Prenda Actually Wins A Round; Order To Pay Back Settlements Tossed In Minnesota

from the well-that's-unfortunate dept

For months now, we’ve been covering how Prenda had been losing pretty much every one of its legal fights concerning its fraudulent copyright trolling practices. I guess it was bound to happen sooner or later, but Team Prenda has bounced back with an actual victory. You may recall that one of the (many) key Prenda cases was taking place in Minnesota, where magistrate judge Franklin Noel, becoming aware of what was happening with Prenda in other courts had reopened a bunch of Prenda (via AF Holdings) cases in Minnesota to explore if Team Prenda had committed fraud upon the court. Noel dug in, demanding actual answers to various questions that Team Prenda had avoided in other cases, eventually ruling against Team Prenda and (importantly) ordering the law firm to pay back all the settlement money it had taken in via those cases.

Well, it appears that’s all for nothing now. Judge Joan Ericksen has apparently stepped in to put magistrate judge Noel in his place, pointing out that he went way beyond what a magistrate judge is allowed to do and then actually siding with Prenda lawyer Paul Hansmeier in saying that the fact that team Prenda forged Alan Cooper’s signatures on the copyright assignment isn’t fraud on the court… and, in fact, saying that it basically doesn’t matter at all. First, as to a mere magistrate judge sniffing out these problems, judge Ericksen isn’t having any of it:

AF Holdings consistently objected to the magistrate judge’s authority to determine whether it had committed a fraud on the Court. The magistrate judge had no such authority. See Reddick v. White, 456 F. App’x 191, 193 (4th Cir. 2011) (per curiam) (“A motion for sanctions under the district court’s ‘inherent’ power is not a pretrial matter under § 636(B)(1)(a). Magistrate judges have no inherent Article III powers—they have only those powers vested in them by Congress. Congress has not created statutory authorization for magistrate judges to exercise inherent Article III powers.”

Furthermore, Ericksen points out that, as a magistrate judge, Noel can’t really make an order like he did (which is likely accurate), but instead can just make a recommendation for a “real” judge like Ericksen to review. And Ericksen just doesn’t seem concerned about the forgery, lying and other shenanigans from Team Prenda.

Cooper’s signatures were immaterial to the decision that granted AF Holdings expedited discovery…. AF Holdings’ submission of the agreements with Cooper’s signatures—legitimate or not, authorized or not—to evince the transfer of the copyrights to AF Holdings did not amount to a fraud on the Court.

It’s somewhat disappointing to see a court not all that concerned that an effort that involved forgery is really no big deal, especially when it was about copyright trolling, a practice of abusing the court system to hound people into paying up to avoid having to fight a lawsuit.

That’s unfortunate, but given how many other courts have ruled on Prenda’s efforts and the multiple referrals to state bars, DOJ and others, I would imagine that this is merely a slight and brief reprieve for Team Prenda.

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Companies: af holdings, prenda, prenda law

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Comments on “Prenda Actually Wins A Round; Order To Pay Back Settlements Tossed In Minnesota”

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That One Guy (profile) says:

So what does count then?

AF Holdings? submission of the agreements with Cooper?s signatures?legitimate or not, authorized or not?to evince the transfer of the copyrights to AF Holdings did not amount to a fraud on the Court.

If forging documents and signatures, then used to sue or extort via threats to sue aren’t considered ‘fraud on the court’, I have to wonder just what does reach that insanely high bar?

They presented fraudulent, intentionally fraudulent at that, evidence to the court to get them to do something, if blatant lying like that isn’t considered fraud, then I can’t imagine what more they could do that would count to a judge like that.

vegetaman (profile) says:

Re: So what does count then?

Well, since apparently lying to Congress under oath isn’t perjury, I guess falsifying a signature on official court documents isn’t either?

At least… Provided you meet the following criteria:

1) You are an Elite, or
2) You are a Corporation, or
3) You are a Lawyer, and
4) You are not just a regular citizen

kenichi tanaka (profile) says:

I hate to side with Prenda Law on this but Judge Ericksen is correct on this one. While the courts can put a stop to Prenda’s settlement letters going forward, forcing Prenda to pay back that settlement money that had already been paid to Prenda was a step over the lines.

I’m all for stopping these law firms from actions like this but to force them to pay back monies they have already collected? The courts only have the ability to stop further collection efforts, not to force Prenda to send back monies already collected.

Their fraud on the court is one thing, it doesn’t affect what they are legitimately collecting from filesharing users.

That Anonymous Coward (profile) says:

Re: Re:

They would not be collecting anything in those cases if the court had been made aware of the fraudulent documents filed in the case… or maybe it still wouldn’t matter.
Lawyers would NEVER knowingly do exactly what Prenda has done time and time again in court after court, so it doesn’t matter.

