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Affirmative defenses to a Malibu media pornography copyright lawsuit

Jan 26th, 2015 | By | Category: Copyright Litigation

Copyright Infringement Law – Malibu Media Affirmative Defenses to Copyright Infringement (Adult porn movies), case review.

Malibu Media affirmative defenses to copyright infringement lawsuit

Introduction

There is an increase, at least in my opinion as an intellectual property lawyer, in copyright holders seeking to enforce their federally registered copyrights in federal court, and through legal demand letters seeking large settlements.  We have dealt with these not only in photographers and image rights holders bringing their claims, but also in software companies such as Microsoft, Adobe and Autodesk bringing claims for alleged infringement of copyrighted business software and with claims of infringing copyrights by downloading and sharing adult pornography videos on p2p (peer to peer) file sharing websites such as BitTorrent.  This blog deals with one one such company (Malibu Media) which is filing numerous federal copyright lawsuits to try to enforce their federal copyrights, in this case, to protect pornographic photos and images.  This is an important public affairs issue internet users should be aware of.

What do you do when you get a legal demand letter regarding internet porn?  The Zumbo case listed a number of affirmative defenses that were raised, and should give you ideas if you are sued by Malibu Media.  There are many other companies who hold copyrights in their work product, and of course have legal rights to pursue their legitimate intellectual property claims.

CLICK HERE FOR A LIST OF KNOWN COPYRIGHTED MALIBU MEDIA VIDEOS

Facts of Malibu Media copyright case

The basic facts of the Malibu lawsuits (a Los Angeles LLC) are fairly simple.  They sued Defendants (often a “John Doe” Defendant) who are alleged in many cases to have downloaded or shared pornographic adult movies alleged to be owned by Malibu often through a peer-to-peer file sharing network known as BitTorrent. Their lawsuits claim they are entitled to damages for federal copyright infringement.  A subpoena may be sent to the ISP (Internet service provider) to learn the identity of the Defendant and the complaint filed with the federal court may list all the movie titles shared and downloaded. This creates a highly embarrassing situation for many named defendants, who often feel they will “lose it all” in the lawsuit.

Malibu Media Copyright Infringement Defense (Affirmative Defenses)

Malibu Media, according to sources, brought 27% of all federal copyright infringement claims in 2013 and were a large filer of copyright claims in 2014.  So what types of defenses can be raised when they are seeking to sue you?  One of the cases Malibu Media, LLC v. Zumbo highlighted some of the legal defenses that were raised in one case.  Some of these were dismissed by the Court, but it is helpful to look at some possible defenses to the infringement claim.

These affirmative defenses came up in Plaintiff’s Motion to Strike these affirmative defenses. The Court struck some, but allowed the other defenses.

Watch Attorney Steve Discuss Malibu Media cases involving notices of infringement to your Internet Service Provider (“ISP”)

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VIDEO:  Click on the photo to watch the video.  Make sure to hit the Red “V” for Victory to subscribe to our legal channel.  If you have received a legal demand letter or infringement notice from any move or music production company from San Diego to Seattle and San Francisco on over to New York, Florida or Georgia (or anywhere in between) dealing with a threat of federal copyright infringement and a $150,000 per title of the song or movie, call us at (887) 276-5084.  We are experienced in this area of law and we can help!  We have offices in CA and Phoenix, AZ.

A. DEFENDANT’S FIRST AFFIRMATIVE DEFENSE (One Satisfaction Rule)

Defendant’s first affirmative defense alleges that the “one satisfaction rule” bars plaintiff’s claim for statutory damages. Defendant asserts that the maximum statutory damage fee has already been received by plaintiff in settlements or judgment paid by co-infringers of the same copyrighted work.  Equity “provides that a plaintiff is entitled to only one satisfaction for a single injury,” thereby barring duplicative recovery from joint copyright infringers. BUC Int’l Corp. v. Int’l Yacht Council Ltd., 517 F.3d 1271, 1276 (11th Cir. 2008) (holding copyright infringers are entitled to a reduction in damages in the amount already paid in settlement by jointly liable parties). Furthermore, under the Copyright Act, “when statutory damages are assessed against a group of defendants held to be jointly and severally liable, each work infringed may form the basis of only one award, regardless of the number of separate infringements of that work.” Columbia Pictures Television v. Krypton Broad. of Birmingham, Inc., 106 F.3d 284, 294 (9th Cir. 1997) rev’d on other grounds sub nom. Feltner v. Columbia Pictures Television, Inc., 523 U.S. 340 (1998). Consequently, a copyright holder may only collect one collective award of statutory damages per work from joint infringers.
Here, defendant adequately alleges that plaintiff has already been paid the maximum statutory damages by joint “infringers who were involved, via Bit[T]orent, [in] the distribution of the same work[s].  No binding precedent was cited by plaintiff which would preclude such a defense because the co-infringers were named in separate cases. Accordingly, the affirmative defense is plausibly pled and the motion to strike defendant’s first affirmative defense is denied.

