Here's a story that touches on a few different issues of importance around these parts. We'll get to the details of the legal ruling in a bit, but the background is really the key part. At the beginning of 2009, a company in Valencia, California, called L&M Optical Disc West, received an order from an authorized partner of the producers of the film Milk
to manufacture the DVDs of the film. They began doing exactly that. On February 2nd, as part of a supposedly unrelated police raid, police saw those DVDs and found them "suspicious." They rang up the MPAA who sent over an "investigator," who falsely declared that the DVDs were unauthorized, leading the police to seize them (though, oddly, allowing the private investigation firm to hold them) and to declare to the press that they had found "pirated" DVDs of Milk
. This happened despite multiple attempts by L&M staff to explain that they had a legitimate order, even offering to show the "investigator" the details of the order.
The following day, L&M provided the police with all of the evidence that they were authorized to make those DVDs, and the police sergeant told L&M's owner that the DVDs could not be released because they were "pirated." From there, a bunch of press stories followed, with the police repeatedly telling the press that L&M was being investigated for such "piracy," even after the MPAA and the police realized that the DVDs were, in fact, authorized. Months later, however, the press was still quoting the police as saying that L&M was "under investigation" for "piracy."
Because of all of this, L&M claims that customers canceled jobs with L&M and past customers chose to find new partners. It also meant that other vendors who used to send "overflow" work to L&M no longer did so. It effectively dried up much of L&M's business.
If this all seems pretty horrifying, think of how much worse this kind of situation may be about to get. First off, just a few weeks ago, we noted that Governor Jerry Brown in California passed a law that would let law enforcement do more of these kinds of raids
but they no longer need a warrant to do so
. Yes, despite this massive failure on such a raid, the government now has even more authority to do these kinds of raids, and the MPAA can continue to get away with providing bogus information and effectively killing businesses.
Take it one step further: this is the reason why so many of us are so worried
about the new E-PARASITE bill. The MPAA and other copyright holders have a dreadful history and reputation for being inaccurate when it comes to accusing others of infringement. Yet, under E-PARASITE, they get to kill sites dead, without any recourse, before anyone even looks to see if the copyright holder's claim is legit. Doesn't that seem the least bit problematic?
Now, as for the actual case at hand, for which you can read the full decision
(pdf and embedded below), it involved the court tossing out a lawsuit by L&M against the MPAA over all of this, using California's anti-SLAPP laws. We're big fans of California's anti-SLAPP laws, and while we find the MPAA's conduct in this situation reprehensible, the ruling actually makes sense. The comments that were the most problematic to L&M in the newspaper reports were not, in fact, made by the MPAA but by the police. If anyone is responsible, it should be the police who made them.
L&M tries to place liability on the MPAA by claiming that the police and the MPAA had a "joint venture" going in these raids, but that isn't supported by the facts. This raid wasn't done at the request of the MPAA, and originally had nothing to do with copyright at all. So, we agree that blaming the MPAA for the comments in the press is improper, as it's misapplied third party liability. Of course, there does seem to be a bit of irony in the fact that the MPAA appears to be working overtime to increase third party liability by undermining the kinds of safe harbors that protect a party from being blamed for the speech of others. However, it's no surprise at all that the MPAA is -- yet again -- too clueless to recognize how its actions undermine its own legal protections elsewhere.