Court To Prenda's John Steele: Okay, Now We'll Sum Up How Much You Cost Taxpayers And Need To Pay

from the the-saga-continues dept

When last we left John Steele, one of the dynamic duo behind the massive copyright trolling scam once known as Prenda Law, he was being scolded by the 7th circuit appeals court (not the first appeals court to do so), for failing to abide by the court's own advice to "stop digging." But digging a deeper and deeper hole has always been in John Steele's nature, it seems. As we've mentioned in the past, Steele reminded me of a guy I once knew, who incorrectly believed that he was clearly smarter than everyone else, and thus believed (incorrectly) that he could talk and lie his way out of any situation if he just kept smiling and talking. That generally doesn't work too well in court -- especially when you're not actually that smart.

In that July ruling, the court upheld most of the money Steele and Paul Hansmeier were told to pay, and scolded them for directly lying about their ability to pay. It referred to Steele's "entire pattern of vexatious and obstructive conduct." However, as we noted, Steele kinda sorta "won" on one point, though even that win was a loss. One of the arguments that Steele's lawyer had made was that on the fine that the lower court gave him for contempt, the basis for that fine appeared to be under the standards for criminal contempt rather than civil contempt. Way back during oral arguments, the judges on the panel had asked Steele's lawyer, somewhat incredulously, if he was actually asking the court to push this over to be a criminal case rather than a civil one, and Steele's lawyer answered affirmatively.

And so, the court notes that the contempt fine "falls on the criminal side of the line," because "it was an unconditional fine that did not reflect actual costs caused by the attorneys’ conduct." So it tossed out the $65,263 fine, but noted that criminal contempt charges might still be filed (out of the frying pan, into the fire). Oh, and of course, it left open the idea that the lower court might go back and actually justify civil contempt fines. And it appears that's exactly what Judge David Herndon in the Southern District of Illinois has done. He's ordered Steele to show cause for why he should not be fined, and then details the basis for such a fine.

As a direct result of Steele’s misrepresentations, between January 29, 2014 and June 5, 2015, this Court expended a significant amount of time and effort addressing matters relating to Steele’s ability to pay the Fee Order. This includes the following: (1) reviewing, researching, and issuing orders resolving and/or reconsidering numerous motions stemming from the misrepresentations; (2) preparing for and holding hearings on February 13, 2014 (Doc. 123) and November 12, 2014 (Doc. 187); and (3) reviewing asset statements submitted by John Steele in support of his inability to pay claim.

Steele’s choice to make misrepresentations to this Court and to continue to press the issue of inability to pay necessitated all of the above. Steele’s misconduct resulted in an actual loss to this Court and, more importantly, to the tax payers. It is the tax payers who ultimately bear the cost of adjudicating Steele’s misrepresentations. See U.S. v. Dowell, 257 F.3d 694, 699-700 (7th Cir. 2001). Considering the real cost to this Court and to the tax payers, the Court may impose a sanction that compensates the taxpayers for the Court’s time....

The Court intends to impose a remedial sanction for the Steele’s misconduct, outlined in this Court’s June 5, 2015 Order (Doc. 199). The remedial sanction shall be a fine in an amount necessary to reimburse the Court for the costs incurred as a result of Steele’s misrepresentations to this Court....

So, yes, the tiny "victory" for Steele in having the contempt fine tossed out was short lived, as a new civil contempt fine appears likely to be on the way. And, who knows, perhaps criminal charges as well. Can't wait to see Steele try to talk himself out of this one too.

Filed Under: 7th circuit, anthony smith, contempt, david herndon, john steele
Companies: lightspeed, prenda, prenda law

Prenda (Mostly) Loses Again; Court Says 'We Warned You To Stop Digging, But You Still Did'

from the first-rule-of-holes dept

Here's a quick lesson in reading judicial opinions. If this is how the ruling on your appeal starts out, things did not go well:

When last we considered John Steele and Paul Hansmeier’s challenges to contempt sanctions imposed on them, we gave them some friendly advice: stop digging.... Apparently they did not realize that we meant what we said. Hoping to avoid paying additional sanctions, they dissembled to the district court and engaged in discovery shenanigans.

And, yes, this is the latest in the still ongoing Prenda saga. Specifically, this is the appeal in the Lightspeed case, one of a few "main" cases where Team Prenda (John Steele, Paul Hansmeier and the late Paul Duffy) got completely slammed by courts for lying and other dishonest and sketchy behavior. Prenda lost big back in 2013, but kept lying. The judge then slapped them with huge fees. On appeal, the 7th Circuit smacked Prenda down again, and (as you probably surmised from above) explained the "rule of holes" to Prenda:

The first rule of holes, according to an old saying, is to stop digging. The two appeals before us bring that to mind, for reasons that will become apparent.

The case went back to the lower court, where the judge hit Team Prenda with sanctions for its behavior, including contempt, and then added on attorneys' fees for good measure.

Because Steele and Hansmeier can't help themselves, they appealed again, leading to this latest ruling. Believe it or not, Steele actually may be temporarily happy with this latest ruling as he actually won on one point (but may lose even bigger in the long run). Still, the court is clearly not happy with either Steele or Hansmeier. It does note that since Hansmeier has filed for a (highly questionable) bankruptcy, he cannot pursue the appeal and thus his appeal is dismissed out of hand.

Steele's appeal, however moves forward. And he still mostly loses and the court doesn't miss opportunities to slam Steele:

Steele offers only the weak argument that Smith should have obtained and submitted this evidence earlier, and that Smith’s lack of diligence should cut off this line of inquiry.... This approach has little but chutzpah—a quality that Steele and his compatriots have long demonstrated—going for it. To begin with, it was Steele and Hansmeier’s actions that prevented Smith from obtaining the necessary evidence in time for the November 12, 2014 hearing. (Indeed, Steele and Hansmeier maintained at the hearing that Smith should receive no further discovery because he already had all the relevant documents in his possession.) Steele’s misrepresentations and Hansmeier’s motion to quash delayed Sabadell’s production regarding Steele’s finances until November 17, 2014. The district court denied Smith’s motion the next day. Meanwhile, Smith first sought discovery regarding Monyet from TCF Bank on March 24, 2014. Because of Hansmeier’s second motion to quash and initially incomplete production, Smith was unable to obtain it until February 2015.

Steele nonetheless says that Smith should have found the relevant documents earlier because Monyet’s existence was “public record” in 2010, and the relevant documents were attached as exhibits to a debtor’s exam in a Minnesota bankruptcy case in June and July 2014. The fact that Monyet’s existence was public record is of little import: Smith had no reason to know of its existence, let alone any way to know of Hansmeier’s control of the company or the transfers Hansmeier made from its Scottrade account. Moreover, Smith was not a party to the Minnesota bankruptcy case. The district court did not abuse its discretion in granting Smith’s motion to reconsider.

