Rightscorp’s game-changing solution to the problem of multi-billion dollar digital theft provides monetary remedies to the holders of violated copyrights. […] At Rightscorp, our unique proprietary patent-pending technology crawls the internet, identifies repeat infringers of copyrighted material, alerts the ISPs who then forward a letter warning infringers that they could be liable for $150,000 in damages and provides a link to a reasonable $20 settlement offer per infringement. If the infringer accepts the settlement, our automated system sends half of the payment to the copyright holder. Repeat infringers have seen their service terminated by their ISPs for non-payment of Rightscorp notices. Our technology is unique — while other technologies identify illegal downloaders, our technology is the only one in the market that detects, tracks, and documents repeat infringers.
Bragging about the “unique,” “game-changing” technology caught my attention: shaking down peer-to-peer filesharers (and innocents who were caught in the wide net of poorly developed “proprietary technologies”) is not new. So it sounded implausible that Rightscorp’s approach was indeed that novel.
I recently wrote about a ridiculous way of boosting one’s significance by buying fake Twitter followers. Rightscorp’s Twitter account, with or without its owners’ blessing, is apparently one of such accounts as it has hundreds of faux followers. While hardly significant by themselves, facts like this result in a reasonable suspicion, which in turn drives the curiosity, and hence the willingness to travel down the rabbit hole.
Let’s go back to 2008. Once upon a time there was a fine company called Nexicon. TorrentFreak reported:
Some people might remember Nexicon from the Getamnesty site we mentioned in the past, or perhaps as the Youtube copyright cops. The company has a history as a cigarette retailer but went on to hunt pirates after they were sued for selling smokes to minors and failing to report their sales to the tax office.
After its transformation into a pirate tracking outfit Nexicon launched its Getamnesty program which offers copyright holders a chance to turn piracy into profit. They cleverly circumvent privacy protection laws by using ISPs to forward settlement requests for various copyright holders to alleged infringers. One of their most successful partner programs is the Payartists website which is a misleading name to say the least.
The money collected through Payartists is not going to any artists at all. The only artist they collect ‘settlements’ for on the site is Frank Zappa, and he passed away in 1993. All the settlement money collected now goes to The Zappa Family Trust which is headed by Zappa’s widow.
Interesting fact: Nexicon spread the information that
Nexicon believes it has a valuable product on its hands and announced today that it has filed a patent application for Get Amnesty. The application, which has not yet been published on the USPTO’s website, aims to patent Nexicon’s MARC platform that analyzes “over 19 billion file transactions each day” with “specialized artificial intelligence” to validate the contents.
It seems to be a lie: no such application exists (and I assure you, Rightscorp’s principals are aware of it).
After making a big initial buzz, the company disappeared from the business arena in 2011: its registration was revoked, its stock was delisted, and its domain name is now for sale by what appears to be Korean cyber-squatters. In addition, an ex-employee sued Nexicon’s principals for breach of contract.
Two of Nexicon’s key people, CEO Sam Glines and CTO Tommi Stiansen recently founded a “darknet attack intelligence” company Norse Corporation. Their long and intimate involvement with Nexicon is totally missing from their LinkedIn profiles, interviews, and Norse executives’ bios page. Obviously, both don’t like to be associated with their past fiasco.
Now, back to 2008.
What does it have to do with Rightscorp? The connection is more than direct. Both Roghtscorp’s key players, Robert Steele and Christopher Sabec, together with a musician and a Malibu businessman Tommy Funderburk, ran a “proto-Rightscorp” named PayArtists (already mentioned in the TorrentFreak’s article quoted above). In October 2008 they partnered with Nexicon to “provide GetAmnesty anti-piracy solution to the music industry”:
Nexicon, an emerging provider of next generation digital media protection and digital media business intelligence solutions, announced the formation of a partnership with PayArtists to provide anti-piracy services for the music catalog of the musician Frank Zappa. PayArtists will leverage Nexicon’s MARC technology platform and GetAmnesty product to help music artists, record labels and other copyright owners enforce their copyrights with music fans who have illegally downloaded protected music.
