Category Archives: Copyright Infringement Cases

Piracy Costs LA Infringer $26,000

In the recent case of QOTD v. Walther, plaintiff brought an action against a party that was using BitTorrent to download and then share the motion picture Queen of the Desert. After investigation and being served with the Complaint, Walther refused to respond and a judgment was entered against him.

The result was an award in favor of QOTD for $15,000 in damages and over $11,000 in costs and fees for a total of over $26,000.

The Court further ordered Walther to, “refrain from knowingly and willfully using BitTorrent or any other online media distribution system for copying or downloading content in violation of United States Copyright laws.”

Relevant Document: 16-cv-02803 Judgment

 

Subscribers Sanctioned in BitTorrent Litigation

Paying for internet service does not by itself make a party liable for any infringing activity, but as two parties have recently learned failing to cooperate in helping identify the infringer may have serious consequences.

In a traditional bittorrent case when infringing activity is traced to an IP address the plaintiff must first identify the subscriber who pays for the service. Then if the subscriber is not the liable party further investigation is needed to identify the actual infringer who may be another party with access such as a roommate or someone else.

But if the subscriber refuses to cooperate with the plaintiff this does not end the process. In a recent pair of federal court cases subscribers have been found in contempt and sanctioned for their failure to respond to letters and court orders directing them to provide information on their internet service and assist in identifying the actual infringer.

As per the opinion:

…Dallas then served Pinnell with a Rule 45 subpoena via United States Mail requiring Pinnell’ s appearance at a deposition on August 9, 2016. After Pinnell failed to appear and participate at that deposition, as required by the Rule 45 subpoena, Dallas filed a motion for order to show cause.

            Pinnell failed to appear at the show cause hearing. The record indicates Pinnell has repeatedly failed to appear as required by the subpoena and this court’s show cause order. Further, Pinnell has made no attempt to provide excuses for her nonappearances and noncompliance with the court orders. As such, the court finds Pinnell in contempt.

Full text: Dallas Buyers Club v. Doe, 3:16-cv-00551 (D. Or. Oct. 21, 2016)

In a similar finding:

…LHF personally served Thompson with a Rule 45 subpoena which required Thompson’s appearance at a deposition on August 9, 2016. Thompson failed to appear at the deposition, thus violating a court order. Subsequently, LHF filed a Motion for Order to Show Cause.

            Thompson failed to appear at the show cause hearing and the record shows Thompson has repeatedly failed to appear, in violation of the subpoena and this court’s Order to Show Cause. Further, Thompson has made no attempt to provide an explanation for his nonappearances and noncompliance with the court orders. As such, the court finds Thompson in contempt.

Full text: LHF Productions v. Doe, 3:16-cv-00716 (D. Or. Oct. 21, 2016)

In both cases plaintiffs were awarded costs and fees.

 

Compelled Internet Subscriber Depositions

Of course, in the absence of other evidence of intent, a court would be unable to find contributory infringement liability merely based on a failure to take affirmative steps to prevent infringement, if the device otherwise was capable of substantial noninfringing uses. Such a holding would tread too close to the Sony safe harbor.
         – Justice Souter in Footnote 12, MGM v. Grokster, 545 U.S. 913 (2005).

Piracy and copyright infringing activity that takes place over the Internet is problematic as often all a plaintiff or rights-holder only knows is the IP address used by the infringer. This IP address can lead to a users or subscriber’s account and the ISP may be able to tell the rights-holder who is behind paying the bill. But if the account goes to a house with several occupants, this does not answer the question of who might be the pirate. As Justice Souter made clear, paying the bill, without anything more, is not enough.

