By Andrew Goldberg
Could it be the beginning of the end for Righthaven?
The Las Vegas-based copyright holding company, which has endured a string of legal setbacks in the last couple of months, suffered another one last week when a federal judge in Colorado halted all the copyright infringement suits brought by Righthaven in the state pending a review of whether the company has the legal standing to sue over an airport security pat-down photo originally published in the Denver Post.
"Because there are serious questions as to whether my exercise of subject matter jurisdiction over Righthaven's claim of copyright infringement is proper, I think it most prudent to stay the proceedings in all pending cases in this District in which Righthaven is the named Plaintiff," wrote Judge John Kane in an order issued last Thursday. "Should I find that I lack subject matter jurisdiction over Righthaven's claim of copyright infringement, it is likely that I will be required to dismiss all pending actions." [ Download Righthaven - Judge Kane Order]
The stay issued by the court in Colorado follows a decision last month by a federal judge in Nevada to unseal the licensing agreement Righthaven signed with its other newspaper partner, the Stephens Media-owned Las Vegas Review-Journal. That agreement, which was unsealed at the request of the Electronic Frontier Foundation, revealed that Righthaven had been granted the right to bring infringement actions but had not actually been granted full copyrights in the articles over which it was suing.
As in Las Vegas, Righthaven's fate in Colorado now likely hinges on the terms of the agreement it signed with the Denver Post. If the agreement, which Kane has not yet ordered Righthaven to make public, merely grants the copyright-holding company the right to sue over Denver Post content but does not assign it the underlying copyrights, then Righthaven would not have the right to reproduce, distribute, or benefit in any way from the licensing of the content. And absent the right to exploit the copyright, Righthaven would not be able to demonstrate any legally cognizable injury owing to the alleged infringement -- a prerequisite to establish standing in court.
Righthaven says it supports Kane's decision to put its suits in Colorado on hold. “His decision to do so reflects a practical and efficient response that promotes the interests of judicial economy in response to an issue directly implicating his authority to decide the cases before him,” Shawn Mangano, a lawyer for the company, told VegasInc. “Righthaven maintains, as it has in response to similar motions brought in Nevada, that it has standing to seek redress for the copyright infringement claims at issue."
About the only thing Righthaven has won lately in the 275 cases it has filed since March 2010 is the wrath of the judges it has appeared before in federal court. Last month, Kane--the same judge who just issued the stay in Colorado--berated the company for its business model in a case it brought against North Carolina blogger Brian Hill for posting the Denver Post photo of an airport security pat-down that has been the subject of multiple Righthaven infringement complaints.
"Righthaven’s motivation for avoiding the simple act of requesting that Mr. Hill cease and desist is simple, it is using these lawsuits as a source of revenue," wrote Judge Kane in the case. "Such abuse of legal process should be rejected."
Colorado isn't the only place Righthaven has been taking its lumps. In March, Judge James Mahan in Nevada took a swipe at Righthaven's business model while dismissing on fair use grounds a case the company brought against an Oregon nonprofit for republishing an entire article that appeared in the Las Vegas Review-Journal. "Righthaven is not using the copyright the same way the R-J used it. Righthaven is using it to support a lawsuit," Mahan wrote, noting that such use has a chilling effect on free speech and doesn't advance the purpose of the Copyright Act.
While Righthaven's defeats have been multiplying, the biggest losers in its copyright litigation crusade have been small websites and amateur bloggers the company has cowed into settling. According to a site that tracks Righthaven lawsuits and settlements, defendants have already paid out a combined estimated total of nearly $500,000 in the more than 100 suits that have settled so far.
In light of what has recently emerged about Righthaven's licensing agreement with the Las Vegas Review-Journal, and what may soon be learned about its arrangement with the MediaNews Group-owned Denver Post, those who've settled with the company may try to argue that those settlements should be rescinded on the basis of misrepresentation. But given that those who settled were seeking to avoid the cost and stress of litigation, it seems unlikely that they would suddenly pursue legal action. (Also, as the Winklevoss Twins can attest, convincing a court that you were duped into accepting an unfair settlement agreement is no easy task.)
Luckily, many of those who have settled with Righthaven may now have another option. Buzzfeed.com, one of the websites sued by Righthaven over the Denver Post airport security pat-down photo, filed a class action counterclaim last week on behalf of all individuals who were accused of copyright infringement by the company and sued in the District of Colorado. The action alleges that Righthaven engaged in unfair and deceptive trade practices and negotiated settlement agreements in bad faith. Look for a similar suit to be filed by another defendant soon in Nevada. [Download Buzzfeed Class Action Counterclaim]
It's unclear, of course, that such a class will ever be certified or that those who settled with Righthaven will ever get damages. But stranger things have happened. After all, if Righthaven has convinced anyone of anything lately, it's that it's more than capable of losing a lawsuit.