Transcript Of The 12 Minute 'We're Done' Prenda Hearing Released

from the read-it-during-a-coffee-break dept

We had Ken White's awesome analysis of what happened at the Prenda Law hearing earlier this week, but now the full transcript of the hearing has been released so you can read along (or figure out how to incorporate it into the necessary movie script). Here's just a snippet, though the full thing is at the link above and embedded below.

THE COURT: Can you tell me, for example, who directs the litigation here in California? Who makes the decision as to whether or not cases are dismissed or settled for how much money? Can you tell me that?

MS. ROSING: Your Honor, I can't testify.

THE COURT: "Yes" or "no", please. Because we need to move through this. Can you tell me that?

MS. ROSING: I personally cannot tell you that, your Honor.

THE COURT: All right. Do you know whether or not there is another Alan Cooper other than the one that was here at the last hearing?

MS. ROSING: I am not aware of another Alan Cooper, your Honor.

THE COURT: All right. Good. What happens to the settlement money?

MS. ROSING: Your Honor, obviously, I represent Mr. Duffy and Ms. Van Den Hemel. I don't have personal knowledge of any of this.

THE COURT: Why weren't notices of related cases filed? Who made the decision to hide from the court the fact that all of these cases were related.

MS. ROSING: I do have a judicially noticeable document on that, your Honor, where the Northern District declined to relate the cases.

THE COURT: That is a different thing. That is consolidating them.

MS. ROSING: It is actually an order declining to relate them.

THE COURT: Same plaintiff, same film, same causes of action, and they are not related? Excuse me? Okay. Tell me this. Who made the decision not to disclose to the court the fact that the law firms have a financial interest in the outcome of this litigation?

MS. ROSING: Your Honor, there is no evidence before this court at all that the law firm or any, well, certainly, my clients, Paul Duffy or Angela Van Den Hemel, have any financial interest in the outcome of this litigation.

THE COURT: Excuse me. Did you read Hansmeier's deposition?

MS. ROSING: Yes, I did, your Honor.

THE COURT: And then you make the statement you just made?

That is one (quite reasonably) unhappy judge...

Filed Under: john steele, otis wright, paul duffy, paul hansmeier, prenda, prenda law
Companies: prenda, prenda law

Prenda Law Tries To Close The Barn Door After The Horse Has Lawyered Up

from the run-away!-run-away! dept

Ken White blogs at Popehat. He's a litigator and criminal defense attorney at Brown White & Newhouse LLP in Los Angeles. His views are his alone, not those of his firm.

My prior coverage of the Prenda Law saga is here.

Yesterday, March 14, as Judge Wright was busy issuing a new Order to Show Cause directing Prenda Law clients and affiliated attorneys to appear before him, Prenda Law was busy too.

More specifically, Prenda Law — through Paul Duffy, one of the lawyers Judge Wright has ordered to appear — was busy dismissing cases and filing a "Notice of Allegations" informing other courts of what is going on. Sort of.

A tipster told me that Mr. Duffy had a busy day yesterday. PACER showed it's true. More specifically, Mr. Duffy filed voluntary dismissals of multiple AF Holdings LLC cases in the Northern District of Illinois — here and here and here (in which he stipulated to dismiss the case with prejudice, meaning it can't be re-filed) and here. In one of those cases he filed the notice of dismissal even though AF Holdings had already secured a default against the defendant, leaving nothing but proving damages. I haven't yet counted all the cases in which Duffy filed dismissals yesterday.

In each of those cases — and in a case in the Northern District of California — Duffy also filed a substantially identical document styled a "Notice of Allegations." Here's what they all say:

Plaintiff hereby notifies the Court of allegations of forgery that were made during a hearing in a matter pending before the U.S. District Court for the Central District of California. Ingenuity13 LLC v. John Doe, No. 2:12-cv-08333-OWD-JC (C.D. Cal. Mar. 11, 2013). On March 11, 2013, an individual by the name of Alan Cooper alleged that his signature was forged on two separate agreements assigning the rights of various copyrighted works to Plaintiff, including the assignment at issue in this matter. (See, ECF No. 1-2 at 2.) Plaintiff categorically denies Mr. Cooper’s allegations, which arise nearly two years after certain of the alleged conduct occurred. Mr. Cooper has a pecuniary interest in his allegations by virtue of a lawsuit he filed against Plaintiff. Cooper v. Steele, et al., No. 27-CV-13-3463 (Minn. Dist. Ct., Hennepin Cty., 2013).

Even if Mr. Cooper’s allegations were true—and they are not—Plaintiff’s assignments, including the assignment at issue in the instant action, remain valid. The formal requirements of a copyright assignment are “quite simple”: a writing signed by the assignor. 17 U.S.C. § 204; Effects Associates, Inc. v. Cohen, 908 F.2d 555, 557 (9th Cir. 1990) (“The rule is really quite Case: 1:12-cv-03567 Document simple: If the copyright holder agrees to transfer ownership to another party, that party must get the copyright holder to sign a piece of paper saying so. It doesn't have to be the Magna Charta; a one-line pro forma statement will do.”); see also Order, AF Holdings LLC v. Does 1-96, No. 11-cv-3335-JSC (N.D. Cal. Nov. 22, 2011), ECF No. 29 at 5 n.1 (“The written copyright assignment recites that it is between the original copyright owner, Heartbreaker Films, and Plaintiff here, AF Holdings, LLC. . . . As the law requires only that the assignment be signed by the assignor and not the assignee, this inconsistency does not prevent a prima facie showing of copyright ownership.”) (internal citations omitted).

Mr. Cooper’s allegations relate to the assignee, not the assignor. The assignment at issue in this action satisfies the Copyright Act’s formal requirements. It is a writing signed by the assignor. Plaintiff’s rights in the copyrighted work in this action were transferred when the assignor executed the assignment.
Plaintiff is treating Mr. Cooper’s allegations with utmost seriousness and is investigating their substance. Because Mr. Cooper’s allegations relate to the assignment agreement at issue in the instant litigation, Plaintiff respectfully brings the matter to the Court’s attention.

