Prenda Law, A San Francisco Treat

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69 Responses

  1. Ken says:

    I view Duffy showing up and talking as nothing short of reckless.

  2. AlphaCentauri says:

    Great summary, thanks! Did Ken tell you about the pony you get?

    Interesting that it's a "nightmare" for Prenda to be expected to pay the costs in just a few cases, when they cared nothing about foisting those same expenses on defendants in hundreds of cases.

  3. SJD says:

    Unfortunately he mumbled so much that even though I was in the front row of the gallery I didn't catch everything he said.

    Duffy is the very definition of the antonym to "eloquent." That's makes him unique among the other Prenda gangsters: if he elected not to plead the Fifth, there wouldn't be much difference.

    (This is my insulting opinion, and it does not contain verifiable facts.)

  4. EH says:

    Excellent, thanks! I wanted to go down and see this for myself, but I forgot it was today.

  5. Jim Tyre says:

    I view Duffy showing up and talking as nothing short of reckless.

    Ken,

    I would have agreed with you earlier – in fact I did in email. But I think Cathy sets forth reasons why, at least arguably, he had to speak in this case.

    And possibly he could have done so without fear of Judge Wright on the spoliation and bond issues, as neither was anywhere near within the scope of his inquiry. The problem is with the AF Holdings ownership issue.

    I'm conflicted on this, but having read Cathy's piece (very nice, Cathy!) I'm no as sure as I was from the early partial report I had gotten.

  6. orvis barfley says:

    i like this cathy gellis.

    also, ken might find this interesting if he were to look pretty soon:
    https://twitter.com/EricNahlin.

  7. MattS says:

    I said on another thread and repeat here: Prenda Law isn't just being ground into dust. They are shipping the dust to CERN and running it through the LHC to reduce it to quantum particles.

  8. SJD says:

    Oops, the story I linked to was about another case, AF Holdings v. Trinh (Cathy briefly mentioned it): the first trolling case (to the best of my knowledge) where a motion for undertaking was granted.

    Booth Sweet later filed a similar motion, as well as a pro se defendant, David Harris (in Arizona). Maybe there are more, but I'm not aware about any.

  9. GM says:

    And <a href="http://www.popehat.com/2013/03/06/deposition-reveals-prenda-law-business-model-monetizing-squalid-douchebaggery/"what a deposition that turned out to be. (At today's hearing Judge Chen asked, "There was a 30(b)(6) depo. What happened?"

    Your link is broken! I always end up re-reading your linked Prenda bits, because it just never gets old on re-reads.

  10. orvis barfley says:

    the prenda boys definitely realize they are on a runaway horse (sorry) and can't get their collective hand out of the rigging. they've become a comedy act.

    great job, cathy.  you laid it out smooth.

  11. Anonymous says:

    Over at Ars and in a Kurt Opsahl tweet, it is said that Duffy claimed "Salt Marsh", who signed a document saying it had "read", "discussed", and "considered" legal options and rules, is a trust. How can a trust read, discuss, or consider anything. From my non-lawyer perspective, this seems as damning as the Alan Cooper allegations. Any lawyers want to comment? The document is:

    http://ia601207.us.archive.org/30/items/gov.uscourts.cand.254869/gov.uscourts.cand.254869.8.0.pdf

  12. Matthew Cline says:

    Hmmm. If a lawyer taking the Fifth (somehow) meant that s/he couldn't represent a (truly independent) client effectively, would the court be required to grant the lawyer a withdrawal as counsel, or would the lawyer be required to waive their Fifth amendment rights?

    On a different matter, isn't it weird that they'd name a trust after the boyfriend of one of the principals sisters?

  13. Alan Bleiweiss says:

    The Ars Technica article ended with:

    Ranallo is seeking to make Prenda pay in more than one case now. Another case in which he's asking for attorney's fees has a San Francisco hearing coming up on May 10.

