Prenda

Brett Gibbs, Paul Hansmeier and their questionable involvement in class action lawsuits

I will start with a quote from a recent Florida State University (Law division) paper by John E. Lopatka — “Class action professional objectors: what to do about them?” — that explains an increasingly popular way to parasitize on nearly settled class action lawsuits (emphasis supplied):

When the plaintiffs’ lawyers and defense counsel agree to settle a federal class action, subject to approval of the district court, any member of the class may object. If the district court approves the settlement the objector may appeal. Appeals take time, and time is money — class counsel and, often, nonobjecting class members incur costs during the pendency of the appeal because attorneys’ fees typically are not payable and settlements are not implemented until the legal process has run its course. The prospect of financial loss caused by delay in implementation of a class settlement has given rise to a cottage industry of so-called professional objectors: attorneys who oppose settlements on behalf of nonnamed class members and threaten to file meritless appeals of the final judgment merely to extract a payoff.

Class counsel have a strong incentive to pay them to withdraw their appeal and thereby avoid the cost of delay. That payment represents a kind of tax on class action settlements. In a nutshell, professional objectors profit by extorting payments from class counsel.

What does it have to do with copyright trolls? Nothing directly, but it seems that some painfully familiar lawyers have recently tried to utilize the scheme described above. With the help of the community, I found three cases that I want to briefly review.

Groupon, Inc., marketing and sales practices litigation

This lawsuit, 11-md-02238, was filed in CASD on 6/2/2011. On 7/6/2012 Brett Gibbs filed an objection on behalf of Padraigin Browne, who quite coincidentally happened to be Paul Hansmeier’s wife. Paul Hansmeier himself appeared later, on 9/5/2012. After some back-and-forth arguments (which I did not recap), Judge Sabraw denied the proposed settlement based on two (out of 18) objections on 9/28/2012. Ms. Browne’s objection was not among those two, and the judge specifically called some of Browne’s objections “meritless” (p. 10 of the Order).

I’m not aware of any extrajudicial negotiations in this particular lawsuit.

Shames et al v. Hertz Corporation et al

This lawsuit, 07-cv-02174, was filed in CASD back in 2007. This time the objector was Paul Hansmeier’s father, a Minnesota lawyer Gordon Hansmeier. The objection was filed by Brett Gibbs on 10/1/2012, which was the last day of the allowed period. Two days prior to that, Paul Hansmeier sent a letter to the class counsel, Denis Stewart, particularly saying that

This letter is to advise you that an objection will be filed to your proposed settlement. I am enclosing a draft of the objection to be filed, which you have previously had an opportunity to review. This (or a similar version) will be filed if you do not attempt to resolve this matter. We find that settlements like this are likely to be rejected following our participation, as was the result today in In re Groupon, No. 11-md- 02238 (S.D. Cal.) (Dkt. No. 97).

I will extend to you an offer to settle this matter with my client for $30,000.00 if the settlement terms are reached by 5:00 PM CST on Monday, Oct. 1, 2012. If you reject this settlement and the objection is filed, the offer to o settle is revoked and will not be extended at the pre-filing settlement amount.

Govern yourself accordingly.

Mr. Stewart was not amused (his profile suggests that that he is an experienced class litigator and he is wary of professional objectors). His reply was firm:

In our view, if you present this objection, it is clear that it will have been presented for an “improper purpose” under Fed R. Civ. P. Rule 11(b)(1). Our view is further informed by the fact that the practice of contacting class counsel with draft objections and inviting them to “discuss them” (i.e. resolve them by making an unjustified payment to the objectors’ lawyers) in advance of filing in the hope of gaining an unjustified payment beyond any legitimate class member’s claim appears from the Record in Groupon to be a pattern of conduct.

Please be advised that we consider this conduct to be improper and sanctionable under 28 U.S.C.A. § 1927 and Rule 11.

That same day, Paul Hansmeier took umbrage at class counsel’s response and replied, in part:

The idea that you would respond to a demand letter which you requested by threatening sanctions is unconscionable and wholly beyond the pale. It has become abundantly clear that you are not interested in good-faith discussion, but only in hardball tactics designed to intimidate my client and to protect this unfair settlement from legitimate challenge.

