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Even as Las Vegas copyright lawsuit filer Righthaven LLC can’t come up with $34,045 to pay one prevailing defendant’s legal fees, it was hit with another demand Friday for $33,148 in fees from a second defendant.
Friday’s request was made by attorneys in Las Vegas and Denver who represented Colorado lawsuit defendant Leland Wolf of the It Makes Sense blog, who defeated Righthaven in one of the 275 no-warning lawsuits it filed since March 2010 over Las Vegas Review-Journal and Denver Post material.
Senior U.S. District Judge John L. Kane in Denver on Sept. 27 ruled Righthaven lacked standing to sue Wolf over an alleged online infringement of a Denver Post TSA pat-down photo.
Righthaven claimed to own the copyright to the photo and the right to sue for accrued infringements – but Kane found the Post remained in control of the photo under its now-canceled lawsuit contract with Righthaven.
In order to deter future abuses of the federal Copyright Act, Kane also ordered Righthaven to pay Wolf’s legal fees.
Wolf’s attorneys at Randazza Legal Group in Las Vegas and with the firm Contiguglia & Fazzone P.C. in Denver on Friday submitted their $33,148 bill, which includes about $1,001 in costs incurred directly by Wolf.
Righthaven will now have an opportunity to challenge the dollar amount of Wolf’s bill – and based on its history it’s likely to ask that the fee award be stayed while it appeals Kane’s ruling closing the case to the 10th U.S. Circuit Court of Appeals in Denver.
The ruling for Wolf on summary judgment grounds prompted Righthaven to voluntarily dismiss 26 more cases in Colorado while Kane put six more contested cases on hold.
Righthaven, in the meantime, as of Friday afternoon hadn’t received a ruling from the 9th U.S. Circuit Court of Appeals in San Francisco on its request that it not be required to post a bond to guarantee Randazza Legal Group is paid $34,045 for its representation of prevailing Nevada Righthaven defendant Wayne Hoehn.
Righthaven, in an urgent appeal to that court Sunday, said it’s short on cash and has been unable to procure a bond.
While the fee requests for Hoehn and Wolf are among Righthaven’s most pressing problems currently, those fee requests are potentially just the tip of the iceberg.
Defendants in the six open Colorado cases may seek recovery of their costs should Kane reject a request by Righthaven that they remain stayed during the Wolf appeal. Instead, Kane may close them on a summary judgment basis against Righthaven.
Prevailing Nevada Righthaven defendant and former federal prosecutor Thomas DiBiase is asking for another $119,000 in fees and the political website the Democratic Underground, which hasn’t submitted its fee request, is likely to demand an even greater amount.
The Democratic Underground case has been the most extensively litigated as its attorneys with the digital rights group the Electronic Frontier Foundation were the first to show Righthaven lacked standing to sue because of what they called sham copyright assignments from the Las Vegas Review-Journal.
Randazza Legal Group’s continuing struggles to get paid for representing defendants that prevail against Righthaven prompted attorney Marc Randazza to offer Righthaven a discount on the Wolf fees if it would pay them without a fight, court records show.
"If Righthaven resists, its efforts to avoid payment will simply result in more of what you have experienced in Nevada, plus some additional plays that you have not yet seen," Randazza wrote in a Sept. 28 letter to Shawn Mangano, an outside attorney for Righthaven.
Absent a settlement, Randazza wrote, "It is our intention to aggressively pursue the fees, seizure of assets and to take steps to pierce the corporate veil to hold Righthaven’s insiders personally liable."
Those insiders include Las Vegas attorney Steven Gibson, half owner of Righthaven; and the family of billionaire Arkansas investment banker and Review-Journal owner Warren Stephens, holder of the other half.
When Righthaven didn’t respond, Randazza noted in a followup letter on Oct. 5 that Righthaven has said the demand for $34,045 in the Hoehn case – or even a bond in that amount – could bankrupt the company.
"If that remains the case, offering a reasonable amount in satisfaction of Mr. Wolf's fees would seem to be in Righthaven's best interest. In the alternative, we respectfully request that Righthaven file a bankruptcy petition, as alluded to in the Hoehn emergency (fee) stay application, so that Righthaven's financial status is crystallized and further litigation is preempted," he wrote.
Mangano responded on Oct. 6, turning down the settlement offer in the Wolf case.
"Righthaven will be appealing the district court’s decision. As such, it will not be paying Mr. Wolf a negotiated amount of attorney’s fees and costs," Mangano wrote to Randazza.
Righthaven, in the meantime, also as of Friday still hadn’t received long-awaited rulings from one of the Nevada federal judges on whether it can sue over Las Vegas Review-Journal material under its amended R-J lawsuit contract.
Four Nevada judges previously ruled Righthaven lacked standing under the initial versions of the lawsuit contract – and those are the rulings that have kept Righthaven’s litigation campaign at a standstill in Nevada and harmed its finances by reducing potential lawsuit settlement income.