Copyright Troll Case Tossed For 'Fraud On The Court' After Abbott & Costello-Worthy Hearing

Legal Issues

from the who's-on-first? dept

We’ve written a few times lately about judges blasting copyright trolls — and divorce lawyer-turned-copyright troll John Steele’s name seems to show up quite frequently in many of those cases. However, this latest one takes the cake — found via incredible stories on Fight Copyright Trolls and Ars Technica. The short version is that the judge has thrown out the case — but that’s not the really fun part. Here’s the order throwing it out:

The case is dismissed for failure to appear at this hearing, for failure to present a lawful agent, for attempted fraud on the Court by offering up a person who has no authority to act on behalf of the corporation as its corporate representative, and the Court will hear, by motion, a motion for sanctions and fees against this Sunlust entity and everyone affiliated with it, including a motion against Mr. Wasinger for his purposeful failure to appear at this hearing.

How did it reach that point? Well, this involves a bit of background… and then it requires, yes requires that you find time in your day to go read the court transcript (also embedded below) of what happened.

First, the background. If you’ve been following Steele, you’ll remember that he got blasted by judges in his home state of Illinois. Then, he suddenly showed up in Florida (as did many copyright trolling cases). Fight Copyright Trolls did a wonderful bit of investigatory journalism concerning Steele’s move to Florida and connection to “Prenda Law Firm.” At issue: Steele is not licensed to practice law in Florida, but there were indications that he was doing exactly that. Steele insisted that he was “retiring” to Florida, and not working. After lawyer Graham Syfert (who has been defending many defendants in troll cases) alerted the Florida Bar to Steele’s activities, the Bar got Steele to sign a cease and desist affidavit agreeing “not to engage in any activities which constitute unlicensed practice of law….” However, there appeared to be plenty of evidence that Steele was still copyright trolling as a part of Prenda.

Okay, leap forward to yet another copyright trolling lawsuit, supposedly brought by a company called Sunlust. A hearing was to be held on November 27th… with federal judge Mary Scriven, and you have to read it to believe it. Officially, Sunlust’s lawyer, Jonathan Torres, appears by phone with permission from the court. But, the judge is perplexed, to say the least, because Torres, who has only just been brought on, has asked to withdraw from the case, as apparently a few other lawyers have as well. Also in the court is a Mark Lutz, appearing as the “representative” of Sunlust. The hearing begins with the judge scolding Lutz for not wearing a jacket and tie to court, and then starts digging into who exactly is the lawyer representing Sunlust.

THE COURT: Well, I’m a little confused. There was a lawyer who moved to withdraw, and there was another lawyer who moved to appear, then he moved to withdraw, so who is on first, I guess?

The judge asks Torres how he came to be associated with the case and is told that he was hired by “the client, Prenda Law,” and we go back to the transcript:

THE COURT: The client and Prenda Law or Prenda Law?
MR. TORRES: Prenda Law, Your Honor,
THE COURT: And what is their relation to you?
MR. TORRES: Just co-counsel arrangement, Your Honor.
THE COURT: And what is that arrangement?
MR. TORRES: For me to appear for any local hearings, Your Honor.
THE COURT: Well, I got a letter from someone from the Prenda Law Group saying they were not representing any party in this case and were not involved in the case and had no authority to speak on anyone’s behalf in this case, so is Prenda Law principal counsel in the case or not?
MR. TORRES: No, Your Honor.
THE COURT: So what is their relationship again then to you as counsel in this case?
MR. TORRES: Well, Your Honor, I was —

The judge then puts Torres under oath and then quizzes him much more directly about Prenda law and his relationship to Prenda, as well as everyone’s relationship to the supposed client, Sunlust. Torres has only spoken to Prenda and believes that Prenda represents Sunlust. He notes that it’s a contingency deal… but that he, too, is asking to withdraw from the case after being made aware of “certain issues that were going on in the case” by the defense. The judge explores how much Torres knew about the case, and whether or not the previous lawyer, a Mr. Wasinger, had spoken to him (he hadn’t). Wasinger was the lawyer who had asked to be removed from the case already, and wasn’t in court, even though the judge had not granted him permission to leave the case (later leading him to file an apology saying he got mixed up). Finally, Torres admits that he had not looked closely at the case docket before asking to appear on Sunlust’s behalf.

The judge then reads a letter from Paul Duffy, another Chicago lawyer who helped set up Prenda and claims in the letter to be the sole principal of Prenda who claims to be surprised that Prenda has been asked to appear in this case. He begs off in the letter, as read/summarized by the judge:

As an initial matter, I must respectfully inform the Court I am located in Chicago and my attendance would require air travel and he has had surgery on his eyes and this and that.

Then he says, I also respectfully question how my appearance could benefit the Court, particularly since I am not representing anyone, in italics, in this case and have no authority to speak on anyone’s behalf.

It would certainly — it would clearly be improper for me to make any statement on a pending matter in a jurisdiction in which I am not licensed and on behalf of a client I do not represent. In light of the foregoing, I pray that the Court will excuse my attendance at this hearing.

The judge then returns to Torres to see if he can explain this mess, since Torres claims to have been hired only by Prenda and Prenda claims that it has nothing to do with the case. There’s an amusing back and forth in which the judge and Torres try to sort out who’s who and what’s what. And then the judge notices the improperly dressed Lutz doing something and turns her attention to him, leading to a surprise “reveal.”