The court notes that the sanctions on Steele are "easy to justify" given "Steele's entire pattern of vexatious and obstructive conduct."

And that included deliberately seeking to hide his and Hansmeier's money just as the sanctions were being ordered:

This was the very time when Steele and Hansmeier were emptying accounts they controlled of sums vastly in excess of the sanctions they owed. This was obviously egregious behavior, and a flat violation of the district court’s order. Their actions necessitated Smith’s litigation over their ability to pay the sanctions. Smith’s compensable expenses reasonably reached back to his first round of third‐party subpoenas, issued on January 16, 2014, as the district court found.

The one point that Steele won on, however, was on the contempt fine. Steele had argued that it was issued as a form of criminal contempt, rather than civil contempt, and there are different standards there. After looking it over, the appeals court appears to reluctantly agree.

Examining the nature of Steele’s fine and its justification, we are convinced that it falls on the criminal side of the line. It was an unconditional fine that did not reflect actual costs caused by the attorneys’ conduct. The district court justified the fine of $65,263.00 solely by reference to the attorneys’ “contemptuous statements in court.” This number, the court commented, was “twenty‐five percent of Judge Murphy’s original sanction.” It added that a “pattern is purposefully developing whereby the contemnors could find their way back to the full sanction … for their original wrongdoing if they continue their misdeeds before this Court.” This justification most naturally supports a fine meant to vindicate the authority of the court and deter future misconduct, not an award designed to be compensatory or coercive.

It is also telling that the amount of the fine was not connected to any cost imposed on either Smith or the district court. The court meant instead to punish past behavior and to deter future contemptuous conduct. Nor was the fine tied to any specific future action. While Lightspeed I found a fine quantified without reference to billing statements to be a civil contempt, the fine there “corresponded to attorneys’ fees and costs incurred by defendants during the course of litigating the contempt motion.” ... That is not the case here: the district court said nothing about Smith’s costs. It had taken care of the costs attributable to the separate discovery sanctions in a separate part of its order.

Of course, this small victory may be short-lived:

We make no comment on what type of contempt Smith may wish to seek, whether the court might re‐consider the possibility of civil contempt, or whether criminal contempt could be justified once the proper procedures are followed. We are confident that the district court will take a fresh look at these questions in light of this opinion.

This issue actually came up during the original appeal, when the judges on the 7th Circuit, somewhat incredulously, asked the lawyer representing Steele and Hansmeier if he was really asking for the courts to consider if Steele and Hansmeier had committed criminal acts when it had already focused solely on civil ones. And, now, Steele, at least may find himself in a deeper hole because of this. That's what happens when you keep digging.

Filed Under: 7th circuit, anthony smith, copyright troll, john steele, paul hansmeier, rule of holes
Companies: lightspeed, prenda, prenda law

Team Prenda Smacked Around Again, Ordered To Pay Another $94,000

from the punching-bags dept

It appears that the courts are now just piling on when it comes to Prenda Law. In the case of Lightspeed v. Anthony Smith, the court that was one of the first to call out team Prenda for "flat-out lies" and then blasted their weak attempt to plead poverty -- leading, instead, to holding Team Prenda in contempt -- has struck again. Having lost badly on appeal, the district court slammed the lawyers again, arguing that Team Prenda lied to the court and obstructed the discovery process concerning where they hid their money. It ordered sanctions of $65,263 and asked Smith's lawyers at Booth Sweet to submit their costs to be added on to the total. Those costs came out to $94,343.51 -- and Prenda lawyers John Steele and Paul Duffy complained that the number was unfair.

Not surprisingly, the court is not buying what Steele and Duffy are selling:

Steele objects to the submitted expenses.... Steele’s objections are not well taken. As is customary for Steele, his objections minimize his misconduct and distort the facts of the case. For the reasons discussed herein, the Court finds that all of the submitted expenses are reasonable and recoverable. The Court awards sanctions against Steele and Duffy in the amount of $94,343.51, apportioned equally between Steele and Duffy. The sanctions shall be paid on or before August 10, 2015.

Note that this filing came out on August 10th. So the judge, David Herndon, basically said pay up now.

This litigation has been entirely frivolous. Moreover, Lightspeed’s counsel’s falsehoods and obstructionist tactics have created significant costs for Smith. The Court agrees that the submitted expenses, costs and fees are eminently reasonable given the history of this litigation and the more than a year Smith spent defending against obstructionist tactics and engaging in extensive discovery to obtain proof of Duffy and Steele’s misconduct.

Of course, with more and more of these types of rulings piling up, it still raises questions as to how the lawyers of Team Prenda are still allowed to practice law -- with both Steele and Paul Hansmeier having moved on to a very similar scam in shaking down small businesses over seemingly trivial ADA violations.

Filed Under: anthony smith, contempt of court, david herndon, john steele, paul duffy
Companies: lightspeed, prenda, prenda law

Unsealed Motions Shows How Team Prenda Sought To Hide Money

from the can't-have-anyone-find-this-cash,-could-we? dept

Back in April, we wrote about a really enraged John Steele (famous for his likely leading role in the Prenda scam) angrily hitting back against a sealed motion for contempt against him, arguing that he was lying and hiding assets in his attempt to plead poverty, after a court ordered Team Prenda to file detailed financial statements. They did not do so. Instead, as the court noted:

In the case where there has been no attempt to comply with the Court's order, plaintiff's counsel must show a "complete inability to pay." ... Plaintiff's counsel, "stated differently, . . . [has] the burden of establishing clearly, plainly, and unmistakably that compliance is impossible." ....

The Court finds that plaintiff's counsel has not met its burden. They submitted incomplete, and to say the least suspicious, statements of financial condition. Attached to each statement was a letter from their certified public accountant ("CPA"). In these letters, the CPA indicates a departure from generally accepted accounting principles. He further notes that plaintiff's counsel elected to omit substantially all of the disclosures required by generally accepted accounting principles. The Court finds these statements insufficient to establish plaintiff's counsel's inability to pay.

Following that, lawyers Dan Booth and Jason Sweet filed the motion that got Steele so angry -- highlighting significant evidence that Steele and others had hid money offshore. Steele hit back at that, with little effect, and, as Fight Copyright Trolls now alerts us, the original filing that reveals some of Steele's financial shenanigans has been unsealed. Not surprisingly, it paints a picture of a lot of "shell games" for how the money was moved around. Here's just some of the details:

1. On December 13, 2011, Steele opened a CitiCard account. In the application for the account he identified his income amount as $900,000.00 and his total income for 2011 as $930,000. See Exhibit A hereto.