Bloomberg wrote on 10/9/2008:
PayArtists was formed by a group of three individuals that include Tommy Funderburk, an internationally recognized songwriter and recording artist, a prominent music industry lawyer, and an accomplished merchant banker. As exclusive rights holders to Nexicon’s applicable technologies to address anti-piracy worldwide in the music industry, PayArtists will monetize internet piracy of illegal music downloads, on behalf of copyright owners. Music fans who have illegally downloaded music from a PayArtists’ client will receive an infringement notice via email directing them to a unique artist-branded PayArtists site. Users then have the option to settle with PayArtists, on behalf of the copyright owner, to avoid potential litigation.
So, it looks like our PayArtists trio didn’t have their own snooping and payment processing technology and simply acted as brokers for Nexicon’s infringement monetization solution.
How did this million-dollar idea work out? It looks like the word “success” is hardly applicable here, as
- The company, registered on 12/30/2009 (C3267755), was suspended by the California Franchise Tax Board and silently disappeared (company’s last tweet is dated 6/30/11).
- PayArtists.com now redirects to Muzit — a new Funderburk’s company that claims that it uses Bittorent snooping to “automatically send friendly marketing emails” to alleged infringers. If it is true, I totally back this business model, a model of engaging alleged pirates instead of shaking them down.
- Both Steele and Sabec don’t mention this endeavor; their LinkedIn profiles don’t list PayArtist at all.
- Tommy Funderburk has more than one LinkedIn profile. The first one, that does mention PayArtists, is most likely abandoned. It states that
In 2010 Tommy founded PayArtists in response to the music industry’s failed policy of suing fans around the world for downloading music and other copyrighted material. […] PayArtists provides artists and other copyright owners a truly fan friendly business model and proprietary technology to connect with and market to the global P2P community.
The second one is all about the abovementioned Muzit. Compare the bio to the first one:
In 2010, Tommy founded Muzit Inc. in response to the music industry’s failed policy of suing fans around the world for downloading music and other copyrighted material. Muzit’s proprietary fan engagement platform employs patent pending technology and a truly fan friendly business model which forensically identifies individual, unauthorized downloaders of copyrighted content in real time and then automatically sends friendly marketing emails to those who use the over fifty networks like BitTorrent to acquire their music for free.
Again, I praise Mr. Funderburk’s new approach if it is indeed about engaging the fans, not shaking them down. I only want to show how strongly he is trying to distance himself from one of his the past occupations, PayArtists — an extortion outfit.
[Update: TorrentFreak ran a story on 1/6/2016, and it confirms that Mr. Funderburk indeed developed a right, ethical approach to deal with illegal file-sharing. That makes me happy.]
bullshits shows its potential to prospective investors, it doesn’t mention the past PayArtists fiasco. Instead, it brandishes its “patent-pending technology.” Indeed, on 4/2/2012 Robert Steele filed a patent application for “System to identify multiple copyright infringements.” I repeat the quote from Sabec I began this article with:
Our technology is unique — while other technologies identify illegal downloaders, our technology is the only one in the market that detects, tracks, and documents repeat infringers.
It seems that because it is clear that the process itself is not new, Sabec is trying to claim that detecting repeat infringers is the crux of the invention. Let’s find out how revolutionary it is. The patent application refers to “repeat infringer” as follows:
A repeat infringer may be detected by monitoring a predetermined threshold associated with the number of entries populating each generated data structure. For example, the method may provide that once a predetermined number (such as, for example, 5, 10, 20, or any positive number greater than 1) of data structure entries are identified that have substantially the same IP address and substantially the same port number […]
To me, it doesn’t sound like a “game-changing,” ingenious discovery, but rather like a quote from a kindergarten math study book, but I’m not a patent attorney. After reading EFF’s “Stupid patent of the month,” I realize that anything is possible.
Other than that, all the other Rightscorp’s claims, such as
[…] our unique proprietary patent-pending technology crawls the internet, identifies repeat infringers of copyrighted material, alerts the ISPs who then forward a letter warning infringers that they could be liable for $150,000 in damages and provides a link to a reasonable $20 settlement offer per infringement.
have been (unsuccessfully) tried by Nexicon.
Again, I’m a dummy when it comes to patents and cannot vouch for the claim that Nexicon’s GetAmnesty infringement monetization solution can be considered a prior art (although to me it certainly is the case), I hope that specialists will have a look and clarify. Maybe R. Steele’s patent application is totally legit, I don’t know.
Nonetheless, it is clear that Rightscorp’s principals attempt to white out their past connection with an unsuccessful corporation (whose own principals attempt to white out their involvement in it), assumingly to attract new investors’ money for the business model that was tried in the past and failed.