INNOVATIVE SPORTS MANAGEMENT INC v. RUIZ (2025)

ORDER GRANTING IN PART AND DENYING IN PART MOTIONS FOR SUMMARY JUDGMENT

Re: Dkt. Nos. 56, 58

This case concerns alleged signal piracy. Plaintiff Innovative Sports Management, Inc. owns the domestic commercial-exhibition rights to broadcast certain soccer games nationwide. Innovative sued defendants Benjamin Jean Ruiz, Tibisay Sanchez, Calros Andres Garcia, and Gs-LLC for displaying one of these soccer matches inside their restaurant without a license. Now before the Court is three defendants’ motion for summary judgment and Innovative's converted cross-motion for summary judgment. For the following reasons, the Court grants in part and denies in part both motions.

BACKGROUND

Innovative purchases exclusive commercial-exhibition rights to license certain soccer matches to business establishments, like bars and restaurants, across the United States. In particular, Innovative owned the licensing rights to the September 12, 2023 soccer match between Colombia and Chile. On that date, an agent of Innovative visited a restaurant located in San José, California that was operated by defendant Gs-LLC and known as La Terraza Grill & Bar. The agent observed La Terraza displaying the match on its televisions for its patrons to view. La Terraza did not purchase a license from Innovative to exhibit the match. The California Secretary of State lists defendants Tibisay Sanchez and Carlos Andres Garcia as the managers and members of Gs-LLC. On its California liquor license, La Terraza lists defendant Benjamin Jean Ruiz.

Innovative filed this suit against defendants seeking damages under either 47 U.S.C. § 553 or § 605; damages for conversion under California state law; and restitution under California's Unfair Competition Law (UCL), Cal. Bus. & Prof. Code § 17200 et seq. Innovative personally served Garcia and Sanchez at La Terraza, and those two defendants also accepted service on behalf of Gs-LLC. All three have appeared before this Court. Innovative did not serve Benjamin Jean Ruiz personally or at La Terraza. Instead, Innovative served a person named “Benjamin Jean Ruiz” by substitute service on an unnamed person at a different address in San José. Both Garcia and Sanchez have attested that Ruiz had no ownership interest in La Terraza at the time of the events underlying this suit. For the reasons the Court explained in a recent order in a related case, Innovative has not demonstrated proper service on Ruiz. See Innovative Sports Management, Inc. v. Ruiz, No. 24-cv-07241-PCP, ––– F.Supp.3d ––––, –––– – ––––, 2025 WL 2838815, at *2–3 (N.D. Cal. Oct. 7, 2025). Perhaps unsurprisingly, then, Ruiz has not appeared in this action. The Court hereafter uses “defendants” to refer only to Garcia, Sanchez, and Gs-LLC.

Defendants concede that they displayed the match without purchasing a license from Innovative in contravention of its commercial-exhibition rights, but assert that they did not intercept any cable or satellite signal as required to face liability under § 553 or § 605. Defendants instead contend that they streamed the match over the Internet without using a cable or satellite signal. The only evidentiary support for defendants’ contention are two declarations by Sanchez and Garcia stating that “[t]he signal for the [match] was received from an internet website” and “[n]o cable television signal” or “satellite signal was used to view the [match].” Although defendants’ motion for summary judgment cited to these declarations, defendants did not submit the declarations with the motion and instead filed the declarations only in replying to Innovative's opposition.

In addition to moving for summary judgment on Innovative's § 553 and § 605 claims, defendants seek summary judgment on Innovative's conversion and UCL claims, arguing that the Court lacks jurisdiction over these state-law claims and that Innovative may not recover damages for conversion if it recovers under § 553 or § 605.

The Court held a hearing on defendants’ motion for summary judgment on August 28, 2025. At the hearing, Innovative objected to the Court's consideration of defendants’ reply declarations because Innovative had not had an opportunity to respond to the declarations in writing. The Court granted Innovative leave to file a supplemental brief responding to the declarations.

