R-J owner says copyright lawsuits target ‘parasitic’ infringers
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10 May 2011
1:55 a.m.
Righthaven Archives
The owner of the Las Vegas Review-Journal on Monday disputed criticism by a federal judge about its no-warning copyright lawsuit campaign.
Attorneys for Stephens Media LLC and its copyright enforcement partner, Righthaven LLC, filed court briefs in two cases defending their copyright assignment and lawsuit arrangement.
Stephens Media attorneys, in one filing, addressed comments April 14 by Roger Hunt, chief U.S. District Judge for Nevada, who wrote in an order that "Righthaven and Stephens Media have attempted to create a cottage industry of filing copyright claims, making large claims for damages and then settling claims for pennies on the dollar with defendants who do not want to incur the costs of defending the lawsuits."
Las Vegas attorneys Donald Campbell and J. Colby Williams, representing Stephens Media, said in their filing Monday that Hunt’s comments present "a blemished portrait of Stephens in this action."
"It is widely known that traditional media sources, including newspapers, face a myriad of challenges that threaten their survival in the digital era," the attorneys wrote in their filing. "Indeed, news stories and websites chronicling the imminent death of the American newspaper abound. Whether this doomsday scenario applies to a given newspaper is, of course, fact specific but there can be no dispute that all newspapers face increasing competition from countless websites on the Internet."
"And while vigorous competition is the foundation of a free market, unfair competition is actionable. Many of the websites that traffic in the news of the day create no original content of their own. More often than not, they simply aggregate work that originated in a newspaper.
"To create that original work, newspapers must pay professional reporters and editors to conduct research, interview and vet sources, cover official proceedings or other events being reported on, write the story or editorial and check for accuracy before publishing," the filing said. "The operator that does nothing more than co-opt a newspaper story for placement on its own website by `cutting and pasting’ original content bears none of the very substantial costs associated with creating the original work.
"In light of the parasitic business model employed by many website operators, Stephens Media contracted with Righthaven in an effort to curb the unauthorized use of its original content on the worldwide web," the attorneys said, adding the high volume of Righthaven suits is "directly attributable to the frequency of infringing conduct on the Internet."
"It is Stephens Media’s hope that the deterrent effect of the lawsuits filed to date and the rulings issued therein will reduce the amount of infringing conduct to a level where such litigation becomes altogether unnecessary," the attorneys wrote.
Their filing, and filings by Righthaven on Monday, were in response to charges by defense attorneys in the case of the Democratic Underground who say the newly-unsealed lawsuit contract between Stephens Media and Righthaven shows Righthaven’s 212 lawsuits over Review-Journal material are invalid.
The defense attorneys say they’re invalid because of "sham" copyright transfers in which Righthaven gets the right to sue while Stephens Media retains all other rights. Case law requires copyright suits to be filed by the true owners of copyrights and that’s not Righthaven under this contract, the defense attorneys say.
U.S. District Judge James Mahan has said the lawsuit contract appears to show Righthaven does not have standing to sue and he’s threatening to dismiss a Righthaven suit over the Pahrump Life blog over the standing issue. Righthaven filed briefs in that case Monday also.
The interpretation of Mahan and the Democratic Underground attorneys is wrong, attorneys for Righthaven said in court papers Monday.
"Binding precedent establishes that the assignment from Stephens Media to Righthaven conveys upon Righthaven standing to bring this case," Righthaven said in a filing in the Pahrump Life case.
However, to remove any doubt, they said the Strategic Alliance Agreement for the lawsuits was amended Monday, effective to January 2010, to further solidify Righthaven’s standing as the true copyright owner, with Stephens Media continuing to receive licensing rights from Righthaven to display and archive stories and other material covered by the copyrights.
On top of that, they said in court papers that the federal judges hearing Righthaven cases could further amend the contract to remove any doubt about Righthaven’s right to sue.
"To the extent the Strategic Alliance Agreement, as clarified through the amendment, somehow fails to effectively assign and convey from Stephens Media to Righthaven all ownership in and to particular copyright protectable content, along with standing to sue for accrued, present and future infringement, while also permitting Stephens Media to still use said content in a manner consistent with its general historical use via the grant of a license to do so from Righthaven, Righthaven asks the court for direction, clarification or to correct the amendment," Righthaven CEO and Las Vegas attorney Steven Gibson said in a court declaration.
Court records show the amendment calls for Stephens Media to pay Righthaven royalties of $1 per year for use of each copyrighted work it uses under license; and includes a provision giving Stephens Media the option to re-purchase copyrights upon the satisfaction of certain conditions. The re-purchase price is $10 plus reimbursement of Righthaven’s "infringement action costs" such as registering copyrights.
