Dish Network LLC has secured a nearly $42 million default judgment against a Ukraine-based internet hosting provider in a lawsuit that accused the host of enabling "pirate streaming services" that transmitted content owned by the network to U.S. viewers.

On Wednesday, a Seattle federal judge permanently barred Virtual Systems LLC and owner Vyacheslav Smyrnov from streaming or transmitting Dish's exclusively licensed content, as well as from "contributing to, inducing, or failing to stop or limit the public performance of this material in the United States."

Dish alleged that Virtual Systems was using its servers, including a data center in Seattle, to host streamable content to which Dish held the copyrights. Virtual Systems openly encouraged the activity, advertising a policy of not complying with U.S. copyright law nor requiring its customers to do so, according to the suit.

In a 14-page order, U.S. District Judge Barbara J. Rothstein said she'd prefer to settle the case on the merits, but Virtual Systems and Smyrnov had repeatedly failed to respond to the allegations or offer any defense.

Virtual Systems also has not complied with earlier court orders enjoining the host from providing services to certain pirate streaming services, the judge noted. And, according to Dish's filings, Virtual and Smyrnov ignored at least 512 notices of copyright infringement sent via mail and email.

The roughly $41.9 million judgment reflects the network's request for $150,000 per offense, the maximum statutory damages allowed, according to Wednesday's order. Although that's a significant sum, Dish didn't seek other damages it might be entitled to, nor did it ask for attorney fees, Judge Rothstein said. She called the company's request "neutral, neither weighing in favor nor against entry of default judgment."

Dish asserted in its August motion for default judgment that Virtual Systems "could have taken very simple measures to stop the infringement — such as removing or disabling the infringing streams or terminating the pirate services' accounts because of their repeated infringement."

Instead, Virtual Systems did nothing, and continued making money by hosting the pirated streams, according to the filing.

The judge found that Dish adequately pled its allegations and supported them with evidence from an expert witness, who "monitored the pirate streaming services and documented the infringement, which defendants have not refuted."

According to the company's October 2024 complaint, Dish entered into licensing agreements with various channels and networks, obtaining exclusive rights to transmit content through satellite, internet and other means. Pirate services hosted by Virtual Systems violated those rights, Dish alleged.

Virtual Systems also advertised its Seattle servers as "a perfect choice for anyone … with a North American audience," and specifically called out "streaming projects and adult tube sites" as "more than welcome here," the suit said.

The hosting provider also boasted of "DMCA Ignored" servers in Ukraine, for which Virtual Systems advertised it would turn a blind eye to takedown requests under the U.S. Digital Millennium Copyright Act, Dish told the court.

As for its Seattle server, the network said Virtual Systems told customers that "all DMCA notices we receive are processed by our legal team, but we do act courteously towards our valued clients, who might be having occasional issues with copyrights."

Judge Rothstein will retain jurisdiction of the dispute for two years under her decision, with defendants and others who violate the injunction subject to future damages and penalties, including possible contempt of court.

Neither Dish Network nor Virtual Systems immediately responded to requests for comment Thursday. Counsel for Dish also did not immediately respond. Smyrnov could not be reached for comment.

Dish Network LLC is represented by Gregory S. Latendresse of Preg O'Donnell & Gillett PLLC and Joseph H. Boyle, Timothy M. Frank and Stephen M. Ferguson of Hagan Noll & Boyle LLC.

Counsel information for Virtual Systems LLC and Vyacheslav Smyrnov was not immediately available.

The case is Dish Network LLC v. Virtual Systems LLC et al., case number 2:24-cv-01683, in the U.S. District Court for the Western District of Washington.