New Filing In Colorado Says That Righthaven Is An Illegal Law Firm In Disguise

from the representation-agreements,-not-assignments dept

The same folks who have been filing amicus briefs charging Righthaven with the unauthorized practice of law in South Carolina and Nevada have made a new filing in Colorado, where a single judge has been reviewing the legality of all of Righthaven’s cases in the state. In that filing, the group — Citizens Against Litigation Abuse — don’t so much focus on the unauthorized practice of law claim, but highlight a separate, but related point: that if Righthaven is really a “law firm” and the newspapers are its “clients,” then there has been no actual assignment of copyrights at all (the key point of dispute these days in Nevada), but rather the strategic agreement between the newspapers and Righthaven really represents a “representation agreement.”

This potentially becomes an issue because Righthaven’s current strategy appears to be to continually “amend” its agreement until it can find that right formula in which a judge says that the copyright has actually been transferred, without totally cutting the newspaper out of things. However, the CALA filing says that if you view the agreement as a law firm representation agreement, it doesn’t matter how many times Righthaven amends the agreement, it never becomes an assignment of copyright:


Amicus invites the Court to ignore the Righthaven for a moment and consider a general proposition: Assume that a company has an actionable claim. The company wants to hire someone to pursue a lawsuit over the claim. The company finds a firm that employs lawyers and handles lawsuits to do just that. In fact, prosecuting lawsuits is all the firm does. So the company and the firm strike a deal: the firm will prosecute the claim, and the firm and the company will split any recovery, after expenses, 50/50.

In the real world, that arrangement is called a ?contingency fee representation agreement,? the ?company? is the client, and the ?firm? is a law firm. But Righthaven does not appear to operate in the real world. Righthaven claims this exact arrangement is actually an ?assignment,? that it is not a law firm but a ?copyright enforcer,? and that its clients are not clients but are ?key relationships.? See Righthaven Website, Ex. L. This is nothing but corporate doublespeak, deployed in an attempt to camouflage an arrangement that is totally impermissible outside the context of a lawyer-client relationship.

Moreover, Righthaven claims to be engaged in a novel pursuit presenting new and undecided issues in copyright enforcement. Those claims are accurate only so long as one does not consider precedents relating to the validity of assignments and the unauthorized practice of law. What Righthaven tries to present as some inventive new way of enforcing copyrights is nothing more than a copyright-specific form of a scheme that has been rejected, so far as Amicus can determine, by every court that has ever examined it. When considering the following arguments and authorities, Amicus submits that it will be extremely useful to keep in mind this language from the SAA: ?Assignor hereby engages Righthaven to undertake the pursuit of Infringement Actions.?

It’ll be interesting to see if this argument resonates with the court, because if it does, Righthaven (and its backers) could be in for yet another pretty serious smackdown… and they won’t be able to keep trying to amend the agreement to “fix” things.

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Companies: righthaven

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Comments on “New Filing In Colorado Says That Righthaven Is An Illegal Law Firm In Disguise”

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Karl (profile) says:


I would be very surprised if judges in all the Righthaven cases did not accept the defendant’s claims.

Frankly, every single one of them has viewed the cases as a waste of time. Even the ones who (without seeing the SAA) admitted there might be some sort of infringement, tried to get Righthaven to agree to innocent infringement, or when the cases actually reached the courtroom, decided (without even being asked) that the use was fair use.

Nobody – not even the most IP-maximalist content holders – likes Righthaven. Nobody believes they’re doing the right thing. If the judges can find any legitimate reason to shut them down, they will do so.

