Recording Industry vs The People: 5 Out of 6 Counterclaims Against RIAA in UMG v. Del Cid are Upheld by Court, Including Counterclaim for Conspiracy to Commit Extortion

Friday, September 21, 2007

5 Out of 6 Counterclaims Against RIAA in UMG v. Del Cid are Upheld by Court, Including Counterclaim for Conspiracy to Commit Extortion

In UMG v. Del Cid, in Tampa, Florida, the defendant had interposed counterclaims, including claims for extortion and conspiracy. On August 16, 2007, she amended her counterclaims*.

The RIAA moved to dismiss all six counterclaims.

The Court has returned its decision, granting the motion as to one counterclaim, and denying it as to the other five, including the counterclaims for extortion and conspiracy.

At the outset the Court rejected entirely the RIAA's assertion of the Noerr-Pennington defense as a basis for dismissal, since the doctrine does not protect "sham litigation", and Ms. Del Cid had alleged that the infringement suits were "sham litigation".

Copyright misuse.

The Court dismissed the third counterclaim, for copyright misuse, saying that it might constitute a defense, but did not qualify as a "cause of action".

Trespass, extortion, conspiracy, Computer Fraud & Abuse Act, Deceptive and Unfair Trade Practices Act, declaratory judgment of noninfringement

The court sustained defendant's counterclaims for

-trespass to defendant's personal property based on the RIAA's having accessed files on Ms. Del Cid's computer without her permission,
-violation of the Computer Fraud and Abuse Act based on the RIAA's unauthorized intrusion into defendant's computer,
-violation of Florida's Deceptive and Unfair Trade Practices Act,
-a declaratory judgment of non-infringement, and
-conspiracy to commit extortion, since defendant sufficiently alleged "a peculiar power of coercion possessed by Plaintiffs [by] virtue of their combination, which an individual alone would not possess".

Defendant's sixth counterclaim, which the Court upheld, alleges:

Plaintiffs have conspired among themselves and with others to commit the
following illegal acts to further the ends of their conspiracy: (a) use of private
investigators to conduct investigations in Florida against Florida residents,
without license, in violation of Fla. Stat. Chapter 493; (b) unauthorized access to a
protected computer system, in interstate commerce, for the purpose of obtaining
information in violation of 18 U.S.C. § 1030; and (c) extortion and attempted
extortion in violation of the Hobbs Act, 18 U.S.C. 1951.

Ms. Del Cid is represented by Michael Wasylik of Ricardo & Wasylik, in Dade City, Florida.

Amended Counterclaims*
Decision and Order Granting Motion to Dismiss Counterclaims as to Third Counterclaim and Denying Motion as to First, Second, Fourth, Fifth, and Sixth Counterclaims*

* Document published online at Internet Law & Regulation

Commentary & discussion:

p2pnet

Keywords: digital copyright online law legal download upload peer to peer p2p file sharing filesharing music movies indie independent label freeculture creative commons pop/rock artists riaa independent mp3 cd favorite songs

5 comments:

AMD FanBoi said...: I've been banging the "sham litigation" response to Noerr-Pennington here for awhile. NP, after all, seems to be the only arrow in the RIAA defensive quiver. It's wonderful to see Defendants assert it, and a court agree with it. Without the NP fig leaf to hide behind, all of the RIAA's despicable actions are open to proper legal attack!; September 21, 2007 at 6:38:00 PM EDT
bbsux said...: I bet the RIAA did a double take when they saw this! Serves them right.

Mr. Beckerman, would a notifaction to other judges in other cases where these claims have been dismissed help? (particularly the declaratory judgment of non-infringement); September 21, 2007 at 8:12:00 PM EDT
StephenH said...: I commend the courts for this ruling. This means that the RIAA will have to face action for what they did.; September 21, 2007 at 8:31:00 PM EDT
Art said...: Yeah! Glad to see the well reasoned order from the Judge in this case!

By the way, there is a typo on page 2 where the judge refers to the "Florida Rules of Civil Procedure" instead of "Federal Rules of Civil Procedure". However, the next paragraph has the correct wording.

Regards,
Art; September 21, 2007 at 8:53:00 PM EDT
Lunarsight said...: This is an interesting one. From what I've read about sham litigation, it's normally used when multiple businesses in the same industry try and interfere with or harm a competitor, so it's going to be interesting to see if the court goes along with it here.

