Righthaven ordered to pay defendant’s legal fees

One of the Righthaven LLC copyright lawsuits turned out to be a money loser for the Las Vegas company after a series of errors, culminating Tuesday in an award of legal fees for one of the defendants.

U.S. District Judge Gloria Navarro on Tuesday ordered Righthaven to pay attorneys for former defendant Michael Leon $3,815. Leon was named in one of the 274 lawsuits Righthaven has filed since March 2010 over alleged infringements of material from the Las Vegas Review-Journal and the Denver Post.

Leon, a veterans advocate in Fitchburg, Wisc., and an organization called MedBillz in San Diego were sued in September over allegations a Las Vegas Review-Journal story was posted on the veteranstoday.com website.

Before he was served, Righthaven filed an amended complaint in November also naming Denver-area retired military nurse Denise Nichols as a defendant. She was accused of posting a Denver Post column on the website.

One problem with this amended complaint is that it was titled "United States District Court – Southern District of California,’’ even though it was filed in Nevada. The amended suit went on to say, "The United States District Court for the Southern District of California is an appropriate venue’’ for the suit.

Problems for Righthaven continued in the case when Nichols was served with the first version of the suit not naming her as a defendant.

Amidst confusion over who was served with what, Navarro eventually dismissed the suit against Leon because he was not served in time, and Righthaven dropped the suit against Nichols after settlement talks with her failed.

Navarro noted in her fee ruling Tuesday that on April 20, when she dismissed the suit against Leon, the parties stipulated the dismissal would be without prejudice but with an award of attorney’s fees.

Since the dismissal was without prejudice, Righthaven can sue Leon again.

But since April 20, two other judges have ruled Righthaven lacks standing to sue over Las Vegas Review-Journal material under Righthaven’s lawsuit contract with R-J owner Stephens Media LLC. That would appear to make another suit against Leon unlikely unless Righthaven can somehow salvage its standing to sue.

Since attorney J. Malcolm DeVoy IV of Randazza Legal Group represented Leon for just the 45-minute April 20 hearing, the bulk of his $3,815 fee award for 13.8 hours of work was for time spent unsuccessfully negotiating the fee issue with Righthaven and then drafting and filing the motion for fees.

"Plaintiff (Righthaven) opposes any attorney’s fees being awarded to Mr. DeVoy or Randazza Legal Group because it was plaintiff counsel’s understanding that any award of attorney’s fees would be directed to a charitable organization since Mr. DeVoy was representing defendant Leon on a pro bono (free) basis,’’ Navarro wrote in her order.

"The court finds that it would be appropriate to award attorney’s fees to the law firm in light of the pro bono representation of defendant Leon,’’ Navarro wrote, citing case law that denying attorney’s fees would discourage pro bono representation.

Navarro has yet to rule on Nichols’ motion that she be reimbursed for her $1,500-$1,600 in legal fees. Nichols says the no-warning Righthaven lawsuit has worsened her health problems, but Righthaven calls her fee request a demand for "blood money’’ as it dropped the suit against her with prejudice, meaning she can’t be sued again.

Righthaven observer Eric Goldman at the Santa Clara University School of Law in California noted that because Righthaven had previously agreed to pay some fees in the Leon case, potentially to a charity, Navarro's ruling "doesn't represent a judicial condemnation of Righthaven's practices."

"Nevertheless, Righthaven's failure to properly serve Leon is yet another costly but avoidable litigation error made by Righthaven. I don't know if it's their staff turnover, general incompetence or something else, but Righthaven has made a surprisingly high number of unforced errors for a company whose sole business is litigation," said Goldman, associate professor and director of the university's High Tech Law Institute.

"There are several Righthaven defendants' motions for fee shifts under copyright's fee-shifting statutes. There are also some pending sanction motions against Righthaven that could further require Righthaven to pay the defendants. This case's relatively small award of attorneys' fees won't break Righthaven's bank, but I think it symbolically represents that Righthaven's profitability has crested. Going forward, I predict Righthaven's cash meter will start running in reverse with some frequency as judges make Righthaven write checks to its defendants. How many of those checks will Righthaven write until it acknowledges that it has no chance of profitability?" Goldman asked.

