Category Archives: Bittorrent

MALIBU MEDIA – Looking Under The Hood of Infringement

One of the most active parties in enforcing against BitTorrent downloads is Malibu Media, who releases adult content under the X-Art brand. While the standard mantra is BitTorrent is largely innocent and about ‘file sharing,’ this is like calling a typhoon ‘rain sharing.’ The level of content distribution is far from trivial or inconsequential.

In a recent filing in the Southern District of Ohio (1:14-cv-493-TSB, Dkt. 9), Malibu Media has let the court see under the hood at some of what is going on. Depending on how you look at the data, Malibu has records of about 12,000 distinct IP addresses in Ohio sharing and distributing their content through BitTorrent. Based on this number, when compared to the population of Ohio (~12 million), there is evidence that approximately 1 in 1000 people in Ohio are ‘sharing’ X-Art’s media through BitTorrent.

Chart of Malibu Infringement Actions, p. 4 of 14-cv-493, Dkt. 9.

Malibu Media is by all accounts one of the most active copyright enforcement litigants in the United States with some sources reporting they filed 40% of all copyright suits in 2014. But with 172 suits in Ohio, and 12,000 known infringers, Malibu’s prolific filing of complaints is addressing less than 2% of the people stealing their work. Some may complain there are too many copyright suits filed (usually those who are being sued / have been caught) but the ratio of infringers to lawsuits is a disproportionate 70:1.  For any other kind of theft, 1 in 70 would lead to the calls for more enforcement, not complaints about excessive enforcement. If one in 70 cars were stolen, or if your car were stolen every 70 days, there would be a national call to action.

With respect to damages claimed and awarded, many may argue the $750.00 statutory minimum for copyright enforcement is draconian, but a one-month subscription to Malibu Media’s web site is $29.95. If Malibu Media’s claims are against 1 in 70 infringers, then the numbers pencil out to damages of at least $2,000 per defendant just to break even ($29.95 x 70 = $2,096.50).   In light of the extensive nature of the problem, the $750.00 statutory minimum starts to seem very reasonable.

Court Document:  Malibu Media v. John Doe, 1:14-cv-493-TSB, Dkt. 9 (S.D. Ohio Sept. 12, 2014)

 

 

 

 

 

 

JOINED BITTORRENT COPYRIGHT SUITS GO FORWARD IN HAWAII

Hawaii now joins the majority of states which allow joined BitTorrent copyright enforcement cases.  In early 2013 the Prenda scam was uncovered where a group of attorneys were revealed to be using shell games to operate a honeypot scheme for people that downloaded porn via BitTorrent.  In response courts across the nation clamped down on all BitTorrent cases as a precaution.   As the courts have become better educated they are recognizing the Prenda scam was unique and that joined BitTorrent copyright litigation is the most efficient and best way to enforce copyrights, especially in light of the massive scale of BitTorrent related infringement.

Single party cases are still being filed in many jurisdictions, but some studies put the average costs and attorney fees for copyright litigation at $300,000 to $2,000,000+ *. (Note, this is a National average for all copyright cases and many cases are resolved for significantly less.)   However the courts, and many wise defendants, recognize that by permitting joinder costs can be reduced dramatically, permitting rights enforcement and allowing cases to be economically resolved for less than 10% of the national average.

Related:

Hawaii: Dallas Buyers Club, LLC, v. Does 1 – 20, Case No. 1:14-cv-00330
Hawaii: Dallas Buyers Club, LLC, v. Does 1 – 22, Case No. 1:14-cv-00331

 

Opinions of the court allowing discover in the joined case to proceed:

Hawaii: Dallas Buyers Club, LLC, v. Does 1 – 20, Dkt. 10, Case No. 1:14-cv-00330, (D. Haw. Aug. 28, 2014), Order allowing subpoenas.
Hawaii: Dallas Buyers Club, LLC, v. Does 1 – 22, Dkt. 9, Case No. 1:14-cv-00331, (D. Haw. Aug. 28, 2014), Order allowing subpoenas.

 

* Amer. Intl. Prop. L. Assoc’n, Report of the Economic Survey.

BitTorrent Copyright Update: Joined Cases Go Forward in Illinois

Judge Tharp, sua sponte, rules to allow joined cases to proceed and rejects a strict reading of D.C. Federal Court joinder analysis.