Regarding your threatened motion for sanctions, please be advised that my client’s objection has a solid basis in both law and fact. You have had ample time to review a draft of my client’s objection, and you have failed to offer a substantive counter-argument at any point. Although you may disagree with our analysis you should certainly be aware that our arguments are well-founded, and that our client has a right to make them under Fed. R. Civ. P. 23(e).

After a while, Paul Hansmeier filed an ex parte motion to file a motion to intervene, which Judge Anello denied on 10/15. This document, embedded below, includes some strong opinions regarding Paul Hansmeier’s conduct:

Milans v. Netflix, Inc.

The last of three lawsuits, discussed here — 11-cv-00379 — was filed on 1/26/2011. Brett Gibbs filed an objection on behalf of Paul Hansmeier’s wife, Padraigin Browne, on 10/31/2012. Plaintiff’s memorandum dated 12/5/2012 is worth reading. In addition to discussing merits (or the lack thereof) of all the objections, the plaintiff’s counsel apparently conducted some investigation and discovered Gibbs’s and Hansmeier’s involvement in copyright trolling (p. 41 of this memorandum).

One of the exhibits to this memorandum, the declaration of Jay Edelson, is especially interesting, as it describes in detail shady dealings of the objectors’ attorneys (pages 5-7). Don’t forget to scroll down to exhibits 4-7, you won’t regret it:

Conclusion

First, the topic of this post is obviously a deviation from this blog’s theme, yet I thought that the facts presented here can help attorneys draw a holistic picture of Prenda Law and its seniors in light of the April 2 hearing. Otherwise, diving into class action specifics is the latest of my priorities.

Second, I have only scratched the surface here, and naturally missed interesting documents (and maybe more similar lawsuits), but this is what the community is for: I hope these deficiencies will be quickly compensated by insightful and informative comments.

Third, due to my peculiar situation, I must strongly stress that all the above (except the quotations from publicly accessible documents) is merely my opinion. That opinion can be miles off, and despite judges’ and class attorneys’ harsh words, it is possible that Mr. Hansmeier’s close relatives are, in fact, model citizens, who lost their sleep and appetite when they saw that certain class action lawsuits were about to settle unfairly.

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73 responses to ‘Brett Gibbs, Paul Hansmeier and their questionable involvement in class action lawsuits’

    • That Wersal v Living Social case actually makes me think Hansmeier has a good side. Seems like a good case for consumers.

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      • Regardless, see the new entity in the signature block: CLASS ACTION JUSTICE INSTITUTE, LLC. So it seems Paul seriously dived in the professional objectors’ business.

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    • The complaint list an address 40 South 7th Street, Minneapolis. Crazy coincidence that I am working at 50 S 6th St this week. (And next).

      That’s right – I am in Minneapolis RIGHT NOW and as much as I want to go check it out, it will have to wait until tomorrow.

      Reply

      • Nothing to look at: a UPS store. Prenda is not a stranger to UPS-provided virtual addresses. LiveWire and Guava use a Washington DC UPS store address (2100 M St. NW Suite 170-417 Washington DC 20037-1233), The key is the suite number uses the pattern XXX-XXX.

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  6. Great post but I’m afraid I will now have to sue you for the concussion I sustained when I fell out of my chair bellowing with laughter at Exhibits 4-7 attached to the Edelson Declaration. 😉 Great post about some epic sleaze!

    Reply

  8. Look guys! Shell companies are so 2012… Institutes are the new thing!

    http://classjustice.org/ – Class Action Justice Institute

    Same address as Alpha Law Firm.

    Mentions all the cases that SJD mentioned. Links to their objection in the netflix case, which is the Gibb’s PDF.

    Whois is protected. Created 8/2012

    Nathan Wersal’s LinkedIn profile previously said present job was the Class Action Justice Institute, but that’s been deleted, only Google Cache has it.

    Last article mentions they are investigating Frito Lay…Found the case: 12-cv-06105 EDNY. Doesn’t look like they objected formally.

    Reply

    • Want to make sure this is clear Wersal’s LinkedIn profile previously said “Associate at Class Action Justice Institute”, so somebody else is calling the shots ::cough:: paul ::cough:: hansmeier ::cough::

      Reply

  9. What a bunch of crooks (in my opinion of course). They just file at the eleventh hour to try and get some leverage and try to force a much better deal for their “clients”. All of whom appear to be related to or work for the various Prenda stooges. Does Steele give seminars on how to use the law for dark purposes? I didn’t think it was possible to look any more despicable, but these @$$ clowns manage to keep finding ways to do it. This has been one man’s opinion.

