to a claim or defence, the judge may nevertheless grant summary judgment in favour of any party, either upon an issue or generally, unless

(a) the judge is unable on the whole of the evidence to find the facts necessary to decide the questions of fact or law; or

(b) the judge considers that it would be unjust to decide the issues on the motion for summary judgment.

(5) Where a motion for summary judgment is dismissed, either in whole or in part, a judge may order the action, or the issues in the action not disposed of by summary judgment, to proceed to trial in the usual way, but upon the request of any party, a judge may order an expedited trial under rule 327.1.

     In order to succeed here, the plaintiff must establish that there is no genuine issue for trial with respect to the following: its right to bring this action; whether the defendants have infringed a right regarding telecommunications; whether the defendants performed in public a work protected by copyright; whether the plaintiff or the National Football League have, by their actions, authorized, approved or acquiesced to the display of the telecasts by the defendants; whether there has been a breach by the defendants of the Radiocommunications Act; whether, on the facts, an injunction is the appropriate relief to be granted; and, whether the appropriate remedy for the plaintiff is in contract, for breach of the terms of the Sunday Ticket package, rather than for infringement of copyright or breach of the provisions of the Radiocommunications Act.

     In the United States, the copyright in these telecasts is held by the NFL and this plaintiff has a license to rebroadcast certain games as part of a program known as the NFL Sunday Ticket. However, the contracts between the National Football League and the NBC and FOX networks are restricted territorially to the United States. There is no evidence regarding the plaintiff's rights, if any, with respect to broadcast or rebroadcast of National Football League games in Canada. Accordingly, there is still a triable issue as to whether the plaintiff is the owner of the copyright in Canada and if it is not the owner, the nature and extent of its license and the specific subject matter to which the license relates.

     Nor is the evidence clear that the defendants engaged in an unauthorized decryption of the subscription program signal contrary to the provisions of the Radiocommunications Act. As a matter of general practice, an individual wishing to purchase a satellite subscription service buys a satellite dish and a decoder box, both of which are commercially available and necessary for the receipt of the subscription program. The customer's dealings are through his local satellite dealer. The dealer asks the customer to provide the decoder box number, the name, address and method of payment and from that point on, the satellite dealer makes arrangements with a distributor of the subscription programs.

     The plaintiff maintains that once the decoder number is entered into the database then the decoder box is authorized to receive the games by the distributor. Thereafter, in the case of residential subscriptions, another entity called AMS sends certain promotional material to the subscriber which includes, among other things, the NFL magazines and a document purporting to be a contract setting out the terms of the subscription. There is no requirement for the subscriber to execute the contract. The plaintiff asserts that those who receive the blacked out games did so in contravention of the terms of this contract which required that the decoder box should not be moved from the address provided at the time that the subscription was obtained. It is also alleged that if the subscriber is a commercial establishment, then that fact has to be disclosed at the time of the application. A different contract form would then be provided and a different subscription rate would be charged.

     Even if the plaintiff's allegations in this regard were accepted, there remains considerable doubt as to whether the defendants' actions constituted a breach of the Radiocommunications Act. On the contrary, it appears that once the decoder box number was entered into the database, the box was then authorized to receive the program. Thus, the plaintiff's pleading breach of contract raises further issues as to whether there was such a contract, if so, with whom, and whether any of the acts of the defendants constituted a breach of it.

     The resolution of such complex issues of fact and law should not be attempted in a summary way on documentary evidence. It should be done in the more comprehensive setting of a trial. For these reasons, the application is dismissed. Costs in the cause.

O T T A W A

February 10, 1997                      "James A. Jerome"

                             A.C.J.