Report From The Court Room On Latest Prenda Hearing In Minnesota: Another Hearing, Another Mess

Legal Issues

from the and-mark-lutz-has-disappeared dept

Lawyer Nancy Sims attended the latest Prenda hearing today in Minnesota and agreed to let us post her recap of what happened in the courtroom. We’ll have a more complete analysis of what happened later. For now, this is a “just the facts” coverage of the events of the day.

I attended the hearing today in what the presiding judge, Magistrate Judge Franklin Noel, characterized as “several iterations of” AF Holdings LLC v. Doe (case nos. 12-1445 – 12-1449). The cases at hand have all previously settled and been dismissed, but the court determined it has the inherent authority to investigate whether it has been the victim of a fraud.

The order for the hearing limited the discussion to whether the copyright assignment agreements for two films, “Popular Demand” and “Sexual Obsession,” attached as exhibits in the various AF Holdings v. Doe cases, are authentic. The discussion during the hearing ranged a bit further afield.

These are my own impressions of what happened, but I don’t guarantee their accuracy — I’m not a court reporter, and I’m not fully up on the details of all the Prenda/AF Holdings/etc cases. And I couldn’t always hear everything. I’ve tried to be fairly objective in reporting what I saw and heard, but to own up to my biases, I am an attorney whose interest in copyright sits solidly on the public interest side. I don’t represent or have any interests with respect to any of the folks present in court today, to the best of my knowledge. (How’s that for lawyer-talk.)

Individuals present in the courtroom today included:

• Paul Hansmeier, lead attorney for plaintiff AF Holdings, LLC
• John Steele, formerly a legal partner of Mr. Hansmeier
• Brent Berry, northern MN real estate lawyer
• Jason Flesher, northern MN resident
• Alan Cooper, who alleges his signature was forged on documents related to AF Holdings
• Paul Godfread, attorney for Mr. Cooper

And some audience members.

John Steele Takes The Stand

Mr. Hansmeier began the day by calling his first witness, Steele, and displaying to him on a document viewer the copyright assignment for “Sexual Obsession.” Mr. Steele authenticated the assignor’s signature as that of Ray Rogers, based on familiarity with Mr. Rogers signature from several instances of business, etc. Mr. Steele also testified that he believed the use of Mr. Cooper’s signature on this document was authorized, because Steele introduced Cooper to the owner/controlling member of AF Holdings.

At this point, and at a couple of later points, the judge asked what exhibit number the documents were that Hansmeier was displaying (since the document viewers don’t produce an ongoing copy.) Hansmeier apparently didn’t intend to offer the documents into evidence, but the court later entered the copyright assignments in question (originally filed as exhibits in cases 12-1445 – 1449) as exhibits 1 and 2 for this hearing.

Hansmeier elicited lengthy testimony from Steele as to his knowledge of Cooper’s involvement with AF Holdings, his involvement with helping Cooper to form a company (VPR, Inc) to market adult content, and about the nature of Steele and Cooper’s relationship over the years. The overview of this testimony is that Cooper was recommended to Steele in 2006 or so as a possible caretaker for his cabin in northern MN, that Cooper lived there subsequently rent-free in exchange for a limited amount of work around the property, that subsequent to Steele’s divorce they had hung out more, and that they had been “very good friends by 2010.” Steele also testified that he had helped Cooper set up VPR, Inc, that Steele had introduced Cooper to Mark Lutz, and heard Cooper’s end of phone calls with Lutz on at least two occasions, and that Cooper had gotten “a kick” out of being associated with the adult industry, and repeatedly joked with friends and others about coming to work for him in his porn company, at least as early as 2011.

Steele testified that he had closed his law firm, Steele Hansmeier, over a short period starting in November 2011, because “I was quite frankly surprised with the vitriol and nastiness of the pirates we were pursuing.” He mentioned a blog post that showed pictures of his house and small child, and included violent threats against the family. Steele appeared visibly upset during this part of his testimony. Steele continued his testimony to affirm that after closing the lawfirm, he decided to sell his cabin in July of 2012. At this point, the Judge himself intervened to ask what the point of this testimony was; Mr. Hansmeier said it was directed towards motive.

Steele then testified that Mr. Cooper had been angry and hostile once he knew the sale was going forward, and that Cooper had taken items from the property, caused property damage, and attacked or threatened people who came on the property. The judge again intervened, to direct the discussion toward an end point; Mr. Hansmeier then asked Steele about his knowledge of rumors, started by Mr. Cooper, that Steele had molested Cooper’s daughter.

Things then got refocused on the topic of the hearing. The copyright assignment for “Popular Demand” was shown to Steele, and he again authenticated Ray Rogers’s signature for the assignor, and stated that Steele himself had used this document to file registration documents with the Copyright Office. Then, focusing on the other signature, Steele testified that he did not know if Cooper had signed the documents himself, but spoke to his “understanding” that Cooper had authorized Lutz and his people to sign documents like this on his behalf.

