Righthaven founder fights to stay on as CEO
2 July 2012
Righthaven LLC founder Steven Gibson insisted Monday he remains in charge of the Las Vegas company and asked a judge to block efforts to fire him as CEO.
Gibson filed papers in federal court in Las Vegas challenging recent actions by Lara Pearson, a Lake Tahoe-area attorney appointed by the court last year to take control of Righthaven assets and to sell them for the benefit of creditors.
In 2010, Gibson’s Righthaven company teamed up with the Las Vegas Review-Journal and the Denver Post to start filing copyright infringement lawsuits claiming material from those papers was wrongly copied and reposted online without authorization.
An affiliate of the Review-Journal invested along with Gibson to create Righthaven.
Righthaven filed 275 lawsuits, but its litigation spree collapsed when judges found that Righthaven lacked standing to sue or that defendants were protected by the fair use doctrine of copyright law.
After Righthaven ran into financial trouble because of the legal setbacks, Pearson entered the picture and auctioned its website and trademark.
The court transferred Righthaven’s copyrights to Pearson as well, but they didn’t sell at auction amid questions about their validity.
With Righthaven continuing to exist so Righthaven could pursue appeals of its legal setbacks, Pearson moved last week to fire Gibson.
Pearson says the Righthaven appeals Gibson has been pursuing are a waste of time as they’re likely to fail and she says they are subjecting the company to additional liability.
Already, it’s been ordered to pay $318,000 in attorney’s fees to defendants that defeated it in court.
Besides moving to fire Gibson, Pearson has hired Las Vegas First Amendment attorney Allen Lichtenstein to represent her.
In his court filing Monday, Gibson asked U.S. District Judge Philip Pro to reject Pearson’s efforts to remove him and to hire Lichtenstein.
Pro hasn’t indicated when he’ll rule on a request by Pearson to endorse her firing of Gibson and his wife, who was also a Righthaven officer.
Gibson said in his filing that Pearson has exceeded the authority Pro granted her last year when he named her receiver for the benefit of Righthaven creditors.
''The court empowered the receiver to deal with Righthaven’s intellectual property — and that is all,'' Gibson wrote in Monday’s filing.
''The court did not generally order that the receiver do more. The receiver’s belief that she is generally in charge of Righthaven is not consistent with this court’s order,'' Gibson said in his 17-page filing.
Gibson said it was ''inappropriate'' for Pearson to move to terminate him, to hire Lichtenstein and to look for an attorney to sue Gibson for alleged malpractice on a contingency basis.
Pearson blames Gibson for Righthaven’s financial troubles — Gibson disputes her charges.
Gibson said Righthaven’s appeals should be allowed to continue because if it wins, that would erase the debt it owes to defendants for attorney’s fees.
While judges ruled Righthaven lacked standing to sue because of faulty or ineffective copyright assignments from the newspapers, and all of Righthaven’s copyrights were seized by Pearson representing creditors, Gibson suggested in his filing Monday that Righthaven still has the right to prosecute lawsuits.
''If the copyrights were indeed transferred, the right to pursue accrued (infringement) actions was not and certainly the rights in this litigation were not transferred. That would have been an entirely wrongful and inequitable result,'' Gibson wrote in his filing.
His filing was made in Righthaven’s lawsuit against Kentucky message board poster Wayne Hoehn. Pro, in a ruling now on appeal, last year found Righthaven lacked standing to sue and that Hoehn was protected by fair use. Righthaven has argued that once Pro found Righthaven lacked standing to sue, the case was over and the fair use ruling was inappropriate.
Gibson’s filing also complained about ''all of the negative personal attacks in the blogosphere and the less than, in my opinion, entirely fair and balanced reporting by the Las Vegas Sun'' about Righthaven.
While Gibson and Righthaven have said the copyright infringement lawsuits were needed to protect newspaper content, critics including Hoehn’s attorneys and the digital freedom group the Electronic Frontier Foundation have criticized Gibson and accused him of misusing the court system to coerce defendants into paying settlements to dispose of dubious lawsuits.
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