Broken down, here's what Duffy is saying: (1) Cooper's claim is untrue, (2) but we're treating the claim seriously and investigating it, (3) but even if it were true, it doesn't matter, because an assignment only needs a valid signature from the person giving the property, not the person receiving the property.

Many things could be said about that argument. Among them: the first two points are oddly at war with each other, particularly when uttered in such proximity. If AF Holdings knows the allegation is not true, then what precisely is AF Holdings carefully investigating? Doesn't AF Holdings already know whether or not Mr. Cooper consented to be an officer for it and executed documents for it? What is there to investigate, exactly?

Duffy's third point is about a doctrine that lawyers — including, for instance, prosecutors and defense lawyers — call materiality. Most civil or criminal laws prohibiting false statements only extend to material false statements — that is, statements that are the sort that could make a difference in the issue at hand. Duffy seems to be previewing Prenda Law's defense by suggesting that even if Cooper's identify was misappropriated and his signature forged on assignments, that false statement was not material because a copyright assignment only needs a valid signature from the guy giving the copyright, not the guy receiving it.

There are a number of problems with that argument. Among them: Judge Wright is not only interested in whether Prenda Law made fraudulent representations about who received the assignments. Judge Wright is investigating — and has ordered Prenda Law to explain — whether Prenda Law made fraudulent representations about the true owners of plaintiff entities like AF Holdings. Whether Alan Cooper is a real officer or not is unquestionably material to that. Judge Wright has specifically ordered them to explain:

2) Why they should not be sanctioned for failing to notify the Court of all parties that have a financial interest in the outcome of litigation;

3) Why they should not be sanctioned for defrauding the Court by misrepresenting the nature and relationship of the individuals and entities in subparagraphs a–m above [of the March 14, 2013 Order];

Prenda Law's apparent theory of materiality may be apt in analyzing whether the copyright assignments are valid. But it may not be apt in determining whether any misstatements were material for purposes of civil or criminal fraud allegations directed at the ownership and management of Prenda Law's clients. For instance, as I've discussed before, for purposes of charging defendants with false statements to the government, materiality is defined very broadly to include the sorts of statements that have the capacity to influence the government, whether or not the government is actually misled.

All that said, aside from questions about the exact language of the "Notice of Allegations," Paul Duffy is very likely doing the right thing legally and ethically by dismissing the cases and informing courts of the allegations against Prenda Law. In doing so he is reducing the risk that he will be accused of continuing any alleged fraud on the court after the March 11, 2013 hearing.

With respect to what has already happened, though — my friends, that die is cast, the Rubicon crossed, the ram has touched the wall.

Filed Under: copyright, dismissed, paul duffy, prenda, prenda law
Companies: prenda, prenda law

As Expected, Team Prenda Trying Desperately To Get Out Of Appearing On Monday

from the well-of-course dept

All week I've been checking the docket on the Prenda case where the showdown is supposed to be happening on Monday, fulling expecting to see John Steele, Paul Duffy, Paul Hansmeier and others desperately trying to get out of appearing, and it's finally showed up -- but not via their own filing, but rather opposing attorney Morgan Pietz who received the documents before the court did, and is opposing them, in part by arguing that Team Prenda stalled in filing these documents. Team Prenda try a variety of arguments, first noting that they have nothing (nothing, I tell you!) to do with the case, and they point out that Brett Gibbs and the lawyers he hired are the lawyers on the case. They're even so bold to claim that they have "no dog in this fight."

Even where the court seeks to adjudicate issues between parties, it must have personal jurisdiction over them. Here, Steele, Hansmeier, Duffy, and Van Den Hemel are not parties and have not otherwise participated in this litigation. As such, the public policy behind the need to determine personal jurisdiction is arguably at an elevated level because, as individuals, they effectively have "no dog in this fight."

As if anyone believes that.

Then they claim lack of jurisdiction by the court:

On March 5, 2013, this court issued an order that eight individuals would have to appear before this court on March 11, 2013. But this court lacks jurisdiction to order those individuals to appear in that they reside outside California, are not parties to this litigation, have not appeared in this action, and do not represent parties to this action.

Moreover, although some of these individuals may have received notice as the court ordered, others did not because those charged with providing notice simply lacked the information necessary to do so. And, even those that were served have not received reasonable notice of the nature of the proceedings they are being ordered to appear in or what is expected of them besides their physical presence.

Further, they have not received a reasonable amount of notice to accommodate cross-country travel or information regarding who will pay for such travel. Based on these factors, the court should withdraw its order for John Steele, Paul Hansmeier, Paul Duffy, and Angela Van Den Hemel to appear on Monday, March 11, 2013 at 1:30 P.M.

On top of that, they argue that they "can be nothing more than witnesses."

Here, because they are not parties in this action, Steele, Hansmeier, Duffy, and Van Den Hemel can be nothing more than witnesses. California Code of Civil Procedure section 1989 provides that "a witness . . . is not obliged to attend as a witness before any court, judge, justice or any other officer, unless the witness Is a resident within the state at the time of service." None of these individuals named in the court's March 5, 2013 reside in California... Thus, the court lacks jurisdiction to order them to appear.

Furthermore, they claim that even thought it seems quite likely that they heard about this order immediately after it came out on March 5th, that they didn't actually find out about it until yesterday, March 7th, which (they claim) is not enough notice.

Although counsel submitting this application has been unable to identify any authority addressing the notice requirements to witnesses ordered to appear at such hearings, logic dictates that such individuals should at least be similarly accommodated with reasonable notice. Here, the court's March 5, 2013 order that notice be provided by March 7, 2013 to attend a March 11, 2013 hearing with no further information is fundamentally unreasonable.