The Grokster footnote is often held as a shield for subscribers who do not personally use their internet service for infringing activity such a BitTorrent. But this shield is not as broad or strong as many might believe. Even after Grokster many courts continue to hold that if a party knows of infringing activity and fails to take action, then they are liable. See Perfect 10 v. Google, 508 F.3d 1146, 1171-72; citing A&M Records v. Napster, 239 F.3d 1004, 1021 (9th Cir., 2001)(“Because Napster knew of the availability of infringing music files, assisted users in accessing such files, and failed to block access to such files, we concluded that Napster materially contributed to infringement.”) See also, Religious Technology Center v. Netcom On-Line, 907 F.Supp. 1361, 1365-66 (N.D.Cal.1995)(Liability proper if party knew or should have known of infringing activity and failed to simply cancel account.) There is also the case of extending liability for providing an anonymizing TOR node, even without actual knowledge of any piracy. Dallas Buyers Club v. Huszar, 3:15-0907, (D.Or., April 28, 2016)(“Huszar actively and knowingly provided an unknown number of computer users worldwide with access to his Tor VM.”)

As a practical matter, even if the subscriber is not liable and knew nothing about the piracy through their network, they are still the person that paid the bill and the only one the rights-holder can identify through the IP address. Courts are recognizing this with California being the newest district to begin to compel subscribers who deny liability to appear and share what they know about who may be the infringer.

In several matching opinions, including QOTD Film Investment v. Doe, 3:16-cv-00749 (Oct. 4, 2016) and LHF Productions v. Doe, 3:16-cv-01157 (Sept. 30, 2016) the courts in California are now directing that subscribers who only pay the bill may be compelled to sit for a 1 hour deposition, cautioning plaintiffs:

Questions are limited to establishing the identity of the alleged infringer(s). The deposition is not to be treated as a fishing expedition for information other than the identity of the alleged infringer(s).

But the Courts are also cautioning subscribers:

Plaintiff shall notify the subscriber that ignoring a Court Order, a subpoena seeking the subscriber’s deposition, or a Summons and Complaint may result in sanctions including an award of attorney fees and possibly the entry of a default judgment for money damages.

These new California orders bring California in line with Louisiana (ELargo Holdings v. Doe, 2:16-cv-03144, June 24, 2016) and the well establishing Standing Orders of Oregon. Standing Order 2016-8, automatically granting a two our deposition of all subscribers in any bittorrent case filed, and Standing Order 2016-7, advising parties:

Notwithstanding contrary information available through the Internet, if a subscriber or defendant ignores a Court Order, a subpoena seeking the subscriber’s deposition, or a Summons and Complaint, then plaintiff may ask the Court for relief, including an award of attorney fees, and possibly the entry of a default judgment for money damages.

Accordingly, it is important that subscribers and defendants seek proper legal advice concerning their rights and obligations.

So while paying a bill (and nothing more) may allow a subscriber to escape liability, they can still be compelled to share what they know about who else may have been present and anyone that might have had access to their internet service which was used to commit piracy.

Default Gamble

To default or not to default, that is often a question when facing litigation.  In the realm of online copyright infringement it is no different.   Many attorneys actively advise clients to ignore letters and even complaints with the knowledge that sometimes Judges will only award $750 in damages, with costs and fees totaling only a few thousand dollars.

But the ignore strategy does not always go as planned, such as in the case of Dallas Buyers Club v. Scott. 3:15-cv-00730-AC (D.Or.). Possibly banking on a minimum damages, Scott was surprised to find a $5,000 default judgment entered against him (docket-41) together with a request for $1,800 more in fees. Scott hired an attorney and tried to set aside the default arguing he was never served and did not know about the case. (docket-54)

Defaults are often set aside as a matter of course, and often by agreement.   But in this case Dallas Buyers Club opposed setting aside the default. (docket-62) Scott replied and added the argument that at the time of the infringing activity he was not even living at the address. (docket-65)

In response, the Judge wrote in total:

Document Number: 68(No document attached)
Docket Text:

ORDER: DENYING Defendant’s Motion to Set Aside Default Judgment [54]. “If a default judgment is entered as the result of a defendant’s culpable conduct, however, [the Court] need not consider whether a meritorious defense was shown, or whether the plaintiff would suffer prejudice if the judgment were set aside.” Alan Neuman Prods., Inc. v. Albright, 862 F.2d 1388, 1392 (9th Cir. 1988) (citation omitted). “Defendant’s conduct is culpable if he has received actual or constructive notice of the filing of the action and intentionally failed to answer.” Id. Defendant was aware of potential litigation in October 2014, as he called Plaintiff’s counsel, and he admits to receiving a notice of default in December 2014. I find that he received at least constructive notice and therefore his failure to answer or otherwise defend was culpable conduct. As such, I DENY the Motion to Set Aside the Default Judgment. Defendant’s response to the Motion for Attorney Fees and Costs [44, 43] is due August 22, 2016. Ordered by Chief Judge Michael W. Mosman. (dls)

The Magistrate assigned the case then followed with:

Document Number: 69(No document attached)
Docket Text:

SCHEDULING ORDER by Judge Acosta – In light of the fact that defendant filed a motion to set aside default and default judgment (#54) and that motion being denied by Order (#68), which was filed on 8/2/16, the court still must address plaintiff’s Bill of Costs [43] and Motion for Attorney Fees and Costs[44]. Accordingly, as plaintiff had to prepare further briefing in response to the motion to set aside default and default judgment, plaintiff may, if it deems appropriate, file supplemental briefing in support of it’s motion for attorney fees and bill of costs by 8/22/16. If plaintiff does not intend to supplement it’s motions, counsel for plaintiff is to notify the court no later than 8/12/16. Defendant’s response(s) to plaintiff’s bill of costs and motion for attorney fees are due by 9/6/16. Plaintiff’s Motion for Attorney Fees [44] and Bill of Costs [43] will be taken under advisement by the court as of 9/22/16. (peg)

Taking the hint, the case concludes with a stipulation and judgment for an additional $7,000 in costs and fees against Scott to address the motion to set aside the default.

The result – Gambling on a $750 default resulted in $12,000 in costs, fees and damages.

 

Dallas Buyers Club only target iiNet customers – as of now

In yesterday’s hearing, Dallas Buyers Club LLC and Voltage Pictures’ lawyers said part of more than 4700 IP addresses they are proposing to contact foe alleged movie downloads were all used by iiNet subscribers. However, 10% of the IP addresses do not represent all the iiNet customers that the DBC LLC believes may have infringed copyright. Aside from iiNet, the complete collection of IP addresses came from Adam Internet, Amnet Broadband, Dodo, Internode and Wideband Networks Pty Ltd.

Previously, Justice Nye Perram who’s presiding over the case granted a DBC LLC application for preliminary discovery where it gains access to ISP customers contact details link to the IP addresses involved in Dallas Buyers Club downloading. However, he imposed a stay on that order in August.

DBC LLC modified the method used to calculate the settlement that they would propose. Initially, they had constructed a formula based on the cost of the film when you purchase a copy, licence fee for the distribution of film (pirate’s uploading activities), a portion of the DBC’s legal costs and a fine for an individual’s piracy of other films. The company was willing to take an approach as “one size fits all” to the proposed demands. They excluded other unauthorised downloads of films as part of its settlement formula but kept the licence fee for the distribution.

When Dallas Buyers Club applied to the court in September to lift the stay, they offered the $60,000 amount in exchange for access of customer details of 10% of the IP addresses but the ISPs opposed the proposal.

DBC’s request for an adjournment while they sought to gather more evidence about the licence fee to seek from downloaders was denied by Judge Perram. A new ruling is expected next week.

8th Circuit Court of Appeals: Suing an IP address subscriber is reasonable

In the case of Killer Joe Nevada v. Leaverton, Killer Joe Nevada, LLC sued internet subscriber Leigh Leaverton for infringement under the Copyright Act for the download and distribution of the motion picture Killer Joe. When on investigation it appeared Leaverton was only the subscriber who paid for the Internet service and not the infringer, Killer Joe moved to voluntarily dismiss its suit. Leaverton objected and demanded her attorney’s fees. The court dismissed the suit and denied Leaverton’s requests for attorney’s fees.

