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In a setback to DirecTV’s fight against satellite piracy, a federal appeals panel on Tuesday ruled unanimously that the company cannot sue people under a wiretapping law just because they possess cards allowing them to intercept its signal. The 11th U.S. Circuit Court of Appeals in Atlanta said that El Segundo, Calif.-based DirecTV must be able to show that the alleged pirate actually used the device. “Congress chose to confine private civil actions to defendants who had ‘intercepted, disclosed, or intentionally used [a communication],’” the 11th Circuit panel said. “Possession of a pirate access device alone, although a criminal offense, creates nothing more than conjectural or hypothetical harm to [DirecTV].” It’s the first federal appellate decision on the issue, and thus is controlling law nationally for the time being. Judge William H. Pryor Jr., who was placed on the bench by President Bush in a controversial recess appointment without Senate confirmation, wrote the decision, DirecTV Inc. v. Treworgy. DirecTV did not return calls for comment, nor did the company’s appellate attorney, Douglas Spears, of Stump Storey Callahan Dietrich & Spears in Orlando, Fla. Tuesday’s ruling affirmed the August 2003 decision of U.S. District Judge John E. Steele, who sits in Fort Myers, Fla. He dismissed DirectTV’s wiretapping claim against Punta Gorda resident Mike Treworgy. The appeals panel called DirecTV’s reading of the wiretapping law “tortured.” DirecTV sued Treworgy in July 2003 after obtaining his name from Fulfillment Plus, an El Dorado Hills, Calif.-based mailing facility. That company’s records showed that Treworgy bought two pirating cards, which enable someone with a satellite dish to receive signals without paying for the hook-up. The appeals court heard oral argument in the case last month. Robert Apgood, a partner at Avant Law in Seattle who represented Treworgy, said DirecTV had no direct evidence that his client actually intercepted the signal. That’s typical of the cases DirecTV litigates, he said. Treworgy’s trial lawyer, Albert Zakarian, a solo practitioner in Tampa, Fla., convinced Judge Steele to dismiss the possession allegation. He argued, and the judge agreed, that under the law, DirecTV had failed to state a cause of action under the Electronic Communications Privacy Act of 1986. Zakarian also worked on the appeal. Publicly traded DirecTV is the biggest provider of digital satellite television in the country. It offers more than 200 channels to customers who receive programming beamed in from satellites. The company is a division of publicly owned DirecTV Group, which also has operations in Latin America. During the past two years DirecTV has waged a massive legal campaign against alleged pirates who steal its signal. Since June 2002, it has filed more than 24,000 lawsuits across the country. The legal assault began after a series of raids on companies that sold decoders enabling viewers to steal DirecTV’s signal. The satellite television operator obtained the names of some 100,000 people in the raids from credit card receipts and other lists. O.J. Simpson has been a high-profile target of the litigation in South Florida, where DirecTV has filed hundreds of lawsuits in federal and state courts. Simpson was caught up in the DirecTV dragnet when the company sued him in U.S. District Court in Miami on March 3 for allegedly pirating its signal. As of March, DirecTV saw four cases go to trial. It prevailed in each one. In February, the company won a $30,000 award against a South Florida man in U.S. District Court in Miami. Federal district courts around the country — including in Florida, New Jersey, Michigan, Illinois, Ohio, Louisiana and Alabama — have split over whether the wiretapping law allows civil prosecution for simply possessing the access cards, and some have allowed the lawsuits charging possession to go forward. The 11th Circuit ruling means that DirecTV will have to conduct a costly investigation of each person it wants to sue to see if the person has actually pirated the signal, said Jason Schultz, a staff attorney for the San Francisco-based Electronic Frontier Foundation, which filed an amicus brief in the Treworgy case. “They are really going to have to sit down and think about their anti-piracy strategy,” he said. “If a $35 piece of equipment is all it takes to hack into their signal, maybe upgrading their security to make it more difficult would be cheaper in the long run and more fair.”

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