2. A statement from Fifth Third Bank shows that Steele had $2,177.005.27 in personal savings accounts there on September 5, 2012. See Exhibit B hereto. By September 25, 2012, two deposits totaling that amount had been transferred from Steele’s personal account into Prenda’s IOLTA account. The remainder of that money was then wired to an unknown destination the next day. See Exhibit C hereto.

3. On December 18, 2012, Prenda Law, Inc. (“Prenda”) paid out $5,000.00 to McCullough Sparks, an asset protection law firm located in Provo, Utah. See Exhibit D hereto. McCullough Sparks promotes its key service as the “541 Trust,” which “removes assets from your personal ownership and from any disclosure of your personal assets. It is a private document and it cannot be discovered through any public records.” See Exhibit E hereto. A CPA would not know about such a trust unless Plaintiffs’ Counsel disclosed it to them.

4. Plaintiff’s Counsel brought this case, like hundreds of others, as part of their coercive litigation settlement practice. See Dkt. No. 61 pp. 14-19. Between 2010 and 2013, when that practice was at its height, BluePay, one of several online credit card processors they used to process settlements from Doe defendants, processed more than $4.4 million in settlement monies, paid out to Prenda, Steele Hansmeier PLLC, Media Copyright Group, LLC, and LiveWire Holdings, LLC. See Exhibit F hereto; see also Dkt. No. 124 p. 4 n.3 (detailing relationships between Plaintiff’s Counsel and these and other non-parties).

5. Smith’s subpoenas sought information about eighteen closely related non-parties. See Dkt. No. 116-1; Dkt. No. 124 p. 4 n. 3. The non-parties opened at least forty-seven bank accounts in just two of the banks subpoenaed since 2010, and have closed all but a few of those accounts. Several of these accounts were opened and shut so quickly as to suggest that Plaintiff’s Counsel have transferred monies between accounts and related entities in a deliberate attempt to obscure its sources and their current holdings. For example, on August 13, 2012, Steele withdrew $29,924.56 from Media Copyright Group, LLC. See Exhibit G. He then opened two Fifth Third Bank accounts in his personal name the same day, depositing $27,924.56 into the account identified in Exhibit H and $2,000 into the account identified in Exhibit I. He then closed the account in Exhibit H on September 25, 2012, transferring all its funds into the other account in Exhibit I, which he closed on January 7, 2013 (after transferring $1,000 to Prenda Law, Inc. on October 2, 2012.).

6. Likewise, on December 15, 2011, John Steele transferred $159,000 from his personal account to that of Steele Law. See Exhibit J. That same day, Steele Law transferred $160,000 into the account of Miami Beach Consulting (“MBC”). Id. MBC is a business owned by John Steele’s wife, Kerry Steele (neé Eckenrode). See Exhibit K. Four days later, $150,000 of that money was wired to an unknown destination via Sabadell Untd. Bank, a subsidiary of Banco de Sabadell, S.A. and provider of international banking services.6 Miami Beach Consulting’s account was closed two months later. See Exhibit L.

7. Duffy and Steele are the two signatories Prenda’s IOLTA and operating accounts with Fifth Third Bank. See Exhibit M hereto. This tends to refute Steele’s repeated denials that he has an ownership interest in Prenda.7 Similarly, and despite his denials otherwise, Paul Hansmeier was a partner in Media Copyright Group (a/k/a/ 6881 Forensics), the IT firm which Plaintiff’s Counsel used to identify alleged infringements. A check made out to Media Copyright Group from Alpha Law and signed by Hansmeier clearly states “capital contribution” “for 50% interest” See Exhibit N hereto.

In the footnotes, it also highlights that the use of "Steele Law" for transferring money is especially suspect, given that Steele claimed that Steele Law was gone as an entity ten months earlier. The filing also discusses money transfers to Latvia, combined with evidence that Steele had been reading about hiding money in Latvia with a program designed to get you a Latvian passport and citizenship.

It's still somewhat circumstantial evidence, but as FCT notes, it's somewhat surprising that Steele apparently missed the deadline to try to keep this particular document sealed...

On top of that, in a second filing, even more questionable moves are revealed. Again, just a snippet:

A. Sabadell Bank.
Smith has identified transactions between accounts owned by Steele and Sierra Investment Partners (“Sierra”) totaling $212,125.00. See, Ex. Q. Sierra is a business Steele co-owns with Robert Balzebre that maintains an account at Sabadell Bank. See, Ex. R. Mr. Balzebre has been involved with Steele in several business ventures going back to 1997—including Steele Hansmeier. See Ex. S. Continued discovery would clarify the true extent of Steele’s financial holdings.

B. ING.
Hansmeier transferred at least $62,979.00 into an account at ING (now owned by Capital One). See Ex. T. Similarly, Hansmeier has transferred $515,000 to Monyet LLC with the notation that such checks were for “estate planning.” See Ex. U. Smith can only surmise that Monyet’s account(s) may also be found at ING. Said company has no discernible address, officers, employees, products or services—but a transfer from Livewire indicates who the owner is: “Monyet/Paul Robert Hansmeier.” Id.

C. Pershing, LLC.
Steele’s frenzied attempt to prevent GMS Group, from complying with discovery though Smith has not yet subpoenaed them, is now understood. Dkt. No. 158. Documents produced by Pershing include statements from GMS Group. Pershing is a clearing firm for GMS Group, and while it has in its possession some documents from GMS Group, it by no means has them all. What Smith was able to obtain indicates Steele transferred via GMS Group in excess of $200,000.00 to various accounts, and under at least two other of his business aliases/shell companies to banks with branches in the US, UK and Canada. See Ex. V.

Remember how, among other things, Judge Wright had referred Team Prenda to the IRS? I wonder if they'll be interested in some of these transactions....

Filed Under: anthony smith, john steele, laundering, money, paul hansmeier
Companies: prenda, prenda law

Appeals Court Smacks Down Team Prenda... Again

from the still-waiting-for-the-truth-to-come-out,-huh? dept

Back in April it seemed fairly clear that the 7th Circuit Appeals Court panel set up to hear the Prenda appeal of the Lightspeed v. Anthony Smith case was not impressed by Team Prenda. I mean, when a judge directly states "there's a lot of shell games going on here" and also points out that it's "shocking" that the lawyer representing Prenda has no idea about the relationship between Prenda, Alpha Law and Steele Hansmeier (a central issue in the case), you expect that the eventual ruling is going to not go well for Team Prenda, but you never really know until the ruling comes out. It has come out. And it is not good news for Team Prenda. Any time a ruling starts off with the following, you know you're going to be in for a good ride:

The first rule of holes, according to an old saying, is to stop digging. The two appeals before us bring that to mind, for reasons that will become apparent.