Without any motion before the court, Judge Tharp has addressed the issue of BitTorrent swarm joinder and the ruling of AF Holdings, LLC v. Does, 1-1058, 752 F.3d 990 (D.C. Cir. 2014), and has found that though in extreme cases joiner may not be proper, in the matters of the pending cases relevant to his ruling joinder is indeed proper for BitTorrent copyright claims, at least for initial discovery.  The D.C. Federal Circuit is the only appellate court to address this issue and in the case of 1000+ defendants, spread out over five months, the court found that joinder was not proper.  Judge Tharp, on his own (sua sponte) rejected the strict D. C. Federal Circuit analysis and the common argument that would require all parties be in a swarm a the same time, and found that such a requirement:

…appears to overlook the fact that the pieces of the file that Doe 1 distributed directly to other Does who were in the swarm contemporaneously with Doe 1 were in turn subsequently distributed by them to the Does who joined the swarm after Doe 1 left it; in the context of a swarm, there is only a single digital file that is distributed among the members. Thus, it cannot be said that subsequent transfers of that file are even entirely “independent” of the earlier transfers; all of the transfers involve the same file and the earlier transfers of the pieces of that file facilitate the later transfers. Moreover, nothing in Rule 20 suggests that joinder requires a direct transaction between every defendant.

…permitting joinder among noncontemporaneous swarm participants does not seem novel or extreme; the law governing joint ventures and conspiracies, for example, permits plaintiffs to proceed against groups of defendants who engaged in a cooperative endeavor to facilitate an unlawful object whether or not all of the members of the group took part in all of the actions of the group and without regard to when the members joined the group.

The judge acknowledged:

Though there are strong arguments on both sides of this issue, entering a sue sponte finding of misjoinder of the Doe defendants would, in the Court’s judgment, be inappropriate at this early stage.

Though the plaintiff may issue subpoenas to determine the Doe defendants’ true identities, the plaintiff is prohibited from publishing the defendants’ identities in any way without leave.

… the Court finds that allowing the defendants to proceed by pseudonym is appropriate at this preliminary stage of the litigation, when no defendant has been put on notice of this suit. Once defendants have received such notice, the Court will revisit the issue of whether the names of the defendants in this matter may be publicly disclosed.

While the proponents of BitTorrent piracy may have expected the D.C. Circuit to end all joined lawsuits nationwide, this is clearly not the case as several districts including those in Texas, Colorado, Illinois and Washington have subsequently made clear that joined cases are going forward.

Full Text of Opinion: Dallas Buyers Club v. Does 1-25, 1:14-cv-05643 (N.D. Il. Aug. 28, 2014).

Reinventing a Broken Wheel – International Investigations and Bad BitTorrent Defenses 

“There is nothing new under the sun.” Ecclesiastes 1:4-11

An attorney’s job is to know the facts and law and argue the facts and the law. But if the facts are against you and the law is against you, then you need to be creative. If not to win, to at least justify the time and billing for your actions. And this leads to a lot of creative arguments, and sometimes plagiarism, even if only to plagiarize other failed arguments.   It is hard for an attorney to make a living telling clients, “You don’t have a case, and there is nothing I can do.” (Or more accurately, nothing I can bill you for…) So an attorney needs to come up with something that at least looks good on paper. After all, a client is rarely able to do the proper legal research to know that an attorney only managed to dig up a dead argument, polish it off, and sell it again as new.

An instance of this recycling can be seen in a recent spate of filings in BitTorrent litigation arguing investigations need to be licensed by the state of the defendant or the case should be thrown out on a technicality.

The argument goes something like this: Since most states have laws that require an investigator be licensed for their investigations to produce admissible evidence, an unlicensed investigator’s evidence should not be admitted.

This argument sounds good, but like many of the other defenses that get sold to defendants it does little more than provide temporary false hope and drive up legal fees that are usually then paid by the defendant. The courts that have looked at this have universally rejected this argument on a number of grounds. The internet does not recognize a state line, so such limitations are largely meaningless in the digital world.

As stated several years ago by Judge Nancy Gertner in SONY BMG Music Entertainment v. Tenenbaum:

“The Defendant raises a number of arguments why MediaSentry’s monitoring was illegal under state and federal wiretap laws, as well as state licensing requirements for private investigators. See Mass. Gen. L. ch. 272, s. 99(A); Mass. Gen. L. ch. 147, s. 22. Given that MediaSentry did not conduct its monitoring from Massachusetts, does not maintain a presence in the state, and the computer on which MediaSentry detected Tenenbaum’s file-sharing was located in Rhode Island at the time, Massachusetts’ wiretapping and licensing provisions would not seem to reach the conduct at issue at all. See Connelly Aff. (document # 866-5); Cox Comm. Subpoena Resp. (document # 866-9). Regardless of which state’s licensing requirements are invoked, the Court previously considered a similar motion to strike in London-Sire Records, Inc. v. Arista Records LLC, Case No. 04-12434, holding that “[n]either the rules of evidence nor the Fourth Amendment bar the use of evidence arguably unlawfully obtained by private parties in their private suits.” Jan. 9, 2009 Mem. and Order at 3-4 (document # 230). Tenenbaum’s remedy for a search he believes illegal under state laws is not exclusion of this evidence, but a separate action against MediaSentry or its employer under the state statutes he identifies. That leaves only the federal wiretapping provisions. See Electronic Communications Wiretap Act, 18 U.S.C. 2510 et seq. Here, Tenenbaum proposes a difficult analogy when he compares MediaSentry’s activities to illegal eavesdropping. The Defendant made his computer’s “shared folder” visible to the world of KazaA users, for the very purpose of allowing others to view and download its contents — an invitation that MediaSentry accepted just as any other KazaA user could have. The electronic communications that ensued were conducted with the consent of both parties. As a result, it is bizarre indeed to describe MediaSentry’s decision to examine and record its counterpart’s IP address as eavesdropping, as though federal law prohibited MediaSentry from determining where the data sent to it from Tenenbaum’s computer originated. It is as if one received a letter in the mail, but was not allowed to look at the return address.This principle makes no more sense on the internet than in the non-digital world, and it is not encompassed by the Act. The type of IP information transmitted by KazaA and recorded by MediaSentry is accessible to almost anyone with a computer. Even if viewed as an “interception” — a characterization that the Court accepts here only as a hypothetical — MediaSentry’s monitoring activities fall within the statute’s safe harbor for interceptions by a party to the communication. See 18 U.S.C. 2511(1), 2511(2)(d); see also R.I. Stat. s. 12-5.1-1 et seq. (one-party consent rule parallel to the federal statute). Tenenbaum transmitted the digital files at issue to MediaSentry, making it a party to the communication, and he has not shown here that any interception occurred with the purpose of committing a “criminal or tortious act” under state or federal law. Id.; see also Order on Motions in Limine, Capitol Records Inc. v. Thomas-Rasset, Case No. 06-1497 (D. Minn. June 11, 2009).
The Motion to Suppress MediaSentry Evidence [853] is DENIED.” (Gaudet, Jennifer)

In the Tenenbaum case the defendant fought to the bitter end, even trying to take their arguments to the U.S. Supreme Court, but still ended up owing $675,000 in damages.  Since Tenenbaum no judge has held differently. But the argument still sounds good and attorneys are still trying to sell it to their clients.

Exemplar Recent Opinion: Malibu Media, LLC, v. John Doe subscriber assigned IP address 24.94.99.165, 8:14-CV-659, Dkt. 16, (M.D. Fla. July 29, 2014) :

Excerpt:

Plaintiff’s claim is plausible on its face and should not be dismissed. Furthermore, Doe Defendant does not have standing to challenge the subpoena issued by Plaintiff to ISP Time Warner Cable as there is no right or privilege associated with an internet service subscription. Finally, a protective order is inappropriate as sufficient safeguards were put in place when the Court granted Plaintiff leave to conduct early discovery.
Accordingly and upon consideration, it is RECOMMENDED that:
(1) Doe Defendant’s Omnibus Motion to Dismiss Action with Motion to Quash Non-Party Subpeonas or Enter Protective Order, with Incorporated Memorandum of Law (Dkt. 8) be DENIED.

Joined BitTorrent Copyright Suits Go Forward in Washington

Over the last two years there have been a number of twists and turns in the world of BitTorrent copyright infringement cases.   In early 2013 the Prenda scam was uncovered where a group of attorneys were revealed to be using shell games to operate a honeypot scheme for people that downloaded porn via BitTorrent.  Courts across the nation clamped down on all BitTorrent cases as a precaution.  More recently with the news that the major studio film Expendables 3 may have lost tens of millions, if not more due to BitTorrent piracy, BitTorrent cases are again receiving renewed interest, though now in a different light.

This whole cycle is readily observed in Washington State, where initially joined cases were allowed by the courts.  Following Prenda, the courts took a close look at the cases and at one point dismissed joined cases across the board.  Elf-Man LLC v. Cariveau, No. C13-0507RSL,(W.D. Wash., Jan.17, 2013).  But on review and scrutiny, the Court reversed itself and cautiously allowed the cases to proceed. Elf-Man LLC v. Cariveau, No. C13-0507RSL, (W.D. Wash., Aug. 7, 2013).

More recently the Washington courts have again affirmed that it will allow joined cases against BitTorrent infringers in a case involving the piracy of Dallas Buyers Club.

Dallas Buyers Club v. Does 1-10, Case No. 2:14-cv-01153 (WAWD).

Opinion of the court allowing the case to proceed:Dallas Buyers Club – 2:14-cv-01153, Dkt. 8; Order Granting Expedited Discovery

Edit:  Also pending:
Dallas Buyers Club v. Does 1-10, Case No. 2:14-cv-01336 (W.D. Wa.).

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October 2, 2014:  Washington is maintaining its position that joined cases are proper as of Oct. 1, 2014 with continued orders that these cases will go forward joined.
Order Granting Discovery – Dallas Buyers Club v. Does 1-10, Case No. 2:14-cv-01402 (W.D. Wa., Oct. 1, 2014).