Ninth Circuit Upholds Sanctions Against Attorneys Who Ran Abusive Copyright Operation Over Downloaded Porn Movies

200px-US-CourtOfAppeals-9thCircuit-Seal.svgI have previously written about a large number of law firms on retainer to bring these actions and artists and companies that do little to limit them. The greatest problem is the success of this lobby in getting Congress and the Obama Administration to push through virtually any legislation that they demand — criminalizing violations, approving warrantless searches, and allowing for obscene awards. Every year it gets worse as companies claim ownership over common phrases and images — reinforced by these legal factory operations of bullying lawyers. We recently discussed the claim of Citigroup to ownership of “ThankYou.” Now in an all-too-rare ruling, The United States Court of Appeals for the Ninth Circuit has upheld an $81,000 sanction against three lawyers — John Steele, Paul Hansmeier and the late Paul Duffy — for being little more than legal trolls in harassing and threatening people into giving them money for downloading pornography. These three lawyers operated “Prenda law” which was little more than a disgraceful shakedown operation.

Here is how it worked. The lawyers set up shell companies that purchased copyrights to pornographic movies and waited for someone to download the film. Prenda Law or a local lawyer would then file a complaint against the “John Doe” downloader and use discovery to discover his or her identity. That person would then be hit with a demand for $4,000 or a lawsuit.

Otis_Wright_District_JudgeU.S. District Judge Otis Wright was livid at what he saw:

They’ve discovered the nexus of antiquated copyright laws, paralyzing social stigma, and unaffordable defense costs. And they exploit this anomaly by accusing individuals of illegally downloading a single pornographic video. Then they offer to settle—for a sum calculated to be just below the cost of a bare-bones defense. For these individuals, resistance is futile; most reluctantly pay rather than have their names associated with illegally downloading porn. So now, copyright laws originally designed to compensate starving artists allow starving attorneys in this electronic-media era to plunder the citizenry.

Wright actually referred the lawyers to criminal investigation for their abusive practices. He even referenced a common Star Trek line that “resistance is futile” to describe the threats and “fraud” of these lawyers.

The Ninth Circuit agreed and found that Wright had “ample reason” for his sanctions as well as the need for attorneys fees: “Considering the magnitude of the Prenda Principals’ misdeeds, and the covert nature of their businesses, the district court did not abuse its discretion by increasing the bond amount. Without hope of receiving attorney’s fees for defending sanctions on appeal, Doe and other victims of abusive litigation would be left with no remedy. Doe would likely not defend the sanctions in appellate court, and thus would lose the only compensation—attorney’s fees at the district court level—that he was awarded.”

This is a reassuring opinion but it is a relatively rarity in this field. There are a growing number of bottom-feeding, predatory firms that bully and threaten average citizens for settlements for copyright and trademark violations. Clearly, neither the Obama Administration nor Congress will confront this powerful lobby. However, the bar can. What concerns me is the lack of any indication of a bar action against John Steele, Paul Hansmeier and Paul Duffy (before Duffy’s passing) but also those local lawyers who assisted them. We need to strip these types of lawyers of their licenses and crackdown on factory operations, which are little more than “smash and grab” litigators.

Here is the opinion: Prenda Decision

24 thoughts on “Ninth Circuit Upholds Sanctions Against Attorneys Who Ran Abusive Copyright Operation Over Downloaded Porn Movies”

  1. Karen,

    Just use google with this search query:

    aridog site:jonathanturley.org

    This will bring back any page with an Aridog comment.

    After you click on one of the returned results and the thread is opened in your browser then you can use your browsers search or find function to scroll through Aridog’s posts in that thread.

  2. Darren – his family would like to get to read his comments from the blog. I sent them the web address, but is there a way to send them a link to the posts that he commented on? I don’t know what’s possible with Word Press, or how difficult it would be.

  3. Sad news indeed Karen. Our condolences. And yes, the insight will be missed.

  4. I just found out the sad news that Aridog has passed away, after a battle with lymphoma. He had mentioned his health issues in some of his posts. He was a calm voice of reason when some of our emotions would get high, and in times like these, I really wish we had his contributions.

    His family and friends have indicated an interest in reading his comments on the blog.

    Aridog will be greatly missed, but I know he’s having a joyful reunion with his family, friends, and his beloved dogs in heaven.

