Righthaven Ordered To Forfeit Its Intellectual Property

New submitter BenJCarter writes with an update on Righthaven, the company that tried to make a business model out of copyright trolling. According to Wired, "[Righthaven] was dealt a death blow on Tuesday by a federal judge who ordered the Las Vegas company to forfeit 'all of' its intellectual property and other 'intangible property' to settle its debts. ... U.S. District Judge Philip M. Pro of Nevada ordered Righthaven to surrender for auction the 278 copyrighted news articles that were the subject of its lawsuits. ... Righthaven's first client, Stephens Media of Las Vegas and operator of the Review-Journal, invested $500,000 into the Righthaven operation at its outset. With Judge Pro's ruling (PDF), the media company is losing financial control of hundreds of articles and photos. 'The irony of this? Perhaps those who buy the copyrights could issue DMCA notices to the Review-Journal stopping them from redistributing them?' [opposing lawyer Marc Randazza] said via an e-mail, citing the Digital Millennium Copyright Act."

Comments

Finally

[Speeddymon]

Maybe all this nonsense with patent trolling will cease & desist ... pun intended.

Re:Finally

[sosume]

"Perhaps those who buy the copyrights could issue DMCA notices to the Review-Journal stopping them from redistributing them?'"
This is pure gold!

Re:Finally

[phrostie]

a little karma in the world.

very nice.

Re:Finally

[Anonymous Coward]

Not until the patent decays into the copyright can this ruling by applied. Unfortunately, physics has yet to ever witness such a transmutation as both patent and copyright objects are currently believed to be stable with a half-life longer than that of the observed universe.

Re:Finally

[Dorkmaster Flek]

In principle, yes, but I thought one of the strikes against them was that they didn't actually own the copyrights to anything they were suing over. They had the "right to sue" only, but the judges rules that you can't transfer only the "right to sue" of a copyright. It has to be the whole thing. If they don't actually own the copyrights, they don't have to forfeit anything.

Re:Finally

[cduffy]

In principle, yes, but I thought one of the strikes against them was that they didn't actually own the copyrights to anything they were suing over. They had the "right to sue" only, but the judges rules that you can't transfer only the "right to sue" of a copyright. It has to be the whole thing. If they don't actually own the copyrights, they don't have to forfeit anything.

My impression was that they went back and got actual copyright transfers late in the game, after suffering several losses on this account.

Re:Finally

[Dorkmaster Flek]

I didn't personally follow up on that, but if that is indeed the case, ouch. That means that news company effectively gave up their copyrights for nothing.

Re:Finally

[idontgno]

Um... I don't play much poker, but even I know that you don't raise heavily on a crap hand. You may think you're successfully bluffing, but you're not; that kind of mad-dog behavior is a tell.

So, Righthaven and their corporate overlords went all-in on an 8-high no-pair hand and rightly lost their entire stake. Yaaaaay.

There we go..

[Walterk]

And nothing of value was lost..

Re:There we go..

[SJHillman]

Nope, it was auctioned off.

Re:There we go..

[rufty_tufty]

Except time money and the stress and grief put up on others by this sham of a company.

Re:There we go..

[Fluffeh]

And nothing of value was lost..

Nothing to us, the sensible masses, but to the folks that invested half a million dollars, around a half million dollars of value was lost.

Chalk one up for the good guys.

Yay!

[Black Parrot]

The Feds finally got *something* right on the topic of intellectual property.

Maybe we can teach them a second trick.

Re:Yay!

[O('_')O_Bush]

I like to think of them like a puppy. Just because they peed in the right spot once, doesn't mean they are potty trained.

temporary

[MickyTheIdiot]

If this is "outbreak of sanity" (and I don't know without more detail) then it will probably only be a TEMPORARY outbreak of sanity.

Protecting IP like rabid dogs is considered "common sense" these days, and we all know how often common sense is actually wrong.

Re:temporary

[MickyTheIdiot]

Why don't we make this business model explicitly illegal???

Oh yeah... government works for the highest bidder right now and never in the public interest. It should be explicitly illegal... buy "Intellectual Property" for the non-good faith reason of suing people and you lose it. Of course that is too simple to be accepted and I have no money to buy lobbyists.