B. DEFENDANT’S SECOND AFFIRMATIVE DEFENSE (“Consent” and Implied license)

Defendant’s second affirmative defense asserts implied license, consent, and acquiescence to distribute plaintiff’s works on the internet. It asserts that plaintiff made works “freely available on the Bittorrent network and a variety of other sources  without paid subscription.” Plaintiff asserts the defense is inadequately pled and insufficient as a matter of law.
There are actually three distinct defenses set forth in the second affirmative defense. Two of them are insufficiently pled.
“An implied license is created when one party:
(1) creates a work at another person’s request;
(2) delivers the work to that person; and
(3) intends that the person copy and distribute the work. Latimer v. Roaring Toyz, Inc., 601 F.3d 1224, 1235 (11th Cir. 2010). Here, defendant does not allege that plaintiff created the works for him or that plaintiff delivered them to him. The affirmative defense fails to give fair notice to plaintiff or establish plausibility and is, therefore, inadequately pled. See Twombly, 550 U.S. at 555; Iqbal, 556 U.S. at 678-79. Consequently, plaintiff’s motion to strike defendant’s second affirmative defense as to implied license is granted.  Defendant also asserts the defense of consent by waiver. “[W]aiver or abandonment of copyright occurs only if there is an intent by the copyright proprietor to surrender rights in his work.” Thornton v. J Jargon Co., 580 F.Supp.2d 1261, 1282 (M.D. Fla. 2008) (citing Oravec v. Sunny Isles Luxury Ventures L.C., 469 F.Supp.2d 1148, 1177 (S.D. Fla. 2006)).
The second affirmative defense states that plaintiff made the works “freely available on the Bittorent network and a variety of other sources and without paid subscription,” and thereby has “authorized distribution on the internet. Specifically, Defendant claims that Plaintiff’s agents have authorized the release of the material over the internet.” This adequately pleads an intent to abandon copyright rights. The defense of waiver is sufficiently pled, and therefore, the motion to strike defendant’s second affirmative defense as to consent by waiver is denied.
Finally, acquiescence requires that: “(1) [Plaintiff] actively represented that [he] would not assert a right or a claim; (2) the delay between the active representation and assertion of the right or claim was not excusable; and (3) the delay caused the defendant undue prejudice.” See SunAmerica Corp. v. Sun Life Assur. Co. of Can., 77 F.3d 1325, 1334 (11th Cir. 1996). Active representation “does not necessarily mean an explicit promise not to sue. It only requires conduct on the plaintiff’s part that amounted to an assurance to the defendant, express or implied, that plaintiff would not assert his trademark rights against the defendant.” See Univ. of Ala. Bd. of Trs. v. New Life Art, Inc., 683 F.3d 1266, 1282 (11th Cir. 2012) (internal quotation marks omitted). The second affirmative defense fails to adequately plead each of the requirements of acquiescence. Accordingly, the motion to strike defendant’s second affirmative defense as to acquiescence is granted.  In sum, the motion to strike defendant’s second affirmative defense is granted as to implied license and acquiescence, and denied as to consent by waiver.

