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Indianapolis, IndianaMagistrate Judge Mark J. Dinsmore recommended that Judge William T. Lawrence deny Malibu Media’s motion for fees and sanctions against two Defendants and copyright lawyer Jonathan Phillips.

This Indiana federal lawsuit involves allegations of the use of BitTorrent to illegally download copyrighted adult films. Plaintiff Malibu Media, LLC of Malibu, California initiated copyright litigation in the Southern District of Indiana alleging that Charles and Kelley Tashiro, husband and wife, violated its intellectual property rights by downloading copyrighted videos without authorization.

On the morning of a scheduled evidentiary hearing in the matter, attorney Phillips, who at the time represented both husband and wife, learned of Mr. Tashiro’s intent to invoke his Fifth Amendment rights to avoid testifying about certain matters. The defense attorney for the Tashiros advised the court that, as a result, a conflict of interest between husband and wife had arisen and that he would be withdrawing as the defense attorney for Mr. Tashiro. As a result, the court postponed that day’s hearing.

Malibu Media subsequently filed a motion asking the court for sanctions, seeking to hold Mr. Tashiro and his copyright attorney jointly and severally liable for the costs and fees incurred in its preparations for the postponed hearing. Malibu Media contended that the defense lawyer’s failure to recognize the conflict of interest between the two Defendants in a timely manner had required Malibu Media to incur unnecessary expenses for the evidentiary hearing. More specifically, Malibu Media contended that it incurred several thousand dollars in unnecessary fees, travel expenses, and other costs. It sought to recover those fees, expenses, and costs 1) under Federal Rule of Civil Procedure 37; 2) under 28 U.S.C. § 1927; 3) through an exercise of the court’s inherent authority; and 4) under Federal Rule of Civil Procedure 16.

Magistrate Judge Dinsmore first concluded that FRCP 37 was inapplicable, as it was generally appropriate for “disputes or misconduct during discovery” and the delay of the evidentiary hearing had not resulted from discovery misconduct.

Plaintiff’s claim under 28 U.S.C. § 1927 was also rejected. That section provides that the court may order costs, expenses, and attorneys’ fees incurred as a result of an attorney’s unreasonable or vexatious expansion of the proceedings in litigation.

Malibu Media asserted that this section applied because the copyright attorney’s failure to timely recognize a conflict of interest between the husband-and-wife Defendants failed to meet the standard of care required of attorneys. The court disagreed, stating that the case had involved no incompatibility of the copyright Defendants’ positions, as both had steadfastly asserted that neither had infringed any of Malibu Media’s copyrighted material and that no evidence had been destroyed. Consequently, the defense attorney’s belief that he could provide concurrent representation to both Defendants was neither unreasonable nor vexatious and, thus, relief under 28 U.S.C. § 1927 was unavailable.

Moreover, the court explained, even had § 1927 applied, it provided recompense only for the excess costs and fees incurred – those that would not have been otherwise necessary. Because much of the material prepared by intellectual property counsel for Malibu Media would likely prove useful later in the litigation, those costs and fees had not been incurred unnecessarily.

Magistrate Judge Dinsmore also rejected Malibu Media’s argument that the court should sanction Mr. Tashiro and the defense attorney under the inherent authority that the court holds to manage its affairs through the sanctioning of a party that has abused the judicial process. The court had already determined during its analysis under § 1927 that the defense attorney had acted neither unreasonably nor vexatiously. Thus, a sanction against the defense attorney for abuse of process was similarly found to be improper. The court also declined to hold that Mr. Tashiro’s decision to invoke his Fifth Amendment rights was an abuse of judicial process.

The court then addressed Malibu Media’s contention that Federal Rule of Civil Procedure 16 authorized sanctions in this case. It concluded that, as the rule authorized the imposition of sanctions only in matters regarding scheduling conferences or other pre-trial conferences, it did not apply to the evidentiary hearing at issue in this request for sanctions.

Finally, Magistrate Judge Dinsmore recommended to Judge Lawrence that Malibu Media’s motion, which had been filed without the required statement showing that Plaintiff’s attorney made reasonable efforts to confer with opposing counsel prior to filing the motion for sanctions, be denied for failure to comply with Local Rule 7-1(g).