I do think the Noerr-Penington defense should not be allowed in a case like this regardless, since it effectively creates a loophole allowing companies acting in unison to do some very unethical [and likely illegal!] things.

Perhaps this case can create a precedent for the extension of the current sham litigation definition.; December 6, 2007 at 5:37:00 AM EST

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JUDICIAL QUOTATIONS

"[T]he Court is concerned about the lack of facts establishing that Defendant was using that IP address at that particular time. Indeed, the [complaint] does not explain what link, if any, there is between Defendant and the IP address. It is possible that Plaintiff sued Defendant because he is the subscriber to IP address .... As recognized by many courts, just because an IP address is registered to an individual does not mean that he or she is guilty of infringement when that IP address is used to commit infringing activity." -Hon. Barry Ted Moskowitz, Chief Judge, S.D. California. January 29, 2013, AF Holdings v. Rogers
"The complaints assert that the defendants – identified only by IP address – were the individuals who downloaded the subject “work” and participated in the BitTorrent swarm. However, the assumption that the person who pays for Internet access at a given location is the same individual who allegedly downloaded a single sexually explicit film is tenuous, and one that has grown more so over time." - Hon. Gary R. Brown, Magistrate Judge, E.D.N.Y. May 1, 2012, K-Beech v. Does 1-37
"The concern of this Court is that in these lawsuits, potentially meritorious legal and factual defenses are not being litigated, and instead, the federal judiciary is being used as a hammer by a small group of plaintiffs to pound settlements out of unrepresented defendants."
-Hon. S. James Otero, Dist. Judge, Central Dist. California, March 2, 2007, Elektra v. O'Brien, 2007 ILRWeb (P&F) 1555
"The University has adequately demonstrated that it is not able to identify the alleged infringers with a reasonable degree of technical certainty...[C]ompliance with the subpoena as to the IP addresses represented by these Defendants would expose innocent parties to intrusive discovery....[T]he Court declines to authorize discovery and quashes the subpoena as to Does # 8, 9, and 14" -Hon. Nancy Gertner, Dist. Judge, Dist. Massachusetts, November 24, 2008, London-Sire Records v. Does 1-4
"[C]ounsel representing the record companies have an ethical obligation to fully understand that they are fighting people without lawyers... that the formalities of this are basically bankrupting people, and it's terribly critical that you stop it...." -Hon. Nancy Gertner, Dist. Judge, Dist. Massachusetts, June 17, 2008, London-Sire v. Does 1-4
"Rule 11(b)(3) requires that a representation in a pleading have evidentiary support and one wonders if the Plaintiffs are intentionally flouting that requirement in order to make their discovery efforts more convenient or to avoid paying the proper filing fees. In my view, the Court would be well within its power to direct the Plaintiffs to show cause why they have not violated Rule 11(b) with their allegations respecting joinder. [I]t is difficult to ignore the kind of gamesmanship that is going on here.....These plaintiffs have devised a clever scheme... to obtain court-authorized discovery prior to the service of complaints, but it troubles me that they do so with impunity and at the expense of the requirements of Rule 11(b)(3) because they have no good faith evidentiary basis to believe the cases should be joined." -Hon. Margaret J. Kravchuk, Magistrate Judge, District of Maine, January 25, 2008, Arista v. Does 1-27, 2008 WL 222283, modified Oct. 29, 2008
"[N]either the parties' submissions nor the Court's own research has revealed any case holding the mere owner of an internet account contributorily or vicariously liable for the infringing activities of third persons.....In addition to the weakness of the secondary copyright infringement claims against Ms. Foster, there is a question of the plaintiffs' motivations in pursuing them..... [T]here is an appearance that the plaintiffs initiated the secondary infringement claims to press Ms. Foster into settlement after they had ceased to believe she was a direct or "primary" infringer." -Hon. Lee R. West, District Judge, Western District of Oklahoma, February 6, 2007, Capitol v. Foster, 2007 WL 1028532
"[A]n overwhelming majority of cases brought by recording companies against individuals are resolved without so much as an appearance by the defendant, usually through default judgment or stipulated dismissal.....The Defendant Does cannot question the propriety of joinder if they do not set foot in the courthouse." -Hon. S. James Otero, Central District of California, August 29, 2007, SONY BMG v. Does 1-5, 2007 ILRWeb (P&F) 2535
