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Case 1:10-cv-00725-PGG-DCF Document 33 Filed 07/30/13 Page 1 of 10

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK

RAMI SHAMIR,

Plaintiff,

v.

ANCHOR·INTERNA TIONAL
FOUNDATION, INC., CIRCLES
INTERNATIONAL, LIGHTNING SOURCE,
RICHARD TORRENCE, and MARSHALL
Y AEGAR, inclusive,

USDC SDNY
DOCUMENT
ELECTRONICALL Y FILED

DOC#:


DATE FILED:
7/3 01,3

I

,

ORDER

10 Civ. 725 (PGG)

PAUL G. GARDEPHE, U.S.DJ.:


Plaintiff Rami Shamir filed this action against Defendants Anchor· International

Foundation, Inc. ("Anchor"), Circles International ("Circles"), Lightning Source, Richard

Torrence, and Marshall Y aegar, claiming copyright infringement in violation of Section 106 of

the Copyright Act, and raising state law claims of invasion of privacy, misappropriation, and

unfair competition. (Cmplt. ~~ 23·25,33·34,38) On February 10,2010, Plaintiff voluntarily

dismissed as against Defendant Lightning Source. (Dkt. No.9)

None of the remaining defendants answered or otherwise responded to the

Complaint. Accordingly, on May 18, 2010, this Court entered a default judgment against

Anchor, Circles, Torrence and Yaegar (Dkt. No. 15), and referred the action to Magistrate Judge

Debra Freeman for an inquest on damages. (Dkt. No. 16) On March 20,2012, Judge Freeman

issued a Report and Recommendation ("R&R") recommending that this Court award Plaintiff

$5,000 in statutory damages pursuant to 17 U.S.C. § 504(c) and deny Plaintiffs request for

attorneys' fees and costs. (Dkt. No. 31) Yaegar filed written objections to the R&R (Dkt. No.

Case 1:10-cv-00725-PGG-DCF Document 33 Filed 07/30/13 Page 2 of 10

32); no other party has submitted objections. For the reasons stated below, this Court will adopt

Judge Freeman's R&R in its entirety.

BACKGROUND

In 2007, Plaintiff authored and registered a copyright for a novel entitled, "Train

to Pokipse." (R&R at 2 (citing Cmplt. ~~ 4, 10)) Defendant Anchor is a not-for-profit

organization that owns Defendant Circles, a publishing company. (R&R at 2 (citing Cmplt. ~~ 5,

6)) Defendant Torrence, who is now deceased, was the executive director of Anchor, and

Defendant Yaegar is the president of Circles. (R&R at 2 (citing Cmplt. ~~ 8, 9)) In May 2009,

Yaegar and Torrence, via Anchor, offered a grant to assist Plaintiff with the publication of "Train

to Pokipse." (R&R at 2 (citing Cmplt. ~~ 11, 12)) Yaegar helped Plaintiff copy-edit the novel

and by September 2009, Defendants had printed "advanced reader's copies" of the book. (R&R

at 2 (citing Cmplt. ~~ 14, 16)) Plaintiff never transferred any of his copyright or publication

rights to Defendants, however. (R&R at 2 (citing Cmplt. ~~ 13, 17))

In October 2009, Plaintiff discovered that Defendants were selling his novel

through Defendants' website and various third-party websites. (R&R at 2 (citing Cmplt. ~~ 17,

18)) Plaintiff sent a cease and desist e-mail to Lightning Source - a publishing company used by

Circles on October 9, 2009. (R&R at 2-3 (citing Cmplt. ~~ 7,20)) Lightning Source

responded that all inquiries should be directed to Yaegar, and forwarded the e-mail to Yaegar.

(R&R at 3 (citing Cmplt. ~ 20)) Plaintiff sent another cease and desist letter to all Defendants on

November 11,2009. (R&R at 3 (citing Cmplt. ~ 21))

On January 29, 2010, Plaintiff filed a complaint alleging copyright infringement,

pursuant to 17 US.c. §§ 106(1), (3), and (5); invasion of privacy under New York Civil Rights

Law § 51; and misappropriation and unfair competition under New York common law. (R&R at

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Case 1:10-cv-00725-PGG-DCF Document 33 Filed 07/30/13 Page 3 of 10

3) On February 11,2010, this Court issued a preliminary injunction enjoining Defendants from

taking any action that infringed Plaintiffs copyright (Dkt No.1 0)

None of the Defendants answered or otherwise responded to the Complaint.