    I hope that this is OK to post.

    1. R.I.P. Aridog – we have missed you and will continue to miss you.

    2. Thanks, Karen. Although I hadn’t been a subscriber for very long when he stopped posting, I thought he was well-thought and on an even keel. I also liked his views of the law.

  5. Thank dog for no ugly Hillary photos on the blog today. I post paper copies under the sink and all the cockroaches got scared away.

  6. Too many lawyers spoil the brothel. Too many male lawyers. And, female lawyers at the brothel are often ugly. Judge Judy should run as VP on the ticket with Hillary. Two dogs don’t make a right.

  7. There are too many law schools, too many law professors, too many students and of course too many lawyers who spoil the broth. Or is it brothe? They get to the brothel.

  8. Steve & Nick

    Ya wanna read stuff more closely and stay on topic. My post focused on the crime and not the school. I specifically included all schools. It is only an assumption that lesser schools probably produce lesser lawyers. However, the point of the post is that the greater the position of trust in society, the greater the responsibility and the greater the punishment.

    This goes for all positions of esteem and authority in all countries.

  9. Steve, I agree w/ you about people from regular professions becoming attorneys. I have worked w/ attorneys ranging from the pompous Ivy League to attorneys who were formerly cops, secretaries, efficiency experts, and chefs. They attended schools like UMKC law school or John Marshall. They brought real world experience and normalcy. I agreed w/ the Canadian regarding the need to thin the herd. I would do the thinning of Ivy League attorneys, starting w/ SCOTUS.

  10. Steve Groen — reread Atlas Shrugged. This is the sort of action, with the complicity of the government, that Ayn Rand railed against in the book.

  11. Sir Issac, this State encourages individuals from humbler beginnings – mechanics to postal workers, to stay-at-home moms – to heighten their station with hard work and ambition in a second career. If you want an English caste system, go to England.

  12. Interestingly enough, there’s never been an Ingenuity 13, LLC, or Prenda Law, LLC, registered to do business in California. There is a California LLC called AF Holdings, LLC, on Figueroa Street in LA. There’s never been a Hansmeier licensed to practice law in California, and the only deceased Paul Duffy was admitted to practice here 70 years ago. There are two attorneys named John Steele actively practicing law here.

    There will be “bar action.” An $81,000.00 sanction I think meets the $1,000.00 self-reporting threshold whereby the sanctioned attorney(s) must report the sanction to the State Bar of California, although I’d guess the State Bar has already heard directly from the defendants, the federal trial court and/or the 9th Circuit.

    Whether any of those who are actually licensed are disbarred rather than suspended – I can’t imagine this conduct isn’t on a level warranting at least a suspension and not probation – for a significant period may depend as much as anything on prior discipline, cooperation with the State Bar investigation, restitution, and a show of remorse in State Bar Court.

    On another level, they’re greed must be admired by the Ayn Rand and Billary Clinton crowds. They’re true venture capitalists and entrepreneurs. Their only sin was getting caught.

  13. Attorneys John Steele, Paul Hansmeier and the late Paul Duffy remind me of the esteemed law firm of Dewey, Cheatem & Howe.

  14. This makes clear the notion that we now have very little community of purpose or value within the bar. I suppose I am naive but I am more than sickened by this. Shyster or self-sacrificing giver – we had better decide which it will be.

  15. It has been stated by various sources, one of which is this blog, that there are more lawyers in law school than practicing. It seems that there is a surplus of lawyers. It would also seem that, baring the always exception, a large portion of this surplus, if not the largest, would be the products of the lesser schools.

    So, why not cull the herd. Sure, a few Georgetown and Harvard lawyers will be eliminated but perhaps most of the bottom feeders who ponder methods of extortion will be cleaned up. I have been a victim of a nuisance suit, a suit that would cost more to win than to pay, and understand that these people are subhuman. In my case it was literally the hand that fed being bitten. The legal system should police itself if it wishes to retain the myth of justice, equality before the law, and every man having his day, etc.

    Perhaps Turley could attach another career onto his already loaded agenda. Out the scum and then pursue them for their despicable behavior. Those in places of esteem and authority should receive several times the punishment.

  16. I have never seen the Bar want to clean itself up from a straight ethics scandal. And I do not see the courts doing their work for them. However, a few courts seem to have grown a pair and have gone after attorneys.

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