Righthaven Charged With Racketeering In Somewhat Epic Filing

from the novel-or-court-ruling dept

Karl points us to the news that the lawyers for one of the people sued by Righthaven, one Dana Eiser, have filed what can only be described as an absolutely epic answer and counterclaim lawsuit in the case in South Carolina, raising an astounding 56 (count 'em) defenses. The 119-page filing, which is embedded below is worth a read. As Karl points out, some of it is pretty far out there (with some parts being simply wrong), but it does make for entertaining reading, with some new and interesting claims about some of Righthaven's actions.

The point that's getting a lot of attention is the fact that the filing raises a racketeering charge against Righthaven under the RICO Act, claiming that using sham copyright transfers to shake people down for money is good, old-fashioned racketeering:
The extortion tactics and fraudulent conduct detailed in this Complaint each constitute a predicate act under RICO of (1) extortion, because such communication were threats intended to obtain money or property premised upon legal action that was a complete sham; and (2) fraud, because each mailing, phone call, and email furthered and executed the scheme to defraud Righthaven’s targets.

Righthaven has a knowing, willful, and specific intent to defraud its targets into entering into settlement agreements under the threat of fraudulent claims.
While I actually think there's a half decent argument here given Righthaven's actions, I just can't see any judge really buying the racketeering claim. Such claims have been made in the past against the RIAA for its mass lawsuits, and they didn't seem to go anywhere. I doubt that will change here, but it would be a pleasant surprise if they did.

Some other interesting tidbits from the filing:
  • The filing highlights that all three of Righthaven's clients have admitted to the press that they decide who to sue, not Righthaven, again indicating that Righthaven is not the actual copyright holder here:
    Officers of each of these client entities have publicly stated that the media entities, not Righthaven, have the right to dictate who can and cannot be sued.

    In an article appearing in the Arkansas Democrat-Gazette, Stephens Media LLC’s General Counsel Mark Hinueber is quoted as saying “I can tell Righthaven not to sue somebody.” ...

    In the same article, WEHCO Media’s President Paul Smith is quoted as saying that if Righthaven discovers someone has violated WEHCO’s copyright, “it would be [WEHCO’s] decision whether or not to move forward with it[.]” ...

    Finally, in The New York Times, MediaNews Group’s Vice President Sara Glines stated that MediaNews Group “reviewed every violation and only approved actions against sites that carried advertising and were not charities.”
  • In fact, Eiser takes the above quotes even further. Because this particular lawsuit was over MediaNews (Denver Post) content, and the site that the material was reposted to does not have advertising, she claims that there can be no lawsuit, since Glines (above) noted that they do not approve lawsuits against sites with no advertising. She uses this over and over again to claim a lack of standing to sue, promissory estoppel (i.e., the company promised not to use Righthaven to sue certain sites, but then did so anyway) and that Glines/MediaNews had issued a waiver of sorts. I don't see how this would carry much legal weight, but it is amusing in suggesting that MediaNews was less than truthful.
  • There definitely are mistakes in the filing. Whoever wrote it, seems wholly unfamiliar with the nature of the "work for hire" doctrine, and confused about when it would apply.
  • It claims that the main lawyer that Righthaven has used in many of its cases, Steve Ganim, is only on the Florida bar, and not allowed to practice law in Nevada, despite doing so. Eiser uses this to claim that Ganim and Righthaven are engaged in the unauthorized practice of law in Nevada. The filing also claims that when another defendant brought this information to light, "Righthaven attorney Shawn Mangano threatened a frivolous defamation action against Leon to shut him up." This would be amazing, if true.
  • The filing claims that after a judge indicated support for the claim by the EFF and others that Righthaven is probably not open to winning lawyer's fees in its cases, because its lawyers are in-house, that it suddenly started hiring outside counsel for its lawsuits.
  • As others have done, Eiser claims that the Denver Post's "sharing" tools give her an implied license to share the works.
  • Eiser claims that "under 20" people saw the article posted to the website, raising questions about how much "damage" was actually done.
    Even if it could show that every single person who read the Rosen Letter on the Lowcountry 9/12 Project blog would have read it at The Denver Post instead, only then would any actual damages be shown, and they would be in the neighborhood of 40 cents.

    The South Carolina Supreme Court was offended by a case over five cents in 1918.

    Adjusting for inflation, five cents in 1918 was worth 72 cents in 2010, when the alleged damages were sustained.

    The approximately 40 cents of damages suffered (not even by Righthaven) is well within the rule of de minimis non curat lex.
  • Eiser tries a First Amendment claim, saying that the use was for communicating ideas. This argument is one that I find interesting, but is clearly dead in the water. The courts have been pretty blind on First Amendment implications of copyright law, and they're certainly not going to jump in now on a case like this.
  • Eiser tries to bring up the famed BMW v. Gore case to say that statutory infringement rates are illegal. This argument has been made before (in the Jammie Thomas and Joel Tenenbaum cases) without much luck. I can't see them suddenly getting a sympathetic ear here either.
  • Eiser claims that Righthaven is technically a debt collector, and that it does not follow proper procedures and laws as a debt collector.
  • We've discussed a few times how bizarre it is that Righthaven demands the publisher's domain name in each lawsuit it files, despite that not being a standard remedy (or a reasonable remedy) for copyright lawsuits at all. In this filing, Eiser suggests that this attempt to get others' domain names is effectively a form of illegal cybersquatting on those sites. That one also sounds like a big stretch, but an interesting idea.
  • There's another big reach, claiming an antitrust (Sherman Act) violation in seeking to stomp out competitors through a fraudulent claim. Again, a nice try at a novel legal theory, but one unlikely to get very far.
All in all an entertaining read, but most of the really out there arguments are unlikely to get very far. However, if they did get some traction, Righthaven could be in even deeper trouble.

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  1. identicon
    A Guy, 27 Jun 2011 @ 11:40pm

    Re: Re:

    Unfortunately for all of us (except RightHaven)... being stupid is still not illegal, even for lawyers.

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