LEGAL STANDARDS

Summary judgment is proper “if the pleadings, the discovery and disclosure materials on file, and any affidavits show that there is no genuine issue as to any material fact and that the movant is entitled to judgment as a matter of law.” Fed. R. Civ. P. 56(c). The movant bears the initial burden of demonstrating the absence of a genuine issue of fact. See Celotex Corp. v. Catrett, 477 U.S. 317, 323, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). To survive a motion for summary judgment, the non-moving party must present evidence that creates a genuine issue of material fact. See Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248–52, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). “The evidence of the non-movant is to be believed, and all justifiable inferences are to be drawn in his favor.” Id. at 255, 106 S.Ct. 2505.

DISCUSSION

I. The Court exercises its discretion to consider defendants’ reply declarations.

Before considering the merits of defendants’ motion for summary judgment, the Court must address a dispute concerning the record before the Court. Defendants’ motion for summary judgment relies heavily on declarations describing the circumstances under which defendants showed the match at La Terraza. But as detailed above, defendants filed those declarations only in replying to Innovative's opposition. Innovative therefore requests that the Court disregard the reply declarations.

The Court may, at its discretion, consider new evidence filed for the first time in reply if the opposing party has notice of and an opportunity to respond to such evidence. Flathead-Lolo-Bitterroot Citizen Task Force v. Montana, 98 F.4th 1180, 1188–89 (9th Cir. 2024). The Ninth Circuit has held that an adverse party received sufficient notice where the reply evidence was submitted “at least five days before the hearing.” Id. at 1189. To be afforded an opportunity to respond, an adverse party need not respond in writing; an opportunity to respond orally at the hearing is adequate. See id.; El Pollo Loco, Inc. v. Hashim, 316 F.3d 1032, 1041 (9th Cir. 2003).

Defendants submitted their reply declarations on July 30, 2025, more than four weeks before the hearing. Innovative had notice of the declarations well in advance of the hearing given its written objection thereto. The Court also invited Innovative to respond to the reply declarations at the hearing and granted Innovative leave to file a supplemental declaration responding to the declarations after the hearing.¹ As a result, it is within the Court's discretion to consider the reply declarations, and the Court will do so. See Flathead-Lolo-Bitterroot Citizen Task Force, 98 F.4th at 1188–89.

II. Summary judgment in defendants’ favor on the § 553 and § 605 claims is warranted.

Defendants argue that they are entitled to summary judgment on Innovative's § 553 and § 605 claims because they did not intercept a signal covered by those statutes. Section 553 prohibits “intercept[ing] or receiv[ing] ․ any communications service offered over a cable system.” 47 U.S.C. § 553. Section 605 similarly prohibits “intercept[ing]” or “receiv[ing]” satellite signals. 47 U.S.C. § 605; see also G & G Closed Cir. Events, LLC v. Liu, 45 F.4th 1113, 1115–16 (9th Cir. 2022). Defendants contend that a signal “received via the internet” necessarily “falls outside the coverage of the[se] ․ signal piracy statutes.” And defendants’ reply declarations assert that “[t]he signal for the [match] was received from an internet site.”

Contrary to defendants’ argument, a pirated signal that is transmitted via the Internet may still be covered by § 553 or § 605. “Both the Supreme Court and the Ninth Circuit have acknowledged that transmissions over the Internet involve myriad technologies that may include both cable and satellite components.” Liu, 45 F.4th at 1116 (citations omitted). For that reason, the Ninth Circuit reasoned in Liu that § 553 and § 605 “do not provide for an ‘Internet defense’ that automatically absolves an entity of liability” and that these statutes instead “regulate specific methods of transmission.” Id. at 1117. The Ninth Circuit ultimately resolved the dispute in Liu on other grounds, see id., but its “[w]ell-reasoned dicta is the law of the circuit,” United States v. McAdory, 935 F.3d 838, 843 (9th Cir. 2019) (alteration in original) (quoting Enying Li v. Holder, 738 F.3d 1160, 1164 n.2 (9th Cir. 2013)). And in the wake of Liu, other district courts—including ones that previously subscribed to the “Internet defense” theory—have rejected defendants’ argument. See, e.g., G & G Closed Cir. Events, LLC v. Castellanos, No. LA CV 20-10964 WDK-JC, 2025 WL 1174725, at *3 (C.D. Cal. Mar. 28, 2025).