At stake for Righthaven in coming rulings over its standing to sue over Review-Journal material are some 86 open cases – and potentially others if defendants that have settled try to re-open their suits based on the newly-disclosed copyright-assignment contract.
The ramifications could be larger if Righthaven’s 62 lawsuits over Denver Post material are affected by the standing arguments. Court records show that in those cases, as in the Review-Journal cases, Righthaven obtains copyrights and then licenses the material back to the Denver Post.
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Discussion 12 comments
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By Amending the "Strategic Alliance" Righthaven and Stephen's media essentially admit that their original agreement was inadequate therefore on that basis alone all lawsuits prior to Monday's amendment should be thrown out and all prior settlements should be null and void and all money's returned.
Now it is Stephens Media who is bashing the very judge hearing their cases. How a newspaper chain could be so bad at PR makes you realize the REAL reason newspapers are in trouble.
THEY WANT ALOT OF MONEY FOR A STORY VALUED AT $ 1.00 ...
What is laughable about this is that most the websites Righthaven have sued are not the ones that may take readers away from the source material but actually lead readers to them or the sites are so separated from the source material that the impact on the newspaper is negligible.
Had Righthaven concentrated on these autoblogs and sites that actually may take away from a newspaper's readership they would not be in the situation they are in now. They chose their targets poorly and it predictably turned into both a legal and PR disaster for both them and Stephens Media.
Stephens Media says they started this campaign to educate the public about online infringements but made no attempt before hand to educate the public in a more productive fashion. Righthaven was never about ending or reducing infringements but a money making scheme to take advantage of it.
I run a website that is dedicated to firefighting and what firefighters do, the equipment, fires, and stories about fires and firefighters. I have it stated in the posting guidelines that no stories from the RJ are allowed on the site, as it is a forum, and that anybody who posts even a link to a RJ story will have the post taken down and will be warned.
Why am I like that, lets say I follow fair use and post a portion of the article and have a link back to the story. But Righthaven won't follow the fair use laws as they have proven time and time again. All they want is a quick buck and I agree with the judge they should have all of their cases thrown out and be ordered that all settlements should be return to those that they forced into submission.
All both parties, the RJ and Righthaven, want is a quick buck.
Ditto
el_diablo_loco (Dave Butcher)
What a load of sanctimonious crap!!!
Chunky says:
"sanctimonious" indeed!
Everything was fine and Stephens Media was quiet until they kicked a few hornet nests that are now stinging them to their knees.
More attorneys, more plaintiffs, more defendants and more BS piling on every day.
Their quick-buck business model will now cost the company more than it ever gained and likely benefit the fair use crowd even more.
That's what Chunky thinks!
The crux of the matter is this: RH is engaged in digital ambulance-chasing, more formally known as champerty and barratry. The law regarding such is murky, especially since it appears that RH is not a law firm. Further complicating matters is that the concept of champerty has been sanctioned to an extent when it comes to contingency fees in some cases. But there is a limit on the percentage an attorney can collect in such.
The agreement between SM and RH appears (in part) to be an effort to get around such limits, as indicated by the 50/50 split of any recovery.
In my opinion (and I am not a lawyer) the amendment doesn't change the original intent at all unless it changes some of the wording surrounding the core transfer provisions. In particular, in the original agreement RH does not have the right to grant a license to anyone other than the original source of the material. That effectively means that SM (or News Media) retain control of their respective works.
Beyond this, I think that by placing an actual dollar amount on the license in the agreement is going to make it very difficult for RH to justify any award other than the minimum as set out in the law since the law gives judges the option to modify the statutory damages based upon actual value of the work (as opposed to actual damages.)
RH has now explicitly stated that any given SM work is worth only $1/yr, and that is the only value it has unless a recovery can be made from an infringement claim. Because RH does not have any revenue stream from a given work other than the license fee it can not suffer more than $1/yr in damages.
As an aside, I would like to know who came up with the plan initially. Was it Steve Gibson or someone at SM?
boftx, yes if RH was to actually win a case in court the maximum damage award should not exceed $1 since they themselves admit this is all their copyrights are worth.
I have a feeling theses changes are going to make things worse on RH not better.
You have to wonder if this "hot shot" New York lawyer hand any hand in this?
Who is the parasite? Certainly not those people being sued.
What a complete scam.
They would not be limited to $1 in statutory damages as no harm need be shown, but they would likely receive the minimum ($200 I think.) I would be very surprised to see them win the maximum at trial unless the defense attorney was an idiot.
Yeah they sued Drudge. He is such a parasite sending millions of hits to any newspaper he links to.
Yeah, go ahead and back date that agreement.