See cause one might think that a sham transfer with a fake name to a corporation might give rise to the idea that the accused never got to face their accuser. This shame document made it difficult for anyone to challenge and facts in the case. How can one investigate when the ownership is hidden? How are we to know there isn’t another document in a folder somewhere where ‘Alan Cooper’ sold off the copyrights to someone else and they kept suing while not owning the rights to do such.

Must protect the legal system… even at the expense of the people it victimized. Which is why it is nice that even with all of the other details now known about this, the victims if they wanted to try and sue to get back their money now can’t bother to argue that the case was a shame because fraudulent documents don’t matter in that district.

That One Guy (profile) says:

Re: Swap a few words and re-read

It only takes a few minor substitutions to see how that idea doesn’t quite hold up.

‘While the courts can put a stop to a [scam artist’s] [‘settlement’] letters going forward, forcing the [scam artist] to pay back that [‘settlement’] money that had already been paid to [them] was a step over the lines.

I’m all for stopping these [scam artists] from actions like this but to force them to pay back monies they have already collected? The courts only have the ability to stop further collection efforts, not to force [scam artists] to send back monies already collected.’

“Well I’m terribly sorry the plaintiff managed to scam you out of your life savings using fraudulent legal threats, but since he’s got the money now, I’m afraid you’re out of luck, all I can do is tell him in a stern voice not to get caught doing it again.”

That seem like a fair thing to you? It may or may not be legal, I couldn’t say for sure either way, but allowing someone to keep the money they conned/threatened/extorted out of their victims certainly doesn’t seem to me like how things should go, unless the punishments they suffer are extensive enough to make them lose at least as much as they managed to con out of people, so at the very least they aren’t coming out of it with a net gain.

Anonymous Coward says:

For those wondering why it seems to take so long to deal with Prenda and other such trolls, this is why. If they don’t dot all the i’s, cross all the t’s, and be careful to stay within the bounds of what they’re allowed to do, the trolls will be able to wiggle out of justice on technicalities just because one part was screwed up.

Anonymous Coward says:

Yet another example (like a story I read earlier about the DuPont Heir getting off with a slap on the wrist) of how the further up the legal and political system you go, the less likely you are to get a fair deal in this country anymore.

I have neither respect nor faith in either the legal or political system in this country anymore. I’d probably move if it weren’t for the fact all the countries I might consider moving to didn’t kowtow to the US at every turn.

Anonymous Coward says:

Re: Re:

(Sympathy For The Devil playing in the background)

Affluenza is a real disease and it seems to be communicable. Recent theories suggest that the debilitating disease is transmitted from person to person via money. The more money you have, the more likely you are to contract the disease.

Scientists at the Center for Disease Control are working closely with members of Congress in order to better understand the epidemic and develop a cure.

sophisticatedjanedoe (profile) says:

Another note (bold emphasis is mine):

(?Courts have held that, in situations where ?the copyright [author] appears to have no dispute with its [assignee] on this matter, it would be anomalous to permit a third party infringer to invoke [Section 204(a)?s signed writing requirement] against the [assignee].?? (alterations in original)); Jules Jordan Video, Inc. v. 144942 Canada Inc., 617 F.3d 1146, 1157 (9th Cir. 2010) (?When there is no dispute between the copyright owner and transferee, it would be unusual and unwarranted to permit a third-party infringer to invoke ? 204(a) to avoid suit for copyright infringement.? (internal quotation marks omitted)).

Albeit it is a case law reference, it is, IMO, still insulting to use the term ?infringer? affirmatively, while no determination on the merits against defendants has been made, neither as a judgment, nor a jury verdict.

kenichi tanaka (profile) says:

You guys keep forgetting that these file-sharers downloaded porn illegally. They got caught. Then they received a settlement letter. They paid the small settlement.

So, where was the fraud?

Just because Prenda Law is misleading the courts regarding their appearances and testimony doesn’t mean it has anything to do with the monies they received.

That One Guy (profile) says:

Re: Re:

Yeah, it’s not nearly as cut and dried as that.

First of all, there was good evidence that Prenda themselves(Steele in particular if memory serves) had posted the files in question, so that people would download them and they could then turn around and threaten to sue those that did so.

So, strike one.

Second, all they were basing their lawsuits and threats of lawsuits on were IP addresses, which numerous courts have found to not be enough to positively identify someone. Add to that, the ‘program’ they used to gather the IP addresses was, again if memory serves, one run by a friend of Prenda, and one that they refused to let anyone check for accuracy.

Strike two.

