Righthaven LLC’s warning today about a potential bankruptcy came amid developments in two more Righthaven copyright lawsuits pending in Denver.
In the first, Senior U.S. District Judge John Kane denied a motion by defendant Brian Hill’s attorneys that Righthaven be required to pay his legal fees. Those fees were unspecified, but likely were tens of thousands of dollars.
Kane’s ruling was heavily weighted to the fact that Righthaven voluntarily dismissed the suit against Hill, known as a blogger with autism and other disabilities – and that Kane declined in the Hill case to rule on whether Righthaven had standing to sue him.
Despite criticism of Righthaven in the case, Kane found "Righthaven’s alleged misconduct, no matter how egregious, did not multiply the proceedings 'unreasonably and vexatiously'" and "although its claims may eventually prove unsuccessful, I cannot find conclusive evidence of bad intent or improper motive."
"As I have previously noted, there is substantial evidence that Righthaven has engaged in a pattern of filing copyright infringement suits against naïve bloggers in order to secure settlement agreements, often with a minimal investment of time and effort," Kane wrote in his order. "These lawsuits act as an effective bargaining chip in the negotiation of settlement agreements, because the cost of settlement is often less than the cost a defendant would incur in defending against Righthaven’s suit. Indeed, if I were to award attorney fees in this case it would materially weaken the bargaining position that Righthaven has so successfully relied upon.
"Nevertheless, even though there are significant legal questions concerning the viability of Righthaven’s cause of action against Mr. Hill, there is no evidence that it brought suit in this district solely for the purpose of extorting settlement," the judge wrote.
David Kerr of Santangelo Law Offices in Fort Collins, Colo., an attorney who represented Hill, said he was disappointed in the ruling but respected it.
"I think Brian deserves to be recognized for being the first Colorado defendant to really refuse to give into Righthaven’s heavy-handed tactics and stand up and fight. I certainly do think there is a correlation between Brian’s case and the MediaNews Group’s decision not to continue their relationship with Righthaven," Kerr said.
MediaNews Group, owner of the Denver Post, disclosed this week it’s not renewing its copyright protection contract with Righthaven. The decision came after several public relations debacles, most notably about the Hill case.
Separately, attorneys for Randazza Legal Group in Las Vegas asked Kane for a preliminary injunction barring Righthaven from disgorging assets until they receive their legal fees for representing another Righthaven/Denver Post defendant.
The attorneys represent Leland Wolf and the It Makes Sense Blog – the case in which Kane is expected to decide if Righthaven had standing to sue in 33 open cases in Colorado.
While Kane hasn’t ruled yet, Wolf’s attorneys are confident of a victory and are also confident Kane will order Righthaven to pay their fees.
"Righthaven’s tactics and activities to date – dilatory, bad faith 'negotiations,' and numerous misrepresentations to multiple courts across the country – make it quite likely (if not inevitable) that Righthaven will take steps to dissipate its assets or use other means to attempt to frustrate this court’s fee award and judgment entered against it," Randazza attorneys said in their filing.
Shawn Mangano, an outside attorney representing Righthaven, said the company would fight this motion.
He said it came less than a day after one of the Randazza attorneys requested that Righthaven post a $25,000 bond to ensure the Randazza firm and co-counsel are paid. Mangano said that obtaining a bond in these circumstances is difficult since Kane hasn’t issued a final ruling.
Mangano noted the Randazza attorneys are seeking a court order freezing "monetary liquid assets," which could interfere with the company’s ability to pay day-to-day expenses.