Accordingly, on May 3, 2010, this Court issued an order requiring Defendants to show cause

why a default judgment should not be entered against them. (Dkt. No. 13) Defendants filed no

response to the order to show cause, and Plaintiff moved for a default judgment. (Dkt. No. 14)

On May 18, 2010, this Court entered a default judgment against Defendants Anchor, Circles,

Torrence, and Yaegar (Dkt. No. 15), and referred the matter to Judge Freeman for an inquest on

damages. (Dkt. No. 16)

Before Judge Freeman, Plaintiff sought $150,000 per defendant in statutory

damages on the copyright infringement claim, $38,176 in attorneys' fees, and $1,500 in costs.

(R&R at 5 (citing Supplemental Submission with Respect to Damages (Dkt. No. 19))) Plaintiff

did not request any damages with respect to his state law claims. (R&R at 5-6 (citing

Supplemental Submission with Respect to Damages (Dkt. No. 19)))

On August 2, 2010, Defendant Yaegar sent a letter to Judge Freeman in his

capacity as "Administrator" of Anchor. (R&R at 6 (citing Yaegar Ltr. (Dkt. No. 22))) In

response, Judge Freeman issued an order noting that, as a pro se litigant, Yaegar could not make

a submission on behalf of a corporation such as Anchor (Dkt. No. 20) (citing Grace v. Bank

Leumi Trust Co., 443 F.3d 180, 192 (2d Cir. 2006))), and also could not act on behalf of the

other individual defendants. (Id.) Judge Freeman also noted that Yaegar's August 2,2010 letter

dealt only with liability, and did not address the damages issue that had been referred to Judge

Freeman. (R&R at 6 (citing August 2,2010 Yaegar Ltr. (Dkt. No. 22)))

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Case 1:10-cv-00725-PGG-DCF Document 33 Filed 07/30/13 Page 4 of 10

Accordingly, on November 23, 2010, Judge Freeman issued an order giving

Defendants a final opportunity to respond to Plaintiff s submission on damages. (R&R at 6-7

(citing Scheduling Order for Damages Inquest (Dkt. No. 20))) Judge Freeman's order explicitly

informed the Defendants that Anchor could make a submission only through counsel, and that

Torrence could make a submission either pro

or through counsel. (Dkt. No. 20)

On December 3, 2010, Defendant Torrence, proceeding pro se, sent a submission

to Judge Freeman that addressed liability. Torrence's remarks concerning damages were limited

to a representation that Defendants had no assets and that, accordingly, any damages award

would be uncollectible. (Dkt. No. 21 at 5)) Yaegar sent additional letters to Judge Freeman

contesting liability and claiming financial inability to satisfy any type ofjudgment. (R&R at 8

(citing Yaegar Ltrs. (Dkt. Nos. 28, 29)))

On January 24, 2012, Judge Freeman conducted an evidentiary hearing on

damages. None of the Defendants appeared at the hearing. (R&R at 8-9) At the hearing,

Plaintiff testified about Defendants' continued sale of "advanced reading copies" of "Train to

Pokipse," despite his cease and desist letters and e-mail, and about the damages that Plaintiff had

suffered as a result of Defendants' infringing activities. (R&R at 9) After the hearing, Yaegar

sent a letter to the court asserting that only 100 "advanced reading copies" of the novel were ever

printed by the Defendants. (R&R at 9)

On March 30, 2013, Judge Freeman issued her R&R. (Dkt. No. 31) In the R&R,

Judge Freeman found that Defendants willfully infringed Plaintiffs copyright by continuing to

sell copies of "Train to Pokipse" despite Plaintiff s cease and desist letters, and that Defendants

had realized estimated profits of $1 ,200 from their infringing activities. (R&R at 12 (citing

Cmplt. ~~ 20, 21; Hearing Tr. at 6)) Judge Freeman also determined that Plaintiff suffered no

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Case 1:10-cv-00725-PGG-DCF Document 33 Filed 07/30/13 Page 5 of 10

losses due to Defendants' infringement because, by Plaintiffs own admission, the book was not

ready for release. (R&R at 12) Accordingly, Judge Freeman concluded that "this case presents a

situation of willful infringement, with modest profits to the infringers, at best, and no

demonstrable, actual loss to Plaintiff. Under the circumstances, while the Court retains the

discretion to award anywhere from $750 to $150,000 in statutory damages, a relatively modest

award would be appropriate here." (R&R at 12-13)

Judge Freeman recommended a $5,000 statutory damages award on Plaintiffs

copyright infringement claim. (R&R at 13) She determined that "[t]his award, while far less

than sought by Plaintiff, would still amount to more than four times the revenue generated by

Defendants' infringement, should be sufficient to deter future infringement, and would be

supported by precedent in this circuit." (R&R at 13 (collecting cases)) Judge Freeman further

recommended that Defendants be held jointly and severally liable for the award. (R&R at 14)

Finally, Judge Freeman recommended that this Court deny Plaintiffs request for attorneys' fees

and costs, because Plaintiffs unsworn, unauthenticated submission, and non-contemporaneous

records, do not substantiate Plaintiff s requested award. (R&R at 15-17) I

On April 5,2012, Yaegar submitted written objections to Judge Freeman's R&R. 2

(Dkt. No. 32) Yaeger's objections address liability and not damages. (Id. at 1-2) No other party

filed an objection.