C. DEFENDANT’S THIRD AFFIRMATIVE DEFENSE (failure to mitigate damages)

Defendant’s third affirmative defense alleges that plaintiff failed to mitigate damages by purposefully avoiding taking sufficient steps to protect the copyrighted material. Plaintiff counters that failure to mitigate damages is not a defense when, as here, a plaintiff seeks only statutory damages. Neither party has identified any binding precedent, and the other courts are split. In a substantially similar case, one district court in the Eleventh Circuit has agreed that an election of statutory damages precludes the defense. Malibu Media, LLC v. Fitzpatrick, 1:12-CV-22767, 2013 WL 5674711, at *3 n.17 (S.D. Fla. Oct. 17, 2013); see also Malibu Media, LLC v. Yamaguchi, No. 13-CV-02781-WYD-MEH, 2014 WL 2021973, at *4-5 (D. Colo. May 16, 2014); Malibu Media, LLC v. Doe, No. 1:13-CV-30, 2013 WL 4048513, at *2 (N.D. Ind. Aug. 9, 2013); Malibu Media, LLC v. Batz, No. 12-cv-01953-WYD-MEH, 2013 WL 2120412, at *3 (D. Colo. April 5, 2013) report and recommendation adopted, 2013 WL 2115236 (D. Colo. May 15, 2013); Malibu Media, LLC v. Lee, CIV. 12-03900, 2013 WL 2252650, at *8 (D.N.J. May 22, 2013) (denying motion to strike only because plaintiff had not yet elected statutory damages). However, other courts have allowed the defense, reasoning that:
“because courts have broad discretion in determining how to award statutory damages and may consider actual damages as a factor in making that determination, a failure to mitigate damages may remain relevant, particularly because one purpose of statutory damages is to approximate actual damages that are difficult to prove.” Malibu Media, LLC v. Doe, 2:13-CV-135-RLM-JEM, 2014 WL 1031336, at *2 (N.D. Ind. Mar. 17, 2014) (citing Malibu Media, LLC v. Julien, 1:12-CV-01730-TWP, 2013 WL 5274262, at *2 (S.D. Ind. Sept. 17, 2013)); see also, Malibu Media, LLC v. Reeves, 1:12-CV-00841-SEB, 2013 WL 5487424, at *2-3 (S.D. Ind. Sept. 27, 2013). In the absence of controlling authority, the Court declines to strike the defense. See Reyher, 881 F. Supp. at 576.  Further, the defense is adequately pled. Some courts have indeed recognized that knowing failure to stop ongoing copyright infringement amounts to a failure to mitigate. See Tingley Sys., Inc. v. HealthLink, Inc.,509 F.Supp.2d 1209, 1219 (M.D. Fla. 2007) (finding dispute about whether copyright holder sent warning letter to defendant constituted genuine issue of material fact in defense of failure to mitigate damages);Interplan Architects, Inc. v. C.L. Thomas, Inc., 4:08-CV-03181, 2010 WL 4366990, at *47-48 (S.D. Tex. Oct. 27, 2010); Frank Betz Assocs., Inc. v. J.O. Clark Constr., LLC, CIV.A 3:08-CV-00159, 2010 WL 2253541, at *18-19 (M.D. Tenn. May 30, 2010). But see Home Design Servs., Inc. v. Trumble, No. 09-CV-00964-WYD-CBS, 2011 WL 843900, at *3 (D. Colo. Mar. 8, 2011) (“Even if [plaintiff] was aware of possible infringements of its copyrights in the same geographic area as the [defendants], [plaintiff] had no duty to preemptively warn individuals like the [defendants] not to violate copyright law.”).

 Here, defendant alleges that:
“Plaintiff has purposefully avoided taking sufficient steps to protect their copyrighted material because it is more profitable to allow their subscribers to distribute content and seek judgments and/or settlements from the subscribers.” (Doc. #11 at 6.) In addition, he contends that “IPP failed and continues to fail to take reasonable steps to ensure that the entity responsible for the freely available nature of their material on the internet ceases operation.” (Doc. #11 at 6.) Thus, defendant gives sufficient notice of the legal and factual grounds of his third affirmative defense. See Twombly, 550 U.S. at 555; Iqbal, 556 U.S. at 678-79.  Because defendant’s third affirmative defense is well pled and presents substantial questions of law and fact, the motion to strike is denied.

D. DEFENDANT’S EIGHTH AFFIRMATIVE DEFENSE

Defendant’s eighth affirmative defense asserts that plaintiff’s works are not entitled to copyright protection because plaintiff has not complied with a criminal statute relating to child pornography, Title 18, United States Code, Section 2257. (Doc. #11 at 8.) The statute provides:

“Whoever produces any book, magazine, periodical, film, videotape, digital image, digitally or computer-manipulated image of an actual human being, picture, or other matter which contains . . . actual sexually explicit conduct . . . shall create and maintain individually identifiable records pertaining to every performer portrayed in such a visual depiction.”