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Indianapolis, Indiana – A copyright attorney for Dallas Buyers Club, LLC of The Woodlands, Texas has filed three additional complaints against Doe Defendants in the Southern District of Indiana. Two of these latest complaints include allegations against 20 separate as-yet-MV5BMTg0MDc3ODUwOV5BMl5BanBnXkFtZTcwMTk2NjY4Nw@@__V1_SX214_CR0,0,214,317_AL_.jpgunidentified Defendants, while the third lists 16 new Defendants. The Doe Defendants are accused of infringing the copyright of the motion picture “Dallas Buyers Club,” which has been registered with the U.S. Copyright Office.

The movie in question, Dallas Buyers Club, stars Matthew McConaughey (pictured) as an AIDS patient who smuggled unapproved AIDS-treatment drugs into the United States during the 1980s for his own use and to distribute to others afflicted with AIDS. The movie was nominated for six Academy Awards and won three. Matthew McConaughey and Jared Leto also won Oscars for Best Actor and Best Supporting Actor, respectively, for their performances in the movie.

These copyright lawsuits are in addition to another similar complaint filed recently by Plaintiff, wherein 24 separate Doe Defendants were sued. In these latest Indiana copyright infringement lawsuits, filed by a copyright lawyer for Dallas Buyers Club, LLC, Plaintiff asserts that the copyrighted movie was infringed by another 56 as-yet unnamed individuals, who were sued as “Doe” Defendants.

Plaintiff alleges that this copyright infringement occurred using the “BitTorrent protocol,” which is different from the standard peer-to-peer protocol. Specifically, the BitTorrent protocol enables numerous computers, even those with low bandwidth, to exchange pieces of a computer file among themselves. Each computer that has downloaded a particular piece of a file then becomes a source from which other computers may download that piece of the file. As a result, the entirety of a computer file may be disseminated across the Internet quickly without having to rely on a central source from which to download.

Plaintiff contends that Defendants in each lawsuit acted as part of a “collective enterprise” to infringe its work and that the acts constituting the infringement were “willful, intentional, and in disregard of and with indifference” to Plaintiff’s intellectual property rights.

The court is asked to enter judgment for the following monetary and injunctive relief:

• for entry of permanent injunctions providing that each Defendant shall be enjoined from directly or indirectly infringing Plaintiff’s rights in the movie;
• for judgment that Defendants have: a) willfully infringed Plaintiff’s rights in its federally registered copyright pursuant to 17 U.S.C. §501; and b) otherwise injured the business reputation and business of Plaintiff;
• for actual or statutory damages pursuant to 17 U.S.C. §504 in an amount to be determined at trial;
• for an Order of Impoundment under 17 U.S.C. §§503 and 509(a) impounding all infringing copies of the movie that are in Defendants’ possession or under their control; and
• for attorneys’ fees, litigation expenses, including fees and costs of expert witnesses, and other costs of this action.

Practice Tip #1:

Copyright trolling, also known as “porn trolling” when the plaintiff owns copyrights to pornographic material, has changed in the years since the practice began. Most early lawsuits were filed against tens, hundreds or even in excess of a thousand anonymous defendants. When judges such as District Judge Otis Wright made it clear that this misjoinder would not be permitted, porn trolls began filing multiple lawsuits claiming copyright infringement against single defendants.

Porn trolls also responded to this change in the judicial landscape by adding a new exhibit, “Exhibit C,” with each filing. Exhibit B to each complaint was a legally relevant listing of the Malibu Media copyrights that were allegedly infringed. However, Exhibit C listed other pornographic material – material not owned by Malibu Media – allegedly downloaded by the internet protocol address of the accused.

While the titles of Malibu Media’s copyrighted works are often fairly innocuous – “Almost Famous,” “Blonde Ambition” and “LA Plans” are among their works – the titles listed in Exhibit C were decidedly not. In response these and other Malibu Media copyright litigation tactics, one federal judge, District Judge William Conley, said, “[t]hese Internet copyright infringement cases … give off an air of extortion.” He sanctioned Malibu Media’s counsel under Rule 11 and ordered a fine of $2,200.