Yes, a failure to "stop digging" has long been a major fault many of us have associated with Prenda "mastermind" John Steele, and the judges clearly see that as well. They go through the history of the case, highlighting a bunch of questionable moves by Steele and Paul Hansmeier in demanding names from ISPs and using a bunch of questionable legal claims in the original lawsuit, and pretty quickly get at the "shell games":

At the same time, Hansmeier submitted a motion for pro hac vice admission; he did not identify a law firm on the form. Steele entered an appearance in which he listed his firm as Prenda Law. The firm affiliations, however, turned out to be provisional, to put it kindly. At the emergency motion hearing, Steele identified his firm as Steele Hansmeier PLLC, Duffy said that he was with Prenda Law, and Hansmeier was with something called Alpha Law Firm. Steele Hansmeier and Prenda are listed at the same street address, 161 North Clark Street, in Chicago, in different suites.

Later, the court notes dryly that when Hansmeier submitted a motion to withdraw, he did so "without indicating which firm he was with." The court then notes how Team Prenda was engaged in similar shenanigans elsewhere, citing the famous smackdown from Judge Otis Wright in California.

Then we get to the meat of the appeal. First, the silly claims (tried repeatedly) from Steele and Hansmeier that they were never properly informed about Smith's motion for sanctions. The court doesn't buy it. At all:

The record, however, does not support them. First, as the district court concluded, even if we assume that they did not have notice originally, that defect was cured when the district court granted rehearing on the sanctions issue. Indeed, in their briefs before this court, Steele and Hansmeier seem to concede as much. Their complaint has shifted to one focusing on the adequacy of their opportunity to respond. It is too late to change theories, however, and in any event, the district court correctly ruled that whatever procedural flaw there may have been was fully corrected by affording a new opportunity for a hearing. Finally, they received adequate notice in the first place.

The court further notes that the attempts by Steele and Hansmeier to claim that even if Duffy was properly notified it doesn't mean they were ring pretty hollow, given how the three of them keep collaborating and using the ever-shifting names of each other's law firms:

Duffy received notice, he was in charge of Prenda Law, and there was evidence that both Steele and Hansmeier were working for Prenda as well. While appellants huff that the district court “wholly gloss[ed] over the fact that Hansmeier noticed his appearance in the case for Alpha Law Firm, not Prenda Law,” the district court had ample reason to find the Prenda/Alpha distinction illusory at best, fraudulent at worst. Two days after Steele moved to withdraw from this case, he declared in another action that he was “of counsel with the law firm, Prenda Law, Inc.” and that Hansmeier was “also of counsel to the firm.” ... And this is to say nothing of the fact that at least once Hansmeier indicated in this case that he was of counsel to Prenda.

And, that's not all. The court unpacks a bunch of the connections:

A quick look at publicly available documents supports the district court’s finding that service on Duffy also accomplished service on Steele and Hansmeier. In its application for authorization to transact business in Florida, Steele Hansmeier, a Minnesota corporation, listed its mailing ad‐ dress as 161 N. Clark St. No. 3200, Chicago, IL 60601. Paul Hansmeier is listed as Manager and his address is listed as 1111 Lincoln Rd., Suite 400, in Miami Beach, Florida....

Interestingly, 161 N. Clark St. Suite 3200 is also listed as the principal place of business for Prenda Law, Inc., in its 2011 application for authorization to transact business in Florida. Its registered agent, Mark Lutz, uses the same Miami Beach address as Hansmeier did in the Steele Hansmeier application.... Alpha’s connection to Steele Hansmeier and Prenda shows up in a search for Steele Hansmeier on Minnesota’s business filing site. There, Steele Hansmeier lists its registered address as 80 S. 8th St. #900 Alpha Law Firm, Minneapolis, MN 55402.

In conclusion, the court basically calls "bullshit" on Steele and Hansmeier:

Little more need be said. We are disappointed that the appellants’ own attorney, Daniel J. Voelker, was either unable or unwilling to tell us at oral argument about the precise relationship between Prenda and Alpha Law, despite its relevance for the issues on appeal. No matter: we have enough to conclude with confidence that notice to Duffy was reasonably calculated to apprise Steele and Hansmeier of the pendency of the motion. For the icing on the cake, we add that the district court also found that Steele received actual notice via email. Smith sent notice to the email address that Steele shared with Duffy. While Duffy argues that after he withdrew from the case he did not receive those emails, the district court did not find him to be credible. We have no reason to upset that assessment.

The ruling seems to be dripping with that kind of sarcastic understatement. The court then takes on the claim by Steele and Hansmeier that they were never given an opportunity "to be heard" in response to Smith's motion for sanctions. Again, the court says "yeah, right."

Once again, the record belies their assertion. As we have noted, they had adequate notice of the hearing. Duffy submitted a memorandum in opposition to Smith’s motion, but Steele and Hansmeier did not. Nonetheless, the court gave all three appellants another opportunity to be heard on the matter after they submitted motions to vacate or reconsider the order granting Smith’s request for attorneys’ fees. Before the rehearing, Steele and Hansmeier both submitted briefs in opposition to Comcast’s fees. They chose not to submit additional briefs (apart from what was presented in the motion to vacate or reconsider itself) on any other aspect of the order

At the hearing Hansmeier explained in detail why he thought that sanctions should not be imposed against him; Steele spoke as well. This more than sufficed as an opportunity to be heard.

The court then turns its attention to Duffy. Duffy whined that he wasn't given an opportunity to respond to the lower court's decision granting fees to ISPs. Remember, in this case Team Prenda made the incredibly stupid decision to drag Comcast and AT&T into this lawsuit, after those two companies refused to just cough up names of people. Both companies decided to go after fees from Team Prenda, which they got. Duffy claimed that he never had a chance to respond to the motion for fees. The court, once again, points out that this is hogwash (or, more specifically, "frivolous.")

While Steele and Hansmeier submitted timely memoranda in opposition to the ISPs’ motions, Duffy did not. He asserts that he was not given an opportunity to respond because the district court ruled on the motions before the time to respond expired under the court’s local rules. This argument is frivolous. Duffy does not cite any local rule for this point, and had he taken the time to look at the rules, he quickly would have realized that there was time to respond. The ISPs electronically filed their motions on November 8, 2013. The local rules allow 17 days for any response to electronically filed motions... The rules provide that “[f]ailure to file a timely response to a motion may, in the Court’s discretion, be considered an admission of the merits of the motion.”.... Duffy had until November 25, 2013, to submit his response, but he did not file anything. The district court granted the ISPs’ motion on November 27, 2013. Duffy had an opportunity to respond; he simply chose not to exercise it.