Re:temporary

[Sique]

The judge found this business model to be illegal (e.g. having no legal basis to work on). So why making something illegal illegal? That's like forbidding criminality.

Since one of the nails in the coffin

[nedlohs]

was it being ruled that they didn't have standing to sue - that assigning the right to sue but not the right to license/use the content doesn't work.

Surely, anyone buying what Righthaven owns also can't sue anyone?

Though given the ruling says they are the registered copyright holder I guess that mustn't have applied to everything?

No, they couldn't use DMCA

[Captain Hook]

'The irony of this? Perhaps those who buy the copyrights could issue DMCA notices to the Review-Journal stopping them from redistributing them?'

I thought that Righthavens undoing was that they acquired the right to sue copyright infringers from the orginal copyright owners but not the right to publish the articles they were suing over.

Original Slashdot Article

It means that anyone acquiring these rights will have the same problem that Righthaven had, they can't use them for anything.

Re:No, they couldn't use DMCA

[canajin56]

Different judge, different case. This judge ruled against Righthaven based only on fair use, that a USER posting to your forum a 4 paragraph excerpt from a 34 paragraph article, linked to the full article, at 0 financial gain to the user or the website, was not copyright violation.

So in this case, the judge never ruled on who owns it, and he said that while he acknowledges that the ownership is now in dispute because of the wording of the transfer agreement, as far as he can tell, Righthaven is the registered owner of all 275 articles, so he has every right to transfer them to the holder of the receivership. The fact that they actually are registered to Righthaven takes some weight from their losses before the first judge. Only that judge also made a declaratory judgement, calling it fair use regardless of who actually owns the rights, awarding lawyers fees and actually even bringing somebody from Stephens Media in to scold them, because the contract gave them the right to have final say in who to sue in the event it ends up being a charity (which it was!) or a hobbyist, and they did not exercise it. Basically he chewed their ear off for suing a charity over fair use, when as publishers of a law journal, they should damn well know better. In any event, other posters have said that after this initial loss, Righthaven was given full control so they wouldn't lose again. And then they lost again over fair use. So in THAT case, it would have 0 effect on the previous case, since they didn't have them yet. But they do KNOW, so they are fair game for forfeiture to pay the judgement in the first case.

Actual Summary

[Anonymous Coward]

They lost some legal proceedings they had brought, and were ordered to pay the defendant's costs.

They failed to comply with the costs order and ended up having their assets seized to be auctioned off to pay the costs.

The fact that the property was intellectual rather than an office block in Las Vegas was less about the philosophy of the Judge and more about the fact that the IP was the only assets the business held.

This doesn't speak to the viability or legality of copyright trolling.

Re:Actual Summary

[Rich0]

If anything the business model is validated to an extent. They still wreaked havoc on the defendant, and the defendant can't recover their costs since there is nothing to recover.

That is the problem with IP trolls - they require little capital to operate, and the companies they go after have quite a bit of capital (in most cases). So, they have little downside and considerable upside. In theory a single lawyer could work for a half-dozen of them, so that if one hits the jackpot it can pay out to its shareholders and divest itself of assets to prepare for the next suit, and if one loses it just folds.

Oh the sweet irony!

[MetalliQaZ]

TFA: "...ordered Righthaven to surrender for auction the 278 copyrighted news articles that were the subject of its lawsuits"

Company gives Righthaven "right to sue" on their article
Righthaven sues bloggers who use article
Court tells Righthaven that the "right to sue" doesn't exist
Company gives Righthaven all rights
Righthaven goes down in flames
Bloggers get ownership of articles

I know it's really going to their lawyers, but the premise is enough to make me smile :)

-d

Dear Troll

[Anonymous Coward]

All your bridge are belong to us.

Re:All that valuable IP

[mcgrew]

"If you give your IP to scumbags, you may loose all rigths to it."

Best pun I've seen all day.

Re:Pro's not a pro

[Compaqt]

Right, it was a play on words.

Too Bad They Had None

[Greyfox]

Their going down in flames was due to them not owning any of the IP they were suing over. So I don't think they actually had any.

Re:A win?

[shentino]

That's not good enough.

With how brazenly he's defying the court orders I don't think anything short of clapping him in irons and throwing him behind bars is going to do for what is probably very blatant contempt of court.