Still, summary judgment is proper because Innovative fails to raise a genuine dispute of material fact as to the nature of the signal intercepted by defendants. In Liu, the Ninth Circuit faced a similar motion for summary judgment in an action concerning a hookah lounge's alleged piracy of a plaintiff's distribution rights to a boxing match. See 45 F.4th at 1115. The Ninth Circuit held that the defendant had met its initial burden of persuasion by providing “declarations from the lounge owner and an employee that [the defendant] purchased the fight from an Internet streaming service and displayed the program by streaming it over the Internet.” Id. at 1116. The burden then shifted to the plaintiff to identify evidence creating a genuine dispute of material fact as to whether a cable or satellite signal was involved in the fight's transmission. Despite having “ample opportunity to pursue ․ discovery to demonstrate how §§ 553 and 605 might encompass the Internet transmission at issue [t]here,” the plaintiff “produced no evidence ․ that the fight could have been transmitted by way of a ‘cable system’ ” or “involved a satellite transmission” covered by the statutes. Id. at 1117. The Ninth Circuit therefore affirmed summary judgment for the defendant lounge.

Here, as in Liu, defendants support their motion with declarations from the owners of La Terraza attesting that “[n]o cable television signal was used to view the [match], and no satellite signal was used to view the [match] either.” Though Innovative had an opportunity for discovery, its opposition identified no evidence concerning defendants’ method of receiving or intercepting the signal that they used to show the match. Counsel for Innovative represented the plaintiff in Liu in the district court and on appeal and so was well aware of the need to present evidence “that [defendants’] method of transmitting the [match] c[ame] within the ambit of §§ 553 or 605.” Id. at 1117. Because Innovative did not do so, summary judgment for defendants on Innovative's § 553 and § 605 claims is appropriate. See id. at 1117–18.

III. The Court grants summary judgment for Innovative on its conversion claim and for defendants on Innovative's UCL claim.

Defendants also move for summary judgment on Innovative's state-law conversion and UCL claims, and request that “i[f] summary judgment is not granted in [their] favor ․ it should be granted in favor of” Innovative. Innovative similarly requests in its opposition that the Court “adjudicate the state law claims.” The Court therefore converts Innovative's opposition into a cross-motion for summary judgment on the state-law claims. See Enplas Display Device Corp. v. Seoul Semiconductor Co., Ltd., No. 13-cv-05038, 2016 WL 454065, at *1 (N.D. Cal. Feb. 5, 2016), aff'd, 909 F.3d 398 (Fed. Cir. 2018).

In California, conversion “comprises three elements: (a) plaintiff's ownership or right to possession of personal property, (b) defendant's disposition of property in a manner inconsistent with plaintiff's property rights, and (c) resulting damages.” Voris v. Lampert, 7 Cal.5th 1141, 1150, 250 Cal.Rptr.3d 779, 446 P.3d 284 (2019) (citation modified). Because no genuine issue of fact exists as to any element, Innovative is entitled to summary judgment on its conversion claim.

First, because intangible property is subject to conversion under California law, id.; see also Welco Elecs., Inc. v. Mora, 223 Cal. App. 4th 202, 210–13, 166 Cal.Rptr.3d 877 (2014), commercial-distribution rights are a form of property subject to conversion. See, e.g., Innovative Sports Mgmt., Inc. v. Lizcano, No. 24-cv-02678-PCP, 2024 WL 5213100, at *4 (N.D. Cal. Dec. 23, 2024). Defendants do not contest Innovative's ownership of exclusive commercial-distribution rights for the match.