Practice Tip #2:

Mass misjoinder in copyright cases has also been flagged as impermissible in other, non-pornography, cases that assert copyright infringement against multiple defendants. In one recent Indiana copyright lawsuit, Magistrate Judge Denise K. LaRue, writing for the Southern District of Indiana, severed all but one defendant from the copyright infringement complaint of Richard Bell, an Indiana copyright attorney. The court also ordered Bell to pay separate filing fees for each new cause of action.

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Indianapolis, Indiana – A copyright attorney for Dallas Buyers Club, LLC of The Woodlands, Dallas_Buyers_Club_poster.jpgTexas sued in the Southern District of Indiana alleging that 24 Doe defendants infringed the copyright of the motion picture “Dallas Buyers Club,” which has been registered with the U.S. Copyright Office.

The movie in question, Dallas Buyers Club, stars Matthew McConaughey as an AIDS patient who smuggled unapproved AIDS-treatment drugs into the United States during the 1980s for his own use and to distribute to others afflicted with AIDS. The movie was nominated for six Academy Awards and won three. Matthew McConaughey and Jared Leto also won Oscars for Best Actor and Best Supporting Actor, respectively, for their performances in the movie.

In this Indiana copyright infringement lawsuit, filed by a copyright lawyer for Dallas Buyers Club, LLC, plaintiff asserts that the copyrighted movie was infringed by 24 as-yet unnamed individuals, who were sued as “Doe” defendants. It alleges that this copyright infringement took place using the “BitTorrent protocol,” which is different from the standard peer-to-peer protocol. Specifically, the BitTorrent protocol enables numerous computers, even those with low bandwidth, to exchange pieces of a computer file among themselves. Each computer that has downloaded a particular piece of a file then becomes a source from which other computers may then download that piece of the file. As a result, the entirety of a computer file may be disseminated across the Internet quickly without having to rely on a central source from which to download.

Plaintiff contends that the 24 defendants acted as part of a “collective enterprise” to infringe its work and that the acts constituting the infringement were “willful, intentional, and in disregard of and with indifference” to plaintiff’s intellectual property rights.

The court is asked to enter judgment for the following monetary and injunctive relief:

• for entry of permanent injunctions providing that each defendant shall be enjoined from directly or indirectly infringing plaintiff’s rights in the movie;
• for judgment that defendants have: a) willfully infringed plaintiff’s rights in its federally registered copyright pursuant to 17 U.S.C. §501; and b) otherwise injured the business reputation and business of plaintiff;
• for actual or statutory damages pursuant to 17 U.S.C. §504 in an amount to be determined at trial;
• for an Order of Impoundment under 17 U.S.C. §§503 and 509(a) impounding all infringing copies of the movie that are in defendants’ possession or under their control; and
• for attorneys’ fees, litigation expenses, including fees and costs of expert witnesses, and other costs of this action.

Practice Tip: Defendants who fail to appear run a significant risk of having a default judgment entered against them. There is a significant disparity in the dollar amount awarded in default judgments against defendants in copyright infringement cases involving BitTorrent. In two separate cases, Judge William T. Lawrence ordered defendants who failed to appear to pay $20,000 for the copyright infringement that was deemed to have been admitted by the defendants’ failure to defend against the allegations. See here and here. However, in a similar case, Judge Jane Magnus-Stinson ordered an entry of default judgment against a defendant for $151,425, the full amount requested.

Overhauser Law Offices, the publisher of this website, has represented several hundred persons and businesses regarding copyright infringement and similar matters.

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Washington, D.C. – The United States Court of Appeals for the District of Columbia handed Copyright-Troll-Crossing.jpgcopyright trolls a major defeat recently by removing one of their most powerful tactics: the ability to sue large groups of John Doe defendants together with minimal evidence.

The case, AF Holdings v. Does 1-1058, is one of the few mass copyright cases to reach an appellate court, and the first to look into fundamental procedural problems that have tilted the playing field firmly against the Doe Defendants. With this decision on the books, it appears likely that even more federal trial courts will disallow cookie-cutter lawsuits seeking cash payouts from dozens or even hundreds of Internet subscribers.

