Following Puerto 80's motion to dismiss
the attempt by the US government to forfeit its domains, the Justice Department has filed its response
(pdf) in which it more or less mocks Puerto 80's lawyers for "not understanding" what they're fighting about in court. Having read both of the documents and being familiar with the case, I will agree that there is certainly some confusion (perhaps on both sides) about the exact nature of the arguments, but it appears that the government is partly the cause of this, in that it keeps leaping back and forth between arguments, since it can't make a single coherent argument for why forfeiture makes sense under the law.
Specifically, the government is claiming that its sole reason for trying to forfeit the domain (and for seizing it in the first place) is that "those domain names themselves facilitated the commission of a recognized crime." That is, it argues that Puerto 80 is wasting its time in suggesting that Puerto 80
did not engage in criminal copyright infringement, because the government has not charged Puerto 80 with anything. It's just claiming that the domains themselves are property used to commit a crime, and therefore can be forfeited.
But the government seems to want to have its cake and eat it too. That's because, in order to show that the domains were used to commit a crime, it keeps going back to actions done by Puerto 80. But then, when Puerto 80's lawyers keep explaining why Puerto 80 did not violate the law, the government tries to claim that this is meaningless because it's not accusing Puerto 80 of anything.
Talk about a disingenuous Catch-22 sort of argument.
For example, here's the kind of mocking that the DOJ presents against Puerto 80:
Despite what Puerto 80
appears to believe, the Government has neither charged Puerto 80 with a crime, nor has it filed a
civil lawsuit against that company. Instead, and as the Complaint makes absolutely clear, the
Government has brought a civil action against certain property an in rem proceeding against
two domain names that facilitated the commission of criminal copyright infringement and are
thus subject to forfeiture pursuant to Section 2323(a)(I) of Title 18, United States Code.
But... then... in making its case, the government still relies on actions of Puerto 80 and not the domains in question. Even worse, contrary to what the DOJ states, nowhere does it make the case that criminal copyright infringement occurred
. Now, as we've stated before, for criminal copyright infringement to occur, and as the government clearly states in its filing, the government needs to show:
(1) the existence-of a valid copyright; (2) an act of infringement of that
copyright; (3) willfulness on the part of the infringer; and (4) either that (a) the infringement was
for purposes of commercial advantage or private financial gain, or (b) the infringer reproduced or distributed, during any 180-day period, one or more copies or phonorecords of one or more
copyrighted works, with a total retail value of more than $1,000.
(1) and (2) aren't hard to show -- but the infringement is done by third parties (users of the site) rather than Puerto 80. In fact, the government even admits multiple times that the content is not hosted or distributed by Puerto 80, but by third parties. (3) is much, much trickier, and the government fails to show willfulness at all -- except to insist that Puerto 80
had willingness to infringe. Again, note that the government goes back to focusing on Puerto 80 here, even though it keeps insisting that it's not on trial. Even worse, it fails to respond to the pretty clear claims by Puerto 80 in its filing that its actions were clearly not willful since it had been tried and found not guilty of infringement twice in its home country. And yes, as people will point out, we're talking about US law, rather than Spanish law, but it's pretty ridiculous to think that Puerto 80 would go through such a huge legal process at home... and then somehow still think that it was willfully
infringing on copyrights.
Point (4) is where an even bigger problem sets in. Once again, the DOJ focuses on Puerto 80 getting commercial gain:
With respect to private financial gain, the Complaint makes clear that when an Internet·
user selected an individual link to a particular sporting event from the Rojadirecta website and the corresponding stream of the telecast began to run, advertisements that were separate and
distinct from any commercials that may have been aired during the stream of the sporting event
broadcast were periodically displayed at the bottom of the video during the live stream. (Compl.
~ 14c). On a motion to dismiss, this Court is required to draw all inferences from the allegations
of a complaint in the light most favorable to the plaintiff. Roth, 489 F.3d at 510. It is certainly a
permissible inference for this Court to draw that these advertisements generate revenue and result
in private financial gain.
All of that is accurate... but again, it's about Puerto 80
who (again) the DOJ insists is not being sued here. Basically, the government totally fails to properly allege criminal copyright infringement, in that it doesn't show how those four elements all take place by a single party. Instead, they pull from here and there to patch together such a claim. A user of Rojadirecta may infringe... and Rojadirecta may profit from an ad shown on the site, but that's not
willful copyright infringement for the purpose of financial gain. Furthermore, as the MP3Tunes case recently showed
, merely having ads near infringement is not profiting from infringement: "However the financial benefit must be attributable to the infringing activity.... While Sideload.com may be used to draw users to MP3tunes.com and drive sales of pay lockers, it has non-infringing users." Merely the fact that infringing content can "draw" users to the site doesn't mean that the profit is directly from infringement.
So, while it is true that Puerto 80's lawyers may have argued for much more than the specific issue at stake in this case, it's in part because the DOJ itself keeps shifting its argument. It can make cases for civil infringement against users. It might be able to make a case for civil inducement for Puerto 80... but what it's doing -- quite amazingly -- is mashing together both of those arguments to pretend that two separate civil issues chopped up together can adequately show criminal copyright infringement... and from that they can claim that the domains were used for such things.
If anything, it seems that Puerto 80's lawyers were too clever in arguing ahead of the DOJ, who I'm still not entirely convinced understands what it's really arguing here. Puerto 80's lawyers didn't just try to show that no full criminal copyright claim was presented by the government. It also tried to debunk the two parts of the (4) factors that the DOJ tried to pin on Puerto 80. The government then says it doesn't care what Puerto 80 did, even as it uses its own questionable claims of what Puerto 80 did to make its case. It's really quite stunning.
On a separate note, even though Puerto 80's lawyers chose not to use the First Amendment claim, the Justice Department seems to be begging for it. As we've noted in the past, the ruling in Fort Wayne Books v. Indiana
makes it clear that a standard higher
than probable cause needs to be used in seizures:
Thus, while the general rule under the Fourth Amendment is that any and all contraband, instrumentalities, and evidence of crimes may be seized on probable cause (and even without a warrant in various circumstances), it is otherwise when materials presumptively protected by the First Amendment are involved... It is "[t]he risk of prior restraint, which is the underlying basis for the special Fourth Amendment protections accorded searches for and seizure of First Amendment materials" that motivates this rule.
But here the government is arguing in the other direction
saying the standard is even lower
than probable cause! It's saying that it just needs "reasonable belief," now that the case has moved on to the forfeiture stage, rather than just discussing the seizure:
Nor is the Government required to show probable cause for forfeiture. See,~,
Daccarett, 6 F.3d at 47. Instead, the complaint simply needs to establish a "reasonable belief'
that the government will be able to meet its burden at trial. Id. "In other words, the complaint
need not allege facts sufficient to show that specific property is tainted, but facts sufficient to
support a reasonable belief that the government can demonstrate" the ultimate trial burden "for
finding the property tainted."
I'm at a loss to see how this makes any sense at all. Remember, the judge in the case has already said that Puerto 80 can't challenge
the seizures on First Amendment grounds, because trampling your First Amendment rights is not a "substantial hardship." That, alone, seems like something that should be appealed. But it also seems like it wipes out any avenue for challenging the seizure on First Amendment grounds, because the standard now being discussed is merely "reasonable belief." Now, it is true that this is just for the motion to dismiss, and the standard at trial is going to be higher, but, honestly, why should a trampling of free speech have to wait so far into the process before being resolved? Plenty of other cases are willing to put the First Amendment issue upfront and center...