Righthaven misses deadlines, again faces asset seizure threat
29 October 2011
In a familiar pattern, Las Vegas copyright lawsuit filer Righthaven LLC missed deadlines in two of its lawsuits Friday, prompting a creditor in one of the suits Saturday to again ask that U.S. Marshals seize its assets.
In the first case, Righthaven had until Friday to either pay prevailing defendant Wayne Hoehn’s $34,045 in legal fees or post a bond guaranteeing payment.
It did neither, prompting Hoehn’s attorneys at Randazza Legal Group in Las Vegas to ask U.S. District Court Judge Philip Pro to issue a writ of execution for Hoehn’s judgment.
The proposed writ requires the Marshals Service to seize Righthaven’s personal property.
This is the second time Randazza Legal Group has asked the court to order the Marshals to seize Righthaven's assets, which are thought to consist of some cash and the copyrights it claims to own.
The first time, on Sept. 28, Pro granted Righthaven’s motion to stay his order awarding Hoehn his attorney’s fees on the condition Righthaven post a bond for the fees by Friday.
Righthaven, in the meantime, lost an appeal for a continued stay with the 9th U.S. Circuit Court of Appeals on Oct. 19.
Righthaven has said it’s running short of cash because of problems with its lawsuit campaign and faces bankruptcy if creditors try to seize its assets. Because of legal setbacks, the company hasn’t filed any copyright infringement lawsuits for months and therefore isn’t receiving much settlement revenue from defendants.
Randazza Legal Group on Oct. 16 responded to these assertions of financial woes by accusing Righthaven of making fraudulent transfers by diverting cash to its CEO, Las Vegas attorney Steven Gibson, and to pay outside attorneys to file frivolous motions.
In Saturday’s filing again asking that Righthaven’s assets be seized, Randazza Legal Group attorney J. Malcolm DeVoy IV wrote: "Righthaven’s dilatory tactics in avoiding Hoehn’s judgment have gone on long enough."
"Righthaven engaged in unsupportable litigation. This honorable court rejected Righthaven’s claims. This court was no mere outlier, as every other court that has been asked to review Righthaven’s actions has ruled similarly. To date, Righthaven and its counsel have needlessly and unethically multiplied the proceedings in any case in which they are involved, in clear violation of (federal law)," the Randazza filing said. "Righthaven has exhausted any benefit of the doubt that it could be afforded, and it is time for it to pay the consequences for its actions — starting with Hoehn’s lawful judgment plus the accrued costs and fees expended in the (so far) futile attempts to compel Righthaven to take this court’s orders seriously."
A request for comment was placed with Righthaven on Randazza’s filing.
It’s unknown when Pro will act on the request, which is sure to add fire to a pending request in another case by Randazza Legal Group that one of Righthaven’s outside attorneys, Shawn Mangano, be sanctioned for needlessly prolonging several Righthaven cases.
In the second case at issue Friday, Righthaven also had until Friday to file a response to a judge’s order of Oct. 20 that it show cause why its lone lawsuit in South Carolina should not be dismissed for lack of standing under Righthaven's flawed lawsuit contract with the Denver Post. In that case, Righthaven sued Tea Party leader Dana Eiser, charging she posted a Denver Post column online without approval, charges denied by Eiser.
Instead of filing its response, a Righthaven attorney in South Carolina, Edward Bertele, asked for a three-day extension.
He said Righthaven was tardy because Mangano has been busy preparing for a trial.
The South Carolina court and Eiser’s attorney have not yet responded to the request.
Righthaven’s continuing battles with Randazza Legal Group and the threat that its South Carolina case will be dismissed are just the latest in a series of legal problems the company has encountered since it launched its litigation campaign in March 2010. Righthaven filed 275 no-warning lawsuits against website owners, bloggers and message board posters charging they had posted material online from the Las Vegas Review-Journal and the Denver Post without authorization.
Righthaven said the suits were needed to deter rampant online copyright infringements of newspaper content. Critics said the lawsuits were frivolous and were aimed at intimidating defendants into settling — for a few thousand dollars — with bogus legal claims and threats of statutory damages of up to $150,000.
Three of the lawsuits were thrown out when judges ruled the defendants were protected by the fair use concept of copyright law in using R-J material online without authorization.
Five judges in Nevada and Colorado also dismissed Righthaven lawsuits for lack of standing, ruling that despite Righthaven's claims of ownership, the newspapers remained in control of the material Righthaven was suing over. Righthaven is not a law firm and acquires copyrights strictly for the right to sue infringers, so its standing to sue has been an issue in most of its contested cases.
The Hoehn case was doubly devastating to Righthaven as Pro found the Kentucky man — who had posted an R-J column on a sports betting website without authorization — was protected by fair use and that Righthaven lacked standing to sue him.
Righthaven is hoping at least one Nevada federal judge will revive its standing to sue under an amended lawsuit contract with the Review-Journal beefing up its copyright ownership claims. The Denver Post did not renew its lawsuit contract with Righthaven after a series of public relations debacles over the suits.
If a judge upholds Righthaven's standing to sue over R-J material, Righthaven plans to start filing new copyright infringement lawsuits so it can collect more settlement income from defendants.
The company, in the meantime, is appealing dismissal of earlier lawsuits on standing and fair use grounds.
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