Guardaley | X-Art

Winds of change begin to blow on Malibu Media

by Dragon

The first time I read Judge Otis Wright II’s order issuing sanctions against Prenda et al, I knew I was witnessing history in the making. There were many times, in this blog and elsewhere in the community where Does expressed frustration that judges were simply not paying attention to the various infringement suits that were coming across their desks. It was an anomaly for a judge to question or put restrictions on discovery. While Prenda had everyone’s full attention in California, and justifiably so, Malibu Media took advantage of this fact with a landslide of lawsuits headed up by the weasel Keith Lipscomb and his “merry men.” As in the past, most of these lawsuits were granted discovery, which allowed Plaintiff the opportunity to “plunder the citizenry.” Then came May 6th. As word of Wright’s “proclamation” has begun to spread, judges are starting to lift their heads and pay attention to what is going on. Two particular districts in the past few days, where judges have looked beyond face value, have now taken an interesting turn.

Wisconsin
Magistrate Judge
Stephen L. Crocker

Three days ago, in the Western District of Wisconsin, Magistrate Judge Stephen L. Crocker, took a closer look at what was going on and decided it was time for “the court to go to battle stations.” He issued an order today that literally had me clapping and cheering (at work mind you) for his ability to get to the root of what is really going on with these suits. Malibu has filed 11 suits in his district, which even though he is well aware of the criticism levied against them, has “no problem” with plaintiff protecting its copyright or negotiating settlement, regardless of the content involved.

Now here’s where it gets interesting. You may recall in Malibu cases, that additional infringement is now being entered as exhibits (exhibit “C” to be precise¹) under the guise of asserting that the Doe is a “serial infringer.” This community had concerns about including infringement of works that did not belong to Plaintiff and clearly those concerns are shared by this Honorable Judge.

This is nonsensical. Complaints are pleadings, not affidavits, so they have no “evidentiary purpose.” Complaints are to provide “a short and plain statement of the claim showing that the pleader is entitled to relief.” F.R. Civ. Pro. 8(a)(2). Here, in each case, plaintiff is explicitly disavowing any claim based on Exhibit C. If it were to matter, under what rule of evidence would Exhibit C be relevant at any stage of this lawsuit? Propensity evidence is forbidden by F.R. Ev. 404(b)(1). Plaintiff makes no claim that Exhibit C is relevant under Rule 404(b)(2), and if it did, then the weighing process of Rule 403 would militate forcefully toward excluding this evidence. So what’s really going on here?

Well, we knew all along “what’s really going on here.” Slap down a complaint, coupled with 100 plus additionally alleged infringements, and you have now increased the chance of settlement exponentially. Trolls prey on FUD (fear, uncertainty, doubt) and these exhibits are one unhealthy dose of it. It’s no surprise that the average settlement amount in these particular cases is between 10 and 15 thousand dollars. Unfortunately for Malibu, Judge Crocker gets the joke; and he’s not laughing.

Even a cursory review of each lawsuit’s Exhibit C shows first, that it is always much, much longer than the short list of titles that is the actual subject of plaintiff’s lawsuit, and second, thatamong the innocuous titles listed in each Exhibit C (e.g., “Top Gear,” “Star Trek VI”) are numerous “adult” programs, usually many more than the handful for which plaintiff is claiming a copyright violation, and many with titles exponentially more lewd than any title claimed by plaintiff Compare “Red Satin”with“[Bestiality] Young Blonde . . . Dog (www.sickporn.in).” One needn’t be a cynic to suppose that an intended purpose–perhaps the primary purpose–of Exhibit C to the complaint in each of these lawsuits is to increase the pressure on a subsequently identified Doe defendant to settle before s/he is publicly linked to hardcore/deviant titles that are completely irrelevant to plaintiff’s actual claims in the lawsuit. If this is true–and right now it is the court’s operating hypothesis–then plaintiff probably has violated F.R. Civ. Pro. 11(b)(1). Nothing else is going to happen in these lawsuits until the court decides this matter.

 

Put another way, GAME OVER. He concludes by ordering all documents sealed, “to protect them from prying eyes” while the court is able to determine if these exhibits “should be stricken and whether plaintiff should be sanctioned” (emphasis added). Malibu now has to explain to the court what they were up to, or face sanctions.