The court also rejects the claim from all three that they didn't have a chance to respond to the details of the fee itemization, noting that all three "had a full opportunity to respond to Smith’s itemization but chose to focus on other issues." The court does admit that they didn't really have a chance to respond to the ISPs' itemization, but says "we conclude that this error was harmless." It notes that no one has come close to suggesting that the ISPs' itemization was unreasonable. In fact, the court points out that one of Team Prenda's arguments is that Smith's itemization is much higher than Comcasts -- suggesting that they find Comcast's to be more reasonable.

From there, they move on to the main act: Team Prenda wants to overturn the main ruling against them. The court is, again, not impressed:

Appellants next throw a variety of arguments regarding the substantive ruling against the wall, with the hope that one might stick. None does.

The court notes that Team Prenda's use of the CFAA to try to route around copyright laws was clearly bogus. Even noting that the CFAA is ridiculously broad, the court notes that "this is a frivolous charge." The court also rejects Team Prenda's Hail Mary attempt to blame ISPs because people may have infringed on their service, an argument that is clearly blocked by the law (citing the DMCA's safe harbors, though probably could have used CDA 230 as well for the non-copyright claims).

To this day, the appellants have provided no support for the idea that every time an internet user does something unlawful online, the user’s ISP is unjustly enriched because it continues receiving subscriber fees from the malefactor. The law in fact is to the contrary. See 17 U.S.C. § 512(a) (a “service provider shall not be liable … for infringement of copyright by reason of the provider’s transmitting, routing, or providing connections for” material distributed by others on its network).

As for the claim that there was a conspiracy between all the defendants, including the ISPs because they refused to cough up info? Um, no.

These assertions are utterly without legal merit. The complaint lacks even the most rudimentary allegation of agreement that would satisfy federal pleading standards. In addition, a service provider does not risk becoming a co‐conspirator every time it challenges a subpoena. To argue that challenging a subpoena makes the ISPs co‐conspirators in a fictional copyright infringement ring is frivolous. Appellants’ theory is all the more outrageous given the fact that the Illinois Supreme Court quashed a functionally identical abusive subpoena.

The court basically agrees with everything the district court said about Team Prenda's scheming in deciding that they deserved to be sanctioned for their actions:

The district court similarly did not abuse its discretion in awarding attorneys’ fees to Smith from the inception of the suit. Lightspeed raised baseless claims and pressed for a meritless “emergency” discovery hearing. The district court found that the litigation “smacked of bully pretense.” At the November 13, 2013, hearing on fees, the court could not have been more clear: it stated that appellants were engaged in “abusive litigation … simply filing a lawsuit to do discovery to find out if you can sue somebody. That’s just utter nonsense.” We see no need to belabor the point. The record amply supports the district court’s conclusions, as our discussion of the case thus far demonstrates. There was no abuse of discretion in the court’s decision to grant either the ISPs or Smith fees for the entire case

So far, Team Prenda seems to be scoring a perfect zero, and their luck doesn't get any better as they move into challenging the fact that the court lumped all of them together in making them jointly and severally liable. Team Prenda didn't like it. The court says, deal with it:

Appellants begin by asserting that the district court misapplied section 1927 by holding them vicariously liable for each others’ actions. They are mistaken. While it is true that section 1927 liability is direct..., an order holding parties jointly and severally liable for costs after determining that each one is individually liable is a finding of direct liability.

Next, they contend that FM Industries, Inc. v. Citicorp Credit Services, Inc...., stands for the proposition that a lawyer cannot be held responsible for documents that bear another’s name but not his own. FMI, however, does not stand for such a broad proposition. There, we upheld sanctions against an attorney, but we found that they could not be levied against the copyright specialist retained by plaintiff’s principal counsel....

[....]

The relevant question thus relates to the scope of responsibility undertaken by each individual attorney. In our case, the district court found that while Steele and Hansmeier were not listed on every court document, the evidence showed that they were “in cahoots” with Duffy and worked with him to use the judicial system for a legally meritless claim. Their efforts seem to have continued in this court. While both Steele and Hansmeier now contend that they showed up in this case only after the federal proceedings were underway, the record shows that both were also involved in the shadows of the state court proceedings. Steele called AT&T’s counsel about the subpoenas, and he appeared and argued against the ISPs’ motion to quash and motion to stay. Hansmeier appeared at a conference before a magistrate judge and was the sole signatory of the 10‐page opposition to the ISPs’ motion for the stay of discovery. While Steele and Hansmeier insist that they had only minimal activity with this case, the district court did not abuse its discretion when it found otherwise.

And finally, the court takes on Team Prenda's appeal for their being found in contempt by the district court. As you may recall, after the original district court ruling that told them to pay $261,025.11, Team Prenda simply ignored it. They didn't pay. When hit with the contempt claim, Team Prenda tried to pretend that the sanctions were ineligible for contempt (by twisting the law and pretending it was a "money judgment" and not "sanctions") and then claiming they couldn't pay. This was when the court ordered financial statements from all of them, receiving documents where the CPA who prepared them flat out admitted that they "elected to omit substantially all of the disclosures required by generally accepted accounting principles." And thus, they were found in contempt, and Team Prenda appealed that too. Guess what the appeals court thinks of that? You're right.

Appellants try to evade it by arguing that they thought the order was for a money judgment. But this was neither private nor public litigation against the attorneys. What was at stake was the court’s power to govern its bar. As section 1927 (and for that matter 28 U.S.C. § 1651) reflect, courts have the authority, through contempt proceedings, to sanction attorneys and to enforce their orders.... The money‐judgment defense gets appellants nowhere.

Oh yeah, almost forgot. Team Prenda claimed there was no evidence that they didn't comply with the sanctions. The court laughs:

Appellants next argue that there is no evidence that they did not substantially comply with the order, or at least take reasonable and diligent steps to do so. This position ignores the record. At the show‐cause hearing appellants made clear that they had not paid anything and, when questioned about payment, they never pointed to any step in that direction. They elected instead to defend on the ground that they were unable to pay. Inability to pay is indeed a valid defense in contempt proceedings..., but the question whether the sanctions were paid is different from the question why payment was not made. The district court was entitled to answer the first one in the negative, given appellants’ admission on the record that they had neither paid the required amount to defendants nor posted a supersedeas bond.