"Plaintiffs are ordered to file any future cases of this nature against one defendant at a time, and may not join defendants for their convenience."
-Hon. Sam Sparks and Hon. Lee Yeakel, District Judges, Western District of Texas, November 17, 2004, Fonovisa v. Does 1-41, 2004 ILRWeb (P&F) 3053
"The Court is unaware of any other authority that authorizes the ex parte subpoena requested by plaintiffs."
-Hon. Walter D. Kelley, Jr., District Judge, Eastern District of Virginia, July 12, 2007, Interscope v. Does 1-7, 494 F. Supp. 2d 388, vacated on reconsideration 6/20/08
"Plaintiffs contend that unless the Court allows ex parte immediate discovery, they will be irreparably harmed. While the Court does not dispute that infringement of a copyright results in harm, it requires a Coleridgian "suspension of disbelief" to accept that the harm is irreparable, especially when monetary damages can cure any alleged violation. On the other hand, the harm related to disclosure of confidential information in a student or faculty member's Internet files can be equally harmful.....Moreover, ex parte proceedings should be the exception, not the rule."
-Hon. Lorenzo F. Garcia, Magistrate Judge, District of New Mexico, May 24, 2007, Capitol v. Does 1-16, 2007 WL 1893603
"'Statutory damages must still bear some relation to actual damages." Hon. Michael J. Davis, Dist. Judge, U.S.District Court, Dist. Minnesota, January 22, 2010, Capitol Records v. Thomas-Rasset
"[T]his court finds that defendants' use of the same ISP and P2P networks to allegedly commit copyright infringement is, without more, insufficient for permissive joinder under Rule 20. This court will sever not only the moving defendants from this action, but all other Doe defendants except Doe 2."
-Hon. W. Earl Britt, District Judge, Eastern District of North Carolina, February 27, 2008, LaFace v. Does 1-38, 2008 WL 544992
"[L]arge awards of statutory damages can raise due process concerns. Extending the reasoning of Gore and its progeny, a number of courts have recognized that an award of statutory damages may violate due process if the amount of the award is "out of all reasonable proportion" to the actual harm caused by a defendant's conduct.[T]hese cases are doubtlessly correct to note that a punitive and grossly excessive statutory damages award violates the Due Process Clause....."Hon. Marilyn Hall Patel, Dist. Judge, N.D. California, June 1, 2005, In re Napster, 2005 US DIST Lexis 11498, 2005 WL 1287611
"[P]laintiffs can cite to no case foreclosing the applicability of the due process clause to the aggregation of minimum statutory damages proscribed under the Copyright Act. On the other hand, Lindor cites to case law and to law review articles suggesting that, in a proper case, a court may extend its current due process jurisprudence prohibiting grossly excessive punitive jury awards to prohibit the award of statutory damages mandated under the Copyright Act if they are grossly in excess of the actual damages suffered....."-Hon. David G. Trager, Senior District Judge, Eastern Dist. New York, November 9, 2006, UMG v. Lindor, 2006 U.S. Dist. LEXIS 83486, 2006 WL 3335048
"'[S]tatutory damages should bear some relation to actual damages suffered'....(citations omitted) and 'cannot be divorced entirely from economic reality'". -Hon. Shira A. Scheindlin, Dist. Judge, Southern Dist. New York, August 19, 2008, Yurman v. Castaneda
"The Court would be remiss if it did not take this opportunity to implore Congress to amend the Copyright Act to address liability and damages in peer to peer network cases.... The defendant is an individual, a consumer. She is not a business. She sought no profit from her acts..... [T]he damages awarded in this case are wholly disproportionate to the damages suffered by Plaintiffs." -Hon. Michael J. Davis, District Judge, Dist. Minnesota, September 24, 2008, Capitol v. Thomas
"If there is an asymmetry in copyright, it is one that actually favors defendants. The successful assertion of a copyright confirms the plaintiff's possession of an exclusive, and sometimes very valuable, right, and thus gives it an incentive to spend heavily on litigation. In contrast, a successful defense against a copyright claim, when it throws the copyrighted work into the public domain, benefits all users of the public domain, not just the defendant; he obtains no exclusive right and so his incentive to spend on defense is reduced and he may be forced into an unfavorable settlement." US Court of Appeals, 7th Cir., July 9, 2008, Eagle Services Corp. v. H20 Industrial Services, Inc., 532 F.3d 620
"Customers who download music and movies for free would not necessarily spend money to acquire the same product.....RIAA’s request problematically assumes that every illegal download resulted in a lost sale."
-Hon. James P. Jones, Dist. Judge, Western Dist. Virginia, November 7, 2008, USA v. Dove