Judge Wright issues Prenda Law order(popehat.com) |
Judge Wright issues Prenda Law order(popehat.com) |
Think about how he characterizes the lawyers and their conduct: (1) they were lawyers with failed practices; (2) they figured a way to shake down victims out of an aggregate of millions of dollars; (3) they did this by threatening to expose them as downloaders of pornographic material via the filing of lawsuits ostensibly asserting copyright violations; (4) yet, the people asserting the claims did not have any good evidence actually proving any form of violation in any given case; (5) and, when someone offered any real resistance, the case was dropped; (6) and when the ostensible holders of the claims needed to be real holders of the copyrights in question, shell entities were set up (controlled and dominated by the lawyers) in order to create a false appearance that this requirement was met; (7) and when the federal court's procedural rules specifically required the lawyer bringing the case to identify all known related cases so that the court can understand the true party relationships, the lawyer suppresses all the known facts about the relationships in order to deceive the court; (8) and when a formal assignment of copyright is needed to meet the legal requirement of standing, the lawyers set up a dummy name and forge the person's signature in order to meet the requirement; (9) and when the scheme turns on a fishing expedition by which the lawyers hunt out a list of IP addresses and then ask the court for the right to subpoena the ISP to get the names associated with those addresses, and the judge issues a discovery order saying, in effect, "hold on, you can't do this here," and yet the lawyers still proceed to serve the subpoenas on the ISPs in order to keep generating opportunities to extort settlements from even more victims; (10) and when the court finds out that the lawyers are deliberately flouting the court's orders and authority, the lawyers refuse to appear until forced to and, when they do appear, refuse to account honestly for their conduct.
Summing up and paraphrasing what the judge concluded based on these findings: This is not lawyering. It is naked extortion covered by a thin veneer of lawyering. Rules don't matter. Honesty doesn't matter. Decency doesn't matter. Whatever it takes to keep the scheme going, right or wrong, fair or foul, justified or not.
The result: not a severe money sanction, which would have been but a slap on the wrist when many millions had been gathered under the lawyers' scheme, and apparently gathered tax free to boot. Instead, something much worse, to wit, a clear conclusion that the lawyers had engaged in acts of moral turpitude, justifying referral to the state bar of every jurisdiction in which they are authorized to practice, and likely eventual disbarment; a criminal referral to the U.S. attorneys' office for possible RICO violations; a referral to the tax authorities; and an order that this devastating order be served and filed in every single legal action that has been filed by these attorneys anywhere in the nation.
This, to put it mildly, amounts to evisceration. This judge got mad. This judge had guts. This judge is smart. And that, for these lawyers, is a lethal combination.
1 - From the perpetrators' POV, this kind of white collar crime is orders of magnitude safer and more lucrative than a blue collar equivalent. This may amount to evisceration, but it's nothing compared to a judge getting angry at drug dealers turning that kind of a profit.
2 - From the victims' POV (or at least many of them), the lawyer-extortionist, defense lawyers, laws & judges are all really part of the same "system." It's the system that is abusing them. The judge has tried to make it clear that it's the perpetrators abusing the system, but I wonder if victims feel that distinction. It sounds like a cleaned up version of this scheme might still be legal and profitable: Get actual porn copyright owners on board, pay their taxes, maybe actually litigate a case or two.
It may be if they end up on the wrong side of a RICO prosecution.
http://en.wikipedia.org/wiki/RICO : "Under RICO, a person who is a member of an enterprise that has committed any two of 35 crimes—27 federal crimes and 8 state crimes—within a 10-year period can be charged with racketeering. Those found guilty of racketeering can be fined up to $25,000 and sentenced to 20 years in prison per racketeering count. In addition, the racketeer must forfeit all ill-gotten gains and interest in any business gained through a pattern of 'racketeering activity.' RICO also permits a private individual harmed by the actions of such an enterprise to file a civil suit; if successful, the individual can collect treble damages (damages in triple the amount of actual/compensatory damages)."
And actually if you keep reading the summary, the bad news goes on.
Patience.
That said, in general I think you're right about the relative safety of white collar crime. But it is possible to overplay that hand, and that may have happened here.
"Further, Plaintiffs cannot conclude whether that person spoofed the IP address, is the subscriber of that IP address, or is someone else using that subscriber’s Internet access. Without better technology, prosecuting illegal BitTorrent activity requires substantial effort in order to make a case. It is simply not economically viable to properly prosecute the illegal download of a single copyrighted video."
That's probably a good thing but many a life has been ruined like that.
In the order, I note that Judge Wright used all the most devastating magic words. In addition to discussing their "moral turpitude," as you mentioned, he also said they "defrauded the Court." Ken predicted that might happen and wrote about how important that may be later:
http://www.popehat.com/2013/04/02/prenda-laws-attorneys-take...