What about the whole "inability to pay" thing? Yeah, guess what the court thinks of that. It simply notes that the burden of an inability to pay is a high one and it's totally on Team Prenda to prove -- and they totally failed to do that.

End result: appeals court basically calls bullshit on every single Prenda claim and upholds the original ruling and the contempt finding. It also notes that while it may have skipped over some of the many arguments Team Prenda threw against the wall "any arguments we have not discussed do not merit separate attention." Oh yeah, and the costs of the appeal are now to be added to the amount that Team Prenda has to pay up.

Filed Under: 7th circuit, anthony smith, john steele, paul duffy, paul hansmeier, team prenda
Companies: alpha law group, lightspeed, prenda, prenda law, steele hansmeier

Chutzpah: John Steele To Court: What, You Think I Would Lie, Cheat And Break The Law? Come On!

from the get-crackin' dept

Having followed the saga of Prenda Law over the past few years, one thing has become clear: John Steele really loves the "I know you are, but what am I" form of legal argument, in which whatever he's accused of, he aggressively accuses his accuser of being guilty of the same. It's a sort of faux macho move, in which every attack on him is met with an equally or more aggressive attack. To date, the strategy has failed badly, but it seems that Steele just can't let go of this kind of approach. In the latest round of the Anthony Smith case, Steele appears to be trying on a variant of that aggressive posture, taking on the very serious and direct accusations made against him (including those by multiple federal judges) and mocking them, by asking another court rhetorically, "what, do you really think I'm guilty of all these crazy things?" when the answer to that question may very well be yes.

At issue is the continuing fight over getting Steele and his collaborators, Paul Hansmeier and Paul Duffy, to actually pay up for their abuse of the legal process. Last we checked in on this particular case, the district court was finding them in contempt and piling more onto the money they would need to pay, while the appeals court does not appear to be impressed by Team Prenda's arguments, clearly calling out the "shell games" that Prenda and associated entities were playing.

While aspects of the case have been stayed during the appeal, other aspects are moving forward, including Smith's lawyer continuing to push for discovery on the actual assets of Steele, Hansmeier and Duffy. As you may recall, despite being required to provide such information, they did so in a questionable manner. As Judge David Herndon pointed out:

The Court finds that plaintiff's counsel has not met its burden. They submitted incomplete, and to say the least suspicious, statements of financial condition. Attached to each statement was a letter from their certified public accountant ("CPA"). In these letters, the CPA indicates a departure from generally accepted accounting principles. He further notes that plaintiff's counsel elected to omit substantially all of the disclosures required by generally accepted accounting principles. The Court finds these statements insufficient to establish plaintiff's counsel's inability to pay.

Since then, Smith's lawyer, Jason Sweet of Booth & Sweet, has continued to push for determining the financial position of the three individuals here. There's a sealed document which apparently hints at some shady financial dealings, but it appears to be making Steele very angry. While Paul Duffy filed a pretty empty opposition saying that he has no offshore accounts, Steele went into full on, ultra-aggressive "who me?" defensiveness in response, leading to some incredible statements, considering what multiple courts have already said about them. The classic part has to be this:

For this Court to find any act of Prenda should be attributed to Steele, the Court would have to believe that Steele lied to multiple federal judges without getting caught, committed massive tax fraud without the IRS finding out, and proactively broke into the Illinois Secretary of State’s corporate records database to hide his ownership of Prenda Law, all because of the remote chance that years later a federal judge might sanction Prenda Law for $261,000.

Except... of course, multiple judges have already claimed that Steele and the others have lied, including in this very case. In the original ruling in this case, Judge Patrick Murphy directly called out Steele for lying, saying: "These men have shown a relentless willingness to lie to the Court on paper and in person." He furthermore highlighted how it was quite clear that Steele was directly involved in Prenda, which Steele is now denying yet again. And no one is claiming he hacked into the corporate records database (though, now that he's denied it, it almost makes you wonder...), but that he was clearly in control of Prenda and received much of the money that went into Prenda.

As for the issue of the IRS, well, last we checked, at least one judge, Otis Wright, has referred their conduct to the IRS, and there are at least some indications that an investigation is ongoing. And while no one thinks they set up this shell game specifically to avoid this particular ruling, it's not difficult to see that they did so to try to avoid a series of similar court rulings, after Prenda's initial approach started getting regularly shot down in court.

Steele's response also ratchets up the ridiculous rhetoric in describing the copyright trolling shakedown business, which they copied from a bunch of other firms:

Steele and his partner, Paul Hansmeier (”Hansmeier”) were early pioneers in catching thieves and hackers who engaged in stealing copyrighted works and other computer related misdeeds, including computer hacking and copyright infringement.

Except, of course, they were neither pioneers, nor were they catching "thieves" or "hackers." Rather, by all accounts, they set up a honeypot site, uploaded their own content to it, shared it on file sharing sites, and then used the IP addresses of those who followed the release that they themselves put online, to shake them down with lawsuits and demands for settlement. The evidence on this is fairly overwhelming.

Steele tries to argue away the "oddities" the court noted in the filings made by the CPA they hired this way:

At the hearing, no reference was made to the GAAP, the Generally Accepted Accounting Rules, a set of standards designed for the financial reporting of corporations, not individuals. Steele submitted his financial statement as directed. Steele’s submissions were accurate, and no filing since has disproved any aspect of Steele’s statement

If he thinks that this will get him out of the fact that the CPA "elected to omit substantially all of the disclosures required" I would imagine he's got another thing coming.

Steele, also tries to angrily argue away the infamous Brett Gibbs spreadsheet that revealed the revenue of Prenda Law, and how 70% of it went to both Steele and Hansmeier, who have long denied being associated with that firm. Steele argues that this spreadsheet was made by Gibbs, as opposed to (as Gibbs has noted) made by Prenda and shared with Gibbs via a shared Dropbox account.

It appears that Mr. Gibbs created some accounting sheet of Prenda Law finances for some period of time prior to this case, and thus is irrelevant. Steele has no personal knowledge of Mr. Gibbs’ accounting records, methodology, or how Mr. Gibbs created his documents. According to Mr. Gibbs himself, he doesn’t either, and claims he doesn’t even know how his document came into existence. Such a document hardly comports with the Federal Rules of Civil Procedure governing admissible evidence.

He focuses on the fact that the spreadsheet is not admissible. Of course, his partner, Hansmeier, having argued basically the same thing in the past, has also suggested that the facts of the document are accurate, noting (incorrectly) that the document supports Steele/Hansmeier's position and that it was "stolen."