    So even if we now have a while to wait for a ruling here, or even if Judge Wright feels he needs more time to cross his eyes and dot his tease, at least we'll continue to be fed more of these shenanigans while we wait impatiently…

  14. Delvan says:

    Aww, Sad Prenda. If only everyone wasn't working for free, they might be able to afford that bond. Perhaps they should have arranged a better fee schedule with their "client" walking around with "a little bit less" than $15 million in settlements alone.

  15. Delvan says:

    And, yes, ever since I read JohnHenryLawyer's awesome map (AKA Patel exhibit P), I can't help but hear "Copyright Infringement Panda" when I read Prenda's name.

  16. SJD says:

    To those who don't follow all the subtle details of this soap opera: Anthony (Tony) Saltmarsh is a real person (not a non-charity trust with undefined beneficiaries); he is (was?) a boyfriend of John Steele's sister, Jayme.

    Anthony Saltmarsh and Jayme Steele.

  17. Matthew Cline says:

    Over at Ars and in a Kurt Opsahl tweet, it is said that Duffy claimed "Salt Marsh", who signed a document saying it had "read", "discussed", and "considered" legal options and rules, is a trust. How can a trust read, discuss, or consider anything. From my non-lawyer perspective, this seems as damning as the Alan Cooper allegations.

    Maybe Saltmarsh the boyfriend is the trustee of Salt Marsh the trust? Now that would be confusing.

  18. OngChotwI says:

    Thank you, Cathy, for attending and sharing this with us.

    As a Red Dwarf Fan, I keep waiting for one of the Prenda Elite to run out of things to say, blot their hand with ink, stamp a paper with their handprint, state "I am a Fish", spin around thrice and faint. They seem to be getting closer to it..

  19. SJD says:

    To those who don't follow all the subtle details of this soap opera: Anthony (Tony) Saltmarsh is a real person (not a non-charity trust with undefined beneficiaries); he is (was?) John Steele's sister Jayme's boyfriend.

    Anthony Saltmarsh and Jayme Steele.

  20. Matthew Cline says:

    @SJD:

    Anthony (Tony) Saltmarsh is a real person (not a non-charity trust with undefined beneficiaries);

    Hey, maybe Prenda discovered an ancient magic ritual which can turn a trust into a human being.

  21. Can't Look Away says:

    Another fine article by the Popehat Team. I find each days revelations more fascinating than the day before. I am most intrigued by the Duffy plot-line for a number of reasons. I gather that he was at one time a legitimate and established attorney at one point and at some point made the decision to go to the dark side. Also, while JS and PH seem to pull the stings, Duffy is the name on Prenda and therefore, his signature invariably shows up on some document in every case.

    So, based on the fact that he's drowning in lies at the moment why does he still have so many active cases? Why has he not pulled all of his Discovery subpoena's in his other cases? Why has he not had his minions stop calling Does? Why is he still accepting settlements? Every time I check in with FCT, more people are getting calls and paying settlements to Prenda.

    Do Judges have any power to look into settlements paid before Discovery is released for cases that they later deem bunk?

    I get the feeling that they are sitting back just laughing this off, waiting for it to end. $10,000 sanctions are a pittance, recoverable with two or three settlements. The big money is well hid and untouchable in Nevis, and if they lose the ability to practice in two states, they still have forty eight others to choose from. Prenda dissolves, the primaries laugh off there wrist slap, start over with new shelf companies, new Alan Coopers, and a new name for the law firm, and have learned from this to be better about staying behind the curtain.

  22. Craig McLaughlin says:

    Been following the Prenda saga with interest. Met Ken in Judge Wright's court and watched Gibbs testify. Enjoying Popehat too. Nice writing Cathy!
    On a troll-related note, I was recently made happy by Judge Wright's award of attorney's fees to my clients as the prevailing party in a trademark troll case where the plaintiff, Slep-tone Entertainment Corp., purportedly concerned about piracy of its karaoke material, has overinclusively managed to sue many dozens of defendants (karaoke jockeys and venues) across the country. In his order, he stated that Slep-tone's lawsuit was "nothing more than a shakedown," Slep-tone was vexatious, its conduct in bad faith and amounted to taking "trolling to the next level." A blow-by-blow account can be found on the blog of Las Vegas lawyer, Robert Kossack. http://soundchoicelasvegaslawsuit.com/los-angeles-court-orders-slep-tone-to-pay-suganos-attorneys-fees-by-a-date-certain/

  23. nathan says:

    '[pleading the 5th] To which Duffy protested, "This is a civil matter, that was a criminal one. You can't make inferences."'

