Lawyers Going After Charles Carreon Increase Their Request To $40,000 In Attorneys' Fees Owed

from the get-some-popcorn dept

Last week, we noted that the case of a parodist blogger against Charles Carreon concerning Carreon's threats to wait the blogger out and sue at a later date was mostly over, after Carreon effectively threw in the towel, and admitted that his legal threats were completely empty and he wouldn't pursue the blogger. However, we noted there was still the issue of attorneys' fees. Carreon argued that his settlement offer included an offer of $750 to cover the filing of the lawsuit, and that by accepting it, any other fees were then out of discussion. The public interest lawyers representing the blogger, Paul Levy and Cathy Gellis, pointed out that's not how this works, and noted that they were owed closer to $5,000. And, now, they're ratcheting that up. In a new filing, highlighted by Adam Steinbaugh, they're explaining why Carreon should be on the hook for $40,115, mostly due to Carreon's own actions.

Moreover, although the "groundless or unreasonable" test is an objective one, defendant's conduct shows that he was fully aware that he had no basis for claiming trademark infringement. He refused to waive service of summons because, he said, he did not want to have to defend the litigation, and indeed he thumbed his nose at the efforts to serve him, saying that he was deliberately not going to "expose [him]self to service." Once service was effected, he refused to pay the expenses of service, supposedly because he was going to file a motion to dismiss the complaint, forcing plaintiff file a motion seeking an award of a few hundred dollars in expenses; plaintiff also sought an award of attorney fees for having had to file this motion. And then, when defendant saw that his escape routes had been cut off— that he had been served, and that plaintiff was not going to let him out of the case—he simply dropped his trademark claims unconditionally and offered judgment. Mr. Carreon's course of conduct speaks volumes about his evident recognition of the fact that his claims were meritless; he provides no reason for believing that his decision to drop them was occasioned by anything that he had learned about the merits during the course of the litigation.

Finally, although the groundlessness of the infringement and cybersquatting claims is alone sufficient to support an award of attorney fees under Ninth Circuit precedent, in circuits with a higher standard for finding cases exceptional, a litigant's oppressive conduct is one of the factors considered in support of fee awards. ... Although plaintiff's counsel tried to steer Mr. Carreon away from his threats of litigation, Mr. Carreon responded by ramping up his threats, trying to put the blogger in fear of significant financial liability by, for example, warning that he would seek statutory damages of $100,000... and would employ counsel instead of proceeding pro se for the precise purpose of running up the blogger's liability for attorney fees... he also boasted of his reputation for "litigating appeals for years." ... Once the litigation was filed, and while he was refusing to submit to service, he sent a letter to Mr. Recouvreur's employer,... which might have caused trouble at work for Mr. Recouvreur, by threatening to hold the employer liable for the conduct of its employee, and in any event to impose invasive document preservation requirements.

And after Mr. Carreon was finally served, he tried to threaten his way out of being held responsible for his baseless threats by making an additional threat to sue the employer of plaintiff's lead counsel, unless counsel induced his client to settle on the terms that Mr. Carreon demanded.... Mr. Carreon's decision to offer judgment giving plaintiff his complete success on the merits is perhaps an item in Mr. Carreon's favor in judging his litigation conduct, but in its entirety Mr. Carreon's litigation conduct was sufficient oppressive to form yet another factor in support of a finding that his case was exceptional.

Steinbaugh also notes a few interesting points. There's an indication that the plaintiff may also go after Register.com for exposing the parodist's name. Furthermore, Steinbaugh points out how ridiculous it is that Carreon complains in his last filing about people online wishing him ill-fate, and saying that he will "never inveigh against anyone in the public forum by deriding their character as others have mine." That, of course, is funny, given that his wife, who once claimed that I was a "nazi scumbag" seeking to do "to Charles what they did to Jewish lawyers in Nazi Germany." Uh huh. And it's not like Tara and Charles have calmed down in this department lately. Steinbaugh points out that Tara Carreon is now arguing that Matt Inman is partly responsible for the Newtown massacre. And then there's Carreon's Rapeutation.com site. The idea that Carreon somehow doesn't deride others' character in public isn't supported by the facts.

Separately, Paul Levy has blogged about the latest, providing more context, in which he also notes that Carreon's claims to the court that he never intended to take the blogger to court may actually make things much worse for Carreon, in that it may have opened him up to legal consequences from other venues, including Walgreens, the blogger's former employer, which Carreon threatened to drag into the lawsuit (which he now claims he never intended to file):

In trying to persuade me not to pursue the claim for attorney fees on the merits, Carreon claimed that the suit for a declaratory judgment was altogether unnecessary because, he claimed, he never would have sued for a trademark violation; if we had only waited, he said, we would have seen that.

If, in fact, Carreon never intended to pursue his threats to sue the blogger, that is perhaps the worst of all, not only because it means that Carreon has probably cost himself a great deal of reputational and financial harm for having a big mouth, but also because it puts him at significant risk of other legal consequences. For example, in addition to threatening to sue Register.com, Carreon threatened to sue Walgreens, the blogger's employer when the case began, demanding an extensive preservation of electronic records. We could not help thinking at the time that his real purpose was to try to drive a wedge between the blogger and his source of employment. If Carreon never intended to file such a claim, the blogger may have a claim for intentional intereference with contract, and perhaps Walgreens has a claim of its own for the expenses incurred in complying with potential data preservation obligations relating to an intentionally empty threat.

Oh, also, there may be ethics issues given how Carreon obtained the blogger's name, claiming it was for legal purposes, even though he now claims he never intended to file a lawsuit:

Moreover, if Carreon's current statement about his intentions last summer is true, there may be ethics consequences. After all, without having to file suit, he managed to intimidate the blogger's domain name registrar into placing the blogger's name into the public WHOIS record where other members of the public were able to see it; Carreon himself took advantage of the disclosure to feature the blogger's name publicly on his "rapeutationist" blog. And yet, Carreon now claims, he never intended to file the lawsuit at all.

The Federal Rules of Civil Procedure, Rule 26(b)(5) and the California Code of Civil Procedure, section 2031.285, both require a party who receives information that has been the subject of a claim of privilege to sequester the information pending a final ruling on the privilege. This rule has been applied to information obtained about the identity of an anonymous Internet speaker, and both an ABA Formal Opinion, and ethics rulings in some states, have taken the position that a violation of the obligation to sequester can constitute an ethical issue. Consequently, Carreon's insistence that he was never actually going to institute legal proceedings to vindicate his claim of trademark infringement outs him at risk of renewed disciplinary proceedings by the California and Oregon bar authorities.

Finally, on the point of whether or not further action will be taken against Register.com, as mentioned above, Levy notes that he's been trying to talk to Register.com about their policies, and that's going to determine the next steps:

Carreon's contention that he would never have followed through on his threats if legal action also reflects poorly on Register.com's craven release of the blogger's identity, albeit temporarily. While the case against Carreon was pending, we put Register.com on notice of a possible claim, perhaps a class action claim, for advertising (and charging extra for) a private registration service without providing any real safeguards against spurious claims demanding disclosure of the registrant's identity. We have tried to discuss with that company's counsel how they will handle cases like this differently going forward, and have postponed legal action to see whether such talks could be fruitful. But, to date, it has never been convenient for Register.com's representative to actually discuss its policies and procedures.

Now that the merits of the Carreon case have been concluded, we will have to see whether it is possible to avoid litigation on that aspect of the problem.

The case may be ending, but there are still plenty of loose ends.

Filed Under: attorneys fees, cathy gellis, charles carreon, ethics, paul levy