Prenda Suffers More Fee Award Blows

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The life of a copyright troll is a hard one. It can take a while for the settlements to come rolling in so you can make a profit, while minimizing your litigation costs. That’s why it’s heartening to see an award in Minnesota State Court for $63k in legal fees and costs.

2013 isn’t turning into such a good year for prolific copyright trolls Prenda Law.

They’ve been slapped down by a Federal judge in south California, hit for costs in northern California, a Georgia Federal Judge has turned the tables and allowed discovery against them, and there’s mounting evidence that they’re behind the very infringements they’re suing about.

So how can Prenda’s summer get better? A state court in Minnesota could award $63,000 in attorney’s fees, that’s how; the kicker being that it’s awarded against Prenda and for those the company accused.

Not that this is Prenda Law, prolific copyright trolls we’re dealing with here. Oh no. This case involved Alpha Law Firm LLC, which just happens to have the same address, principles, and operating practices as Prenda, and even did a nice bit of content-sharing between websites. However, the assertion is that they’re completely NOT Prenda, at all, especially since Prenda just shut-up shop.

In this particular case – Guava LLC v Merkel – the subject isn’t actually copyright trolling, but that most dastardly of crimes, hacking. According to the complaint (PDF):

Defendant used hacked usernanes and passwords to gain access to Plaintiff’s protected computer systems and intentionally intercepted numerous electronic communications between Plaintiff and its paying members.

The intercepted electronic communications included information regarding the identities of Plaintiff’s customers, account information, financial information, computer programming and security information, and other information that Plaintiff protects and does not even give access to third parties, even those who pay for and obtain legitimate passwords to access Plaintiff’s websites.

Put more simply, “..this guy used someone else’s username and password, and by doing so accessed info that wasn’t available to anyone.” If that sounds confused and contradictory to anyone else, you’d be right, which is why the exhibits accompanying the complaint are random ‘hacking’ stories, with no real relevance to the case.

From there, the case gets stranger.

The defendant, Spencer Merkel, already had dealings with Prenda Law in another case based in DC. In that one he was accused of infringement of the film “Amateur Alure – Maelynn”, and agreed to settle after admitting he downloaded it from Cheggit.

Not having the amount of cash they wanted he asked if there were other ways to settle, and the suggestion was to become a complicit defendant to be dismissed at the end of the case leaving a lot of other co-defendants, found during this case, hanging.

As a side note, the settlement demand spends a significant portion talking about the sophisticated detection systems used, and refers to a 2009 paper published by the University of Colorado. However, we strongly doubt that Prenda, or its expert witness (now usually called 6881 forensics or LiveWire, run by the brother of Prenda lawyer Paul Hansmeier) is actually using the Bitstalker program, whose effectiveness we doubted when the paper first came out.

That led to this case, Guava LLC v Merkel, and its computer hacking claims. These claims were, it seems, to get around the problems of having already sued and settled the copyright case. Using state laws they could file in state courts, and keep a distance between this case and the Doe case filed in DC that Merkel settled.

Eventually the case was dismissed with prejudice back on March 1st, in part thanks to a statement by Merkel and in part thanks to a motion by a number of ISPs. However, the truth is that any case like this isn’t over until people have been paid, and so on Wednesday, District Court Judge Tanya Bransford awarded attorney’s fees to defense lawyers totalling $63,367.52

This order is made jointly and severally liable to Alpha Law Firm, Guava LLC and Guava’s counsel of record, Michael Dugas, and due within 30 days. This means it doesn’t matter which of the parties pays it, they’re all liable for the amount as a group. Meanwhile, Steele, Hansmeier, Prenda Law, and the Anti-Piracy Law group were not held liable for these costs, but since Alpha is part of that ‘group’ (and even shares their address) they were still effectively hit by it.

That leaves a choice for ‘Alpha Law Firm’. They can pay the amount (either in part or in full) or leave the local counsel Dugas to pay for it all. However, if they throw Dugas under the bus they may find it extremely difficult to recruit any more lawyers to act as local counsel for them, and could even start losing the local counsel they already have in cases around the country.

No matter which way you slice it though, it’s another win for the public, and another loss for the copyright trolls.

Hat-tip –  SJD @ FightcopyrightTrolls.com

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