Judge Noel then directed several questions to Steele about the documents in question, and Steele’s understanding that Cooper had authorized Lutz to sign on his behalf. Judge Noel elicited that this was based on hearing Cooper’s half of two phone conversations with Lutz. Noel also elicited that Steele does not actually know if Cooper signed those documents, but that as far as Steele knew, Cooper had had a position as a “helper” for AF Holdings. Steele testified that he did not know if Cooper was employed by AF — because Steele himself had no involvement with AF, other than them having been very briefly clients of the Steele Hansmeier firm. Finally, Noel questioned Steele as to whether he knew who signed the Cooper name on either of the exhibits, and Steele testified that he did not.

Jason Flesher’s testimony

Hansmeier called Jason Flesher to the stand, who testified that he had known both Steele and Cooper for 4-5 years. Hansmeier began questioning Flesher about the nature of Steele and Cooper’s relationship, but the judge redirected him, and he then focused his questioning on Flesher’s knowledge of Cooper’s involvement in AF holdings. Flesher testified that Cooper’s partner, Charity (last name not ever clearly established) had talked with him about her concern over Cooper’s adult industry involvement on cabin visits as early as 2011, but that he did not know anything further about Cooper’s invovlement in signing documents, or details of his involvements with any companies. The judge briefly questioned Flesher about his knowledge of the copyright assignment documents (none) or familiarity with Cooper’s signature (none), and Flesher was dismissed.

Brent Berry’s testimony

Hansmeier called Brent Berry to the stand, and began questioning him about the nature of Cooper and Steele’s relationship, Cooper’s behavior after Steele decided to sell the house, and so on. The judge intervened to focus again on the documents, eliciting that Berry had seen Cooper’s signature before, but wouldn’t recognize it on sight, and did not know if the signature on the documents was Cooper’s.

Alan Cooper takes the stand

Hansmeier then called Cooper to the stand. Hansmeier’s questions posed to Cooper were often spoken quite quickly, so in a number of instances, Cooper had to ask them to be restated. Cooper also fairly frequently didn’t respond directly to the questions, so this part of the recap is a bit more out of order.

Hansmeier’s initial line of questioning focused on Cooper’s claim that other AF Holdings documents had included forgeries. Cooper wasn’t quite sure why he was being questioned about other people’s signatures; “I’m concerned about my signature.” Finally, the judge directed some specific questions about Cooper’s knowledge about specific signatures related to the case, and Cooper responded that he did not have any specific evidence about forgeries of signatures for Mooney, Webber, or Salt Marsh. Godfread objected that this seemed to be litigating the motion pending in October, and this was sustained.

Hansmeier began a new line of questioning, about Cooper’s testimony in other courts as to his involvement with AF Holdings. Cooper acknowledged that he became aware that his signature was being used related to AF Holdings in late 2012. Cooper stated that Steele had told him at an earlier date that if anyone asked any questions, they were to be directed to Steele. Hansmeier cut off Cooper’s testimony on that point, and kept questioning him about other members of his community who might have made him aware of his involvement at an earlier date. Cooper testified that his father-in-law (an ex law-enforcement officer) had told him he needed to find out why Steele was telling him to forward any questions.

After this, Hansmeier’s questions shifted direction repeatedly. He raised several points apparently intended to discredit Cooper: about being paid for testimony (Cooper denied he is), having expenses covered for his trip to an LA hearing (Cooper affirmed flight and one night hotel were covered by EFF), lost jobs (Cooper denied), mental health diagnoses and medications (also denied), and whether Cooper had ever signed anything on behalf of Steele (some unclear discussion about DMV registrations.)

There was a confusing line of questioning about why Cooper thinks he’s being held out as CEO of AF Holdings. Cooper tried to look something up on his phone (and was directed by the judge to stop). Cooper basically insisted that he wasn’t the CEO of AF Holdings, and the judge eventually said that whatever was on the documents in evidence would have to be good enough. Hansmeier worked hard to get Cooper to testify “who told you that your name was being held out as CEO of AF Holdings” but Cooper just didn’t remember, and focused on his concerns about his signature being misused.

Another line of questioning focused on how Cooper had retained Godfread, and a text message he had received, which was his first alert as to his name being used in association with AF Holdings. Cooper testified that the text had come from a Kim Eckenrode, who is John Steele’s mother-in-law. Cooper also testified that he had been referred to Godfread via an attorney whose number Eckenrode had texted to him.

Cooper denied any specific memory of March 18, 2011 (which I believe is the date Steele testified he introduced Cooper to Lutz by phone.) Finally, Hansmeier asked Cooper why he believed Steele owned Prenda Law; Cooper said Steele told him that, but that he had never seen any documents to that effect.

The judge then questioned Cooper, establishing that he had no familiarity with AF Holdings prior to the text from Eckenrode, that Cooper had never worked for AF Holdings or AF Films (Steele had previously testified that he thought any mentions of AF Films were typos), that he’d never signed any documents on behalf of AF Holdings or Films, that the signatures on the copyright assignments in question are not his and that he does not know who signed them, that he did not authorize anyone to sign his name, and that he did not know these documents were being submitted to a court “with what purports to be your signature.”

