| Main |

The mother of all attorney-fees rulings

A new ruling by a federal judge in Oklahoma may have opened a can of worms for the RIAA and MPAA and their lawsuit campaigns against file-sharing piracy. On Tuesday, U.S. District Judge Lee R. West essentially ruled that the major record companies (and, by implication, the Hollywood studios) should pay the legal fees of the people they sue for indirectly violating copyrights if the only connection shown to the alleged infringement turns out to be their name on the high-speed Internet access account.

The case here followed much the same path as many of the lawsuits filed by the entertainment industry since the RIAA began going after file-sharers in bulk in September 2003. Its contractors targeted an anonymous Kazaa user ("fflygirl11") who was offering hundreds of copyrighted songs for others to download, then traced the user to a specific IP address. The RIAA filed a John Doe lawsuit against that user, then obtained a subpoena to force the Internet service provider associated with the address (the cable TV operator Cox) to reveal the name of the account holder to whom the address was assigned at the time. That turned out to be Deborah Foster, a nurse. The RIAA's "settlement" contractors -- a law firm -- contacted Foster and threatened to sue unless she paid several thousand dollars. She said she had no knowledge of the illegal downloading, and suggested that her estranged husband or daughter Amanda, who was in college, were responsible. The labels sued her anyway in November 2004, saying she was liable merely because it was her account; the following July, after the younger Foster offered to admit liability, they amended the suit to add Amanda as a defendant and accuse both Fosters of directly and indirectly infringing. Exasperated, Deborah filed a counterclaim asking the judge to declare that she had not violated the labels' copyrights and seeking payment of her attorney fees. But Amanda didn't respond to the amended complaint, and in November 2005 the judge issued what's known as a default judgment against her. In July 2006, a year after the amended complaint was filed and 19 months after the case began, West granted the labels' motion to dismiss the complaint against Deborah. He also ruled that she was the prevailing party in the lawsuit, which meant she could apply to the court for attorney fees. And so she did.

The Electronic Frontier Foundation, the ACLU, Public Citizen and the American Assn. of Law Libraries weighed in on behalf of Foster's motion for attorney fees, and the RIAA opposed it. The former argued that awarding attorneys fees to defendants like Foster would provide an important deterrent to overreaching by copyright holders. That deterrent is missing today, they argued, adding that the RIAA's tactics forced most defendants to knuckle under because the payment demanded -- several thousand dollars in most cases -- was far less than the cost of proving in court that they weren't pirates. The RIAA argued that its claims weren't frivolous -- someone was using Foster's account to make copyrighted songs available on Kazaa without the labels' permission -- and that courts around the country had dismissed claims for attorney fees from similar defendants.

Still, there's no settled legal doctrine that holds the person paying for an Internet access account  liable for any bad deeds done with it. On the contrary; as West says in his decision (and Foster says in her motion), merely supplying the means to violate copyrights doesn't make someone liable for indirect infringement. There has to be some evidence of knowledge and participation, or control and financial interest. West said the RIAA offered no such evidence. He also questioned the labels' motives, saying, "there 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." In other words, they were just trying to shake her down.

A key difference between Foster's case and the ones where the defendants failed to recover their legal fees, West wrote, is that the labels expanded their initial claims to accuse her of indirect infringement -- as he put it, "a novel application of secondary copyright infringement claims." By hiring a lawyer (Marilyn Barringer-Thomson of Oklahoma City) and defending herself, Foster helped test this unusual theory, West wrote. That advanced the goals of the Copyright Act, which tries to balance the need to promote innovation while also making the fruits of that innovation available to the public.

The amount of fees to be paid remains to be determined. But the message from West is clear: unless an Internet account holder is the actual infringer, copyright holders can't squeeze them until they pop. Otherwise, they'll be paying the defense lawyers. Suing account holders may be a legitimate first step toward identifying the actual infringer, but copyright holders can't hound them after the trail leads somewhere else. It's a win for parents, and it could put the labels and studios in the position of having to focus their fire more squarely on youths -- with all the political and public-relations baggage that would bring.

(Thanks to TechDirt for putting this one on my radar screen.)


TrackBack URL for this entry:

Listed below are links to weblogs that reference The mother of all attorney-fees rulings:


The comments to this entry are closed.

Our Blogger
Times editorial writer Jon Healey pens opinion pieces about a variety of business issues, and blogs about technologies that are changing the entertainment industry's business model.

Search this blog

Subscribe to this Blog - What is RSS?

Now Playing

Where I've Been Lately