Oh yes, and they also say that they need to be paid to show up:

Finally, witnesses are entitled not only to receive payment for their attendance, but also for travel expenses.... But, the court's order not only fails to provide who will compensate Steele, Hansmeier, Duffy, and Van Den Hemel for their time and these expenses, but that they will be compensated at all. Given the considerable expense of traveling such distances (including consideration of the fact that one of the witnesses likely has limited means given her employment as a paralegal), especially on such short notice when many common carriers may not have seats available, this is a significant issue.

As is typical for Prenda, throwing any excuse at the wall to see what sticks.

Morgan Pietz has already filed a response noting the claims of the court not having jurisdiction are basically bullshit, since all of these guys have been involved in this and other Prenda cases in California. He lists out each and every person and notes their connection to California or this case in particular. I won't post them all, but here's the entry on Steele:

John Steele has frequently sent demand letters into the State of California, seeking to pressure Internet users into settling copyright infringement claims. An example of only one such letter (undersigned counsel knows there are many more) accompanies this opposition as Exhibit 1 to the Declaration of Nicholas Ranallo. Further, Mr. Steele has not been shy about conducting media interviews, with California publications, about his California cases. See http://www.sfgate.com/business/article/Lawsuit-says-grandma-illegallydownloaded-porn-2354720.php. Accordingly, both general and specific jurisdiction exists over John Steele.

For Paul Hansmeier, they note he already traveled to California for that deposition. Paul Duffy is a member of the California Barr, and has taken over some Prenda cases in California for Brett Gibbs. Oh yeah, and the paralegal Angela Van Den Hemel is accused of violating the court's discovery order in this very case, so the jurisdiction over her is even clearer.

Pietz also claims that the short timeframe argument is bogus too, and suggests that Prenda chose to file this attempt to get out manually in an attempt to delay the whole thing, and even notes the oddity that he got the documents before the court did:

It appears that the Application may have been manually filed in order to create a purposeful lag time (of the motion getting from the filing window to chambers) on what is supposed to otherwise be an emergency motion. It is unclear why undersigned counsel found himself in possession of a copy of the moving papers prior to the Court. Further, the original amount of time was reasonable.

And now... we see what Judge Otis Wright thinks about all of this...

Filed Under: angela van den hemel, brett gibbs, fees, john steele, jurisdiction, morgan pietz, paul duffy, paul hansmeier, prenda, prenda law
Companies: prenda, prenda law

John Steele Dismisses His Defamation Lawsuit Against Alan Cooper And Anonymous Internet Critics

from the perhaps-he's-got-other-things-to-worry-about dept

Today's quite a Prenda Law day around here. While the focus has reasonably been on the upcoming showdown on Monday, where Judge Otis Wright has ordered all of the Prenda players to be in his courtroom on Monday, John Steele has apparently dismissed his defamation case against Alan Cooper, Cooper's lawyer Paul Godfread and a bunch of anonymous commenters who have been mocking Steele mercilessly for months. Perhaps Steele realized that the case would open him up to discovery, which could reveal some things he'd prefer not to reveal to a court. Or, perhaps, he's suddenly realized that he's going to be busy dealing with the fallout from the Wright hearings. Or, perhaps there's another strategy as yet unrevealed. Given Steele's history of searching for and testing out all kinds of loopholes in the hopes that something works, it wouldn't surprise me to find out that this isn't the last we hear concerning this attempt to "out" his critics.

Filed Under: defamation, dismissal, john steele, prenda, prenda law, slapp
Companies: prenda, prenda law

What To Expect When You're Expecting Prenda Law To Get A Judicial Beat Down

from the a-scorecard-for-those-playing-along dept

Earlier today we had a post about Judge Otis Wright ordering nearly everyone associated with copyright trolling operation Prenda Law to be in his courtroom on Monday. We made the rather obvious understatement that it appeared Wright was not happy with Prenda or what he had seen happening in the various Prenda cases he is presiding over. If you're just picking up the story now, you may have missed some of the backstory behind all of this, but, no worries, Ken White at Popehat (a former federal prosecutor and long term litigator) has put together a post that lays out, in great detail (and in an easy to understand format for non-lawyers) both exactly how we got here and "what to expect." It's worth a read.

It actually leaves out some of the history and details that suggest Prenda/John Steele/others have been acting with something less than good faith. As we've discussed in the past, it often feels like Prenda Law is using an any means necessary approach to getting access to people's identities, often piling questionable legal trick upon questionable legal trick to create a multi-layer operation of questionable activity, all designed to get identities to then start hounding those people for "settlements." Even leaving aside many of those tricks, many of which don't touch on this particular case, Prenda's actions in this case alone are quite incredible. And as White makes clear, each move by Prenda lawyer Brett Gibbs seemed to only draw more attention from Judge Wright. This started early on, when Gibbs sought sanctions against the opposing lawyer, Morgan Pietz, which the judge quickly denied. As White points out: "It's a bad sign when the judge denies your motion summarily before the other side can even oppose it."

Throughout our coverage of this case, we've repeatedly pointed out that Gibbs could have just put most of the questions to rest by identifying Alan Cooper. But his continual tap dancing around the simple question "who is Alan Cooper?" has been pretty damning. Responding: "I am sure there are hundreds of Alan Coopers in this world," really seemed to make clear that something fishy was going on here. Personally, I was wondering if there was some reasonable legal strategy that I was completely unaware of, that would explain the failure to answer the Alan Cooper question, and White points out that everyone's general suspicions are correct: it makes no sense unless there is no such Alan Cooper:

I've been a lawyer for almost 19 years now. I've practiced in federal court that entire time. Here's what's very strange to me about Gibbs' opposition to the ex parte application, and about Gibbs' sanctions motion: they conspicuously avoid direct engagement with the most incendiary accusations Pietz makes. It's one thing to argue that Pietz' evidence is insufficient, or that other courts have failed to act based on them. It's quite another to evade the question of who "Alan Cooper" really is. I find it very difficult to imagine a scenario in which an experienced litigator would have a good reason to avoid confronting such a serious charge of fraud head on by saying, for instance, "the Alan Cooper who is a principal in Ingenuity 13 LLC is a real person who is resident of the State of X, living at Y, and has no relation to the Alan Cooper who has made scurrilous allegations against Prenda Law. Here is a declaration from the Alan Cooper who is a principal of Ingenuity 13 LLC, and here are reasons why the other Alan Cooper has a grudge against Prenda Law and is lying." It is very difficult to imagine an innocent scenario explaining why Prenda Law would not offer such a response if it could.