Second, defendants’ disposition of the pirated signal—that is, their conceded showing of the match without purchasing a license—was inconsistent with Innovative's exclusive commercial-distribution rights. See id.

And third, Innovative has shown damages, as it submitted an affidavit showing that an establishment the size of La Terraza would have paid $1,000 for the right to display the match. Summary judgment for Innovative on its conversion claim is therefore appropriate.

Defendants conceded at the hearing on this matter that Innovative is entitled to relief on its conversion claim on the merits, but they argue that this Court lacks federal-question or diversity jurisdiction over that claim. Even if that is true, however, the Court has supplemental jurisdiction over both the conversion and UCL claims under 28 U.S.C. § 1367 because they “derive[ ] from the same nucleus of operative fact” as Innovative's federal claims: defendants’ showing of the match without a license. Royal Canin U.S.A., Inc. v. Wullschleger, 604 U.S. 22, 27, 145 S.Ct. 41, 220 L.Ed.2d 289 (2025) (citation modified). Recognizing this, defendants argue that the Court should decline to exercise its supplementary jurisdiction. See Carlsbad Tech., Inc. v. HIF Bio, Inc., 556 U.S. 635, 639–40, 129 S.Ct. 1862, 173 L.Ed.2d 843 (2009) (“[W]hether to exercise [supplemental] jurisdiction after dismissing every claim over which [the Court] had original jurisdiction is purely discretionary.”). Given that this case has been pending in this Court for 18 months and the parties have fully briefed the merits of Innovative's conversion claim, the Court chooses to exercise its supplementary jurisdiction in the interest “of judicial economy, convenience, [and] fairness.” Carnegie-Mellon Univ. v. Cohill, 484 U.S. 343, 350, 108 S.Ct. 614, 98 L.Ed.2d 720 (1988).²

Defendants are also entitled to summary judgment on Innovative's UCL claim. Because the UCL provides only for equitable remedies, the Ninth Circuit has held that plaintiffs seeking equitable relief under the UCL must establish that they lack an adequate remedy at law. See Sonner v. Premier Nutrition Corp., 971 F.3d 834, 844 (9th Cir. 2020). Innovative has not explained why it lacks an adequate remedy at law for defendants’ unlawful exhibition of the match. To the contrary, Innovative conceded at the hearing on this matter that it would have an adequate legal remedy if the Court granted summary judgment in its favor on its conversion claim. Summary judgment for defendants on the UCL claim is therefore proper.

CONCLUSION

For the foregoing reasons, the Court grants summary judgment in favor of defendants as to Innovative's federal and UCL claims and grants summary judgment against Sanchez, Garcia, and Gs-LLC as to Innovative's conversion claim.³ The Court will hold a status conference at 1:00pm on January 22, 2026 in Courtroom 8 of this Court's San José Courthouse to discuss the process for determining any damages, fees, or costs to which Innovative may be entitled on its conversion claim. The parties shall file a joint statement setting forth their proposals for making this determination by no later than January 15, 2026.

IT IS SO ORDERED.

FOOTNOTES

1.   Rather than file a supplemental declaration, Innovative filed a request for judicial notice asking that the Court consider two declarations filed by defendants in other signal-piracy cases. Innovative offers no explanation as to the import of these declarations. On their face, they do not alter the Court's analysis concerning Innovative's failure to raise a triable issue of fact as to the nature of the signal defendants pirated.

2.   Defendants also argue that Innovative may not recover duplicative damages under both a conversion theory and their federal claims. There is no risk of duplicative recovery here because the Court grants defendants’ motion for summary judgment as to the federal claims.

3.   Because Innovative has not demonstrated proper service on Ruiz, the Court will not grant summary judgment against him.

P. Casey Pitts, United States District Judge