May 27, 2014 | By Mitch Stoltz

Major Victory Over Copyright Trolls: A Deeper Look

As we announced this morning, a federal appeals court handed copyright trolls a major defeat today by taking away one of their most powerful tactics: the ability to sue large groups of John Doe defendants together with minimal evidence. Now that the dust is clearing, we’re filling in the details.

This case, AF Holdings v. Does 1-1058, is one of the few mass copyright cases to reach an appellate court, and the first to look into fundamental procedural problems that have tilted the playing field firmly against the Doe Defendants. With this decision on the books, we suspect that even more federal trial courts will say "No" to the sordid business of cookie-cutter lawsuits seeking seeking cash payouts from dozens or even hundreds of Internet subscribers.

This appeal was brought by several internet service providers (Verizon, Comcast, AT&T and affiliates) with amicus support from EFF, the ACLU, the ACLU of the Nation's Capitol, Public Citizen, and Public Knowledge.

On the other side was notorious copyright troll Prenda Law. Prenda, and other groups like it, wanted to use the courts' subpoena power to identify Internet subscribers, then shake them down for $2,000-$4,000 "settlements." They assuredly didn’t want to invest the time and expense needed to actually figure out who, if anyone, likely infringed a copyright. Trolls use court processes not to enforce their rights or to protect a legitimate business, but to make a profitable business out of groundless threats and intimidation.

In this case, Prenda sued 1058 Does (anonymous defendants identified only by an Internet Protocol address) in federal district court in the District of Columbia. It then issued subpoenas demanding that ISPs give them the names of subscribers. The ISPs objected to this request, arguing that most of the IP addresses were associated with computers located outside of the DC court's jurisdiction. Limits on the courts' jurisdiction are a vital protection for the rights of defendants, because without this safeguard, Internet subscribers in Oregon (for example) can be forced to defend themselves in D.C. That made it even more likely that subscribers would choose to pay the troll a few thousand dollars to make the case go away, even if they had not infringed any copyright.

We also explained to the district court that joining together many subscribers in one lawsuit was fundamentally unfair and improper under the rules governing when defendants can be sued together (known as ‘joinder’). Lumping dozens or hundreds of Internet subscribers together denies them a real opportunity to explain their unique circumstances in court, such as who uses their Internet connection and when.

The district court disagreed with the ISPs and EFF, and in August 2012 issued a decision that would allow Prenda and its fellow trolls to continue these abusive tactics. We took the fight to the Court of Appeals for the D.C. Circuit, an influential appellate court.

Today, the appellate court agreed with us, and set some powerful precedents. On the jurisdiction issue, Circuit Judge Tatel ruled that in order to subpoena ISPs for subscribers' names, a plaintiff must show a "good faith belief" that Doe Defendants have a connection to the court's geographic territory. Quoting EFF's brief, Judge Tatel noted that Prenda could have used simple geolocation tools to determine what state or region each Doe likely lived in, rather than suing people from all over the country in one court. If Prenda had done so here, it would have discovered that most of the Does were likely not DC residents. "[W]e think it quite obvious," he wrote, "that AF Holdings could not possibly have had a good faith belief that it could successfully sue the overwhelming majority of the 1,058 John Doe defendants in this district."

The court also put a major limit on the number of Doe Defendants who can be lumped into one suit.  While many people may share files in a single BitTorrent swarm over the course of days or months, the court suggested that only those who participate at the same time could be joined together in a single copyright infringement case. Delving deeper than most courts into the workings of the BitTorrent protocol, Judge Tatel used an analogy that EFF suggested during last month's oral argument:

[T]wo BitTorrent users who download the same file months apart are like two individuals who play at the same blackjack table at different times. They may have won the same amount of money, employed the same strategy, and perhaps even played with the same dealer, but they have still engaged in entirely separate transactions. And “[s]imply committing the same type of violation in the same way does not link defendants together for the purposes of joinder.”

As the only federal appeals court decision on these issues in the context of copyright trolling, we expect this decision to have a wide impact. Although Prenda seems to have ceased its copyright lawsuit campaign after being accused of fraud by Judge Otis Wright II last year, copyright trolling continues. Over 10,000 Doe defendants were sued in federal copyright infringement cases in 2013.1 After this decision, though, people who try to use copyright litigation as a money-making machine will have to limit the defendants in each suit by geographic region and by the time of their alleged copyright infringement. This gives each defendant a better chance to defend him- or herself, and will also discourage some of the most abusive lawsuits from ever being filed. Let's celebrate today, and continue the fight.

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