Las Vegas Sun

June 2, 2015

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Attorneys say new evidence shows fraud by Righthaven

Defense attorneys in at least two Righthaven LLC copyright infringement lawsuits filed motions to dismiss over the weekend, citing new evidence they say shows Righthaven has perpetrated a fraud on the federal court in Nevada.

The evidence cited is the newly-unsealed Strategic Alliance agreement covering copyright assignments from Stephens Media LLC, owner of the Las Vegas Review-Journal, to Righthaven.

In motions filed Sunday, attorneys with Randazza Legal Group said this contract shows Righthaven’s lawsuits are based on "sham’’ copyright claims since Stephens Media maintains control of the material covered by the copyrights.

"Righthaven is neither the owner nor exclusive holder of any rights in the copyrighted work underlying this lawsuit. As such, Righthaven has suffered no injury or other cognizable harm required for it to have standing’’ to sue, said one of the filings by attorneys Marc J. Randazza and J. Malcolm DeVoy IV.

"Indeed, the agreement makes it abundantly clear that Righthaven actually has no rights in the copyrights it claims,’’ the filing said.

"The `assignment’ is a transparent sham that is designed to make Righthaven appear to be a copyright assignee for the purposes of filing suit, meanwhile the actual rights at issue are governed by this agreement, which renders the assignment meaningless,’’ their filing said.

"This is not a true copyright ownership that Righthaven has acquired, nor is it even an exclusive license – it is simply an attempt to illegally assign a copyright claim,’’ the attorneys wrote.

"Righthaven has willfully deceived this court. Righthaven fought mightily to keep this evidence from the public and from all defendants in its legion of cases brought in this district. An examination of the document and its implications for Righthaven’s business model make the reason plain – it reveals the unlawful nature of Righthaven’s actions before this court and renders all of its lawsuits null and void,’’ the filing said.

They said Righthaven perpetrated upon the court a "sham’’ and a "fraud’’ hundreds of times in its lawsuits by claiming in the lawsuits that Righthaven "owns’’ the copyrighted stories, photos and graphics it sues over, and has exclusive rights to reproduce and distribute them, when in fact its contract with Stephens Media says Stephens Media retains those rights.

For instance, in its lawsuit against then-U.S. Senate candidate Sharron Angle, Righthaven said: "Righthaven is the owner of the copyright in and to the literary work entitled: `It’s the jobs, stupid.'”

That literary work was a Review-Journal editorial.

"Righthaven holds the exclusive right to reproduce the Jobs Work,’’ Righthaven said in its lawsuit. "Righthaven holds the exclusive right to prepare derivative works based upon the Jobs Work. Righthaven holds the exclusive right to distribute copies of the Jobs Work. Righthaven holds the exclusive right to publicly display the Jobs Work.’’

It’s common knowledge that the Review-Journal and Righthaven are partners in the lawsuits.

For non-attorneys wondering why the copyright assignment issue is so important, Randazza and DeVoy explained it this way in a court filing in another Righthaven case: Providing Righthaven only rights to sue isn’t a procedure intended by the federal Copyright Act.

"Righthaven’s practices create a secondary commodities market for copyrights, or exclusive subsidiary rights in copyrights, to be used only in suing others who may have valid defenses, but cannot afford to raise them — or engage counsel whatsoever," they said in a case where they and New York copyright attorney Ron Coleman represent the Media Bloggers Association.

"This is inimical to the purpose of the Copyright Act, which was intended to protect the intellectual investments of creators, rather than creating lawsuit mills that use registered copyrights – only after their infringement was discovered – as a source of income, rather than a shield against others’ misappropriation," their filing said.

Sunday’s filings for dismissal were made in the Righthaven lawsuits against Lehi, Utah, company Vote For The Worst LLC and against Kentucky message-board poster Wayne Hoehn.

Righthaven has not yet responded to these motions, but has said the newly-discovered evidence does not undermine its lawsuits over Review-Journal material and arguments otherwise “would completely eviscerate countless years of licensing and related transactions throughout the country.”

Righthaven, co-owned by Las Vegas attorney Steven Gibson and an affiliate of Stephens Media, since March 2010 has filed 264 lawsuits in federal courts in Nevada, Colorado and South Carolina over Review-Journal and Denver Post material.

The no-warning lawsuits are a departure from the usual newspaper industry practice of resolving copyright issues out of court.

Righthaven, however, says takedown requests and orders have been ineffective in deterring rampant online infringements of newspaper content. And while defendants complain about getting sued without warning, Righthaven notes in its lawsuits those same defendants for the most part didn’t contact the Review-Journal or the Denver Post for permission to use their material.

Some attorneys believe disclosure of the Strategic Alliance contract may result in dismissal of Righthaven’s pending lawsuits over Review-Journal material, and could even lead to more defendants — including those who have settled — hitting Righthaven with counterclaims for damages based on the alleged misrepresentation of its ownership in the copyrights.

One attorney familiar with Righthaven told the Las Vegas Sun and its sister publication VEGAS INC over the weekend that at minimum, Righthaven is unlikely to file new suits over Review-Journal material and that proposed settlements may be put on hold until Nevada federal judges hearing Righthaven cases rule on the validity of the copyright transfer.

This attorney noted that to avoid such difficulties in the future, Righthaven would simply need to modify its agreement with the Review-Journal and other existing or potential lawsuit partners.

It’s unknown whether Righthaven’s contract with the Denver Post includes the language at issue in Righthaven’s contract with Stephens Media.

Righthaven has filed lawsuits over at least three copyrights it claims to have been assigned from the Denver Post, one involving a photo and two involving columns.

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