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  10. It appears Paul is also affiliated with Class Action Justice Institute, LLC (as of 1-13-2013). Their website can be found at http://www.classjustice.org. Reference to the above cases can be found there.

    Also the address for Paul according to this site is:
    50 S. 8th Street, Suite 900
    Minneapolis, MN 55402

    Reply

    • I should of looked further … The above address is an executive suite (short term office space) in the IDS building in Minneapolis.

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  11. Well, if Prenda Law would like to claim that Otis Wright is anti-copyright and filed for bankruptcy, thinking that it helps them make their case, the Internet will simply have to dig in the opposite direction.

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  13. Whats even funnier is that Living Social Vouchers specifically say the expiration date is subject to applicable state law. The paid portion of the voucher has no expiration date. I believe Expiration dates on these type “daily deals” web coupons have already been subject to class action lawsuits and the policies adjusted. A little late to the game it seems

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  14. All i could think of when reading Gibbs’ letters was the French knight on the castle roof in Monty Python and the Holy Grail.

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  16. In exhibit #4 of the declaration, accompanying the memorandum with read-worthiness noted by SJD, Attorney Jay Edelson of Edelson McGuire LLC describes a phone call.

    Click to access gov.uscourts.cand.236457.226.5.pdf

    (pp.42-43 and following)

    Edelson describes the call as “bizarre and disturbing”. The callers are reportedly two men representing Brett Gibbs. The callers reportedly said they were lawyers,. They reportedly refused to answer when asked to confirm to Mr. Edelson that they were associates of “Brett Gibbs Law Offices”.

    Mr. Edelson notes that the call came FROM (800) 308-0480. This is the SAME number used for callbacks about Livewire Holdings, that has also used frequently by Prenda:

    LiveWire Holdings: Evolution of Prenda’s Fraud. Part II

    So Brett Gibbs’s reported representatives used a Prenda/Livewire phone number in the class action case. There is no mention of Prenda/Livewire/Steele-Hansmeier in the objection to Milans v. Netflix class action case, filed by Mr.Gibbs:

    Click to access gov.uscourts.cand.236457.190.0.pdf

    In the six months preceding the filing of this objection, Mr. Gibbs filed 87 NEW cases for the pornography business A.F. Holdings alone. (The cases were between 4/24/12 and 9/24/12.) Cases were filed in all four federal civil court districts in California. Somehow, they Brett Gibbs Law Offices found time to represent a client in a class action case, while running dozens of new and old copyright cases for porn purveyor clients.

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    • Wow, that is crazy. It would be weird enough if it were just that once incident/email but the continuing exchange with Gibbs’ responses that turn into near hysteria… WTF?

      Reply

  17. The following links are just having some fun googling a name, using interesting terms and showing links:

    http://larkspurcortemadera.patch.com/articles/the-life-and-times-of-elizabeth-pschorr (note the author of the article)

    which led me to

    http://www.marinij.com/millvalley/ci_13546376

    which had a link to a deleted blog, which led to:

    http://web.archive.org/web/20120725095947/http://blogs.marinij.com/bretts_journey/

    I am sure many others have found (and read) it before… but it was new to me. It actually humanizes the guy a bit. I just can’t see how his life’s path veered towards being on the wrong side of a judge. (At least, I feel it’s the wrong side. I guess the April 2nd hearing and subsequent motions will tell me if he is indeed on the wrong side. I trust Judge Wright to be able to discern better than I – if the whole PL/SH/etc stuff is on the up and up.)

    Reply

    • I also want to note that this is interesting on a few levels. Prenda et al. filing the lawsuit against this blog and others is interesting when you realize:

      1. Brett Gibbs is a public personality, having written for that online newspaper (not sure if they have a print edition.) and having a blog.
      2. John Steele is a public personality, having conducted interviews (with Forbes being the most prominent.)
      3. Some of their other firms have produced commercials (I’ve linked this before) like this one for the Alpha Law Firm, one of Prenda’s offshoots: https://www.youtube.com/watch?v=h_DxhwmqgVo

      Reply

  19. This comment is a little off-topic, but the use of “Govern yourself accordingly” jumped out at me. I had never seen that expression before I received a shakedown letter from troll Daniel G. Ruggiero. That was how he ended his letter, too. It is possible that it is just a coincidence, but it makes me wonder if his scare letter was also drafted by Hansmeier.