So, what to expect? White lists out four possibilities, with a focus on the last two as being the most likely:

3. Some of the individuals named could assert that exigent circumstances or medical conditions prevent them from attending, or could ask for an extension to allow them to retain counsel and get their new counsel of up to speed.

4. Some of the individuals named could show up and answer Judge Wright's questions.

I've been wondering if Judge Wright would grant an extension, given the extremely short notice on all of this. Normally such an extension would be pretty normal, and lawyers and judges often bend over backwards to try to accommodate things like that. But given that it appears Wright is clearly deeply concerned about the possibility that Prenda is committing fraud on the court, I wonder if he'll be a little less lenient than might otherwise be normal.

Oh, and for those wondering if this could end in jail time for everyone showing up in court, White is a little more skeptical there, but suggests it is entirely possible that it leads to a criminal case, which could result in jail time:

Judge Wright could certainly issue monetary sanctions against, at a minimum, Mr. Gibbs. The question of what other attorneys he could sanction under Rule 11 and his own inherent authority depends on a tedious discussion too long for this post; suffice it to say that he might conclude that he can sanction supervisory attorneys with Prenda Law.

Judge Wright's terrifying comment aside, his ability to jail people before him for contempt is quite limited when they have not been charged with a crime by the executive. That, too, is a discussion too complex for this post. But Judge Wright might well refer the case to the U.S. Attorney's Office for criminal prosecution if he concludes that criminal contempt or fraud has occurred. Such referrals tend to get immediate and intense attention. Moreover, if Judge Wright finds misconduct, he could refer the matter to various state bars.

In the meantime, I'm curious if anyone can pinpoint the moment at which John Steele/Prenda Law surpassed Righthaven in the Hall of Fame for the Spectacular Self-Destruction of Copyright Trolls.

Filed Under: brett gibbs, john steele, ken white, otis wright, prenda, prenda law, sanctions
Companies: prenda, prenda law

Prenda Law Showdown Happening Monday: Judge Orders Everyone To Show Up In Court

from the get-yourself-some-popcorn dept

Okay... so I was just putting the finishing touches on a blog post about the latest filings from Prenda's Brett Gibbs and his opponent in a series of cases, Morgan Pietz, ahead of the planned hearing on Monday concerning various Prenda Law cases. As in the past, it was full of more attempts by Gibbs/Prenda to tapdance, with more evidence presented by Pietz that Prenda is up to no good (understatement of the year).

And... just as I was getting set to post it, I discover that Judge Otis Wright has had enough of the tap dancing, and has ordered just about everyone to show up in court on Monday for the hearing. And I do mean just about everyone.

John Steele? Yes. Mark Lutz? You bet. Alan Cooper? Oh yeah -- in fact, the judge ordered both Alan Coopers (the one claiming his identity was used by Steele and the one who supposedly "ran" AF Holdings) to show up, to see if there really are two of them. Paul Duffy? Yes. Paul Hansmeier. Yup. Of all the "players" from the latest filings, the only one missing may be "Allan Mooney" or "Alan Mony" or "Alan Moony" depending on which filing you're looking at (more on that below).

Sometimes it's difficult to actually get a sense of "tone" when you see some text, and that's doubly true of a court filing from a judge. But... this time, you get the feeling that Judge Otis Wright is not happy about all of this.

I expect that there will now be a flurry of filings with excuses and attempts to get out of appearing. I don't think that's going to work.

And... because I hate to let a perfectly good post go to waste, below is what I had originally written, but which has now been pushed down by this bit of breaking news. Consider everything below some additional background info for the main event coming Monday.

---

Brett Gibbs, who both is and is not a lawyer working for Prenda Law (depending on which time you ask him), continues his tap dance routine as we get closer to the expected showdown in Judge Otis Wright's courtroom on March 11th, in which sanctions against Gibbs, including the possibility of jail time, will be considered. The latest filing from Gibbs (filed by some lawyers he has hired to help him out), basically attacks nearly every statement in the declaration filed by the opposing lawyer, Morgan Pietz. It's really quite a work of art. First, he tries to get various declarations concerning evidence that Prenda sought to have AT&T identify IP address holders after Judge Wright had already ordered that such discovery stop. Gibbs claims that these declarations are "untimely." Then, pretty much every single statement from Pietz is challenged with a rotating list of claims, including: irrelevant, lacks foundation and/or personal knowledge, hearsay, improper characterization of evidence, assumes facts not in evidence, speculation and argumentative. Basically, nearly every single point that Pietz raises to show improper or questionable conduct by Gibbs and or Prenda should be ignored based on this filing. Given that Judge Wright hasn't exactly been swayed by Gibbs' arguments over the last month or so, I find it unlikely that he's going to be swayed by all of this tap dancing.

Oh, and still no indication of who Alan Cooper is.

