DISH Network Implores Court to Rethink Remand Order in Illinois Municipality’s Right-of-Way Fee Class Action

Last Friday, DISH Network filed an amended motion for reconsideration of the court’s March 24 order granting plaintiff the Village of Shiloh’s motion for remand. The television provider, one plaintiff alongside other companies that offer subscribers online streaming video service, says that there is good reason to consolidate this case with an identical, first-filed federal court case because the factors buoying consolidation outweigh the comity abstention factors addressed in last month’s order. 

The Village of Shiloh sued Netflix, Hulu, Disney, DISH, and DIRECTV in state court, arguing that they owe it fees under the state’s Cable and Video Competition Law of 2007. According to the plaintiff, they provide services that bring them within the ambit of the statute, and like all traditional cable television providers, must pay public right-of-way usage fees.

The case was filed on behalf of all local units of government within the state and to which the defendants provide video service. The defendants removed the case on the basis of diversity jurisdiction, causing the plaintiff to seek remand.

Last month, the court granted the plaintiff’s motion, abstaining from exercising jurisdiction on the basis of comity. Magistrate Judge Mark A. Beatty reasoned that the statutory interpretation questions at the heart of the case were better left to the state court system.

The court however acknowledged that a previously filed case, identical in nature to the Village of Shiloh’s, would create duplicative litigation with one case proceeding in federal and the other in state court. Judge Beatty further remarked that even in view of this possible outcome, the defendants neither asked for a stay nor formally asked for the court to consolidate or coordinate the two cases.

“The Court is not a clairvoyant and this is simply not the type of issue this Court can and should address sua sponte without formal briefing and a full-throated discussion on the topic because the path forward is not manifestly clear,” the opinion concluded.

Now, DISH requests that the Southern District of Illinois court “recall its mandate to the state court and grant leave to file a formal motion to consolidate.” In support of its argument, DISH contends that consolidation is appropriate, and the arguments made by the streaming platforms “amount to an effective request for consolidation.”

The motion further asserts that comity does not warrant remand instead of consolidation. The filing notes that comity-based abstention is the exception, not the rule, and that in fairness to the defendants under the Class Action Fairness Act, “the court has [to] avoid duplicative litigation of putative class actions, like these actions, that are properly before the federal court.”

The Village of Shiloh is represented by Despres, Schwartz & Geoghegan Ltd. and DISH Network by Steptoe & Johnson LLP, Cross Castle PLLC, and Armstrong Teasdale LLP.