Former Righthaven CEO Secretly Hires Lawyers For The Company He No Longer Has Anything To Do With

from the that's-not-right dept

Mon, Jun 25th 2012 2:32pm — Mike Masnick

We'd pretty much thought that the Righthaven saga was over. After all, the company had gone into receivership back in December, and the court-appointed receiver had been auctioning off what little assets the company had in an attempt to satisfy all of the court-ordered attorneys' fees that Righthaven owed to the lawyers of some of the many defendants that Righthaven sued for copyright infringement on a repeatedly-rejected legal theory. At the same time, the CEO/founder of Righthaven, Steve Gibson had stopped showing up in court, had taken another job, and was being investigated by the Nevada State Bar.

As far as the court-appointed receiver, Lara Pearson, knew, Gibson and his wife Raisha "Drizzle" Gibson (who had been "COO" of Righthaven) no longer had anything to do with the company.

And then... she discovered that Gibson had somehow secured another law firm to supposedly represent "Righthaven" in its appeal of the Hoehn case (the first of the big losses that resulted in attorneys' fees being owed). That firm apparently tried to file some documents in the appeal six months late. This was quite a surprise, and Pearson reacted, as she should, by sending notices to both Gibsons, to the law firm that they employed and to the court explaining why this was ridiculous. In the letters, you can tell that Pearson is quite reasonably angry with the Gibsons, whom she reminds no longer have control over the firm, and makes it explicit to them that they were fired back in December. On top of that, she explains her intent to take legal action against the Gibsons for legal malpractice:

Your actions have caused, and continue to cause ongoing harm to Righthaven and its finances. To put an end to this damage and prevent future harm, I hereby remove any and all authority for you to act on behalf of the company, and formally place you on notice that the company will be taking legal action against you for your ultra vires acts as well as for claims of legal malpractice, which led the company to its current state.

.... Recently, it has come to my attention that you engaged the services of Miller Barondess LLP in Righthaven v. Hoehn.... I was neither informed of nor did I authorized this action, nor did I authorize any expenditure. Engaging yet another law firm and pursuing an appeal that both the Ninth Circuit and the District of Nevada have declined to find has a substantial likelihood of success is not in Righthaven's best interest...

Presently, Righthaven must satisfy more than $350,000 in judgments entered against it.... For you or anyone else acting on behalf of Righthaven to incur new fees or engage in any activity other than mitigating these liability is directly contrary to the company's best interests.

[....] To be clear, you are fully terminated from any position with Righthaven LLC. You are prohibited from taking further action on its behalf, and may not hold yourself out as an officer, employee, or representative of the company. Any further actions you purport to take on Righthaven's behalf shall be met with requests for injunctive relief and personal sanctions...

The letter to the law firm that Gibson retained is equally direct:

Mr. Gibson does not and has not had authority to enter new contracts and incur new expenses for the company, which presently must satisfy more than $350,000 in judgments entered against it.

I was unaware that Mr. Gibson had retained your firm until Mr. Hoehn's counsel inquired about this development and whether I had approved it. Mr. Gibson has no authority to act on behalf of Righthaven -- and even if he did, the act of pursuing this appeal would add further costs onto Righthaven's already substantial debts -- which I would not have approved... I demand that you cease all billing activity immdiately. I also demand that you provide me with a full accounting of all funds in trust for Righthaven.... All future actions taken with respect to Righthaven require my approval, as I am the only person with the authority to make decisions on Righthaven's behalf unless and until my receivership is terminated.

Finally, in the filing with the court, Pearson notes that this action indicates that Gibson has been hiding certain Righthave funds/assets:

Instead of satisfying Righthaven's substantial judgments, Gibson has elected to allocate Righthaven funds that have been concealed from me to pursue appeals over rights that Righthaven no longer owns, and has done so in a manner that further imperils what is left of Righthaven's assets with additional attorneys' fees awards and sanctions.

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Filed Under: lara pearson, steve gibson
Companies: righthaven

34 Comments

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Jeff (profile), 25 Jun 2012 @ 2:16pm

Well, if according to the US Supreme Court, corporations are people, then they can also die. It also follows that once dead, they can become undead - thus bringing about the zombie apocalypse without any people actually having to die!
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average_joe (profile), 25 Jun 2012 @ 2:40pm

Good grief. LMAO @ Gibson.
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Bill W (profile), 25 Jun 2012 @ 2:49pm

Wow! One wonders how he gets his pants over those cojones!!
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Deirdre (profile), 25 Jun 2012 @ 2:52pm

Gibson reminds me of the last boss I had. The joke in the office was that he didn't pass the bar. he sneaked under it.
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DannyB (profile), 25 Jun 2012 @ 2:58pm

Here's a clue . . .
When you're an a-hole . . . STOP DIGGING !

(pssssssst . . . Carreon, you should heed that advice also.)
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Joe Publius (profile), 25 Jun 2012 @ 3:03pm

You know, if I was as foolish to go through what the Gibsons went through, and then got the boot from Righthaven, I would have considered it a relief. I mean, who would really want the hassle of being the one who has to dismantle a business that is essentially assets-on-the-hoof? The mind boggles.
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Anonymous Coward, 25 Jun 2012 @ 3:07pm

Someone should check on Gibson. Maybe he's lost his marbles. Maybe he still thinks he's the CEO, and that Righthaven's still doing well...
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ricebowl (profile), 25 Jun 2012 @ 3:10pm

No one told me it was crazy-lawyer month again...
So, we've got Carreon digging himself into the depths of insanity, the Gibsons coming back into the crazy...I'm scared to look outside in case Jack Thompson turns up to play too.