THE COURT: Mr. Lutz, who is the individual who you just spoke to in the Courtroom with you?
MR. LUTZ: Sorry?
THE COURT: Who is that behind you?
MR. STEELE: Your Honor, my name is John Steele.
THE COURT: Who are you?
MR. STEELE: I’m an attorney, but not involved in this case.
THE COURT: You’re an attorney with what law firm?
MR. STEELE: I’m not an attorney with any law firm right now, but I have worked with Mr. Duffy in the past and I am certainly familiar with this litigation just because I’ve been involved in many different cases like this in the past.
THE COURT: But not this case?
MR. STEELE: Correct.

There’s another brief exchange with the judge and Torres and then back to Lutz. Lutz is asked about Prenda as well, and more or less tries to claim he doesn’t know that much about them. At this point Syfert (the defense lawyer) jumps in to point out that Lutz was, at one point, employed by Prenda Law and worked for John Steele. You can almost sense the judge rolling her eyes, as she immediately has Lutz sworn in as well. Then there’s this lovely exchange:

THE COURT: Mr. Lutz, you’re under oath, you have to give truthful answers or you face penalties of perjury. Do you understand that?
MR. LUTZ: Yes.
THE COURT: What is your position with Sunlust?
MR. LUTZ: I’m a representative of them.
THE COURT: What does that mean?
MR. LUTZ: Corporate representative.
THE COURT: What does that mean?
MR. LUTZ: They asked me to appear on various matters throughout the country.
THE COURT: Are you an officer of the company?
MR. LUTZ: I’m not, no.
THE COURT: Are you authorized to bind the company to any legal contracts?
MR. LUTZ: I am not.
THE COURT: Are you salaried?
MR. LUTZ: No, 1099.
THE COURT: So you are a 1099 contracted entity and you just go around and sit in a Court and represent yourself to be the corporate representative of the company?
MR. LUTZ: Yes.
THE COURT: Mr. Torres, did you know this was Mr. Lutz’s position, a paid corporate representative?
MR. TORRES: No, Your Honor, I did not.
THE COURT: Who is the president of Sunlust?
MR. LUTZ: I’m unaware.
THE COURT: Who is the vice president?
MR. LUTZ: I’m unaware
THE COURT: Who is the secretary?
MR. LUTZ: I have no idea.
THE COURT: Who owns Sunlust?
MR. LUTZ: I do not know.
THE COURT: Who signs your checks?
MR. LUTZ: I believe somebody in the accounting department.
THE COURT: What is their name?
MR. LUTZ: To be honest with you, I can’t read the signature.
THE COURT: Where is the accounting department located?
MR. LUTZ: I’m sorry?
THE COURT: Where is the accounting department located?
MR. LUTZ: I’ve received checks from California.
THE COURT: How much are you paid monthly to be the corporate representative?
MR. LUTZ: Again, it depends on my appearances, the number of appearances that I do.
THE COURT: How much were you paid last month?
MR. LUTZ: Approximately $1,000.

She then asks about what else he does or if he does this for others as well (yes) and starts asking some more questions about Prenda, and then asks both Lutz and Torres about what other copyright holding companies they’re working with. And then goes back to John Steele.

THE COURT: Mr. Steele, who is the principal of Sunlust?
MR. STEELE: I’m sorry, you’re asking me, ma’am?
THE COURT: Yes, sir.
MR. STEELE: I wouldn’t know.
THE COURT: You don’t know who owns Sunlust?
MR. STEELE: That’s correct.
THE COURT: You don’t know who the president is?
MR. STEELE: I — the only person that I know that’s involved with Sunlust is Sunny Leone.
THE COURT: Sunny Leone?
MR. STEELE: Is one of the people involved with Sunlust. That’s the only person I’ve ever —
THE COURT: What is the name?
MR. STEELE: Sunny Leone.
THE COURT: Spell it.
MR. STEELE: S-O-N-N-Y, Leone —
THE COURT: L-E-O-N?
MR. STEELE: I believe there’s an E at the end of that, I’m not certain.
THE COURT: Where’s is he located.
MR. STEELE: Well, I believe it’s a she, and I believe that the last time I heard, she was in India filming a major motion picture with some studio down there, but I don’t keep up with that, I don’t represent Sunlust or anybody anymore. I no longer actively practice law.
THE COURT: You’re not practicing law?
MR. STEELE: Correct. I do appear occasionally at hearings on an ad hoc basis, but I do not have any current clients.
THE COURT: You still have a bar license in the State of Florida?
MR. STEELE: No, I’m licensed only in the State of Illinois.
I want to make very clear to this Court I’m not purporting in any way to be an attorney licensed in the State of Florida.
THE COURT: Have you ever been licensed in the State of Florida?
MR. STEELE: No.
THE COURT: All right.

End result? First, she tells Lutz to get out of there:

THE COURT: You can sit away from the table, you’re not a corporate representative of anybody if you don’t have any information about the corporation.
You’re not an officer or principal of the corporation. The Court will exclude you as a proper corporate entity for this Defendant.

She then lets Torres off of the case, but also provides “a word to the wise” suggesting he do a bit more research about who he agrees to represent before showing up in court on their behalf, otherwise he runs “a strong risk” of losing his license. She notes that she hopes it’s a lesson about “going forward with characters such as the ones that are presented here.”

And, as noted at the beginning, she dismisses the case, suggests there was “attempted fraud on the Court” and says that “a motion will also be heard on Mr. Duffy for his lack of candor in relation to his connection with this matter.”

The transcript is so wonderful that I really, really, want someone to use it as a script to create a short film out of it. It honestly feels right out of a movie.

Filed Under: copyright trolling, florida, fraud on the court, graham syfert, john steele, jonathan torres, mark lutz, paul duffy
Companies: prenda law, sunlust