I Judge Freeman also recommended that no damages be awarded for Plaintiffs state law claims,

because Plaintiff did not request - and thus had waived - any right to damages on those claims.

(R&R at 8 n.7) This Court finds no clear error in this determination.

2 Yaegar's objections were submitted on the letterhead of Anchor. As Judge Freeman noted, as

a pro se party, Yaegar may not appear on behalf of a corporation or any other defendant. (R&R

at 6 (citing Grace, 443 F.3d at 192)).


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Case 1:10-cv-00725-PGG-DCF Document 33 Filed 07/30/13 Page 6 of 10

I.

STANDARD OF REVIEW


DISCUSSION


This Court "may accept, reject, or modify in whole or in part" findings or

recommendations issued by a magistrate judge. 28 US.C. § 636(b)(1). A district court must

review de novo "those portions of the report or specified proposed findings or recommendations

to which objection is made." Id. § 636(b)(1)(C). "To the extent, however, that the party makes

only conclusory or general arguments, or simply reiterates the original arguments, the Court will

review the Report strictly for clear error." Indymac Bank, F.S.B. v. Nat'l Settlement Agency,

Inc., No. 07 Civ. 6865, 2008 WL 4810043, at *1 (S.D.N.Y. Nov. 3, 2008); Ortiz v. Barkley, 558

F. Supp. 2d 444,451 (S.D.N.Y. 2008) ("Reviewing courts should review a report and

recommendation for clear error where objections are merely perfunctory responses, argued in an

attempt to engage the district court in a rehashing of the same arguments set forth in the original

petition.") (citation and internal quotation marks omitted).

"The objections of parties appearing pro se are 'generally accorded leniency' and

should be construed 'to raise the strongest arguments that they suggest. ", DiPilato v. 7-Eleven,

Inc., 662 F. Supp. 2d 333, 340 (S.D.N.Y. 2009) (quoting Milano v. Astrue, 05 Civ. 6527,2008

WL 441Ol31, at *24 (S.D.N.Y. Sept. 26,2008) (internal quotation marks omitted)).

'''Nonetheless, even a pro se party's objections to a Report and Recommendation must be

specific and clearly aimed at particular findings in the magistrate's proposal, such that no party

be allowed a second bite at the apple by simply relitigating a prior argument.'" Id. (quoting

Pinkney v. Progressive Home Health Servs., No. 06 Civ. 5023, 2008 WL 2811816, at * 1

(S.D.N.Y. July 21,2008) (internal quotations marks omitted)).

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Case 1:10-cv-00725-PGG-DCF Document 33 Filed 07/30/13 Page 7 of 10

II.

THE R&R IS NOT CLEARLY ERRONEOUS

In his objections, Yaegar argues that: (l) Plaintiff had already published and sold

an earlier version of the novel; (2) Defendants only published 100 "Advanced Reading Copies"

of "Train to Pokipse"; (3) Plaintiff put ads for "Train to Pokipse" on the Internet; (4) Plaintiff is

mentally unstable; (5) Plaintiffs suit is motivated by a desire to extort money from Defendants;

(6) Plaintiff has no proof that Defendants sold his book; (7) the copies Defendants published

were never sold; (8) advanced reading copies cannot be copyrighted and thus Plaintiff could not

obtain a copyright for Defendants' edited version of "Train to Pokipse"; and (9) Plaintiff picked

up the approximately 1 00 published copies of the novel from Yaegar's apartment building after

Defendants severed ties with Plaintiff. (Yaegar Obj. at 1-2) These arguments do not address

Judge Freeman's findings concerning damages, but instead relate to liability.

To the extent that Yaegar's objections could be construed as addressing damages,

his objections lack specificity and are not directed at particular findings of fact or conclusions of

law in the R&R. Accordingly, this Court will review Judge Freeman's R&R for clear error. See

Gilmore v. Comm'r of Soc. Sec., No. 09 Civ. 6241 (RMB)(FM), 2011 WL 611826, at *1

(S.D.N.Y. Feb. 18,2011) (,"The district judge evaluating a magistrate judge's recommendation

may adopt those portions of the recommendation, without further review, where no specific

objection is made, as long as they are not clearly erroneous. "') (quoting Chimarev v. TO

Waterhouse Investor Servs., Inc., 280 F. Supp. 2d 208,212 (S.D.N.Y. 2003)).

A.

