The Year of Downloading Dangerously: Federal court gives adult film copyright “trolls” the Third Degree

by Foley Hoag LLP - Trademark, Copyright & Unfair Competition
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 About this time last year, we reported on a case which bore perhaps the least catchy name in the history of the Massachusetts Federal District Court: Liberty Media Holdings, LLC v. Swarm Sharing Hash File AE340D0560129AFEE8D78CE07F2394C7B5BC9C05,821 F.Supp.2d 444 (D. Mass. 2011). In that case, 38 John Doe defendants were accused of illegally downloading the adult film, “Amateur College Men Down on the Farm,” via BitTorrent.  The defendants argued that it was improper for all of them to be joined together in one lawsuit, and that they should be allowed to proceed anonymously in order to protect them from embarrassment.

But Judge William Young disagreed.  Permissive joinder of multiple defendants, pursuant to Rule 20 of the Federal Rules of Civil Procedure, requires only that (1) the cases against the various defendants arise from the same series of transactions or occurrences, and (2) the cases have questions of law or fact in common.  In part because of the collective manner in which BitTorrent technology works, as opposed to certain other peer to peer file sharing systems, the court held that each defendant’s downloading was part of the same series of transactions, and thus their cases could be joined.  The Judge further held that the John Does could not proceed anonymously, because mere embarrassment to a defendant cannot overcome the public’s interest in open court proceedings.

In the year since Judge Young’s decision in Liberty Media, suits by adult film companies against “John Doe” BitTorrent users have increased in volume.  They generally follow a similar pattern.  Suits are brought against individual “John Doe” downloaders or uploaders of copyrighted content and, in order to save on filing fees and other costs, dozens or hundreds of these individuals are joined in a single case. The plaintiff initially identifies the John Does by their IP addresses only, and then issues subpoenas to their internet service providers in order to secure their real names and addresses. Each John Doe then receives a demand letter, threatening to publicly name him or her as an illegal downloader of pornography unless a cash settlement is paid.  Most of these defendants, even those with meritorious defenses, can’t afford the legal fees to defend the case.  And even if they had free legal counsel, all but the boldest John Does, in order to avoid embarrassment, can’t get out their check books fast enough.

Last month, about one year after Liberty Media, Judge Young was confronted with another of these cases in Third Degree Films v. Does 1-47, Civil Action No. 12-10761 (D. Mass. October 2, 2012).  In that case, adult film company Third Degree Films sought to join 47 John Doe defendants in a single suit, alleging they had illegally downloaded and/or uploaded certain pornographic films.  However, by then, Judge Young had become “increasingly troubled by copyright trolling, specifically as it has evolved in the adult film industry,” and decided to revisit his decision in Liberty Media.

Now, let’s briefly define what a “copyright troll” is.  According to Judge Young’s opinion, a copyright troll is “an owner of a valid copyright who brings an infringement action not to be made whole, but rather as a primary or supplemental revenue stream.”  While this definition certainly describes the activities of certain adult film companies, some may consider it too broad. The traditional definition of an intellectual property “troll” is a party that doesn’t actually create or manufacture anything itself, but rather is little more than a holding company that acquires rights for the sole purpose of suing. Third Degree Films, for example, appears actually to have made the adult films over which it is suing, so it might fit into one definition of a “troll,” but not the other.

But whether labeled as “trolling” or not, the real issue for Judge Young was the potential for abuse and misuse of the judicial process in service of “what seems to be a developing pattern of extortionate settlement demands.”  As Judge Young described:

While it is without question that a valid copyright holder is entitled to seek protection of its intellectual property in federal court, it appears that in at least some of these cases, adult film companies may be misusing the subpoena powers of the court, seeking the identities of the Doe defendants solely to facilitate demand letters and coerce settlement, rather than ultimately serve process and litigate the claims. And while it is true that every defendant to a lawsuit must assess reputational costs in his or her determination of whether to settle or defend an action, the potential for embarrassment in being publicly named as allegedly infringing such salacious works as “Big Butt Oil Orgy 2” or “Illegal Ass 2” may be playing a markedly influential role in encouraging a myriad of Doe defendants to settle once subpoenas are issued—a bargaining chip the adult film companies appear to well understand.

The Judge stood by his original position that joinder of multiple BitTorrent users in a single suit is technically compliant with Rule 20.  However, Rule 20(b) also provides for the court to issue orders “to protect a party against embarrassment, delay, expense, or other prejudice.”In Third Degree Films, Judge Young used this provision to sever the John Doe defendants, requiring the plaintiffs to sue each one separately.

So what does this mean for illegal downloaders of porn?  Ultimately, Judge Young’s decision will not directly protect the identity of a John Doe defendant.  If someone is sued anonymously and later identified, he or she must still settle the case early or risk catastrophic embarrassment.  However, Judge Young’s new decision indirectly protects John Doe defendants by undercutting the economic foundation of the adult film “trolling” business model.  Requiring plaintiffs to sue each defendant separately will compel them to pay a $350 filing fee for each case, and bear other individualized expenses, which will make the entire exercise less profitable. In the words of Judge Young, it will also ensure that the plaintiff is “suing the Doe defendants for a good faith reason, that is, to protect its copyright and litigate its claim, rather than obtain the defendants’ information and coerce settlement with no intent of employing the rest of the judicial process.”

 

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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