 

Illinois

Moving on to the Central District of Illinois. Magistrate Judge Byron Cudmore has long been handling Malibu cases, essentially passing local counsel Mary K. Schultz the keys to discovery without so much as breaking a sweat. Currently, I count 38 cases pending in this district alone. While there isn’t a whole lot of detail to share yet, the following text was entered in each of these cases yesterday:

Chief District Judge
James E. Shadid

ORDER REASSIGNING CASE. Case reassigned to Chief Judge James E. Shadid and Magistrate Judge John A. Gorman for all further proceedings. Judge Michael M. Mihm, Magistrate Judge Byron G. Cudmore no longer assigned to case. All discovery and deadlines are stayed pending further order of the Court. Entered by Chief Judge James E. Shadid on 5/30/2013. (MC, ilcd) (Entered: 05/30/2013)

Again, while there isn’t much detail to relate with these particular suits, it is worth noting that the Order issued has taken the cases from Springfield, IL and placed them now in Peoria to be handled. That raises some eyebrows as to what exactly was happening in Springfield that caused the reassignment.

Along with the Bellwether trial, Malibu Media is finally starting to get some much deserved notice and it couldn’t have come sooner in my opinion. As the winds of change start to blow, hopefully more judges across the country will start to uncover the truth: the troll “business model” is alive and in full swing with Malibu Media.

Update

6/1/2013 (SJD)

According to RFC Express (which is buggy, so the numbers may be slightly off), orders reassigning cases and staying discovery have been filed in at least 21 cases². Strangely, exactly at the same date (5/30/2013) Malibu/Lipscomb/Schultz voluntarily dismissed without prejudice (example) at least 9 cases. Feeling the heat and running away like thieves caught pilfering cigarettes? All these cases feature “extended surveillance” Exhibit “C,” which I hope will serve as a ground for sanctions against Lipscomb and his gang — first in Wisconsin, then in other states. I urge all the named and unnamed defendants in all states file judicial notes attaching Judge Crocker’s order.

Followup

@SaltMarshGhost has posted an interesting analysis of recent events on the copyright trolling front, with big emphasis to Judge Crocker’s order and its possible impact. Below is the entire piece (I only linkified it).


The Copyright Troll Big Picture

@SaltMarshGhost
2013-06-01

Several big things have happened in the last month in the copyright troll world. First, Ingenuity 13 v. Doe, 12-cv-08333 (C.D. Cal.) has essentially ended (some drama regarding Klinedinst’s withdrawal notwithstanding). Several Prenda characters have filed appeals with the Ninth Circuit; those will not bring about any news until October, when their opening briefs are due (fans of schadenfreude, however, can look at In re: Hansmeier, in which Paul Hansmeier has to file a “status report” regarding his sanctions by July 14. Or perhaps he will not file one, and withdraw his application to the bar. Anything is possible with Prenda). Paul Duffy posted a bond to the district court, but will not motion to stay until June 24 (not sure why this is), so there won’t be any news out of the Central District of California for at least three weeks. The CAND 12-cv-02396 AF Holdings LLC v. Joe Navasca case was closed recently, to our dismay, with Judge Chen saying that Prenda had “substantially complied” with his order to produce the Salt Marsh signature by claiming to no longer have it (given my twitter handle, I am personally disappointed by this). Sunlust v. Nguyen in FLMD also ended unexpectedly, with Syfert withdrawing all sanctions motions, in an apparent deal.

But in this lull, M. Keith “don’t call me a pornographer” Lipscomb has been busy. As discussed above, Judge Crocker in W.D. Wisconsin warned Lipscomb that his now-infamous Exhibit C put him in serious jeopardy of sanctions under FRCP 11(b)(1). (Note that Judge Wright, before moving to inherent sanctions power, was considering sanctioning under FRCP 11(b)(3).)

The relevant paragraphs of FRCP 11:

(b) Representations to the Court. By presenting to the court a pleading, written motion, or other paper—whether by signing, filing, submitting, or later advocating it—an attorney or unrepresented party certifies that to the best of the person’s knowledge, information, and belief, formed after an inquiry reasonable under the circumstances:
(1) it is not being presented for any improper purpose, such as to harass, cause unnecessary delay, or needlessly increase the cost of litigation;

(3) the factual contentions have evidentiary support or, if specifically so identified, will likely have evidentiary support after a reasonable opportunity for further investigation or discovery.

Wright’s assertion wrt FRCP 11(b)(3) was that Prenda did not sufficiently show that the Doe they were going after was actually the infringer; basically, that the IP address does not equal the infringer. While this is important, this isn’t actually central to the copyright trolling M.O. And his sanctions were not based on that at all; his sanctions were for Prenda’s asshattery with regards to their corporate structure, the Alan Cooper issue, etc. That’s where Judge Crocker comes in, and where Lipscomb has made a very, very bad mistake.

