Strange Bedfellows

Submitted by patentadmin on Mon, 08/15/2011 - 15:46

We have written many times about Righthaven, the über troll of the copyright world. In our last blog we noted that the tide had seemingly turned. Rather than merely settling with Righthaven, defendants were arguing that Righthaven lacked standing to sue and were seeking to recover their attorney’s fees and costs. Well, the matter has now reached the point where we find a third party, Electronic Frontier Foundation, filing an amicus curiae (literally, “friend of the court,” in reality, “self-serving”) brief in support of the defendant in one of Righthaven’s more ill-advised shakedown suits. Righthaven, LLC v. Leland Wolf et al.

While we do not often agree with the E.F.F., in this instance we can only applaud the position they have taken, namely that Righthaven is not the “owner of an exclusive right under a copyright…and, therefore, is not entitled to sue Mr. Wolf or any of the other defendants in the dozens of lawsuits it has filed in this District…” (The District of Colorado). As pointed out by the E.F.F. “[t]his case will call on this Court to address whether a non-publishing litigation company may build a business suing bloggers and websites based on a purported transfer of the bare right to sue” (emphasis added).

The E.F.F. argues that the “Strategic Alliance Agreement” between Righthaven and the copyright claimant, the Denver Post, failed to convey ownership of the copyrights to Righthaven. The E.F.F. maintains that Righthaven merely obtained “a limited revocable assignment (with a license-back) of copyright…” from the Denver Post, allowing it to secure copyright registrations identifying it as the copyright owner. Righthaven then filed lawsuits with the understanding that the “real copyright owner would ultimately enjoy the copyright registration.”

The Strategic Alliance Agreement apparently comprised two parts, an “assignment” document which was designed to be shown in Court and a separate, secret agreement which explained – according to the E.F.F. – the “true” nature of the relationship between Righthaven and the Denver Post. Herein lies the heart of the matter. This agreement specified that “[d]espite any Copyright Assignment, Publisher (the Denver Post) shall retain…an exclusive license to Exploit the…Copyrights for any lawful purpose whatsoever and Righthaven shall have no right or license to Exploit…other than the right to proceeds in association with a Recovery.”

As the E.F.F. repeatedly noted, the Court in Nevada, which had previously considered this agreement, found “the plain and simple effect of this section was to prevent Righthaven from obtaining, having, or otherwise exercising any right other than the mere right to sue…” The law – as cited by the E.F.F. – requires that a party “Can only obtain a right to sue on a copyright if the party also obtains one of the exclusive rights in the copyright.” Thus – according to the E.F.F. – Righthaven lacks “standing,” i.e. the legal right, to sue for infringement of the subject copyright.

As described by the E.F.F., “Righthaven and Stephens Media (the owner of the Denver Post) 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. Righthaven’s business plan is encouraging and exacting settlements from Defendants cowed by the potential costs of litigation and liability.”

Well, the E.F.F. seems determined to shut down this industry once and for all. To that end, the E.F.F. has urged the Court to dismiss the subject case with prejudice, thus barring Righthaven from amending the Strategic Alliance Agreement and refiling its suit. More importantly, a dismissal with prejudice could lead to a holding that the defendant, Wolf, is the “prevailing party” and is entitled to recover his costs and attorney’s fees.

Yes indeed, Mr. Wolf is joining a growing legion of Righthaven defendants who are seeking recovery of their attorney’s fees. We hope that they succeed.

The Lesson To Be Learned – don’t rely on supposedly secret “side” agreements; nowadays there are no secrets.

Submitted by Anonymous (not verified) on Mon, 08/15/2011 - 15:57


I think the standing issue is a brilliant way to combat the attempted rise of copyright trolls. Bravo.

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