Related to all of this, Steele appears to still be playing games. In a separate filing, Sweet details how Steele took it upon himself to (incorrectly) inform various parties that Sweet had subpoenaed, that the stay on one part of the case meant those subpoenas were withdrawn as well. Except that they're part of a separate process, which is still ongoing. Sweet asked Steele to confirm that Steele had gone back to those third parties, and admitted that he was wrong in interfering with the discovery process. Steele did not do so, but rather sent one of his snarky emails about how he promises that he "will address your most recent round of subpoenas as appropriate."

It's been a while since Steele has done this kind of thing, but it's the same old John Steele, cocky until the very end, even as all of the evidence is against him. It reminds you of a little kid who has been caught doing something wrong but figures if he just keeps denying it over and over again, buying himself time, there will be some way to get out of it all.

Filed Under: anthony smith, brett gibbs, david herndon, jason sweet, john steele, paul duffy, paul hansmeier, sanctions, subpoenas
Companies: af holdings, ingenuity 13, lightspeed, lightspeed media, prenda, prenda law

Appeals Court Not At All Impressed By Prenda's Appeal

from the wanna-try-that-again dept

Team Prenda finally got to an appeals court on Monday and it didn't go particularly well. The appeal in the Lightspeed case, in which Judge Patrick Murphy called them out for "flat-out lying" to the court and hit them with $261,000 in attorneys' fees (a number that has been bumped up as Team Prenda was found in contempt for not actually paying) was heard on Monday, and the three judge panel in the 7th Circuit did not appear at all impressed by the arguments made by Daniel Voelker who was representing John Steele, Paul Hansmeier and Paul Duffy. You can listen to the 32 minute hearing yourself for all the fun.

It starts off almost immediately, as Voelker argues there's no basis for the district court ruling -- and is interrupted by one of the judges, noting that the court found that the case was pursued in bad faith "which stands on its own as a basis for sanctions." Voelker insists that the court "didn't rely on any record nor cite any facts" and, again, he's cut off: "well, it talks about an extensive pattern of lying and misrepresentations, and vindictive pursuit of claims that were, in the court's view, frivolous or marginal at best. And, trying to extract settlement payments before an inevitable voluntary dismissal."

In other words, within 3 minutes of the appeal hearing, the judges had made it clear that they were well-informed about the scheme Team Prenda had cooked up and why the district court had ruled the way it had. Voelker tries to slam the judge for taking "extrajudicial notice" of basically every other case where Prenda had been thumped. Of course, I don't see how that helps Team Prenda at all: to argue "please ignore my clients' record of being slammed by judges all across the country" doesn't seem very convincing. And, immediately another judge jumped in to point out that there were, in fact, statements made on the record in those other cases that contradicted what was being said in this case. The same judge immediately highlights the questionable nature of the different organizations, such as the affiliation between Prenda Law and AF Holdings, and says that of course it's reasonable for the judge to take notice of those contradictory claims.

Eventually, the judges ask about the relationship between the various organizations, including Prenda Law, Alpha Law and Steele Hansmeier ("in 25 words or less") and Voelker doesn't inspire any confidence by saying he has no ideas: "I can't your honor. I don't know, I don't know what it is today; I don't know what it was a year ago. So I wouldn't want to even begin to tell you because I just don't know." One of the judge hits back immediately:

That's shocking!

After a bit more of a back and forth she understates the situation:

There's a lot of shell game going on here.

Voelker claims this has no relevance to the issue at hand. The judges don't appear to buy it, at all, noting "this is all pretty serious conduct."

It's often a mistake to read too much into what appeals court panels (and Supreme Court Justices) say during oral hearings. Sometimes they're just testing out theories or pushing various attorneys to see how thoroughly their arguments make sense. But in this case, it seems abundantly clear that the judges are incredibly skeptical about Team Prenda's appeal.

Filed Under: 7th circuit, anthony smith, daniel voelker, john steele, patrick murphy, paul duffy, paul hansmeier
Companies: af holdings, alpha law, at&t, comcast, prenda, prenda law, steele hansmeier

Team Prenda Slammed Again, Found In Contempt; Judge Blasts Their Attempts To Plead Poverty

from the nice-try,-guys dept

It's been a little while since we had a Team Prenda update, but suffice it to say, judges still don't seem to be buying their brand of bullshit, even as they get more and more desperate. The latest is the followup in the Lightspeed case in which Team Prenda made the incredibly poorly thought-out move of dragging Comcast and AT&T into the proceedings. Not only did Judge Patrick Murphy find that Team Prenda flat out lied to the court, he hit them with an order to pay $261,025.11 in attorneys' fees for wasting everyone's time.

Team Prenda has been avoiding paying that ever since. There was an amusing hearing back in February in which they weakly sought to justify the non-payment, first quibbling with Judge David Herndon that the original order to pay up was a "money judgment" rather than an order, in the belief that this would give them more flexibility in paying. That ridiculous argument was more or less dismissed out of hand by Judge Herndon quickly. Following that, John Steele and Paul Hansmeier specifically tried to plead poverty, arguing that they simply couldn't pay the amount. Judge Herndon said, effectively, okay: prove it. And while they filed documents that attempt to prove that, Judge Herndon is not buying it at all. In a ruling earlier this week finding Paul Duffy, John Steele and Paul Hansmeier in contempt, Herndon noted that even in filing financial statements, it appeared they were trying to deceive the court:

In the case where there has been no attempt to comply with the Court's order, plaintiff's counsel must show a "complete inability to pay." ... Plaintiff's counsel, "stated differently, . . . [has] the burden of establishing clearly, plainly, and unmistakably that compliance is impossible." ....

The Court finds that plaintiff's counsel has not met its burden. They submitted incomplete, and to say the least suspicious, statements of financial condition. Attached to each statement was a letter from their certified public accountant ("CPA"). In these letters, the CPA indicates a departure from generally accepted accounting principles. He further notes that plaintiff's counsel elected to omit substantially all of the disclosures required by generally accepted accounting principles. The Court finds these statements insufficient to establish plaintiff's counsel's inability to pay.

Given all that, he notes that Team Prenda "significantly violated an unambiguous order of the Court" and has tacked on an additional 10% to the original order, giving them until March 31st to pay up... or the amount will keep going up at $500 per attorney per day (so $1,500 more per day). After another 30 days, the amount will increase to $1,000 per attorney per day. Hansmeier is already begging for a reconsideration, but given how many times these guys have been called out for attempted deceptions in court, it seems unlikely he's going to have much luck.