Finally, just because someone paid, does in no way mean they were guilty. If presented with the choice of coughing up a few hundred, or even thousand dollars, or going to court, with the massive costs of time, money, and effort that involves even if you win, a lot of people are going to chose #1, even if they are completely innocent and know it.

Furthermore, by suing over porn titles, people are given yet another reason to just pay rather than go to court, as even if they are completely innocent, they’ll still be on record as accused of downloading porn(with some very… ‘creative’ titles I believe), something many people would be more than ‘happy’ to pay to avoid.

Strike three, that argument’s out.

Anonymous Coward says:

Re: Re:

You guys keep forgetting that these file-sharers downloaded porn illegally.

No, I’m rather sure I remember that part.

They got caught.

Honey pots will do that.

Then they received a settlement letter.

As part of the scheme.

They paid the small settlement.

And somehow that makes the whole process ‘not a fraud’?

That Anonymous Coward (profile) says:

Re: Re:

The others got most of it, you also managed to miss that Prenda was publishing peoples names on their website calling them guilty before the case ever got heard to increase the pressure to make them settle.
You missed that their ‘neverwrong’ system “caught” at least 1 woman who did nothing wrong… and only after the media started asking questions they magically corrected that error after hounding her day and night to pay them for a ‘crime’ she didn’t commit.
You missed the flat out lies in their settlement letters, misrepresenting the law to ratchet up the pressure. One might question how an officer of the court is allowed to LIE about the law.

Didn’t you hear? They claim they got NO MONEY. They all worked for free.

Anonymous Coward says:

Re: Re:

You keep forgetting that IP Addresses can be spoofed, subnets can leached and your goddess Prenda never proved anything in a court of law, they simply extorted money from their victims.

So, where is the fraud you ask .. if you refuse to look for something, it is likely that you will not find it.

Just because someone is a bad actor doesn’t mean they deserve scrutiny, amirite?

Pragmatic says:

Re: Re:

Old grannies, dead people and small children have been targeted in the same way and for the same reason (by the **AAs in other filesharing cases). Was that legitimate? No. IP address is not proof of infringement, and that’s what they were using to go after a string of Does. Assume for the moment that you’re right.

TAC (That Anonymous Coward – the guy with the Guy Fawkes mask as an icon) was one of the Does unfairly targeted – based on IP address alone. That’s all they had on him. I believe him when he says he didn’t do it. Don’t you?

The only evidence to the contrary is an IP address. That’s not proof of anything other than the presence of an internet connection. Have you ever tried to track down an individual via their IP address. Go on, try. Let us know how you get on.

Anonymous Coward says:

This isn't good for Prenda

The best outcome for Prenda is to lose all of its court cases, be compelled to pay back all funds, and have its attorneys disbarred. Maybe plead a charge or two, pay a fine (attorneys don’t go to prison) and be done with it.


Because if that happens, then everyone watching will probably be satisfied that some semblance of justice has been done and that they’ve been punished sufficiently for their many, MANY crimes.

And if it doesn’t?

I suspect that by and by, anonymous will take an interest. As you might have noticed, they tend to react eventually and inevitably to injustice. And I would really, really not want to be any of the Prenda principals if and when anonymous decided to turn its attention their way.

Pragmatic says:

Re: Re: Re:

Behold thy god, his name is Copyright and all shall bow before him, particularly pirate-people who promote open source, etc. Those guys. He hates them.

Green smoke billows at the front and nearby, a shoe pokes out from behind a twitching curtain

Pay no attention to the man behind the curtain. Copyright the Great and Terrible has spoken!

Wally says:

It’s somewhat disappointing to see a court not all that concerned that an effort that involved forgery is really no big deal, especially when it was about copyright trolling, a practice of abusing the court system to hound people into paying up to avoid having to fight a lawsuit.

Couldn’t be any more disappointing than a judge overstepping his or her bounds of power and due process thus giving scum like Prenda/AF Holdings a leg up…

Anonymous Coward says:

seems to me that rather than being pulled to one side by Prenda, she needs pulling to one side by other members of her profession and brought completely up to speed and then firmly put in her place with a little ‘do you want to keep your job?’ question tagged on the end.
she is behaving like a certain judge who has sat on copyright trials after being a copyright industry employee, got a touch of bias from somewhere!

Zonker says:

Watch as Prenda, emboldened by this ruling and always too clever by half, attempts to pay their upcoming sanctions with a forged check. Claims this is not a fraud on the court referencing this ruling and because the matter was settled with the forged check they do not have to repay the sanction. Watch the court rule that since it is the court/lawyers that have been defrauded instead of the common folk that Prenda *has* committed fraud on the court and *must* pay up.

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