It's sort of like a legal-zombie movie...
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fogbugzd (profile), 25 Jun 2012 @ 3:14pm

Righthaven and Carreon are gifts that keep on giving.
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The eejit (profile), 25 Jun 2012 @ 3:17pm

Re: No one told me it was crazy-lawyer month again...
No, because a legal zombie movie would have no deaths in whatsoever. However, the legal fees would be lethal...
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Overcast (profile), 25 Jun 2012 @ 3:26pm

Do they own the copyright on 'poetic justice'? :)
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Anonymous Coward, 25 Jun 2012 @ 4:04pm

Zombies
Which weapon would you use on these zombies?

I'm orientated toward the AR-15...

http://www.gunsandammo.com/2011/11/15/the-8-best-guns-for-zombie-killing/
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TtfnJohn (profile), 25 Jun 2012 @ 4:26pm

Re:
Gibson has marbles a-plenty. Thing is he's thinking with them if you could call it that. It seems that being a troll is a hard role to give up.
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Anonymous Coward, 25 Jun 2012 @ 4:36pm

If you were ever intent on providing the Bar with evidence of your lack of character and unworthiness to be a member of that association, it seems Gibson just can't stop with things are they were. I can't help but think when the the Bar considers this new data with the old, it will be a slam dunk case to eliminate his license to practice law.
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F!, 25 Jun 2012 @ 4:49pm

Re: Here's a clue . . .
I came here to say this, it's our first opportunity to use "The Carreon Effect" outside of Carreon himself...
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F!, 25 Jun 2012 @ 4:51pm

Who knew trolls could act?
This is just unreal. Clearly this must be performance art. I'm on to you, Gibson!
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Jeffrey Nonken (profile), 25 Jun 2012 @ 5:33pm

I'd say that The Gibson Effect has a chance to beat out The Carreon Effect for doubling-down on hole-digging.

And Gibson did start first.
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Anonymous Coward, 25 Jun 2012 @ 5:45pm

Re:
But the wordplay on Carreon is much better.
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Eventos Rancagua, 25 Jun 2012 @ 7:17pm

my opinion
Wow...Good grief...This is just unreal....;)
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G Thompson (profile), 25 Jun 2012 @ 7:19pm

Re:
So you're saying that Gibson is a zombie and/or Righthaven is part of the Umbrella corporation?

That means that Ms Pearson would be Alice or Jill Valentine??

No wonder she's so awesome!
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Anonymous Coward, 25 Jun 2012 @ 7:36pm

Re:
If the receiver considered him fired as of the date she was appointed receiver, she probably should have told him that. Apparently he had no idea that he wasn't CEO. That's the kind of information you usually give someone directly, rather than just assume they know it. Not sure what she was thinking there. It's a shame too that Randazza and the receiver are so anxious to kill this appeal. The brief (starting on page 42 of the document embedded in the article) nails it. The court can't find it lacks subject matter jurisdiction and then render a judgment on the merits. You can't have it both ways. Regardless, the fair use analysis done by the court was very, very sloppy.
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That Anonymous Coward (profile), 26 Jun 2012 @ 12:33am

Gibson was just hoping that the court would give Righthaven more guidance.
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DataShade (profile), 26 Jun 2012 @ 12:39am

They really *do* always come back to the scene of the crime.
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wilkinsy (profile), 26 Jun 2012 @ 3:36am

as Eddie implied I'm blown away that a person able to profit $7977 in four weeks on the internet. did you look at this site http://thinfi.com/7py
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JustMe (profile), 26 Jun 2012 @ 4:23am

Re: Re: Here's a clue . . .
Bravo!
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Anonymous Coward, 26 Jun 2012 @ 6:16am

Re:
This entire thing makes no sense.

Your company has been dismantled b/c it was out of cash with substantial debt, you've been fired, you lost majorly in multiple court killing your entire business model, your companies name is synonymous with "stupid" and "incompetent" lawyers, the state bar has turned against you... and you want to fight for it now?

When you claimed you & your (former) company had no money?

This is absolutely the dumbest thing I've heard in ages.
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Beta (profile), 26 Jun 2012 @ 6:24am

one case is not a syndrome
It can't be The Gibson Effect unless someone else also does it, and honestly I don't think anyone will ever match Gibson.
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Anonymous Coward, 26 Jun 2012 @ 6:29am

I just don't understand what he was thinking when he hired this new law firm and filed an appeal? Did he think no one would notice? What about the funds he is using to pay for this that should be going to the debts owed? It boggles the mind.
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Fake Bob, 26 Jun 2012 @ 7:23am

I didn't read the article but why are you giving Mel Gibson such a hard time?
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Anonymous Coward, 26 Jun 2012 @ 11:56am

Re: Re:
Nice try Gibson.
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Anonymous Coward, 26 Jun 2012 @ 12:40pm

Re: Re:
Apparently he had no idea that he wasn't CEO. That's the kind of information you usually give someone directly, rather than just assume they know it.

I know, right? I mean Righthaven was just forced into receivership, and Cuban is only a lawyer - how can you expect a lawyer to know anything about the law!?!? That's just crazy talk!
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Anonymous Coward, 27 Jun 2012 @ 7:21am

Re: Re: Re:
Not Gibson, average_joe. I read through the entire thing embedded with the article, and those were my thoughts.
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Anonymous Coward, 27 Jun 2012 @ 7:22am

Re: Re: Re:
Having a receiver appointed does not mean that all officers lose their jobs. So, no, I don't get your point. Don't you think it's kind of weird that she just assumed that the CEO would know he no longer had a job? Seems like the kind of thing you discuss rather than assume.
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Niall (profile), 27 Jun 2012 @ 7:33am

Re: one case is not a syndrome
No, the 'Gibson Effect' should be where one turns from a much-loved movie star into a loud-mouthed, racist/anti-semitic boor.
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