Righthaven may contest creditor’s writ to seize its assets

Copyright lawsuit filer Righthaven LLC of Las Vegas signaled Wednesday that a creditor will have to jump through more hoops before it gains control of Righthaven’s assets.

On Tuesday, the federal court in Las Vegas issued a writ of execution requiring the U.S. Marshals Service to seize $63,720 in Righthaven assets to satisfy a judgment and costs in favor of Wayne Hoehn.

Righthaven had filed a lawsuit against Hoehn alleging copyright infringement for his unauthorized post on a sports betting website of a Las Vegas Review-Journal column — but the suit backfired on Righthaven when a federal judge dismissed it and then ordered Righthaven to pay Hoehn’s attorney’s fees.

Shawn Mangano of Las Vegas, an outside attorney for Righthaven, said Wednesday the company was aware of the writ.

"We’re evaluating the appropriate course of action,’’ Mangano said.

The options include challenging the writ in federal court in Las Vegas or at the 9th U.S. Circuit Court of Appeals in San Francisco, Mangano said.

If the Marshals Service and Hoehn’s attorneys try to seize Righthaven’s intellectual property, Righthaven will likely go to court to have the value of that property established, Mangano said.

The intellectual property includes software Righthaven uses to detect infringements, its website domain name and hundreds of copyrights Righthaven has registered.

Many of the copyrights have been the basis for the 276 lawsuits Righthaven has filed since March 2010. Of the suits, 275 claim material from the Review-Journal and the Denver Post was infringed on, while one suit involves sports betting material.

Righthaven has also registered copyrights to at least two porn movies. They are "Ebony Amateurs Vegas Edition #10" and "Ebony Princess #3."

While Righthaven has warned it could face bankruptcy if a creditor tried to seize its assets — particularly copyrights that generate lawsuit settlement revenue — Mangano said Wednesday that a bankruptcy is not imminent.

"We’re not there yet,’’ he said.

The $63,720 writ for Hoehn is just the beginning of Righthaven’s problems arising from defendants prevailing against Righthaven in court and then winning orders requiring Righthaven to pay their legal fees.

A federal judge in Las Vegas has ordered Righthaven to pay $119,488 in legal fees and costs to prevailing defendant Thomas DiBiase and a much larger fee award is likely by the same judge, Roger Hunt, in Righthaven’s failed lawsuit against the Democratic Underground.

It was in the heavily-litigated Democratic Underground case that Hunt first ruled Righthaven lacked standing to sue over R-J material because it was falsely claiming to own the copyright it was suing over.

In a domino effect, three more judges in Nevada and one in Colorado dismissed Righthaven suits, including Hoehn’s, ruling the company didn’t control the copyrights it claimed to own. Righthaven has also lost three lawsuits on fair use grounds.

In Denver, attorneys for another defendant who defeated Righthaven in a lawsuit over a Denver Post photo, Leland Wolf of the It Makes Sense Blog, have asked for Righthaven to pay another $33,148 in fees.

These attorneys include lawyers from Randazza Legal Group of Las Vegas, who also represent Hoehn.

On Wednesday, Senior U.S. District Judge John L. Kane in Denver reiterated that Righthaven must pay Wolf’s fees — the only question is how much money Kane will award Wolf for his costs.

"Plaintiff Righthaven must reimburse defendant Leland Wolf’s full costs in defending this action, including reasonable attorney fees. Despite my encouragement to negotiate an informal resolution of this question, the parties have failed to do so,’’ Kane wrote in an order Wednesday setting a Nov. 10 hearing on the issue.

Additional fee awards against Righthaven are possible in several of its contested lawsuits in Nevada, Colorado and South Carolina — though Righthaven is appealing the dismissals of many of its lawsuits and the attorney's fee awards against it.



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Discussion 6 comments

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  1. Should peoples work and copyrights be protect? Yes, but Righthaven went about it the wrong way with a bad contract with their clients.

    They abused the system and now it coming back to bite them. They are also costing the taxpayers of this state money with the abuse of the legal system. Time for them to fold their tents and file for BK and settle their debts.

    Hopefully a judge is going to hold them responsible for their actions and debts and not let them walk away from this mess they have created.

  2. Steve, you could turn this into a book, a play, a movie, or maybe a whole TV series on an idea gone bad. It is one heck of a story of avarice temporarily running amok in a fit of self-righteous tone-deaf self-aggrandizement.

    Of course, it being Righthaven, Crusader for Copyright Sactity, they will avoid and evade, running up everyone's costs, but it seems pretty clear that (1) the Copyright Act they claim to hold Sacred has a clause which expressly provides for attorneys fees to the prevailing party, (2) the result of not a few of Righthaven's filings is that the other parties have prevailed, (3) that others prevailing against Righthaven's claims was foreseeable when Righthaven LLC was capitalized, (4) that, since Righthaven's business was the bringing of lawsuits for Copyright infringement, attorneys fee awards were to be expected in the ordinary course and scope of its' business operations and (5) that Righthaven's capital was insufficient to provide for the debts to be incurred in the normal course and scope of its operations.

    Stephens Media and Mr. Gibson Esquire need to pay for the damage they have done. Otherwise the size of the checks they will have to right will get much bigger.

  3. It will be quite a while before the final chapter can be written since the appeals process will take time. And although I fully agree with the rulings that decided standing, I think a couple of the "fair use" decisions were just plain bad, especially the one by Judge Mahan.

    But overall, I will be very happy to see the demise of Righthaven's business model.

  4. boftx, what do you think is wrong with the fair use decision? Is it out of line with the Copyright Act or with the previous decisions construing it? If so, in what way?

  5. So when is the sheriff going to serve the warrant and start the seizure? We should all go over there and cheer!

  6. Leric,

    I disagree with the fair use decisions in that they have held that copying a work in its entirety is okay so long as it is a non-profit doing so. The Copyright Act (Title 17) actually gives examples of when such a use is allowed, mainly in an educational setting such as a class and involves the physical reproduction of a work.

    There is no reason whatsoever why a website can not take a reasonable excerpt (yes, that is undefined in the act) and then link to the original source.

    That being said, I think Righthaven is unethical at best and borders on immoral for how it approached these cases. I will be among the first to cheer when Righthaven is shut down.