The appeal was brought by several internet service providers (Verizon, Comcast, AT&T and affiliates) with amicus support from copyright attorneys for the Electronic Frontier Foundation (“EFF”), the ACLU, the ACLU of the Nation’s Capital, Public Citizen, and Public Knowledge.

Indianapolis, Indiana – Nine copyright infringement lawsuits have been filed in the Southern District of Indiana on behalf of Malibu Media, LLC of Los Angeles, California. The lawsuits assert that nine separate unidentified defendants, each identified with only “John Doe” and an internet protocol address, infringed Malibu Media’s copyrighted works.

Frequent copyright litigator Paul Nicoletti has filed another set of copyright infringement complaints in Indiana federal court. The complaints, filed on behalf of adult-content purveyor Malibu Media, assert infringement of the company’s intellectual property. In this latest round, Malibu Media submitted nine new and nearly identical lawsuits for adjudication in the Southern District of Indiana against nine anonymous John Doe defendants. The defendants allegedly used the BitTorrent file-sharing protocol to illegally download, copy and distribute elements of various works of Malibu Media’s copyrighted material. As with all of Malibu Media’s complaints, the copyrights-in-suit cover pornographic videos.

Malibu Media seeks a permanent injunction barring the defendants from engaging in infringing activities; an order by the court that infringing materials be removed from all computers of each defendant; a separate award of statutory damages for each work found to have been infringed and reasonable attorneys’ fees and costs.

Practice Tip: Defendants who fail to appear run a significant risk of having a default judgment entered against them. There is a significant disparity in the dollar amount awarded in default judgments against defendants in copyright infringement cases involving BitTorrent. In two separate cases, Judge William T. Lawrence ordered defendants who failed to appear to pay $20,000 for the copyright infringement that was deemed to have been admitted by the defendants’ failure to defend against the allegations. See here and here. However, in a similar case, Judge Jane Magnus-Stinson ordered an entry of default judgment against a defendant for $151,425, the full amount requested.

Overhauser Law Offices, the publisher of this website, has represented several hundred persons and businesses regarding copyright infringement and similar matters.

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Indianapolis, Indiana – An intellectual property attorney has filed fourteen new copyright MMpicture.jpgsuits in the Southern District of Indiana on behalf of Malibu Media, LLC of Los Angeles, California alleging that 14 separate unidentified defendants, listed as “John Doe” defendants, infringed Malibu Media’s copyrighted works.

In this latest batch of lawsuits filed by copyright lawyer Paul Nicoletti, the 14 defendants, all sued under the name “John Doe” until they can be identified pursuant to a court subpoena and named, are listed as “persistent online infringer[s]” of Malibu Media’s copyrighted works. The nearly identical copyright infringement lawsuits contend that the defendants used the BitTorrent file-sharing protocol to illegally download, copy and distribute elements of various works of Malibu Media’s copyrighted material.

The defendants accused of infringing the fewest copyrighted works are accused of infringing 16 of Malibu Media’s copyrights. Malibu Media contends that two defendants, however, have infringed more than 40 of its copyrighted works.

Malibu Media seeks a permanent injunction barring the defendants from engaging in infringing activities; an order by the court to remove infringing materials from all computers of each defendant; an award of statutory damages for each infringed work and reasonable attorneys’ fees and costs.

Practice Tip #1:

Copyright trolling, also known as “porn trolling” when the plaintiff owns copyrights to pornographic material, has changed in the years since the practice began. Most early lawsuits were filed against tens, hundreds or even in excess of a thousand anonymous defendants. When judges such as District Judge Otis Wright made it clear that this misjoinder would not be permitted, porn trolls began filing multiple lawsuits claiming copyright infringement against single defendants.

Porn trolls also responded to this change in the judicial landscape by adding a new exhibit, “Exhibit C,” with each filing. Exhibit B to each complaint was a legally relevant listing of the Malibu Media copyrights that were allegedly infringed. However, Exhibit C listed other pornographic material – material not owned by Malibu Media – allegedly downloaded by the internet protocol address of the accused.