Karl (profile) says:

Not assignments

Oh, yeah. For those who believed the SAA is in fact what it claims to be – that is, an “assignment” of rights, with a mere “exclusive license” of all the 106 rights – the filing quotes a ton of case law that pretty much demolishes that theory:

An assignment must be an ?absolute, unconditional, and completed transfer of all right, title, and interest in the property that is the subject of the assignment . . . with the concomitant total relinquishment of any control over the property.? Bank of Cave Spring v. Gold Kist, Inc., 327 S.E.2d 800, 802 (Ga. Ct. App. 1985). In the text of the assignment, the assignor must ?manifest an intent to transfer and must not retain any control or any power of revocation.? Burkhardt v. Bailey, 680 N.W.2d 453, 463 (Mich. Ct. App. 2004).
[…]If the assignor’s cooperation will be necessary or is expected in a subsequent lawsuit by assignee, the assignment is more likely to be held invalid. People v. Adams, 243 P.3d 256, 266 (Colo. 2010) at 264.
[…] Creative attempts to use a valid-in-form assignment to accomplish a forbidden purpose are wholly ineffective. E.g., Palazzo v. Gulf Oil Corp., 764 F.2d 1381, 1385 (11th Cir. 1985) (corporation could not assign claims to an officer to bring them pro se); Jones v. Niagara Frontier Transp. Auth., 722 F.2d 20, 23 (2d Cir. 1983) (procedural device of an assignment cannot circumvent rules preventing a lay person from representing a corporation); Christiansen v. Melinda, 857 P.2d 345, 349 (Alaska 1993) (?A statutory power of attorney does not entitle an agent to appear pro se in his principal’s place.?); Brown v. Unauthorized Practice of Law Comm., 742 S.W.2d 34, 42 (Tex. Ct. App. 1987) (contracts to act as plaintiffs’ agent on a contingency to collect personal injury claims constituted the unauthorized practice of law).
[…] Even if the text is satisfactory, the claim is ordinarily assignable, and there are no unauthorized practice of law issues, courts can still go behind the language of an assignment and investigate the conduct and true intentions of the parties. If this investigation shows that the assignor retained some level of control or a power of revocation ? even where the documents denied that power ? the assignment is invalid. Adams, supra, at 263-65. Where the intent is lacking, the assignment fails. This appears to be, by far, the most important factor. [Emphasis mine.]

snidely (profile) says:

Re: Re:

Me too. I don’t get the benefit that Righthaven provided over a regular law firm. Was it just so the LVRJ could distance itself from the ugly mess of suing people? I am not a lawyer, but why doesn’t Righthaven just give up and say, yes it was a contingency fee arrangement? Is it because they are not a law firm? Help me out lawyers…

The eejit (profile) says:

Re: Re: Re:

P:retending to be a lawyer is worse than actually being one, for the simple fact that a large portion of lawyers are seen as money-grubbing parasites, especially in the area of IP.

Righthaven took it to the next level by pretending to be money-grubbing parasites. when in actual fact they’re parasitic parasites from parasites.


Manabi (profile) says:

Re: Re: Re:

Whatever the initial reasons for the separation were, now it’s all about trying to protect Stephens Media from financial liability from counter-suits. If they come out and admit it’s just a contingency fee arrangement then everyone Righthaven has sued (pretty much all improperly) can turn around and counter-sue not just Righthaven, but Stephens Media. And Stephens Media actually does have money to lose, although multiple large lawsuit awards against them could potentially bankrupt them.

Of course all signs in the real world are that Stephens Media is going to get sued anyway, and the courts will probably allow it. (Righthaven ticking off every judge they’ve met isn’t helping any.) But no one said that Righthaven/Stephens Media was living in the real world.

Mike Masnick (profile) says:

Re: Re:

Can somebody explain to me why they bothered with this whole charade to begin with? Why didn’t they just go with the client-lawyer thing?

I believe the theory is twofold:

(1) To limit the backlash liability for the newspaper companies, which so far has failed, since the papers in question are getting dragged into court.

(2) Because the hilariously clueless execs behind Righthaven and Stephens Media honestly thought this would be a “big business” which could sign up a bunch of newspapers to use, and that would make them all rich.

Anonymous Coward says:

The same folks who have been filing amicus briefs charging Righthaven with the unauthorized practice of law in South Carolina and Nevada have made a new filing in Colorado . . .

Todd Kincannon’s been the one to watch, that’s for sure. He might bring down the whole show on all fronts. Kudos, Todd.

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