"The fraud issue is of such huge importance because there is an exception to the attorney-client privilege from discovery and testimony in cases in which the attorney is alleged to be a participant in the fraud. Even the attorney work product exception from discovery falls by the wayside in such cases."
So this order is devastating not because of the small monetary sanction. Rather, Judge Wright methodically destroyed all of their defenses, threw them to the wolves, and then rounded up every other carnivore in the country to join the wolves in taking a bite out of them.
Would showing this much unmasked disgust towards one party leave a ruling more vulnerable to accusations of bias on appeal (presuming this can even be appealed)?
By refusing to testify on the basis of the right to avoid self-incrimination, they effectively admitted on the court record that they'd committed a crime. At which point, the judge can see the smoke, and though he may not be allowed to investigate the ignition source he can certainly point the DOJ in the general direction of the fire.
Source: http://ia601508.us.archive.org/28/items/gov.uscourts.cacd.54...
As for appeal, he set the monetary awards at a figure just below the cost of a successfully appeal. So they may appeal, but they will not reap any benefits.
They can't appeal the fact that he's going to report them to the IRS CID and the feds.
We all knew this judgement would be good and the judge delivered.
"Federal grand jury investigations are very slow, but represent experienced practitioners bringing almost unlimited resources to bear against their targets."
I willing to wager that if we looked at it with objective perspective, 95% of the time the Federal Grand Juries are doing work for good, it's only 5% of the time that they are misguided - but it's that 5% that we all seem to remember.
[1] https://en.wikipedia.org/wiki/The_Light_Brigade_%28The_Outer...
But Plaintiffs did not conduct a sufficient investigation to determine whether that person actually downloaded enough data (or even anything at all) to produce a viewable video. Further, Plaintiffs cannot conclude whether that person spoofed the IP address, is the subscriber of that IP address, or is someone else using that subscriber’s Internet access.
The first part, proving that they downloaded a complete copy, seems to be a bit more difficult than just grabbing a snapshot of all the IPs at a point-in-time as they had been doing.
> Prenda Law, also known as Steele | Hansmeier PLLP and Anti-Piracy Law Group,[1] is a Chicago, Illinois-based law firm that claims it battles copyright piracy, but is also strongly identified with copyright trolling
page 10 line 21: "Third, though Plaintiffs boldly probe the outskirts of law, the only enterprise they resemble is RICO. The federal agency eleven decks up is familiar with their prime directive and will gladly refit them for their next voyage."
I have never had more fun reading a decision from a judge. It is heartening as well as entertaining.
So this is the other side of the looking glass... when do I meet the disappearing cat?
Source: http://ia601508.us.archive.org/28/items/gov.uscourts.cacd.54...
Ignoring the Star Trek references, the judge established a large number of "findings of fact", where specific factual elements and legal repercussions were identified or quantified. This is a very compelling approach for appellate/higher courts, and should suggest the intent of resiliency in the language by the judge.
Nuking xenomorphs from orbit does seem to be a very good way to be sure.
But what of all the others that have been mired in endless litigation with no such happy ending? And while fitting, is it really desirable for Prenda's punishment to mainly consist of being ground down by the bureaucracy?
Wouldn't we rather an efficient system where ridiculous cases were dismissed outright, unenforceable laws were retired quickly, the lawyer protection racket was unnecessary, and the innocent could be reasonably confident of ultimately prevailing instead of simply settling to avoid years of stress?
http://www.woai.com/media/lib/12/5/9/5/59511ba8-415b-4b2e-a7...
The lawyers out there speculated he did it as yet another smack down to Prenda law. This will always be known in law circles as the "Star Trek Order". It'll be more widely read, and the shame will always follow them.
His findings of law are correct, a little toying with them outside of his findings is quite enjoyable.
Star Trek quotes? Firefox screenshot? Amazing. I read a lot of negative stuff about US law. I hope that's because people are interested in the negative stuff and there's biases operating to not publicise that good stuff.
Is this likely to have any implications for a wider range of copyright-by-IP address cases? Since I've only given a cursory glance past the details of other (let's say music and video) cases, this level of 'proof' sounds quite similar to what is being offered elsewhere.
Moreover, what got this judge's goat was specifically "the illegal parts" of what Prenda was doing, most notably repeatedly lying in court. It wasn't the tangled ownership structure (a feature they share with some of the trolls in the news, like, say, Lodsys), but specific lies they told about it.
(The reason the ownership mattered in the Prenda case is that the lawyers and the owners were one and the same, which is against some court rules. Whoever owns Lodsys, it's pretty clearly not the attorneys representing them in court. And the lies about the ownership structure were not necessarily the most extravagant or significant --- Judge Wright also has a lot to say about misrepresentations of evidence, etc.)
Right at the top. Looks exactly like a writeup about patent trolling except for the porn part.
