September 28, 2011 | By Julie Samuels

Righthaven's Losing Streak Continues in Colorado

In what is becoming a well-settled pattern, Righthaven again finds itself on the losing end of a motion, with its case thrown out and owing the defendant – here, Leland Wolf, proprietor of the It Makes Sense Blog – costs and attorneys' fees for bringing a baseless copyright case. The lawsuit, Righthaven v. Wolf, is also notable for being the leading case among more than 50 that were filed in Colorado. Pending a motion to dismiss, the Colorado court stayed the remaining cases. With this ruling, the court has hopefully rung the death knell for the other remaining live cases in that district (joining the Nevada cases that have also been dismissed.)

Some background: In March, Righthaven sued Mr. Wolf for alleging infringing a Denver Post photograph titled “TSA Agent performs enhanced pat-downs," by virtue of a parody of the photo posted on his blog. Mr. Wolf moved to dismiss the case for lack of subject matter jurisdiction; EFF filed an amicus brief supporting that motion, explaining that Righthaven lacks ownership of any exclusive right granted under Section 106 of the Copyright Act.

Judge John L. Kane agreed, holding that Righthaven assigned to the Denver Post’s parent “the bare right to sue for infringement – no more, no less.” As such, Righthaven was neither a “legal owner” nor a “beneficial owner” of the copyright, and consequently could not bring a suit under the Copyright Act.

To its credit, the court also recognized the enormous pressure the prospect of statutory damages (on top of the expense of litigation) can place on defendants, even those with meritorious defenses, and called out Righthaven’s business model for the settlement mill that it tried to be:

[A] party with a bare right to sue may file numerous infringement actions of questionable merit with the intention of extorting settlement agreements from innocent users. This possibility becomes even more likely when the financial viability of the entity filing suit depends upon the proceeds from settlement agreements and infringement suits. Even though copyright law expressly provides for an award of costs and reasonable attorney fees to a party prevailing in its defense of a meritless infringement action, the economic realities of securing counsel and paying in advance the costs of litigation turns this remedy into a Potemkin Village. Both fundamentally and practically, the reality is at odds with the constitutional prioritization of public access to copyrighted works.

The court’s opinion also highlighted the important balance that the copyright laws are intended to protect. Specifically,

[C]opyright law necessarily balances the derivative goals of rewarding the creative labor of authors of original works with the primary goal of promoting further creativity by allowing public access to copyrighted works.

We are pleased that the Court refused to allow Righthaven to proceed with a lawsuit based on a copyright that it never owned and never had any plans to exploit. Finding otherwise would frustrate the important balance the court highlighted, and “the public interest in access to copyrighted materials.” Well done, Judge Kane.

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