    Reply

    • It’s a common ideomatic expression in legalese. It just means, in a terse way, “now that I have provided with this information/threat, act on it as you see fit”. In a nutshell, it doesn’t really add any further meaning (i.e. it’s slightly redundant), but I guess it sounds ominous and pompous, so it’s no wonder such trolls would use it.

      Reply

  20. In my opinion…

    I’m tired of seeing comments about how Brett Gibbs is “humanized” because of his brain cancer or a “small fish” that doesn’t deserve the scorn of the other Trolls. That’s B.S. This guy has been stealing and cheating and lying for a long time and being sick doesn’t give you freedom to screw other people. I hope Judge DreddWright brings him right down with the rest of these asshats.

    Reply

    • “a “small fish” that doesn’t deserve the scorn of the other Trolls.”

      I’m assuming this response is meant for me. My sentence following the humanizing comment was: “I just can’t see how his life’s path veered towards being on the wrong side of a judge.” which clearly illustrates that what I think he is engaged in is wrong, but that I believe it is up to our justice system to pass judgement with the facts they have. Not that I think he should just skip off tra la la no consequences because he had cancer.

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  21. @Psychic Doe:

    No, it wasn’t just your comment. There is a segment out there, albeit small, that I’ve seen pipe up here and over at Popehat…even in Judge Wright’s comments, that seem to want to excuse Gibbs for what he’s done. Some because he’s the low man on the pole and some because he’s been sick in the past/present(?), but I’m not buying it. We all make decisions every single day about our behavior in the world, and yes, we all make mistakes, but Gibbs has been making the wrong decisions, purposefully, day after day after day. And I think he deserves to pay for it.

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  22. You know, this sorta blows a hole in the meme of Gibbsie being a ‘dupe’. I can’t wait for the Morgan Pietz judicial notice filing to Judge Wright.

    It really comes down to the level of disgust the lawyers of the various state bars are willing to endure. They, after all, control the Bar Associations. Maybe they like the fact that these trolls are running around, scaring up business for them. I dunno–I would think that some of them purely hate dealing with the trolls, but can’t get the rest of them to get out the Raid.

    Heinlein was right. There are two kinds of lawyers–those that help people, and everyone else.

    Reply

  23. Just Wow. This really does show Gibbs is deep in this little Prenda mob.

    They should rename themselves Legal Scams R Us.

    If the do get shut down on the copyright troll game unless these guys take some serious pain expect them to move onto the next best misuse of the legal system.

    That 30k request alone is so close to blackmail its not funny. No wonder that Judge wasnt impressed. Lucky for them he didnt decide to ask a few questions too.

    Just wow at the levels these guys are sinking to. Where are the Bar associations on this?

    Reply

    • In my opinion this just shows what no-talent ass clowns these people are. They obviously can’t hack it as real lawyers so they try to game the system. All that time and money spent on what is supposed to be a disguished career choice and they’re even worse than ambulance chasers. They’re scum, crooks, and extortionists. Every one of them. If they were any good in their field they wouldn’t have to resort to tactics like this. You must be very proud of what you’ve made of yourselves. I hope you Prenda stooges and everyone who is in on your scams rot in Hell. This has been one man’s opinion.

      Reply

  24. My sense is that Gibbs, Paul Hansmeier and John Steele all knew each other from their time at Minnesota Law school together. Has anyone figured out yet how Paul Duffy got to know this crew and become so involved?

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    • Gibbs studied law in northern California. he was admitted to practice the same year as Steele & Hansmeier. The actions that this group colluded in are the main thing, more than their meeting.

      ——-
      Paul Andrew Duffy graduated from DePaul University School of Law and was admitted to practice in Illinois in 1993.
      http://members.calbar.ca.gov/fal/Member/Detail/224159
      https://www.iardc.org/ldetail.asp?id=176808448

      Brett Langton Gibbs graduated from Hastings College of Law (San Francisco, University of California), and became eligible for California practice in 2007.
      http://members.calbar.ca.gov/fal/Member/Detail/251000

      John Steele and Paul Hansmeier, as mentioned in different sources, were law school classmates at the University of Minnesota. John Lawrence Steele reportedly is a 2006 graduate of the University of Minnesota School of Law. He was admitted to practice in Illinois in 2007.
      http://www.mncourts.gov/mars/AttorneyDetail.aspx?attyID=0104644
      http://www.forbes.com/sites/kashmirhill/2012/10/15/how-porn-copyright-lawyer-john-steele-justifies-his-pursuit-of-sometimes-innocent-porn-pirates/

      Paul Robert Hansmeier was also admitted to practice in Minnesota in 2007. Paul R. Hansmeier is listed as plaintiff counsel on one AF Holdings Minnesota court case, filed on 7/6/11. Eight more cases for the same plaintiff and district were filed in 2012 by Michael Dugas of Alpha Law Firm. Dugas was admitted to practice in MN during 2011.

