Steve Green, who was the absolute best reporter covering the Righthaven saga, recently wrote about the fact that 97 Las Vegas karaoke providers were recently sued
by a company called Slep-Tone Entertainment Corp., which apparently mainly does business as "Sound Choice," selling various karaoke content -- music and videos. Green notes that someone familiar with Slep-Tone has called it the "Righthaven of trademark infringement," though there are clearly some differences. First, though, the similarities: like many intellectual property "troll" operations, it appears that the goal of these efforts is to pressure companies into settlements, rather than actually get a judgment from the court. This has become an unfortunately common business model, where companies with a claim over some IP sue a ton of others at once mainly just to put pressure on them to "settle" for some amount -- often significantly less than what it threatens in the letter. And, it appears that Slep-Tone has at least some history
of filing these kinds of mass lawsuits against a ton of defendants at once.
Of course, there are also lots of differences with Slep-Tone, in that it actually makes a product -- even if it's a somewhat silly and potentially obsolete product. I was a bit confused by the original article, because it never made clear what the actual trademark
in question was -- and reading through some other lawsuits, it appears to be on the "Sound Choice" name and possibly logo, which is often displayed on the karaoke videos it produces. The other thing that confused me for a bit was why this was a trademark
dispute, rather than a copyright dispute. After all, the key claim is that these karaoke locations were copying the content
-- the music and the videos -- for use in karaoke machines, so shouldn't there be a copyright claim? But then it hit me: this is karaoke
-- meaning that Slep-Tone probably doesn't hold the copyrights
to the music in question in the first place. While it likely licenses the music for its karaoke productions, that license wouldn't necessarily give it the right to pursue others for copyright infringement on the music. Not knowing where it gets the videos from, I have no idea if there's a copyright issue there too, but it doesn't look like the lawsuits make any kind of copyright claim at all. Instead, they seem to focus on the use of the logo in the video to suggest trademark infringement -- which seems like an interesting way to get around the lack of copyright for copied content.
That said, again reading through some previous efforts -- and rulings
(pdf) -- lends credence to the idea that these are questionable "trollish" claims in the first place. For example, in that ruling, linked above, the judge grants a summary judgment against Slep-Tone for failing to show any real evidence that its trademark was actually infringed on in the case. Instead, the company seems to rely on some very vague statements to claim infringement where none may exist:
While the Court sympathizes with Slep-Tone's claim that counterfeiting is a rampant problem that has devastated the karaoke industry, Slep-Tone has failed to direct the Court's attention to any evidence in the record tending to show either unauthorized use of the SOUND CHOICE marks, or that any of the allegedly infringing material originated with Defendants. In its response... Slep-Tone relies exclusively for evidence of unauthorized evidence of unauthorized use by Defendants on the affidavits of [two former employees of the defendant and one "purported expert"]... [None of these affidavits] establish any such facts. Instead, they provide vague and conclusory statements without foundation.
Whether or not Slep-Tone has a legitimate claim, it seems like we're seeing more and more of these kinds of cases -- using patents, copyrights and trademarks to bring mass lawsuits against a number of companies who may or may not infringe, where the goal often appears to be to push for settlements for a few thousand dollars (often cheaper than defending the lawsuit). It seems like this is a form of abuse of the judicial system, effectively relying on the threat of an expensive trial as a weapon to pressure companies (and, in some cases, though not in the above cases, individuals) into settling and just paying up to avoid the hassle and expense.
I'm not sure what the solution is to these kinds of lawsuits, but it seems worth calling out just how common these kinds of activities are becoming. IP holders using the "threat" of a lawsuit as a key component of a business model seems like a serious problem both for defendants in those lawsuits, as well as the public, which funds the courts through taxes. I'd be interested in ideas for ways to prevent this kind of abuse of the judicial system, where the key role of the courts is merely to act as "the heavy" in a "business model." That feels a little too much like a traditional protection racket.