However, in the same case, Pietz has also filed another document presenting evidence that suggests that Alan Cooper may not be the only name that was "faked" as a part of all of these lawsuits:

First, there was Alan Cooper. Mr. Gibbs has no real explanation for the Alan Cooper situation, other than to disclaim responsibility and deflect blame for the apparent fraud, etc., to his supposed “supervising” attorneys at Prenda Law, Inc. Unfortunately for Mr. Gibbs, it is his name on the pleadings and "counsel can no longer avoid the sting of Rule 11 sanctions by operating under the guise of a pure heart and empty head." Smith v. Ricks, 31 F.3d 1478, 1488 (9th Cir. 1994). Hopefully, Mr. Cooper himself can address theses issues at the March 11 hearing.

Now, there is also "Allan Mooney" a/k/a "Alan Mooney" a/k/a "Alan Mony." Newly discovered facts suggest that Alan Cooper may not be the only person who has had his identity misappropriated by Prenda in connection with its shell companies. Although some details are still hazy, suffice it to say that undersigned counsel (and many others) would very much like to question the real "Allan Mooney" on the record, under oath. Similarly, there is widespread interest in a subpoena to obtain testimony and records from the Minnesota bank that employs the notary who supposedly notarized Mr. Mooney's signature on legal pleadings filed in other jurisdictions. Then, of course, there is also Anthony "Salt Marsh" Saltmarsh. In short, "Alan Cooper" was not a mistake; there appears to be a pattern.

Furthermore, Pietz points out, the "rotating case" of characters that Prenda uses, seems to involve constantly switching roles so they can't be pinned down.

Another pattern with Prenda is that all of the persons involved constantly change hats; who is acting in what capacity seems to fluctuate to suit whatever the instant legal predicament happens to be. Inconsistencies include:

Mr. Gibbs is counsel of record for AF Holdings, LLC (e.g., C.D. Cal. No. 2:12-cv-5709, ECF No. 1) (7/2/12); Mr. Gibbs is "in house counsel" for AF Holdings (N.D. Cal. No. 3:12-cv-4221, ECF No. 22, p. 2) (1/30/13)3; Mr. Gibbs is not in house counsel to AF Holdings, and has never been anything other than AF Holdings’ "independent contract attorney" (ECF No. 49, p. 3) (2/19/13).

John Steele is "of counsel" to Prenda (Exhibit D) (4/20/12); John Steele is "not an attorney with any law firm" when questioned by Judge Scriven (Exhibit N, p. 135)(11/27/12); John Steele is back to being "of counsel" to Prenda in the St. Clair County Guava case (Supp'l. Dec. 15 (ECF No. 53)) (2/13/13).

AF Holdings copyright assignment is executed by Alan Cooper (e.g., C.D. Cal. No. 2:12-cv-5709, ECF No. 1) (12/20/2011); "Salt Marsh" is the "AF Holdings Owner" (Exhibit R) (7/20/12); AF Holdings is owned by a mystery trust, and never had any other members or employees other than its manager Mark Lutz (ECF No. 52, p. 28) (2/19/13, 11:00 a.m.); AF Holdings is owned by Livewire Holdings, LLC (ECF No. 49, fn. 1) (2/19/13, 6:00 p.m.).

Guava, LLC files a petition supposedly verified by client "Alan Mony" (ECF No. 51-1) (11/20/12); Prenda confirms "Alan Mony" is the client's name (Exhibit FF, p. 5) (2/12/13); Prenda files new verification, now spelling the purported client's name as "Alan Mooney" (Exhibit GG) (2/21/13); however, the real name of the "client" (who may or may not have agreed to lend his name to Prenda's efforts) is probably "Allan Mooney" (ECF No. 52, pp. 15–16).

Pietz has even spent the time to put together a graphic in which he tries to map out the various characters at play here. Given all of this, it seems likely that Judge Wright isn't going to simply agree that everything Pietz has to say is "irrelevant" and "lacks foundation." At some point, Gibbs, or someone else from Prenda is actually going to have to produce Alan Cooper and/or possibly Allan/Alan Mooney/Mony/Moony/etc. Watching Prenda's lawyers continue to try to tap dance their way out of this is really quite an astounding thing.

Filed Under: alan cooper, brett gibbs, john steele, mark lutz, morgan pietz, otis wright, paul duffy, paul hansmeier, prenda, prenda law
Companies: prenda, prenda law

Prenda's Brett Gibbs Finally Answers Some Questions; No Mention Of Alan Cooper

from the heading-for-a-showdown dept

With the news breaking of copyright troll firm Prenda Law, along with John Steele and Paul Duffy (who basically appear to be Prenda) suing a bunch of critics for defamation, it's worth remembering that the challenges to some of their existing lawsuits are still ongoing.

Brett Gibbs, who has been trying to weasel out of a variety of troubling situations concerning his acting as a lawyer for Prenda in California, was finally forced to answer some questions from Judge Otis Wright -- the same judge Gibbs tried to have kicked off the case once Wright started asking Gibbs to explain who the mysterious Alan Cooper really is. That effort failed (miserably) and last we'd seen, Judge Wright was threatening sanctions (including potential incarceration) against Gibbs for his, um, lack of candor.

Late last week, Judge Wright also consolidated a bunch of Gibbs' Prenda cases, so that they were all included for the sanction hearings on March 11, and also ordered Gibbs to answer some basic questions:

The names and contact information of the “senior members of the law firm that employed Mr. Gibbs in an ‘of counsel’ relationship.” (Gibbs Resp. 2.);

The names and contact information of the persons who make “strategic decisions . . . whether to file actions, who to sue, and whether to make a certain settlement demand or accept an offer of settlement.” (Gibbs Resp. 2.);

The names and contact information of the “owners of these copyrights.” (Gibbs Resp. 2.) If these owners are business entities, then provide in addition the names and contact information of the principals of these entities.

The names and contact information of the principals of AF Holdings LLC and Ingenuity 13 LLC.