The fee ruling was one of four legal headaches that emerged Tuesday that Righthaven will have to deal with.

On top of Randazza Legal Group’s application for $34,000 in fees for successfully representing Righthaven defendant Wayne Hoehn, attorneys for South Carolina Righthaven defendant Dana Eiser filed a new motion for dismissal in federal court there asking that they, too, be awarded attorney’s fees should they prevail.

Also Tuesday, one of Eiser’s attorneys, Todd Kincannon, and his group, Citizens Against Litigation Abuse Inc., were allowed to participate as a friend of the court in a second pivotal Righthaven case in Las Vegas.

U.S. District Judge Roger Hunt allowed Kincannon’s group to file a brief in the Democratic Underground case – a key lawsuit in which Hunt first found Righthaven lacks standing to sue and then threatened Righthaven with sanctions. A hearing on potential sanctions in that case is now set for July 14.

U.S. District Judge James Mahan earlier ruled Kincannon’s organization could participate in the high-profile Pahrump Life case.

In both cases, Kincannon and Citizens Against Litigation Abuse will be arguing that Righthaven – by seeking lawsuit assignments and sharing lawsuit revenue with its media partners -- has been practicing law without a license. Righthaven has not yet responded to these assertions.



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Discussion 12 comments

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  1. Never mind paying the money to a charity, the actual defendant in these cases should be reimbursed for monies spent if Righthaven has been shown to be in the wrong.

    Eventually they will learn to exercise due diligence before bring an action. (Assuming they can correct all the defects in their business model to begin with.)

  2. In a word: excellent. Let the schmucks at Righthaven pay for the grief they cause to folks who have done no harm and caused no damages. As for the attorney, $3,815 for less than 14 hours on the job? Nice work if you can get it.

  3. I felt very fortunate to have retained the services of Randazza after the SAA revealed that they had lied in federal court repeatedly and to me in negotciations.

    Randazza worked cheap, Jerry.

    As the order notes: "Mr. DeVoy'shourly rate is $275 per hour and he provides a brief summary of the hours and labor and results obtained in accordance with Local Rule 54-16(b)."

    Righthaven's stubborn refusal to even consider paying attorneys' fees certainly raised the amount of time put into this, so please know this firm is in the words of another prevailing defendant: Aces.

    No defendant asked for becoming a victim of this terror campaign, but I and my fellow defendants are fortunate we received the services of socially minded attorneys who volunteered to work pro bono and then upon seeing their clients prevail followed the direction of the Court and rightfully seek costs and fees to which they are richly deserving.

  4. Hey Righthaven. You should just pay the $3815. It will be a lot cheaper than fighting it in court.

    Oh how the tables have turned. Sweet justice.

  5. Where is Sgt. Rock at?

  6. Karma's noose...
    Is that thing starting to gag you yet, fellas?

  7. Sgt Rock has suggested before that defendants in lawsuits should just admit they were wrong and pay up. Sounds like Righthaven should listen to Sgt Rock.

  8. mal (Michael Leon): I don't think Randazza worked "cheap" at all, the firm worked "inexpensively." Knowing law firms as I do, representing a couple of major one, your fee structure seemed eminently fair to me, especially considering the result.
    Jerry Fink: You must be aware that attorneys at some firms in town are between $600 and perhaps as high as $1,000.

  9. The profit potential of Righthaven's practices is getting smaller by the day and by each new ruling.

    When there is no profits you will see this all come to an end.

    Question is, how much is it going to cost Righthaven to make it go away? ;-)

  10. On June 14 of this year, I put the over/under at 60 days until RightHaven ceases to exist. ( http://www.vegasinc.com/news/2011/jun/14... )

    I stand by that prediction given the most recent stories.

  11. boftx

    I think Stephens Media and MediaNews needs Righthaven to stay around as cannon fodder, or should I say Kincannon Fodder.

  12. Ken,

    Unless the SAA is radically changed and RH changes how they select people to sue, RH is going to lose money and SM won't throw good money after bad.

    I doubt that SM (or NewsMedia) is willing to do what is required to effect a true transfer of ownership. Since RH can not sue without that, it will serve no purpose and SI Monitor, LLC will take their lumps and move on.