18 U.S.C. § 2257(a). Nothing in this criminal statute suggests that it is an affirmative defense in a copyright infringement claim. Additionally, while no court has directly ruled on the copyrightability of child pornography, “the prevailing view is that even illegality is not a bar to copyrightability.” see also Belcher v. Tarbox, 486 F.2d 1087, 1088 (9th Cir. 1973) (affirmatively holding that fraudulent publications were copyrightable). Moreover, the Eleventh Circuit has held that even obscenity and immoral content are copyrightable. Mitchell Bros. Film Group v. Cinema Adult Theater, 604 F.2d 852, 858 (5th Cir. 1979); accord Dream Games of Ariz., Inc. v. PC Onsite,561 F.3d 983, 991 (9th Cir. 2009) Illegal operation of a copyrightable work neither deprives the work of copyright protection nor precludes generally available remedies.”); Jartech, Inc. v. Clancy, 666 F.2d 403, 406 (9th Cir. 1982) (dicta) (finding obscenity is not a valid defense to copyright infringement). Thus, the Court grants the motion to strike.

E. DEFENDANT’S TWELFTH AFFIRMATIVE DEFENSE

Defendant’s twelfth affirmative defense alleges that the “technical investigators of Malibu Media have a contingent outcome in the interest of the suit and have therefore maintained this action in violation of the common law principles of champerty and maintenance.” “Maintenance is defined as an officious intermeddling in a suit which in no way belongs to the intermeddler, by maintaining or assisting either party to the action, with money or otherwise to prosecute or defend it.” Hardick v. Homol, 795 So.2d 1107, 1109 (Fla. Dist. Ct. App. 2001) (quoting Kraft v. Mason, 668 So.2d 679, 682 (Fla. Dist. Ct. App. 1996)). “Champerty, meanwhile, is a form of maintenance wherein one will carry on a suit in which he has no subject-matter interest at his own expense or will aid in doing so in consideration of receiving, if successful, some part of the benefits recovered.” Hardick, 795 So. 2d at 1109 (internal quotation marks omitted); accord Roberts v. Cooper, 61 U.S. 467, 475 (1857) (“[P]rofessional or any other aid, in consideration of having a part of the subject or thing in controversy, is sufficient.”).  At common law, a champertous contract is void. Cone v. Benjamin, 27 So.2d 90, 107 (Fla. 1946).

However, a plaintiff does not forfeit a valid claim against a defendant merely by entering a champertous contract with a third party. Id. at 107; Hardick, 795 So. 2d at 1111; accord Watkins v. Sedberry, 261 U.S. 571, 576-77 (1923); Burnes v. Scott, 117 U.S. 582, 590 (1886); Boone v. Chiles, 35 U.S. 177 (1836).
“It is the champertous contract and not the right of action itself which the contract avoids, and therefore defendant cannot avail himself of the champertous agreement as a defense to the action.” Cone, 27 So. at 107.  Here, even if plaintiff’s agreement with his technical advisors is void for champerty and maintenance, it is not a defense to the independent copyright infringement claim against defendant. Accordingly, the motion to strike defendant’s twelfth affirmative defense is granted.

F. DEFENDANT’S FOURTEENTH AFFIRMATIVE DEFENSE

Defendant’s fourteenth affirmative defense states that “Plaintiff’s claims are barred in whole or in part by the doctrine of laches.
“In face of a statute of limitations enacted by Congress, laches cannot be invoked to bar legal relief.  See Petrella v. Metro-Goldwyn-Mayer, Inc. (holding laches cannot bar relief under the Copyright Act). Since the Copyright Act establishes a three year statute of limitations, 17 U.S.C. § 507(b), the motion to strike will be granted as to the defense of laches.

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What is a “John Doe” Defendant?

Naming a “DOE DEFENDANT” is what you do when you file a federal lawsuit and do not know the actual name of the Defendant or Defendants.  Under Cal. Civ. Proc. Code § 474:

“When the plaintiff is ignorant of the name of a defendant, he must state that fact in the complaint, or the affidavit if the action is commenced by affidavit, and such defendant may be designated in any pleading or proceeding by any name, and when his true name is discovered, the pleading or proceeding must be amended accordingly; provided, that no default or default judgment shall be entered against a defendant so designated, unless it appears that the copy of the summons or other process, or, if there be no summons or process, the copy of the first pleading or notice served upon such defendant bore on the face thereof a notice stating in substance:
“To the person served: You are hereby served in the within action (or proceedings) as (or on behalf of) the person sued under the fictitious name of (designating it).” The certificate or affidavit of service must state the fictitious name under which such defendant was served and the fact that notice of identity was given by endorsement upon the document served as required by this section. The foregoing requirements for entry of a default or default judgment shall be applicable only as to fictitious names designated pursuant to this section and not in the event the plaintiff has sued the defendant by an erroneous name and shall not be applicable to entry of a default or default judgment based upon service, in the manner otherwise provided by law, of an amended pleading, process or notice designating defendant by his true name.”

