A blog post this week by former Las Vegas Review-Journal Publisher Sherman Frederick is now being used against Righthaven LLC in one of its copyright lawsuits.
Frederick appeared to comment Thursday that he was responsible for Righthaven suing then-U.S. Senate candidate Sharron Angle last year over allegations she infringed on copyrights by posting R-J material on her campaign website without authorization.
“I even sued her for lifting our material,” a comment on Thursday’s post on the R-J website by “Sherm” said.
The significance of that comment, defense attorneys say, is that it undermines claims by Stephens Media LLC, owner of the Review-Journal, that Stephens Media does not control Righthaven.
Counterclaims and existing and threatened lawsuits against Stephens Media, Frederick and others involved in the Righthaven litigation could result in financial damages and attorney’s fee awards against Stephens Media.
Besides being publisher of the Review-Journal, Frederick was CEO of Stephens Media until November.
Frederick’s blog post Thursday “constitutes a public admission by Stephens Media’s then-CEO that he — and by extension, Stephens Media — was truly in control of the Righthaven litigation,” said a court filing Thursday by attorneys for Righthaven defendant Dana Eiser in South Carolina.
Earlier, Righthaven defendant the Democratic Underground charged in a counterclaim against Righthaven and Stephens Media that “Stephens Media is an alter ego of Righthaven for the purposes of this case and that any separation between them for the purposes of this lawsuit is a sham.”
Righthaven is half owned by the same investors who own Stephens Media. The other half of Righthaven is owned by Las Vegas attorney Steven Gibson.
Righthaven since March 2010 has filed 275 lawsuits over alleged infringements of Review-Journal and Denver Post material. Its litigation campaign slowed down this summer after three judges dismissed suits over Righthaven’s lack of standing, and since last year the firm has been hit with three fair use losses.
Also on Thursday, U.S. District Judge Roger Hunt in Las Vegas fined Righthaven $5,000 as a sanction for deliberately hiding the role of Stephens Media in the Righthaven lawsuits over R-J material.
Hunt earlier rejected arguments by Stephens Media that its only role in the Righthaven cases was to assign copyrights to Righthaven. Stephens Media made that argument without disclosing it receives half of Righthaven’s lawsuit revenue over R-J stories, after costs.
“Contrary to its assertions in its moving papers, Stephens Media has threatened Democratic Underground with litigation because, according to the SAA (lawsuit contract between Stephens Media and Righthaven), Stephens Media approved or consented to suit against Democratic Underground,” Hunt wrote last month in a ruling in the Democratic Underground case.
That was the ruling in which Righthaven was removed from the case for lack of standing, while Hunt ordered that Stephens Media remain in the case as a defendant in the Democratic Underground’s counterclaim.
“Additionally, Stephens Media’s then CEO, Sherman Frederick, generally threatened potential defendants that he would send his ‘little friend called Righthaven’ after them. Here, Stephens Media actually did send Righthaven after Democratic Underground,” Hunt wrote in that order.
Separately, a spokesman for the State Bar of Nevada said Friday that its investigation of grievances filed against Righthaven and one or more of its attorneys remains active.
The State Bar plans to obtain a transcript of Thursday’s hearing in which Hunt suggested Righthaven operates as an unlicensed law firm while masquerading as a company.
While the State Bar hasn’t commented on the specifics of its investigation, it’s believed to be looking into the unlicensed practice of law allegation as well as the allegation that Righthaven has been involved in barratry and champerty.
These concepts are generally defined as a form of ambulance chasing in which a party with no real interest in a dispute tries to make money by inciting and prosecuting litigation over that dispute.