Gibbs names John Steele and Paul Hansmeier as the "senior members" from whom he took orders, both when he was working with Steele Hansmeier and with Prenda Law. That's not surprising, but marginally interesting since Steele, at times, likes to pretend that he's not working for Prenda. The more interesting tidbit concerned the "CEO" of AF Holdings and Ingenuity 13, the two shell companies that Prenda has been using for a bunch of these lawsuits, which many believe are controlled by Steele and Hansmeier. Those are the companies who supposedly had "Alan Cooper" as their CEO, until Alan Cooper, who took care of one of Steele's homes, spoke up to the court, wondering if his identity was being used illegally. Apparently "Alan Cooper" is no longer CEO, but Mark Lutz is the CEO (of both companies).

You may remember Mark Lutz for his laugh-o-riffic appearance in that Florida Prenda case which consisted of a hearing worthy of Abbott and Costello. Lutz, who was identified as a "former" paralegal for Steele, was there to be the "representative" of the plaintiff, a company called SunLust. However, an absolutely hilarious exchange with the judge (which came about after she saw Lutz talking to Steele, who claimed he was just there to "observe" but had no actual involvement in the case) showed that Lutz was not a representative of the company, but a stand-in for Steele. Here's just a snippet.

THE COURT: Mr. Lutz, you're under oath, you have to give truthful answers or you face penalties of perjury. Do you understand that?
MR. LUTZ: Yes.
THE COURT: What is your position with Sunlust?
MR. LUTZ: I'm a representative of them.
THE COURT: What does that mean?
MR. LUTZ: Corporate representative.
THE COURT: What does that mean?
MR. LUTZ: They asked me to appear on various matters throughout the country.
THE COURT: Are you an officer of the company?
MR. LUTZ: I'm not, no.
THE COURT: Are you authorized to bind the company to any legal contracts?
MR. LUTZ: I am not.
THE COURT: Are you salaried?
MR. LUTZ: No, 1099.
THE COURT: So you are a 1099 contracted entity and you just go around and sit in a Court and represent yourself to be the corporate representative of the company?
MR. LUTZ: Yes.
THE COURT: Mr. Torres, did you know this was Mr. Lutz's position, a paid corporate representative?
MR. TORRES: No, Your Honor, I did not.
THE COURT: Who is the president of Sunlust?
MR. LUTZ: I'm unaware.
THE COURT: Who is the vice president?
MR. LUTZ: I'm unaware
THE COURT: Who is the secretary?
MR. LUTZ: I have no idea.
THE COURT: Who owns Sunlust?
MR. LUTZ: I do not know.
THE COURT: Who signs your checks?
MR. LUTZ: I believe somebody in the accounting department.
THE COURT: What is their name?
MR. LUTZ: To be honest with you, I can't read the signature.
THE COURT: Where is the accounting department located?
MR. LUTZ: I'm sorry?
THE COURT: Where is the accounting department located?
MR. LUTZ: I've received checks from California.

If you follow the FightCopyrightTrolls site, they've spent plenty of time tracking Lutz, who (that site claims) is Prenda's main "enforcer" in trying to get people to pay up. People receiving phone calls related to Prenda cases, asking the recipient to pay up to avoid getting sued, often report that it's Lutz who is calling (though it appears he may use another name on some phone calls). That "Alan Cooper" is gone from Ingenuity 13 and AF Holdings, and Lutz has been put in his place, adds even more weight to what most people suspected: that the companies are mere shells for Steele and Hansmeier, who seem to be trying to layer on more and more and more bullshit to avoid getting in serious trouble for their actions in these cases, seeking any way possible to try to demand money from people they accuse of infringing copyrights (or, in some crazy cases, accessing computers in an unauthorized manner).

In the answer, Gibbs also refuses to directly respond to Judge Wright's question to reveal the contact information for Steele and Hansmeier, but does offer to file them under seal. There is, of course, no mention of Alan Cooper.

I imagine the hearing on March 11th should be quite the spectacle.

Filed Under: alan cooper, brett gibbs, john steele, otis wright, prenda, prenda law, sanction
Companies: prenda, prenda law

Prenda Law Sues Critics For Defamation

from the grab-some-popcorn dept

Wow. Wow. Wow. Okay, so we have another story we've been working on concerning Brett Gibbs, a lawyer who was working for Prenda Law in California, finally answering some of the questions presented to him by a judge. We'll get that story up later, because there's a new Prenda story that has leapfrogged all the others. It appears that three separate lawsuits have now been filed -- one from Prenda itself, one from John Steele (the guy who is often considered the man behind Prenda) and Paul Duffy the actual official partner of Prenda Law (you may remember Paul from this story, in which he sent a letter insisting that Prenda Law had nothing to do with a case, despite the lawyer appearing believing they had been hired by Prenda). Jordan Rushie, a lawyer who has been following the Prenda cases pretty closely, has links to all of the filings, which we've embedded below. All three were originally filed in state courts (Prenda & Duffy in Illinois, Steele in Florida), but were quickly removed to federal courts.

These are basically defamation lawsuits with a few other claims thrown in as well. There are two named defendants in the lawsuit: Alan Cooper (a caretaker for a home of John Steele, who has accused Steele/Prenda of illegally using his name as "CEO" of companies Ingenuity 13 and AF Holdings) and Paul Godfread, Cooper's lawyer, who filed the letter alerting some judges to these concerns, and then followed it up by filing a lawsuit against Steele and Prenda on behalf of Cooper.

The other targets of the lawsuit are a bunch of unnamed John Does (and if these guys have expertise in anything, it's filing lawsuits that involve John Does), who are... a bunch of anonymous commentators concerning the various Prenda Lawsuits. It looks like they're targeting people on the two main copyright troll tracking websites out there, FightCopyrightTrolls.com and DieTrollDie.com. It's worth noting that both sites were the subject of a nice profile article in Ars Technica last week.

The three filings are similar, but not identical. The Prenda one and the Duffy one are almost identical, but the Steele one is different in a few ways, including focusing on lots and lots and lots of statements specifically about Steele. Steele's suit also does not make the "false light" claim, which means he actually realized that Florida has rejected "false light" as a tort in that state.

