The opinion of the court was delivered by: GARRETT BROWN, District Judge
This matter comes before the Court upon plaintiff DIRECTV's
("Plaintiff" or "DIRECTV") motion to dismiss defendant Dave
Richards' ("Defendant") counterclaim pursuant to Fed.R.Civ.P.
12(b)(6) for failure to state a claim upon which relief may be
granted. DIRECTV also seeks to recover its attorneys' fees
associated with this motion. The Court has jurisdiction over this
matter pursuant to 28 U.S.C. § 1331. The Court, having considered
the parties' submissions and decided the matter without oral
argument pursuant to Fed.R.Civ.P. 78, will grant DIRECTV's
motion and award attorneys' fees.
On November 25, 2003, DIRECTV instituted this action against
several named defendants,*fn1 including Dave Richards,
alleging violation of the Federal Communications Act of 1934
("the Communications Act"), 47 U.S.C. § 605, and the Electronic
Communications Privacy Act ("the Privacy Act"),
18 U.S.C. §§ 2510-2521. See Complaint ¶ 5.
DIRECTV is a direct broadcast satellite provider that delivers
television programming to millions of homes and businesses across the nation. See
Complaint ¶ 1. DIRECTV invested over $1.25 billion in developing
its direct broadcast satellite system. Id. In order to secure
and prevent unauthorized viewing of its programming, DIRECTV
encrypts, or electronically scrambles, its satellite
transmissions. Id. at ¶ 2. DIRECTV has been plagued by the
proliferation of companies engaged in the sale of illegal
equipment that unscrambles their signal and allows users to view
their programming for free. With the assistance of law
enforcement authorities, DIRECTV has engaged in an aggressive
campaign designed to identify the manufacturers and distributors
of pirate access devices and the individuals purchasing them and
recover lost revenue via legal actions.
On or around December 1, 2001, DIRECTV executed Writs of
Seizure upon an internetbased seller, The Computer Shanty. Id.
at ¶ 3. Through its website, The Computer Shanty was allegedly
selling pirate access devices that are used to illegally
intercept transmission signals, including DIRECTV's programming.
Id. DIRECTV acquired The Computer Shanty's business records and
commenced actions against those individuals who allegedly
purchased illegal devices for resale or to intercept DIRECTV's
programming for unauthorized viewing. Id.
DIRECTV alleges that Defendant purchased pirate access devices
over the internet on The Computer Shanty's website. Id. at ¶
13. On or about May 30, 2001, Defendant allegedly purchased two
devices; namely, two "Boot Loader Boards." Id. at ¶ 13(a).
These devices were shipped to Defendant's home in Lodi, New
Jersey. Id. DIRECTV claims that Defendant's actions violate
Section 605 of the Communications Act and Sections 2510-2521 of
the Privacy Act.
On August 31, 2004, Defendant filed a motion to dismiss
DIRECTV's complaint and a motion to quash the third-party subpoena on PayPal.*fn2 On
October 14, 2004, this Court denied both motions. Subsequently,
on October 18, 2004, Defendant filed an answer and counterclaim,
asserting that DIRECTV had engaged in false, misleading and
deceptive acts and practices in violation of the New Jersey
Consumer Fraud Act, N.J. STAT. ANN. §§ 56:8-2 and 56:8-19, et
seq., by circulating derogatory and inaccurate information
regarding Defendant's financial responsibility and credit
worthiness ("Counterclaim"), causing him to suffer emotional and
financial damages. See Counterclaim ¶¶ 6-31. By letter dated
November 3, 2004, DIRECTV advised Sobel that it believed the
Counterclaim was patently frivolous and demanded that it be
withdrawn. During a November 15, 2004 Telephonic Status
Conference with Magistrate Judge John J. Hughes, the parties
addressed Defendant's counterclaim. Judge Hughes' November 19,
2004 Scheduling Order states: "In the event that Defendant
Richards does not withdraw his Counterclaim, Plaintiff may, at
any time, move to dismiss Defendant Richards' Counterclaim and
may seek its attorney's fees in connection therewith." See
Scheduling Order, entered November 19, 2004 .
Defendant has not withdrawn the Counterclaim. On December 1,
2004, DIRECTV filed the instant motion to dismiss the
Counterclaim and seeks its attorneys' fees and costs associated
with the motion.
A. Standard for a Motion to Dismiss
A motion to dismiss pursuant to Fed.R.Civ.P. 12(b)(6) may be
granted only if, accepting all well-pleaded allegations in the complaint as true,
and viewing them in the light most favorable to plaintiff,
plaintiff is not entitled to relief. Oran v. Stafford,
226 F.3d 275, 279 (3d Cir. 2000); Langford v. City of Atl. City,
235 F.3d 845, 850 (3d Cir. 2000); Bartholomew v. Fischl,
782 F.2d 1148, 1152 (3d Cir. 1986). The Court may not dismiss a complaint
unless plaintiff can prove no set of facts that would entitle him
to relief. Conley v. Gibson, 355 U.S. 41, 45-46 (1957);
Angelastro v. Prudential-Bache Sec., Inc., 764 F.2d 939, 944
(3d Cir. 1985), cert. denied, 474 U.S. 935 (1985). "The issue
is not whether a plaintiff will ultimately prevail but whether
the claimant is entitled to offer evidence to support the
claims." Scheuer v. Rhodes, 416 U.S. 232, 236 (1974).
Under Rule 12(b)(6), the Court must "accept the allegations in
the complaint as true, and draw all reasonable factual inferences
in favor of the plaintiff. [The motion can be granted] only if no
relief could be granted under any set of facts that could be
proved." Turbe v. Gov't of the V.I., 938 F.2d 427, 428 (3d Cir.
1991) (citing Unger v. Nat'l Residents Matching Program,
928 F.2d 1392, 1394-95 (3d Cir. 1991)); see also Langford,
235 F.3d at 850; Dykes v. SE. Pa. Transp. Auth., 68 F.3d 1564,
1565, n. 1 (3d Cir. 1995), cert. denied, 517 U.S. 1142
(1996); Piecknick v. Commw. of Pa., 36 F.3d 1250, 1255 (3d Cir.
1994); Jordan v. Fox, Rothschild, O'Brien & Frankel,
20 F.3d 1250, 1261 (3d Cir. 1994). A complaint may be dismissed for
failure to state a claim where it appears beyond any doubt "that
no relief could be granted under any set of facts that could be
proved consistent with the allegations." Hishon v. King &
Spalding, 467 U.S. 69, 73 (1984).
A complaint should not be dismissed unless it appears beyond
doubt that "the facts alleged in the complaint, even if true,
fail to support the claim." Ransom v. Marrazzo, 848 F.2d 398, 401 (3d Cir. 1988). Legal conclusions made in the guise of
factual allegations, however, are given no presumption of
truthfulness. Papasan v. Allain, 478 U.S. 265, 286 (1986);
see also Morse v. Lower Merion Sch. Dist., 132 F.3d 902,
906 (3d Cir. 1997) ("[A] ...