Statutory Damages

In making her recommendations, Judge Freeman applied the correct standard for

determining a statutory damages award under the Copyright Act, 17 U.S.C. § 504(c). Judge

Freeman considered: "'(1) the infringers' state of mind; (2) the expenses saved, and profits

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Case 1:10-cv-00725-PGG-DCF Document 33 Filed 07/30/13 Page 8 of 10

earned, by the infringer; (3) the revenue lost by the copyright holder; (4) the deterrent effect on

the infringer and third parties; (5) the infringer's cooperation in providing evidence concerning

the value of the infringing material; and (6) the conduct and attitude of the parties.'" (R&R at 11

(quoting Bryant v. Media Right Prods., Inc, 603 F.3d 135, 144 (2d Cir. 2010)))

As to the infringers' state of mind, Judge Freeman correctly found that

Defendants willfully infringed Plaintiff's copyright because they continued to offer copies of

"Train to Pokipse" for sale even after Plaintiff sent them multiple cease and desist letters. (R&R

at 12) Judge Freeman found that there was little evidence as to the expenses saved, and profits

earned, by the Defendants, because they had not participated in the proceedings. (R&R at 12)

Judge Freeman determined, however, that because Defendants retained approximately 100

copies of the book, which were advertised for sale at $12 each, the Defendants estimated profit

was $1,200. (R&R at 12) There is no clear error in Judge Freeman's findings, especially "in the

absence of any evidence on costs that could have been supplied by Defendants," had they chosen

to participate in the damages inquest hearing. (See R&R at 12)

There is also nothing clearly erroneous in Judge Freeman's finding that Plaintiff

could not substantiate any revenue loss because he admitted that the book was not yet ready for

publication. (R&R at 12); see Harpercollins Publishers L.L.C. v. Gawker Media LLC, 721 F.

Supp. 2d 303, 307 (S.D.N. Y. 2010) (granting temporary restraining order against on-line media

company from publishing abridged versions of copyright holder's book before the copyright­

holder officially released her book, but noting that "[a] later claim for damages would probably

be unavailing because of problems of measurement").

Accordingly, this Court agrees with Judge Freeman that where, as here, there is

"willful infringement, with modest profits to the infringers, at best, and no demonstrable, actual

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Case 1:10-cv-00725-PGG-DCF Document 33 Filed 07/30/13 Page 9 of 10

loss to Plaintiff," a modest statutory award of$5,000 is appropriate. (R&R at 12-13 (collecting

cases with similar statutory damages awards));

Yurman Studio, Inc. v. Castaneda, Nos. 07

Civ. 1241(SAS), 07 Civ. 7862(SAS), 2008 WL 4949775, at *3 (S.D.N.Y. Nov. 19,2008)

("[S]tatutory damages cannot be divorced entirely from economic reality .... [Courts should not]

impos[e] ... monumental statutory damages against smaller-scale or shorter-term willful

infringers. ").

B.

Attorneys' Fees and Costs

Judge Freeman also correctly denied Plaintiffs application for attorneys' fees and

costs. The Second Circuit requires that a party seeking an award of attorneys' fees support the

request with contemporaneous time records that "specify, for each attorney, the date, the hours

expended, and the nature of the work done." N.Y. State Ass'n for Retarded Children, Inc. v.

Carey, 711 F.2d 1136, 1147 (2d Cir. 1983)). Here, Plaintiff submitted only an unsworn,

unauthenticated document that does not substantiate the dates when work was performed, the

hours expended, or the nature of the work completed by the various timekeepers. (R&R at 15­

16) Judge Freeman also noted that, in violation of Carey, Plaintiff had not put forth either a

sworn or unsworn statement representing that his submission constituted a compilation of

contemporaneous time records. (R&R at 17)

As to costs, Plaintiff submitted no affidavit or declaration confirming that the

requested costs were actually incurred. (Id.)

Given these defects, Plaintiffs submissions do not provide an adequate basis for

an award of costs or attorneys' fees. See Ermenegildo Zenga Corp. v. 56th Street Menswear,

No. 06 Civ. 7827 (HB)(GWG), 2008 WL 4449533, at *6 (S.D.N.Y. Oct. 2,2008) (noting

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that "courts routinely decline to award fees when a party submits a fee request that fails to

indicate that it is based on contemporaneous time records").

CONCLUSION

The Court adopts the findings and conclusions set forth in Judge Freeman's

Report and Recommendation in their entirety. It is hereby ORDERED that Defendants are

jointly and severally liable for statutory damages, pursuant to the Copyright Act, 17 U.S.C. §

504(c), in the amount of$5,000. Plaintiff's request for attorneys' fees and costs is denied.

The Clerk of the Court is directed to enter judgment for Plaintiff and to close this

case.

Dated: New York, New York

July 29, 2013

SO ORDERED.

Paul G. Gardephe
United States District Judge

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