The primary component of the copyright troll’s M.O. is of course that a person who is accused of illegally downloading pornography will, much of the time, settle to prevent the news from being public. This smells of extortion, and Paul Duffy’s wife has admitted of Facebook to what amounts to inter-state extortion, according to Popehat. Where Lipscomb made a very bad mistake is in the so-called “Exhibit C”, which listed *other* works the Doe is accused of infringing, which appears to be nothing more than a print-out of the Bittorrent monitoring software and includes works that Malibu Media doesn’t even own the copyright to, such as real Hollywood movies. Crucially to Judge Crocker, it also includes several works with titles much cruder—and so more incriminating and more embarrassing—than used by X-Art. Judge Crocker finds this to be in violation of FRCP 11(b)(1).

This could be a crucial step in the dismantling of the copyright troll business. Judge Wright’s sanctions on Prenda, if upheld by the Ninth Circuit, would destroy Prenda but leave Lipscomb and other trolls intact. The broadest effect it might have is tilting other jurisdictions toward adopting an IP-address-is-not-the-infringer doctrine, due to Wright’s findings of fact. A finding that Lipscomb violated FRCP 11(b)(1), on the other hand, would strike at the heart of the copyright troll business model by saying that *filing a porn lawsuit based on trying to get somebody to settle to keep it out of the public eye* is legally-unacceptable harassment.

There is, however, one caveat—Judge Crocker seems to be interested in Exhibit C specifically. This leaves room for suits where the troll is not so stupid as Lipscomb and files a suit against a single, named Doe, for a single work. My understanding is that Lipscomb/Malibu are leaning toward this angle. (See Cashman on this.) If Crocker rules broadly and says that even that would violate FRCP 11(b)(1), then porn copyright trolls are all absolutely dead. If not, then Lipscomb/Malibu Media need to be watched very closely.

What with this and the talk of “copyright small claims” by Judge Titus in Maryland, the post-Prenda era (fingers crossed) still remains an exciting time for copyright troll watching.

Followup 2

 


¹The linked exhibit is from a different case: the complaint and all exhibits in this case are sealed per judge’s order embedded above. Yet it is perfect as an illustration: all such exhibits are essentially the same, only filenames differ.

²ILCD Malibu Media cases stayed and reassigned:

  • 2:13-cv-02096-HAB-DGB (dismissed)
  • 2:13-cv-02097-HAB-DGB (dismissed)
  • 2:13-cv-02094-HAB-DGB (dismissed)
  • 2:13-cv-02093-HAB-DGB (dismissed)
  • 2:13-cv-02059-MPM-DGB (dismissed)
  • 2:13-cv-02044-MPM-DGB (dismissed)
  • 2:13-cv-02058-HAB-DGB (dismissed)
  • 1:13-cv-01073-JES-JAG (dismissed)
  • 1:13-cv-01200-MMM-BGC
  • 1:13-cv-01201-JES-JAG
  • 3:13-cv-03116-RM-BGC
  • 3:13-cv-03118-RM-BGC
  • 3:13-cv-03119-RM-BGC
  • 1:13-cv-01194-JBM-BGC
  • 1:13-cv-01195-JBM-JAG
  • 1:13-cv-01189-JES-JAG
  • 1:13-cv-01096-JBM-BGC
  • 1:13-cv-01075-JES-JAG
  • 3:13-cv-03044-SEM-BGC
  • 1:13-cv-01074-JES-BGC
  • 1:12-cv-01493-JES-JAG
  • 1:13-cv-01102-JES-JAG
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Discussion

32 responses to ‘Winds of change begin to blow on Malibu Media

  1. I hope you rot in Hell “Lipscum”. By loading p Exhibit “C” with non-verified info as evidence, all you are doing is extorting people for more money by preying on their fears. God forbid you actually prove your claims. You’re a liar and a crook you miserable piece of $#!+.

  2. I’d be curious to know what a lawyer thinks about Lipscomb’s in Limine motions in the Bellwether trial to (among other things) preclude the defense from referring to Malibu Media as a “Copyright Troll” or any other nasty name, say anything about their other (~870) law suits, and — most incredibly — prevent the defendant from introducing any evidence of or reference to wi-fi hacking.

    This seems like such an overreach to me that I hope it rebounds on Lipscomb, but then again IANAL and maybe it’s standard practice?

    • I think trying to have this case tried in a vacuum without being able to give the jury an overall picture of the nationwide business model is prejudicial to the Does. Likewise IMO the general public’s overall impression as expressed in the media and law reviews is relevant in assessing plaintiff’s true motive, protect copyright OR generate millions in settlements, is relevant to the counterclaims.