Godfread then questioned his client; Cooper denied Steele approaching him in 2010 about getting involved in the porn industry. He also stated that he did not know about VPR, Inc before last year, nor had he agreed to be an officer or have any other position with that group, nor to authorize use of his signature for that venture. Cooper stated that he had never met Lutz, nor talked to Lutz on the phone, nor ever indirectly told someone to talk to Lutz on his behalf. Cooper said that he did not authorize use of his signature on any documents related to AF Holdings or AF Films.

Godfread introduced a copy of the text from Eckenrode, including an attached image of Cooper’s purported signature on a document. There was some discussion about the admissibility of this copy of the text, including questioning from the judge about how Godfread had gotten the text to the page (emailed to himself). It was entered in the record as Exhibit 3, “with all caveats about what it purports to be.” Godfread questioned Cooper basically as to whether the printout of the text was what Cooper had received from Eckenrode. The judge asked briefly if Cooper had ever received any money from AF Holdings or VPR, or been employed by AF (no to all.)

Hansmeier then questioned Cooper (or tried to) about Hansmeier’s own previous conversations with Cooper. Cooper expressed confusion about whether he’d met Paul Hansmeier or his brother Peter, and maintained that whichever brother had visited the cabin, Cooper had not been around much or talked much with him. Hansmeier brought up that he had stayed in Cooper’s own cabin, but Cooper said he’d stayed away during that visit because “I didn’t want to deal with you”. Hansmeier, apparently taken somewhat aback, said “I didn’t know that,” and allowed that line of questioning to drop.

Hansmeier tried to call Godfread to the stand, and Godfread objected. The judge conferred with his clerk for a bit, and questioned Hansmeier as to his intent in questioning Godfread (to establish whether AF Holdings had any knowledge of Cooper’s concerns prior to filing the copyright assignments with courts). Godfread reiterated no knowledge on those points. After a bit more conferring, Judge Noel directed the attorneys to Shelton v. American Motors, 805 F 2d 1323 as on point, and said they’d reconvene on that point after lunch.

Before lunch, Hansmeier brought Steele back to the stand to address the text message (over Godfread’s objections as to Steele’s lack of direct knowledge of the conversation.) Steele testified that his mother-in-law is very religious and was very concerned over his involvement with the adult industry, and had been active on Die Troll Die and other sites. He testified that he has no interest in Prenda Law, but that she had gotten over excited about “random guesswork from internet pirates.” Hansmeier also questioned Steele as to whether Cooper has any other litigation pending against Steele — he does, but Steele said “it defies logic” that an attorney would forge a signature when he could get anyone in the world to sign a document.

The judge questioned Steele about the text message, eliciting that he doesn’t know whether it was sent by his mother-in-law, but that it was consistent with the tone of “anonymous pirates on the internet.” He mentioned something about the Secretary of State of Illinois, and Judge Noel followed up to ask about that; Steele testified that the Secretary of State website would show that Prenda was created by Paul Duffy. There was some additional questioning about St Kitts and Nevis, and AF Holdings and Prenda, and that a lot of people incorporate there.

Where’s Mark Lutz?

We broke just before noon, to reconvene after lunch on the point of whether Godfread would testify. When we reconvened, Hansmeier, having read the case the judge suggested, recalled his request to have Godfread testify. And then things got really interesting.

Judge Noel referred to his order for this hearing including an order for Cooper to appear in person, and for an officer of the plaintiff “capable of testifying as to the authenticity” of the documents to also appear. He reviewed the witnesses who had appeared, and noted that we’d heard nothing from AF Holdings — though he mentioned that he was “not sure what Steele’s role” was in all this other than being a former partner of Hansmeier… “So,” he said, “Where’s AF Holdings?”

Hansmeier said that Lutz was planning to come, and is the sole officer of AF Holdings, and did make it to an earlier conference in this case in person, but that he wasn’t present today, and that Mr. Hansmeier hadn’t been able to reach him by phone or email. He voluntarily elaborated that Steele and Lutz had been booked on the same flight from Miami, that Steele had gone to Lutz’s apartment to meet him (because Steele had Lutz’s boarding pass), but found him not home. Steele had then, according to Hansmeier, driven around Miami looking for Lutz, and even encountered some of Lutz’s friends who said Lutz had told them the night before that he had to make an early night of it because he was traveling to this court in the morning. Hansmeier offered the boarding pass as proof that Lutz had intended to come. (Steele was not present in the courtroom after lunch.)

Godfread suggested that Lutz has repeatedly failed to appear at evidentiary hearings related to AF Holdings cases. Hansmeier responded by stating that Lutz hadn’t been able to attend one hearing because he’d been detained by “federal agents” in an airport (the court requested clarification on this point, but all Hansmeier had was that; he stated that Lutz had asked to file further details of that detention, in that case, under seal because the detention was embarrassing.) Hansmeier finally stated that Lutz has appeared, before Judge Snow in Arizona, on closely related points.

Judge Noel took this all in, gave parties until close of business tomorrow to file all declarations, and said he’d issue an order “in due course.” The court recessed just about ten minutes after convening for the afternoon.

Filed Under: alan cooper, brent berry, forgery, franklin noel, john steele, mark lutz, paul godfread, paul hansmeier, signature
Companies: af holdings, prenda, prenda law