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      • According to Gibb’s LinkedIn profile, he also was at Minnesota Law for one year in 2005. I am pretty sure he overlapped with S&H there and consequently there is much more to his relationship with them than the other local counsel’s Prenda used.

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      • His LinkedIn profile lists University of Minnesota Law, 2004-2005, studied law, no degree.

        Then a JD from Hastings after studying there from 2005-2007.

        I won’t post a link because LinkedIn tells you who’s viewed your profile and I don’t want anyone clicking through and letting a Troll know they’re snooping, but Google will take you right there.

        That might have been a little early to cross paths with S&J, especially since law school has a very rigidly class based curriculum, but a curious fact nonetheless.

        Reply

    • Gibbs having attended Minnesota Law does make that seems likely. Without having the records, I believe Steele, Hansmeier and Gibbs’ tenures would have overlapped. That would actually be very useful to prove because Brett Gibbs was asked under oath how he came to work for Prenda law and while I don’t remember the answer, hopefully someone else who has in attendance at the March 11 hearing does. He may have said he answered a Craigslist ad, but I may have that mixed up with him recruiting other Prenda local counsel through Craigslist when that came up. In any case, it was not “we knew each other from law school so they threw me some work” so any evidence of prior association would mean Gibbs perjured himself. Gibb has tried to distance himself from the guys at Prenda HQ, so just as his participation in class actions on behalf of Hansmeier’s family undermines his credibility regarding his relationship with Hansmeier, proving they knew each other years earlier would be very damaging to their story.

      Duffy is more of a mystery. Steele claimed they knew each other from law school, but given the years between Duffy and Steele’s attendance that story does not make sense at face value, unless there was some internship, work study, or other program that would have had Duffy meeting current students when Steele was there.

      Duffy also doesn’t seem to do that much, both based on watching their filing history and based on Gibbs testimony, his role seems very minor. Just a figurehead and someone to sign documents (who in this case apparently exists).

      Reply

  26. Padraigin Browne or Paddy Brown (Maybe a Paddy Brown tag?) has an astonishingly tiny google footprint for a lawyer in her early thirties. It’s weird. I’m impressed anyone managed to dig up that she married a Hansmeier. Apparently only from a now vanished wedding registry?

    I wonder what dinners are like at the Browne-Hansmeiers these days. Do you think her current employers know what she’s doing? She works for what looks to be a reasonably legitimate law firm in Minneapolis: Shumaker & Sieffert. How do legal firms work, is it generally alright for lawyers doing any sort of moonlighting they feel like in their off time?

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    • > She works for what looks to be a reasonably legitimate law firm in Minneapolis: Shumaker & Sieffert

      Not, apparently, anymore. Wonder if there’s been fallout from her husband’s approach to law, and resulting publicity.

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  27. I too yearn for the novelization of the Prenda saga. The rise, the fall, now we even have a romantic angle. Will Paddy Browne stand by her man? Ditch him for subjecting her to this dubious publicity? I’m agog.

    Reply

  28. I wonder if Jay Edelson is aware of the courtroom spectacle that Brett Gibbs has created of himself in Judge Wright’s courtroom. I should send some popcorn to his office on North LaSalle.

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    • I’d like to add that it doesn’t look like profiteering (declared not asking for more than $75k), and honestly, I kind of like the case. GMO is decidedly not natural IMHO.

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  30. Can’t find the right place for the defamation suits — but responses to the complaint (at least Paul Duffy’s) is now on PACER! Hopefully RECAPPED soon!

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      • Hansmeier probably didn’t realize his deposition on behalf of AF Holdings would make him a minor celebrity when he wrote that.

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        • And now he will be famous for his assclownery and serve as a warning to future generations of law students.

          Reply

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