    • I believe the term you are looking for is prior restraint. And yes, Lipscomb is a scum-sucking, dick-licking, due-process-hating, America-hating douchebag for trying it.

      You shall know them by their fruits.

  3. MM will probably dismiss any of these suits where this is happening; too much at risk for an adverse ruling. He’s a !@#$ing coward. If he was serious, he’d stand and fight if he truly believes this is the right way to pursue a case. Nothing more than a well dressed bully with deep pockets; all filled by extorting people whether they’re guilty or not. Even calling this guy “Lipscum” is giving him too much credit. The white stuff that forms in the corner of my lips has more integrity than this mafioso and his dirt bag clients.

  4. Lipscomb is asking that the Bellweather case be delayed for a couple of months, while he attempts to get a paid export to certify Gaurdley/IPP software actually works.

  5. In the Bellwether case Lipscomb is asking for 2 month postponement of trial while he scrambles to get a “paid” expert to certify that Guardley/IPP software works as claimed.

    • Two months? I suppose he needs that amount of time to craft together some masterpiece of bullshit that makes a working silk purse out of a dysfunctional sow’s ear. What could he do in two months that the likes of BayTSP and MarkMonitor couldn’t for years, trying to prove the RIAA’s case?

    • Gee 2 months to get an expert to prove that one of the more used pieces of software actually works?
      So what he is admitting to is that he has no idea if the software works because he did no due diligence before using this software to begin his cases.

      Maybe it’ll take 2 months to find a single expert who says it does work… not sure that is enough time.

      • “Hey, Judge! Yea, I know we’ve been filing that lawsuits for 2(?) years now and we’ve promised on many occasions that we’re willing to take them to trial, but, umm, we’re completely unprepared to go to trial. Can I have more time? M, kthanks.”

    • I hope the judge denies this. He should already know that it works as claimed. if he didn’t have confidence in it before he started his extortion scheme, it shows he is suing people on faulty technology. This trial was supposed to originally take place in April. This dick has been stalling at every turn just like he did in Fantalis’s case. This crook needs to be taken to task and fast. Don’t give him time to do what should already be done. He should have been ready to prove any one of his 700+ cases from day one of filing them. Just shows he was never serious about going to trial. He is a crook and extortionist. I wish he would do the world a favor and drop dead. Harsh words, but that’s my opinion.

  6. Thank you for the update. Hope to see more “publicity” regarding this troll’s special “twist” of the copyright troll business model. The games the same – he’s just quieter about it; however ACTIONS SPEAK LOUDER THAN WORDS and as the filings are showing Colette Leah Pelissier Field, Brigham Field, Malibu Media LLC, M. Keith Lipscomb & Mary Katherine Schulz sure have A LOT to SHOW about what they are REALLY UP TO !!!

  7. The Wisconsin State Bar shows that Mary K. Schulz has had her license to practice suspended for non-payment of dues. Not sure if this is the same Mary K. Schulz, but sure looks the same.

    http://www.wisbar.org

  8. I wonder if Lipscomb will have the same balls as Prenda and not serve the order to stay discovery to the ISPs.

    • Since these cases were filed between March and May, I think there is a good chance that they already have the ISP responses on many of them. The real question is will they stop harassing the people they have already identified.

      It should be standard procedure for the ISPs to also file a copy of their reply under seal with the court, so when these things happen there can be assurances that all the people who need to be notified are in fact notified.

  9. [quote]All discovery and deadlines are stayed pending further order of the Court. Entered by Chief Judge James E. Shadid on 5/30/2013.[/quote]

    Maybe I missed it, but did anyone else pick up on this from the case reassignment order? This stays the Rule 26 discovery. This means either 1) if what someone else reported is correct and that the attorney who filed the case was suspended at the time, these cases must be dismissed (or perhaps give time for the party to find new counsel); 2) the Chief Judge wants to look at these cases before discovery proceeds; or 3) nothing more than balancing caseloads.

  10. Two months to figure out if they can prove their “evidence” collection works?

    This sounds like a Rule 11 nightmare for Lipscomb.

    Baylson should go thermonuclear and start a Wright-style inquiry into their “investigative” techniques. After that fiasco with the forensics guy who can’t figure out how a hard drive works, this is completely unacceptable.

    Gibbs and Prenda got busted for not doing a proper stakeout of the account holder’s homes, and this guy admits he can’t even say, today, that their evidence gathering works?

    The Does’ attorneys should go in for the kill and demand source code for the software for independent analysis. That is the only way to be sure.

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