Leaverton appealed and the key issue on appeal was whether or not it was reasonable for a subscriber to be sued solely for being the party responsible for the internet service used by the infringer and whether the District Court abused its discretion in denying her attorney fees.

As per the Court of Appeals:

[Leaverton] argues that the district court erroneously ruled it was reasonable and not frivolous for Killer Joe Nevada to sue the subscriber for the IP address. Leaverton believes it is unreasonable for a Copyright Act plaintiff to sue the subscriber without first investigating whether the subscriber was responsible for the infringement.
          . . .
Leaverton cites no binding authority that a Copyright Act suit based on the infringer’s IP address is frivolous or unreasonable. The district court thus did not abuse its discretion by concluding that Killer Joe Nevada’s acts were reasonable.
          . . .
…because Killer Joe Nevada promptly dismissed its lawsuit once it learned Leaverton was not the infringer, Killer Joe Nevada had proper motives to sue the subscriber.

If nothing else, this case stands for the principal that providing internet service alone, though it may not make you liable for infringing activity, reasonably exposes you to potential litigation.

Full Text: Killer Joe Nevada v. Leaverton, No. 14-3274, 8th Circuit Court of Appeals, Dec. 4, 2015

Maverick Eye Data Analysis “Sees Through” Dynamic IPs

In a recent case filed on behalf of Glacier Films for infringement of the film American Heist, it is revealed BitTorrent monitor Maverick Eye has developed a system to “see through” dynamically assigned IP addresses allowing the tracking of infringing activity by a single infringer through multiple IP assignments.

As stated in the complaint –

14.  The defendant’s ISP CenturyLink is known to dynamically reassign IP addresses, sometimes assigning an IP address to a party for days, and at other times only for a very short period of time.

15.  Dynamically assigned IP addresses with very short durations may be problematic in identifying a specific infringer as there is only a limited window of data available to the rightsholder in the investigation of the identity of the infringer.

16.  While the identity of the subscriber is readily ascertainable even if only an instant of infringing conduct is observed, limited data creates a greater burden for a rightsholder in using subscriber data to correlate with observed infringer data to identify a specific liable infringing party who acted through the IP address of the subscriber.

17.  To assist in overcoming this issue, plaintiff’s investigator Maverick Eye, UG has developed technology to identify other IP addresses also likely assigned the same subscriber and therefor used by the same defendant.

18.  By expanding the window of known activity associated with a singular defendant across several IP addresses plaintiff is able to use a broader pool of observed activity to assist in identifying the actual infringer and liable party.

The complaint identifies 6 IP addresses all assigned to a single defendant and seeks statutory damages and costs and fees.

 

Copy:  Glacier Films v. Doe 3:15-cv-02016

Evasion of service caused an infringer $10,000

In Dallas Buyers Club, LLC v. Vladamir Ivashentsev [Case No.: 3: 15-cv-00220-AC], the Court found Vladamir Ivashentsev willfully infringed the copyrights of Dallas Buyers Club, LLC (“DBC”). Mr. Ivashentsev willfully attempted to evade service and refused to participate in court proceedings with notice. He was properly served by publication.

Also, the Court awarded statutory damages in the sum of $10,000 in favor of DBC. The award was intended to compensate DBC as well as to provide proper notice and deterrence to others.

Further, the Court enjoined Mr.  Ivashentsev from infringing DBC’s copyrights in the motion picture “Dallas Buyers Club”, including without limitation using the internet to reproduce, distribute or copy the movie. He was also directed to destroy all unauthorized copies of DBC’s motion pictures and to delete all software used to make or distribute those copies or exchange unlicensed content using the BitTorrent protocol. Similarly, he was enjoined from using BitTorrent or the Internet for the copying or downloading of unlicensed copyrighted content.

DBC was also awarded reasonable costs and fees pursuant to FRCP 54.