While the titles of Malibu Media’s copyrighted works are often fairly innocuous – “Almost Famous,” “Blonde Ambition” and “LA Plans” are among their works – the titles listed in Exhibit C were decidedly not. In response these and other Malibu Media copyright litigation tactics, one federal judge, District Judge William Conley, said, “[t]hese Internet copyright infringement cases … give off an air of extortion.” He sanctioned Malibu Media’s counsel under Rule 11 and ordered a fine of $2,200.

Practice Tip #2: Mass misjoinder in copyright cases has also been flagged as impermissible in other, non-pornography, cases that assert copyright infringement against multiple defendants. In one recent Indiana copyright lawsuit, Magistrate Judge Denise K. LaRue, writing for the Southern District of Indiana, severed all but one defendant from the copyright infringement complaint of Richard Bell, an Indiana copyright attorney. The court also ordered Bell to pay separate filing fees for each new cause of action.

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Indianapolis, Indiana – A copyright attorney for Malibu Media, LLC d/b/a X-Art.com of Los Angeles, California has sued alleging that an unidentified Indiana resident, “John Doe,” infringed numerous of its copyrighted works in the Southern District of Indiana between July 2012 and May 2014.

The “John Doe” defendant in this copyright infringement lawsuit allegedly used the BitTorrent file-sharing protocol to illegally download, copy and distribute elements of various works of Malibu Media’s copyrighted material. Malibu Media has also claimed that the defendant is a “persistent online infringer.” It claims that “John Doe” has infringed 43 separate copyrighted works owned by Malibu Media. Of these 43 works, 42 have been registered by the U.S. Copyright Office. One registration remains pending.

Malibu Media seeks a permanent injunction against infringing activities; an order by the court to remove infringing materials from all computers of the defendant; an award of statutory damages pursuant to 17 U.S.C. § 504(a) and (c) and reasonable attorneys’ fees and costs.

Practice Tip #1: The BitTorrent protocol is a decentralized method that allows users to distribute data via the Internet, and has become an extremely popular method for unlawful copying, reproducing and distributing files in violation of the copyright laws. While the copyright infringements committed with BitTorrent once consisted mostly of music copyright violations, the adult entertainment industry has increasingly been filing suit against infringers who have used BitTorrent-based technology.

Practice Tip #2: Malibu Media, LLC is represented by Paul Nicoletti, one of the country’s most notorious “copyright troll” attorneys. In addition to filing suits on behalf of Malibu Media, LLC, he has also sued hundreds of defendants on behalf of copyright trolls Patrick Collins, Inc. and TCYK, LLC. (Search for these company names on this site to find articles about those other suits, or visit http://fightcopyrighttrolls.com/or www.dietrolldie.com.)

Practice Tip #3: Overhauser Law Offices, the publisher of this website, has represented several hundred persons and businesses regarding copyright infringement and similar matters.

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Indianapolis, Indiana – A copyright attorney for Malibu Media, LLC of Los Angeles, MMpicture.jpgCalifornia d/b/a X-Art.com filed a copyright infringement lawsuit in the Southern District of Indiana alleging that an anonymous defendant (“John Doe”), asserted to be an Indiana resident, infringed 43 copyrighted works to which Malibu Media claims ownership.

Malibu Media contends that infringement by John Doe of the works, which include multiple pornographic movies, began on September 14, 2013. Currently, the defendant is identifiable by Malibu Media only by his or her internet protocol address (“IP address”). Malibu Media asserts that it used “geolocation” technology to ensure that the anonymous defendant’s alleged acts of copyright infringement occurred using an IP address that could be traced to a physical address within Indiana.

Malibu Media has accused the defendant of a single count of “Direct Infringement” encompassing all 43 copyrighted works. It seeks a permanent injunction against infringing activities; an order by the court to remove infringing materials from all computers of the defendant; an award of statutory damages pursuant to 17 U.S.C. § 504(a) and (c) and reasonable attorneys’ fees and costs.