Still, all three suits read like obvious SLAPP suits, targeting online critics. The fact that they target Cooper and Godfread, who have a lawsuit pending against them, is ridiculous. That they then go after anonymous bloggers and commenters who have been revealing and calling attention to some of Prenda's more questionable moves seems like an obvious SLAPP situation, in which they appear to be using the lawsuit to create chilling effects and to stifle speech. Looking over the long list of quotes they pull out in the various lawsuits, the vast majority seem to be clear statements of opinion, rather than fact. And even when you could argue some of them are statements of fact -- such as referring to anyone associated with Prenda as a "criminal" or a "scammer" or calling Prenda a "fraud" or similar such things -- courts have increasingly noted that name calling in online forums does not reach the level of defamation, since the context matters. That's no guarantee, as those rulings are still limited, but it's at least a sign that these lawsuits may be overreaching in their claims (which, of course, is a key component of a SLAPP).

It is not uncommon for people in comments on blogs to go a bit far in some of their claims (and even the main authors of the two blogs above sometimes seem to make pretty strong statements that may not be fully supported by the evidence presented). However, to take that to the level of defamation feels like a pretty big stretch. If anything, these lawsuits seem more likely to be attempts to first "out" the folks behind those blogs (and some of the nastier comments) and, barring that, to scare them with chilling effects.

Of course, one interesting thing: the best defense against defamation claims, obviously, is the truth. And, it would seem that, in filing these lawsuits, Steele, Duffy and Prenda may have opened themselves up to pretty wide discovery efforts which may turn up things they probably would rather not have in court. That point alone has me wondering why they'd take this step.

On top of that, the lawsuits note that the plaintiffs are not public figures, which sets the bar much lower for defamation. Paul Duffy might be able to get away with such a claim, but John Steele would seem to have a lot more difficulty. After all, he's been the subject of detailed profiles in Forbes Magazine (which he happily participated in). Forbes doesn't do profile stories on nobodies.

It would seem important to note that both Illinois and Florida have passed anti-SLAPP laws. Florida's are fairly narrowly defined, however, and may not be useful here. Illinois, however, has as broader anti-SLAPP law that has sometimes been interpreted narrowly. Both of these are reminders for why we desperately need a federal anti-SLAPP law.

It appears that, at least for now, Steele and Duffy are representing themselves, while Prenda has another law firm representing the firm. Cooper and Godfread have signed up lawyers to represent them in both Illinois and Florida (in Illinois the lawyers, Erin Russell and Jason Sweet, both have a decently established history of fighting Prenda cases, and while I wasn't familiar with the name, the same appears to be true of Brad Patrick, who is representing them in Florida).

As always with Prenda/Steele, every time you think a story can't possibly get crazier, it seems to take another massive curve in the road. At some point, when this is all over, there's going to be an amazing book to be written about the rise (and, most likely, fall) of John Steele and his adventures in copyright trolling. The story is gripping.

Filed Under: alan cooper, defamation, dietrolldie, fightcopyrighttrolls, florida, illinois, john steele, paul duffy, paul godfread, prenda, prenda law, slapp
Companies: prenda, prenda law

Making The Case For Why John Steele And Prenda Law Deserve To Be Sanctioned

from the fraud-on-the-court dept

Last week we had the incredible story of the comedy routine that copyright troll John Steele and Prenda Law tried to pull on a courtroom in Florida, leading to the case being dismissed and the judge planning to dig deeper into the potential "fraud on the court." If you have not read that post and accompanying transcript do so now. It is one of the funniest things ever to come out of a courtroom.

And, of course, it's not over yet. The defense attorney in the case, Graham Syfert, who has been getting pretty good at exposing bad behavior by Steele and Prenda, has filed a motion asking for sanctions, and it's a good one. You can see it here or read the embedded version below. Syfert kicks it off by showing, in massive detail, that the letter from Paul Duffy -- claiming to be the sole principle of Prenda Law -- denying any involvement in the case is likely bogus on multiple levels.

Mr. Duffy’s signature is on the subpoena issued out of the United States District Court for the Northern District of Illinois, relating to Civil action 1:12-CV-20920-PAS in the Southern District of Florida. (See attached Exhibit “B”) This subpoena revealed the name of the internet subscriber with the IP address of 96.254.186.43, and produced the name of the Defendant to Prenda Law, Inc., at 161 N. Clark St. Suite 3200, Chicago IL 60601, the same address listed on the letter where Paul Duffy stated that he did not represent anyone involved in this case.

Further, Mr. Duffy has made appearances in Sunlust v. Does 1-75, 12-CV-1546 (N.D. Ill.), Sunlust v. Sadiq Majid, 12-CV-07868 (N.D. Ill.), and Sunlust v. Norbert Weitendorf, 12-CV-07826 (N.D. Ill.) and possibly other Sunlust matters.

The website www.wefightpiracy.com is the website of Prenda Law, Inc., lists Paul Duffy as the principal, and lists the work product that is the complaint in this matter as their own, stating “Below is a sample of individuals who chose to litigate the matter and are currently in court over their alleged infringment” and then listing the name of the Defendant, along with a link to the complaint in this matter. The complaint is held on Prenda Law’s website at http://www.wefightpiracy.com/userfiles/Nguyen%20(FL).pdf and the website reports an address of 161 N. Clark Ste. 3200.

Yeah. That last one is pretty damning. And, as of the moment I'm writing this, that link is still on Prenda's list of cases. A quick screenshot: When you claim that you aren't associated with a case, you probably shouldn't put the case up on your website listing "recent cases" that your firm has been involved in.