Internet sites – not a reliable source for legal advice

Killer Joe Nevada, LLC, copyright holder of the movie “Killer Joe”, subpoenaed Mr. Reston Eilers in an attempt to get information about potential copyright infringement taking place apparently at his residence. They tried to find out who is the infringing party, making sure that only the right people are haled into court.

 

However, despite receiving notices, Mr. Eilers had not responded or complied with them. Thus, the Court issued an order to show cause why he had not complied with the court’s prior order to appear for deposition. Mr. Eilers is not a lawyer and not familiar with legal proceedings.

 

During the show cause hearing, the Court admonished Mr. Eilers for ignoring legal process saying, “You’re telling me it’s because you didn’t think you had to comply because of this information you had been receiving off of the Internet. Bad information. Now you’re in a lot of trouble, okay, because you’ve been not complying.”

 

The Court added that ignoring notices because of some stuff found in the Internet is not an excuse for avoiding legal process.

 

The Court told Mr. Eilers, “What you should have done, from the beginning, is not go to the Internet and do the research and follow that advice; instead, you should have contacted Mr. Crowell when you got the papers with his letters saying “What’s going on? What do I need to do?” Right? Burying your head in the sand is not the appropriate response.”

 

Finally, the Court gave advice to Mr. Eilers to inform the others not to ignore legal process and not to rely on internet sites, saying, “It may not be worth it to them, but part of what I’m doing is sending a message to you and others that you know, okay, that you can’t ignore the legal process. And it is in your best interest at this point to get onto whatever Internet sites you’ve been looking at and tell people out there that they’re giving out the wrong information and if they ignore these lawsuits they also are going to get hit by the Court for costs and fees….”

 

This article is lifted from the case Killer Joe Nevada, LLC v. DOE-76.115.252.140, Case No. 6:15-cv-00494-ST

Reliance on the internet for legal advice caused subscriber legal troubles …

To address the issues of Internet piracy, Killer Joe Nevada LLC “Copyright Owner” filed an action to enforce its copyrights in the motion picture, “Killer Joe” against an unknown party (“infringer”) identified as Doe-76.115.252.140. Pursuant to a subpoena, the Internet Service Provider (“ISP”) identified Reston Eilers as the subscriber assigned to the ISP account associated with the infringing activity.

 

To ascertain whether the subscriber is an innocent third party and, if so, the identity of the infringer, copyright owner sent several letters to Mr. Eilers to elicit his cooperation. However, Mr. Eilers did not respond to any of these letters. Copyright owner then asked the Court to issue an FRCP 45 subpoena to compel Mr. Eilers’s assistance in its investigation. Because Mr. Eilers evaded service, he by was served by U.S. mail. Again, Mr. Eilers failed to respond. Thus, the copyright owner obtained a court order compelling his response. Served with the Order, a new subpoena, and a cover letter, Mr. Eilers again failed to respond or appear. Accordingly, the court issued a Show Cause Order to Mr. Eilers.

 

At the show cause hearing, Mr. Eilers assured the court that he is not the infringer who downloaded copyright owner’s motion picture. He asserted that there was no evidence before the court to indicate otherwise. However, the court said that the issue is not whether Mr. Eilers is the infringer, but his refusal to respond to a subpoena served on him by U.S. Mail, delivery thereof was confirmed, and his subsequent failure to comply with the court’s Order to respond to the copyright owner’s subpoena.

 

Mr. Eilers explained that his failure to respond was in reliance on an advice provided by various Internet web pages that oppose copyright owner’s actions or copyright enforcement. The Court said that any advice to ignore court orders or a subpoena, whether served in person or by mail, is incorrect and provides no legal excuse.

 

Therefore, the Court found Mr. Eilers in contempt of the Court’s Order and the copyright owner was awarded reasonable costs and fees.

 

Lifted from the case Killer Joe Nevada, LLC v. DOE-76.115.252.140

[Case No. 6:15-cv-00494-ST]