Practice Tip:

It has been estimated that over 200,000 users of various peer-to-peer file-sharing protocols, usually users of BitTorrent, have been sued for copyright infringement. Instead of a thorough investigation, followed by a lawsuit, these plaintiffs — usually holders of a copyright to a work of adult entertainment — gather the IP addresses of many potential/presumed infringers and then sue multiple defendants.

These suits used to involve tens, hundreds or even thousands of defendants joined in a single suit. The problem of these cases of mass joinder of largely unrelated defendants became sufficiently widespread that it garnered attention from mainstream press (see, e.g., here).

The problem also caused considerable strain on the federal judiciary, leading one judge to deny joinder as serving no legitimate purpose in such cases once IPSs have been put on notice to preserve identifying information for particular IP addresses and to opine that it is “difficult to even imagine the extraordinary amount of time federal judges have spent on these cases.” Many other courts also denied joinder, often on the theory that, while doing so does not solve the problem of trolling for copyright damages within the federal judiciary it, at least, makes pursuing such abusive litigation much less profitable.

As a result of such rulings, copyright attorneys such as Paul Nicoletti have modified their practices and now have shifted to filing more single-defendant copyright infringement complaints. While this may solve the earlier problem of mass misjoinder, many other contentious issues inherent in copyright trolling – including proper identification of the alleged infringer – remain.

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Washington, D.C. – Public meetings called for in U.S. Commerce Department’s Green Paper on “Copyright Policy, Creativity, and Innovation in the Digital Economy” will be held in Tennessee, Massachusetts and California.

The U.S. Department of Commerce’s Internet Policy Task Force will host roundtable discussions in cities around the country on several copyright Internet policy topics, as part of the work envisioned in the Green Paper. The purpose of the roundtables is to engage further with members of the public on the following issues: (1) the legal framework for the creation of remixes; (2) the relevance and scope of the first sale doctrine in the digital environment; and (3) the appropriate calibration of statutory damages in the contexts of individual file sharers and of secondary liability for large-scale infringement.

The roundtables, which will be led by the U.S. Patent and Trademark Office (“USPTO”) and the National Telecommunications and Information Administration (NTIA), will be held in Nashville, Tennessee on May 21, 2014, Cambridge, Massachusetts on June 25, 2014, Los Angeles, California on July 29, 2014, and Berkeley, California on July 30, 2014.

Indianapolis, Indiana – Malibu Media, LLC d/b/a X-Art.com of Los Angeles, California has sued an unidentified Indiana resident, “John Doe,” for copyright infringement in the Southern District of Indiana.

Copyright lawyer Paul Nicoletti is again in federal court on behalf of Malibu Media. The “John Doe” defendant in this copyright infringement lawsuit allegedly used the BitTorrent file-sharing protocol to illegally download, copy and distribute elements of various works of Malibu Media’s copyrighted material. Malibu Media has also claimed that the defendant is a “persistent online infringer.” It claims that “John Doe” has infringed 67 separate copyrighted works owned by Malibu Media.

Malibu Media seeks a permanent injunction against infringing activities; an order by the court to remove infringing materials from all computers of the defendant; an award of statutory damages pursuant to 17 U.S.C. § 504(a) and (c) and reasonable attorneys’ fees and costs.

Practice Tip #1:

The actions of companies such as Patrick Collins and Malibu Media have been called “extortionate” and, in at least one case, a class action suit has been filed against these “copyright trolls.”

The issue of intellectual property “trolls” has also caught the attention of several U.S. lawmakers, including Senator Charles Schumer. Senator Schumer has proposed legislation wherein the U.S. Patent and Trademark Office would review patent infringement suits before they could be filed in court. Of course, such legislation is not directly relevant to actions sounding in copyright, such as the multiplicity of lawsuits filed by Malibu Media and Patrick Collins. It may, however, sound a warning bell that tolerance of the questionable activities of intellectual-property trolls of all varieties is wearing thin.

Practice Tip #2:

We have previously blogged about Malibu Media’s previous attempts to sue unrelated defendants en masse (see also here), as well as some responses of various Indiana courts (see also here and here).

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