Filed Under: anthony smith, contempt of court, david herndon, john steele, lightspeed, paul duffy, paul hansmeier
Companies: lightspeed, lightspeed media, prenda, prenda law

Court Says Team Prenda 'Flat-Out Lied' To Court; Hits Them With $261k More In Attorneys' Fees To Pay Up

from the boom dept

Another court, another set of problems for Team Prenda: Paul Hansmeier, Paul Duffy and John Steele are certainly in trouble, and the damage just keeps adding up. Following yet another big loss for Team Prenda in Illinois, in Lightspeed Media v. Anthony Smith, we noted that Prenda's ridiculous decision to sue Comcast and AT&T for failing to hand over names in that case was backfiring in a big way, since both of those companies asked for attorneys' fees as well. Duffy, Hansmeier and Steele did their usual dance: filing motions arguing that none of them did anything wrong, that the ruling should be overturned, and (of course) that there was a violation of due process because they weren't informed about these proceedings. This is basically the same crap they file every time.

Southern District of Illinois Judge Patrick Murphy is having none of that. In a scathing opinion he rips to shreds the arguments of Duffy, Hansmeier and Steele. Beyond noting the basic procedural deficiencies in their own filings (once again, they don't seem to actually understand the law and just fling as much shit at the wall as possible, and the judge clearly recognizes this), he also appears to be well aware of the larger scam Team Prenda has been pulling. There's a long discussion about the claim that Hansmeier and Steele weren't properly served, in which the judge makes it clear this is simply beyond belief. Here's just a snippet of a much longer discussion:

First and foremost, Steele’s claim that he never got notice of Smith’s motion for fees is baseless. A review of CM/ECF records reveals that notice of Smith’s motion for attorney fees (Doc. 61) went to numerous email addresses, including: docket@wefightpiracy.com—an email address used by both Steele and Paul Duffy. Therefore, it is irrefutable that Steele had actual notice of Smith’s motion for attorney fees prior to the Court’s order granting the motion.

The judge also points out the tremendous evidence that Steele, Hansmeier and Duffy are working quite closely together on all of this anyway.

Aside from being from the same firm, there is other evidence suggesting these three men worked in concert with one another. First, Duffy, Steele, and Hansmeier used each other’s CM/ECF login information, and/or filed documents on behalf of one another. For example, both Steele and Hansmeier used Duffy’s CM/ECF login information to enter their appearances, or Duffy attempted to do so for them (See Doc. 11, 15); Hansmeier also used Steele’s CM/ECF login information to file his motion to continue, or Steele filed it on Hansmeier’s behalf (Doc. 73). Second, the similarities in documents filed by Duffy, Steele, and Hansmeier indicate an ongoing relationship. For example, in the instant motions to vacate/reconsider, the three men use identical formatting from the caption, to the font, and the signature block, and the substance is largely the same...

Then, of course, there's the citation to the numerous other cases that have found against Team Prenda, and noted that those three are clearly in control. The judge also notes that even if they didn't have notice, they clearly had notice in time for a later hearing and still their filings did not state any actual grounds for relief. Basically, the judge points out that they absolutely knew about all of this, and he won't overturn the original decision because for all the shit they threw at the wall, none of it actually stuck.

But then the judge goes further. He calls them liars. He doesn't dance around it. He flat out calls them on it.

The Court also finds that Duffy, Hansmeier, and Steele exhibited a “serious and studied disregard for the orderly process of justice.” .... These men have shown a relentless willingness to lie to the Court on paper and in person, despite being on notice that they were facing sanctions in this Court, being sanctioned by other courts, and being referred to state and federal bars, the United States Attorney in at least two districts, one state Attorney General, and the Internal Revenue Service. For example, at the November 13 hearing, Hansmeier skirted the Court’s direct questions, Steele made feigned protestations, and both flat-out lied about their association with Prenda Law, Inc. in the face of documentary evidence on the record in this case, and their sworn declarations in other cases.

In the end, the judge grants all the requests for attorneys' fees, adding yet another $261,025.11 to the rapidly increasing total from other cases. I imagine it won't end there, though it's unlikely anyone will see any of that money. Instead, we're all still waiting for the main act, when the criminal charges almost certainly arrive.

Filed Under: anthony smith, john steele, lies, patrick murphy, paul duffy, paul hansmeier
Companies: lightspeed, lightspeed media, prenda, prenda law

Comcast And AT&T Want Their Cut From Prenda Too

from the welcome-to-the-big-leagues dept

Last week, we noted that yet another court had ruled against Prenda. In this case, rather than their own shell companies, Prenda was representing Lightspeed, a porn company which already had a questionable reputation. Also, this was a case where Prenda tried to use a "hacking" claim rather than a straight copyright claim, in an attempt to get the case in state court, rather than the more savvy federal courts. Finally, when the ISPs protested having to turn over names, the brilliant Prenda strategy was to sue the ISPs as well. So, now that the court found "the litigation smacked of bullying pretense," it's not just the random guy, Anthony Smith, seeking legal fees... but Comcast and AT&T as well. Late last week, Comcast and then AT&T each asked for John Steele, Paul Hansmeier and Paul Duffy (by name) to each pay their attorneys' fees as well. And, as you might imagine, they have some pricey attorneys. Comcast's filing goes into quite a bit of detail about the questionable actions taken by Team Prenda in this case (and in other cases). AT&T's filing is much shorter and more or less says "you already know what these guys have been up to, so no need to repeat it here."

Not surprisingly, Hansmeier quickly filed an angry response, arguing that there is no possible reason why he should have to pay attorneys' fees, and even arguing that there's still no evidence of wrongdoing... by himself (leaving the others out to dry). Basically, he argues that while he was involved with the case briefly, none of his actions were the problematic ones. He also claims that the requests for attorneys' fees isn't timely, since Team Prenda had dismissed the case six months ago -- leaving out the ruling from just last week which found Team Prenda's actions problematic and subject to attorneys' fees. Amusingly, he also argues that Comcast laying out in great detail all of the bogus actions of Team Prenda in this case, as well as how multiple other judges have called out their behavior and alerted law enforcement about their activities for criminal investigation, is nothing more than an ad hominem attack.

Sorry, Paul, if someone calls you a morally bankrupt scamming loser -- that would be an ad hominem attack. Comcast laying out in great detail how judges have ruled that you committed fraud on the court in very similar cases, and ordered you to pay attorneys' fees (while also alerting law enforcement, the IRS, local legal bars and others to investigate), is presenting relevant information to the court. It might help to learn the difference.

Filed Under: anthony smith, attorneys fees, john steele, paul duffy, paul hansmeier, steve lightspeed
Companies: at&t, comcast, lightspeed, prenda, prenda law