Of course, Syfert then turns his attention to John Steele, noting that Duffy's claims of not being involved might actually be true if John Steele -- who is not licensed to practice law in Florida and has already been warned by the Florida Bar about this issue -- is actually running the show, potentially even to the point of writing the "letter" that Duffy supposedly sent:

There is only one possible way that the letter is true, and filled with candor, and that would be if John Steele was using Paul Duffy as a “face attorney” using his identity to litigate, and therefore Paul Duffy doesn’t truly represent any Sunlust client. Another option is that that the letter was not even sent from Paul Duffy, and that it was created by John Steele, and was sent without with or without Paul Duffy’s permission.

A quick and dirty forensic examination of the PDF document, as sent by email by “Angela Van Hammel” of Prenda Law, reports that the PDF document was created by a computer user by the name of Kerry Eckenrode (the maiden name of John Steele’s wife) and was created by “Steele Law Firm.” Exhibit “C” attached gives the simple properties of this document and evidences that it was created on 11/20/2012 even though it is dated the 11/18/2012. It is possible that John Steele created the letter at the request of Paul Duffy, but it is unlikely that it was ever presented to Mr. Duffy for his approval, as he would know of his representation in the Sunlust matters.

It is unlikely that Paul Duffy would own or use a computer associated with John Steele’s wife, which would bear the the name of John Steele’s Illinois family law practice (a relatively new creation, post-Prenda Law and post-Steele Hansmeier). Regardless of whether it was created at the behest of Paul Duffy or John Steele was given carte blanche to create the document, it is common for John Steele to create documents and send emails with other attorney’s names to serve his own agenda, with or without their knowledge. When counsel filed his second bar complaint against John Steele, it was for the impersonation of a Florida attorney via e-mail. John Steele’s slippery and wily traits always resulted in insufficient evidence to prove this Mr. Syfert’s claims to the Florida Bar. The loyalty John Steele mysteriously engenders in those around him results in lies to protect him, and therefore insufficient evidence to show that he is violating his affidavit of no UPL attached as Exhibit D.

It goes on to note that Syfert himself, in Chicago to see a Cubs game, stopped by Prenda's offices asking to see Duffy, and the security folks had no idea who he was talking about. But when he asked about John Steele, the guards immediately knew who he was talking about. That would seem odd if Duffy is really running Prenda, as he claims. Furthermore, he notes that every time people try to contact Duffy, Steele seems to call them back. Syfert also notes how Steele's own actions in this particular case seem just a bit odd if he's really got nothing to do with the case:

John Steele wanted to make very clear that although Mark Lutz was looking to him for assistance that he had nothing to do with the case or with Prenda Law. In his Forbes interview, Mr. Steele is filing 20 lawsuits a month with hopes to increase to 300 and he is raking in millions for his efforts. Before this Court, his demeanor is that he is essentially retired, just a fan of bittorrent litigation, in town from Miami or from Chicago, because civil motion arguments as interesting as to him as a Cubs game. He projects that he is a passing acquaintance of Mr. Duffy, and has nothing to do with the case, but has the knowledge to allege that the principals of the Plaintiff were in India (even though that was also a lie). He also knew the correct pronunciation of one of the principals of Sunlust Pictures.

Then there's a second filing about sanctions, this time targeted at Matthew Wasinger, who really only played a bit role in the original hearing -- in that he was the lawyer who had, very briefly, represented Sunlust/Prenda in the case, but had asked to be removed from the case. He did not show up at the court that day, pissing off the judge who had not actually released him from the case. He later filed an apology, saying that he got mixed up, but the judge still considered sanctioning him. Syfert's motion there is interesting, in that he suggests that, in lieu of monetary sanctions, Wasinger should have to answer a number of questions about Prenda/Steele.

It is the hope of Defendant’s counsel and Defendant, by this motion, that a similar line of questioning to the one presented by the Court to Mr. Torres would clarify Mr. Wasinger’s position in this case. By requiring answers to these questions, Defendants counsel hopes that the responses serve as a warning to other potential “local counsel” representatives of Prenda Law to caution themselves in representing Plaintiffs in Federal Court without a reasonable disclosure of the facts surrounding the cases that they are accepting and ability to adequately protect the interest of their clients.

He then lists out fourteen questions, similar (though not identical) to the ones asked by the court of Torres in the hearing.

A few days after this was filed, Wasinger responded to the motion by again apologizing profusely and making a compelling case that his failure to appear was unintentional (since Jonathan Torres had been approved to replace him in a bunch of other cases, and there were indications he was appearing in this case as well). He also notes that his absence did not likely harm the case, seeing as his answers to the questions Torres answered would have been basically the same (i.e., he signed onto this case, not realizing what a clusterfuck it was, or what kind of confusing mess Prenda had gotten him into).

In response to Syfert's request to substitute answering questions for any monetary sanctions, Wasinger seems happy to help nail Prenda and warn others, but he wants to make sure that if he answers the questions, he won't still be on the hook for monetary sanctions.

The undersigned is willing to answer the questions set forth by Mr. Syfert in his Motion upon Order by the Court and a finding of this Court that answers to these questions would not violate any potential ethical duty to Sunlust Pictures. The undersigned would truthfully answer any questions as directed by the Court under oath. However, the undersigned is concerned about Mr. Syfert's request to leave open the possibility of a $500.00 monetary sanction if he is not satisfied with the answers. Since the answers would be provided under oath, it is respectfully requested that the Court denies this request.

And, finally, he once again asks to be removed as the attorney for Sunlust.

I expect there will still be plenty of entertainment value as this case moves forward. So far, the only thing that has happened is that the judge responded to Torres initial motion to be added as counsel and his near immediate request to be removed. Amusingly, she denied the motion to substitute as counsel, given that he's also asked to be removed, and then denies the request to be removed as moot. I'm sure the next few filings should be even more entertaining.

Filed Under: copyright trolls, florida, fraud on the court, graham syfert, john steele, mark lutz, matthew wasinger, paul duffy, prenda law
Companies: prenda law, sunlust