What is the “one satisfaction” rule?

In Winzler & Kelly v. Superior Court, 48 Cal. App. 3d 385, 392, 122 Cal. Rptr. 259, 263-64 (Ct. App. 1975) the Court discussed the “one satisfaction rule””

“However, although each joint tortfeasor is liable for the entire damage, the injured party can receive only one satisfaction for his injury; ‘hence Satisfaction of the judgment by execution sale, or payment by one or more of the joint or concurrent tortfeasors, extinguishes the obligation and discharges the liability of all the others; and partial satisfaction has the effect of a discharge pro tanto.’ (4 Witkin, Summary of Cal.Law (8th ed.) s 37, p. 2335; see Rest. Torts, ss 885, 886; Rest. Judgments, s95; Cole v. Roebling Construction Co., supra, 156 Cal. 443, 447—449, 105 P. 255; Fowden v. Pacific Coast Steamship Co., supra, 149 Cal. 151, 157, 86 P. 178; Laurenzi v. Vranizan, 25 Cal.2d 806, 813, 155 P.2d 633; Watson v. McEwen, 225 Cal.App.2d 771, 774—775, 37 Cal.Rptr. 677; Steele v. Hash, 212 Cal.App.2d 1, 2—3, 27 Cal.Rptr. 853; Heves v. Kershaw, 198 Cal.App.2d 340, 345, 17 Cal.Rptr. 837.)  In Watson the rule is stated thusly: ‘The discharge or satisfaction of a judgment against one of several persons, each of whom is liable for a single harm, discharges each of the others from liability therefor.”

Tips to help stop a company that may be bullying you without good cause

Some of the common defenses that can arise with copyright litigation cases are listed above.  This is not an exclusive list.  We can help you identify potential defenses if you are being sued for federal copyright infringement or dealing with an adult video copyright violation due to illegal uploading or downloading (ex. you are a seeder in a torrent).   In some cases you may have paid for a monthly subscription and may be getting a letter because someone looked you up and find that you have a prominent position in the community and they just assume you will pay a damages award (EVEN IF YOU HAVE NOT INFRINGED ANYTHING), so that other people will not learn about your porn interests and preferences.  This is something most people would prefer to keep private.

There are also some legal causes of action you might have to counter the allegations being made against you.  These should be examined by your copyright counsel.  Revealing your personal tastes and habits (when you have a reasonable expectation of privacy) can be deemed a tortious invasion or privacy, or bringing an action without proper grounds may be deemed “extreme and outrageous” to support a tort claim such as:

  1. Intrusion on seclusion and solitude
  2. Publication of private facts
  3. Intentional infliction of emotional defense (IIED)
  4. Negligent infliction of emotional distress
  5. Civil RICO (if any company is trying to extort funds out of you with no legal justification)

Contact a Federal Copyright Litigation Lawyer

Our law firm can help you if you get a copyright cease and desist letter or monetary demand letter or are served with a summons and complaint alleging federal copyright infringement or other violation of intellectual property rights. We offer aggressive legal representation, a history of litigation success and flexible legal fees.  Contact us at (877) 276-5084 or leave you name, number and general description of your case using the contact for below.  One of our copyright lawyers will contact you to discuss your case.  We have offices in California and Arizona and serve clients throughout these two states and serve Federal Copyright Clients throughout the United States.

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We are a business and civil litigation firm with a focus on copyright infringement cases involving illegal movie downloads (torrent cases such as London Has Fallen and Malibu Media defense), software audits (ex. Microsoft audits, Autodesk licensing, Siemens PLM defense, SIIA, Adobe and Business Software Alliance defense) and other software vendors threatening piracy and infringement. We also handle cases involving internet law, anti-SLAPP, media law, right of publicity, trademarks & domain name infringement, and we have a niche practice area handling California BRE licensing disputes, accusations, subpoena response, statement of issues and investigations. We have offices in San Francisco, Beverly Hills, Newport Beach, San Diego & Phoenix, Arizona and accept federal copyright and trademark cases nationwide. All content on our website is general legal information only and not a substitute for legal advice, and should not be relied upon. Decisions to hire counsel should not be based on advertising alone. Blogs, videos and podcasts are authored by Steve Vondran, Esq. unless otherwise noted. We can be reached at (877) 276-5084.

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