Ruling that Righthaven misled court likely to be felt in other cases
14 July 2011
A federal judge’s finding Thursday that newspaper copyright lawsuit filer Righthaven LLC misled the court will likely be used in one or more planned legal actions against Righthaven and its newspaper partners.
At least two attorneys are known to be considering suing Righthaven and/or the Las Vegas Review-Journal and Denver Post on behalf of current and former Righthaven defendants. The basis for a suit or suits, among other things, would be that Righthaven has tried to coerce defendants into settling by falsely claiming it owns the copyrights it sues over.
Righthaven since March 2010 has filed 275 lawsuits over Review-Journal and Denver Post material it says has been misappropriated by Internet sites, bloggers and message board posters. The copyright infringement litigation campaign stumbled this summer when three federal judges found Righthaven lacks standing to sue over R-J material. Since last year, Righthaven has also suffered three lawsuit defeats on fair use grounds.
One of the attorneys plotting to sue Righthaven, Todd Kincannon in Columbia, S.C., announced Thursday he’s accepting past and present Righthaven defendants "as new clients for class action or mass action litigation against Righthaven, its media clients and others involved in the Righthaven operation."
Kincannon said he’s taking the clients on a contingency basis, meaning if there is no recovery of damages, they will not have to pay his law firm, the Kincannon Firm.
Kincannon is already litigating against Righthaven on behalf of Righthaven defendant Dana Eiser and a group called Citizens Against Litigation Abuse Inc. in South Carolina.
In Nevada’s federal court, Citizens Against Litigation Abuse, represented by Kincannon, is appearing as a friend of the court against Righthaven in two cases. It’s arguing in those cases that Righthaven has been practicing law without a license. Righthaven has not yet responded to this assertion.
Kincannon also is now representing Righthaven defendant Dean Mostofi, who was sued for a second time by Righthaven on Wednesday, just hours after a federal judge dismissed the first Righthaven suit against him.
Wednesday’s suit No. 2 against Mostofi was the first to be filed by Righthaven under the latest version of its lawsuit contract with Review-Journal owner Stephens Media LLC – a contract Righthaven has amended twice and insists gives it standing to sue once and for all.
Righthaven was hit with a $5,000 fine as a sanction on Thursday by U.S. District Judge Roger Hunt in Las Vegas for failing to disclose that Stephens Media was an interested party in the lawsuits over R-J material, as it shares in Righthaven lawsuit revenue.
"This has been part of a concerted effort to hide Stephens Media’s role in this litigation," Hunt said.
Hunt didn’t say why he thought Righthaven had hid Stephens Media’s involvement in the lawsuits. One theory is that if Righthaven had made that disclosure, it would have undermined its claims of standing to sue, as plaintiffs in copyright lawsuits must have exclusive ownership of the copyrights at issue.
Hunt also commented on the relationship between Stephens Media and Righthaven and representations Righthaven had made about exclusive rights it had in the copyrights assigned to it by Stephens Media – when in fact those rights were retained exclusively by Stephens Media.
The judge noted that at one point in the litigation, before the lawsuit contract was unsealed, Stephens Media had filed a court brief saying it was "neither an owner, member or investor in Righthaven LLC nor holds any pecuniary (financial) interest in the company itself."
Yet, as defense attorneys fighting Righthaven have noted, Righthaven did nothing to set the record straight about Stephens Media having a direct financial interest in the lawsuits as it receives 50 percent of lawsuit revenue, after costs.
"The representations about the relationship and the rights of Righthaven were misrepresentations. They were misleading," Hunt said.
Former Review-Journal publisher and current columnist Sherman Frederick, in the meantime, appeared to comment in a blog post Thursday that he was responsible for Righthaven’s 2010 lawsuit against then-U.S. Senate candidate Sharron Angle.
"I even sued her for lifting our material," the post by "Sherm" said.
This seems to confirm assertions by Righthaven defendants that Righthaven has been acting as the agent of Stephens Media and the Review-Journal, as opposed to suing over its own copyrights.
And Righthaven’s role suing over Review-Journal material and sharing lawsuit settlement revenue has been like that of a law firm – even though Righthaven isn’t a law firm, Hunt noted during Thursday’s hearing.
“In the court’s view, the arrangement between Righthaven and Stephens Media is nothing more, nor less, than a law firm — which incidentally I don’t think is licensed to practice law in this state — with a contingent fee agreement masquerading as a company,” Hunt said.
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