2. Judge Wright says he is referring Steele, Duffy, Hansmeier, and Gibbs to their respective state bars and federal bars. They can very well be debarred from practicing law, there will be a very thorough bar investigation. This is what lawyer's nightmare are made of.
3. He is referring the case to the U.S. Attorney's Office for RICO (Racketeer act) and the IRS. This is what Hells Angels/Mafia nightmares are made of.
4. All judges that have pending cases with these lawyers will be notified of the above (and most likely more).
Worse case scenario: More attorney fee x2 (how many cases did they prosecute?) , debarred, send to jail for racketeering.
tl;dr the Judge fined them 2x and then set 3 organizations you don't want to mess with on their asses, and told everyone about it.
So they have to face this all over again in front of every single judge where they have a case, with every bar association they're a part of. All while facing the feds AND the IRS.
This is akin to being stripped naked and thrown to the wolves, except that Judge Wright didn't stop with wolves, he looked up every carnivore in the country and gave it a dinner invitation.
This case is awesome because they tried to do exactly that, but an alert Judge thought something not just unpleasant but actually fraudulent was going on.
What that says about all the other cases (where Prenda got millions, apparently) is open for discussion.
http://fightcopyrighttrolls.com/2012/01/31/defendant-strikes...
In any case, if they hadn't evaded taxes, forged signatures and were "legitimately" representing copyright owners they may not have gotten such "harsh" treatment from the judge. So even if not completely above board, they may have escaped with a wrist slap and moved on to another scam.
Informing all other courts about this is going to kill their other lawsuits and bring some interesting new lawsuits / appeals.
"So now, copyright laws originally designed to compensate starving artists allow, starving attorneys in this electronic-media era to plunder the citizenry. "
It is quite obvious that this is the conduct that the judge intends to punish through this order, but that conduct is entirely legal under current law. So are many of the other things the judge complains about, including the use of boilerplate language in the lawsuits, which is routinely done.
This judge disliked the plaintiffs from the outset and went combing through their conduct to find any way he could to nail them. Judges are not supposed to decide who they do or don't like in a case, then craft an outcome based upon those personal feelings. But that is exactly what happened here. Popular rulings aren't always legally sound.
That reminds me of the story of the child who murders his parents only to beg the court for mercy because he is an orphan.
That sounds awful, if you don't know the specific business model being discussed is extortion of random citizens.
I'm not a US lawyer, or even from the US. But surely, if courts can draw adverse inferences from someone 'taking the fifth', that makes it a pretty pointless right, no? It's not much of a right to avoid self-incrimination if exercising it incriminates yourself. Can someone from the US clarify whether that's really how it's interpreted?
I am not a lawyer this is not legal advice, etc etc, but there are other examples in civil cases of where this kind of thing can be used against you. I have a lawyer friend who does personal injury cases, and one of the first things lawyers do in those cases is send spoilation letters to the insurance companies demanding that they preserve any evidence. Absent this, it's common practice for insurance companies to have totaled vehicles destroyed, for example. If they destroy any evidence after receiving a spoilation letter, then in the lawsuit the jury will be instructed to assume that the destroyed evidence showed things in as favorable a light as possible to the other party.
"Even if their refusal was based on the Fifth Amendment privilege against self-incrimination, the Court still may draw adverse inferences against them in this civil proceeding. Baxter v. Palmigiano, 425 U.S. 308, 318 (1976)"
The way I read it (again, not a lawyer) is that you can't convict someone based on their refusal to testify, but this isn't a criminal proceeding. In civil matters the rules are different.
So the fact that the lawyers are taking the Fifth can reasonably be used as evidence that some of the specific claims and assertions already made are materially fraudulent.
Taking the Fifth in your own lawsuit must be quite startling for a judge to behold. One can imagine possible sound reasons why a defendant might take the Fifth or the Sixth (right to consult an attorney, i.e. you caught me off guard but I might answer your questions later), but that is not pretty either, in a civil case.
"In effect, the responsible lawyers for a law firm conducting litigation before a court have refused to explain that litigation to the court on the grounds that doing so could expose them to criminal prosecution."
I'm not a lawyer, but what I took from that was that in this instance the Prenda Law guys were not being asked questions with relation to their role in the actual scheme. They were actually being asked questions in relation to their role as 'officers of the court' ie. as the lawyers for themselves that were involved in the scheme.
Oh what a tangled web they weaved...
Although lawers mid-trial taking the fifth may be different.
The situation is quite different in a trial. If you are summoned to appear in court, you must appear. If you are asked any questions, you must answer them (or assert fifth amendment rights explicitly in a refusal to answer, like the Prenda clowns did).
Also, in the order leading to the Prenda attorneys pleading the 5th, the judge basically said "I have drawn these inferences. Tell me why I'm wrong.", and they declined to do so (pleading the 5th). According to Popehat's coverage, that seems to leave him pretty free to stick with the initial inferences.
IANAL and all that.