Strike 3 Holdings

Magistrate judge finds that defendant’s privacy interest trumps copyright troll’s need to unmask an alleged infringer, denies ex-parte discovery

The recent explosion of copyright trolling lawsuits (particularly filed by a new aggressive porn troll Strike 3 Holdings¹) was possible in part because courts routinely rubberstamp ex-parte discovery requests. It does not matter that foundations of such requests are flimsy at best, illegal at worst. Since there is no meaningful opposition at the subpoena stage, judges don’t bother looking into the validity of the trolls’ claims and take false statements and fake declarations for granted. As a result, requests to unmask alleged file-sharers are almost always granted.

Yet once in a while there is a judge who denies a discovery motion. The reasons vary: it can be a doubt of geolocation accuracy, finding that a plaintiff has no intention to litigate, concerns about abuse of process, or suspicious declarations, which a real estate agent from suburban Chicago signs by the truckload.

On 4/24/2018 Magistrate Judge Franklin Noel denied a discovery motion in Strike 3 Holdings v John Doe (MND 18-cv-00768) for yet another reason. Namely, he concluded that a defendants’ privacy interests trump copyright trolls’ need to learn the defendant’s identity:

Plaintiff’s ex parte motion illustrates an ongoing conflict between the Digital Millennium Copyright Act (DMCA), 17 U.S.C. § 512, the Communications Act, 47 U.S.C. § 551, and Federal Rule of Civil Procedure 45. At the heart of this conflict is whet her a copyright owner can use the federal judiciary to discover evidence about a potential, alleged infringer when the infringer’s actual identity is unknown.

You already guessed which statute Judge Noel thinks should prevail:

This Court concludes that the conflict between the statutes, DMCA and the Communications Act, compels it to deny Plaintiff’s instant ex parte motion. As the Eighth Circuit reasoned in In Re Charter Communications, when it held that DMCA did not authorize the subpoena the district court had issued, “it is the province of Congress, not the courts, to decide whether to rewrite DMCA ‘in order to make it fit a new and unforseen internet architecture.’” 393 F.3d at 777 (quoting Verizon, 351 F.3d at 1238).

While this is a good order, it is not a reason for celebration. First, the rut of the case law – rubberstamping ex-parte discovery requests in bittorent cases – is depressingly deep despite the fact that some “wheels” that deepened it will enjoy prison time soon. Six years ago, Judge Otis Wright wrote: “The federal courts are not cogs in a plaintiff’s copyright-enforcement business model.” Wright was right, but his dictum turned out to be correct only in his own court, not federal courts in general. Today the courts are essential cogs in “essentially an extortion scheme,” thanks to an extremely low judicial standard that allows invading privacy of those who cannot afford competent and honest legal representation. Advocacy groups’ abandonment of the bittorent litigation battlefield also contributed to the recent explosion of the racket.

So, I’m afraid that this order will be either overruled by the district judge or on appeal. Magistrate Noel has a good sense of smell for scams, but he is rather a maverick. In 2012, he denied similar Prenda’s discovery motions – only to have his order overruled by a federal judge. Time showed that Noel was right, but it is of little comfort to today’s victims of Prenda’s “spiritual heirs.”

It is depressing that we tamed our conscience into getting excited about such good rulings, forgetting that they are few in a thousand. Denials of weakly-evidenced ex-parte discovery motions should be a rule, not an exception.

Anyway, it is a great no-nonsense order, and if not overruled, it will be definitely cited and maybe it will contribute to the demise of the copyright extortion. We’ll see.

Thanks to Raul for discovering this order.

Coverage

 


¹ So far, I didn’t cover this particular troll yet: “Strike 3 Holdings” is a shell for Greg Lansky’s porn empire. More than 700 lawsuits have been filed since September 2017. Strike 3 Holdings’ racket is not much different from Prenda’s or X-Art’s – as a matter of fact it is run by a former X-Art/Malibu Media attorney Emilie Kennedy. This troll, despite the involvement of a large lawfirm Fox Rothschild, cuts a lot of corners – both ethical and legal: they are just not always the same corners that got Prenda’s principals indicted. This is a topic for future blog posts though.

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Discussion

8 responses to ‘Magistrate judge finds that defendant’s privacy interest trumps copyright troll’s need to unmask an alleged infringer, denies ex-parte discovery

  1. Interesting read, While I initially thought Strike 3 would write off the cost ($3,200 or 8 filings), I now think otherwise and agree with SJD. Raul also advising that the counsel fronting the filing fees (surprising if true considering Strike 3’s deep pockets) makes me believe this more so since greater chance of recovering funds. I am wondering if the 800+ cases filed by Strike 3 is going to bring them on greater scrutiny from the alphabet agencies, but the glowing profile in Rolling Stone makes me think not.

    One interesting aspect of Strike 3 versus Malibu media was made by Rob Cashman. I don’t have a exact link, but he basically said this is Target in the shadow of Walmart. For Malibu Media, I generally saw the number of infringements ranging from roughly from 8 to 20 (with one as high as 130) in the pacer filings. I’ve only seen 2 filings for Strike 3 and there were 51 and 103 infringements for them. How that affects settlements going forward, I am not sure.

    I obviously have more comments, but will save for another day.

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