    In earlier posts, I thought it was said that in civil matters one could make inferences from a 5th pleading (and cannot in criminal ones). Without admitting that the LA hearing was criminal, even if it was cannot a different civil case make inferences about what was said there? Cathy's post mentions that you can't plead and not-plead the 5th in different contexts about the same matter.

    Am I missing something or is Duffy's claim incorrect?

  24. C. Ellis says:

    Read the whole thing with the Perry Mason theme song playing in my head.

  25. pearl says:

    In the motion to substitute Duffy for Gibbs, it says, "Gibbs has provided written notice of his withdrawal to Plaintiff…. The client understands and accepts the withdrawal…."

    I would really like to know exactly who the notice was provided to!

  26. That Anonymous Coward says:

    Ohai Ms. Gellis!
    Thank you for the update, I knew your name sounded familiar to me…
    https://www.techdirt.com/articles/20121125/11372821136/charles-carreon-finally-gets-served.shtml#c421
    I'm also impressed to finally have actual proof Duffy wasn't replaced with a mannequin as I had though before… live and learn I guess.

    @Craig McLaughlin – That name slep-mathingy… so familiar….
    They have their own topic on TechDirt… and it appears I was slapping someone around in the comments there back then.

  27. Charlie says:

    I guess I'm too new to practicing in California, but how is it that Section 1030 can apply to a lawsuit brought under the Copyright Act? I understand a state law claim for personal injury or whatever, but I don't see how state law can require a bond to be posted in order to proceed with a federal claim.

  28. Lucy says:

    Pleading the 5th. Who declares a case criminal or civil? It wasn't a criminal case to begin with, but Prenda seems to have declared it criminal for the purpose of pleading the 5th. Wouldn't a judge need to agree with them first before they start telling people it is criminal? Has Judge Wright changed it to criminal? Does mentioning criminal behavior automatically move the distinction?

  29. Patrick says:

    Lucy, all testimony in a civil case is sworn, and can therefore be used in a subsequent criminal action.

    For instance, I'm called to take the stand as a defendant in a personal injury case. I testify that I had the green light. The plaintiff's attorney, in an attempt to discredit me, asks whether I've ever committed a crime (an improper question but let's assume my attorney fails to object).

    I respond, "No, I killed Jimmy Hoffa, but they've never caught me, the stupid bumblers. I committed the perfect murder!"

    Now I'm in some serious trouble. It was a civil case, but I'm potentially looking at a murder charge, based on my sworn testimony that I killed Jimmy Hoffa.

    It's always the witness's choice as to whether to assert the privilege against self-incrimination, regardless of the nature of the case in which he or she is called to testify.

  30. Dan says:

    @Charlie
    Federal courts tend to follow the rules of the forum state with respect to awarding costs and security–the relevant authority is laid out in the opening to the motion for the undertaking.

    @Lucy
    The case doesn't have to be criminal in order to invoke the 5th, there only needs to be a reasonable belief that your answers might bring criminal action. For example, if the OJ Simpson civil case had happened before the criminal murder trial, OJ could have taken the 5th in the civil case.

    However, the criminal vs. civil case distinction matters with respect to whether the court may draw adverse inferences from the invocation of the 5th. Prenda is saying that the LA case has effectively become criminal, because Judge Wright was talking about fraud. Judge Wright doesn't seem to agree. Being the judge, his opinion is likely to carry a bit more weight.

  31. anne mouse says:

    Ohai Cathy, indeed! I remember when you were blogging about having nobody to debate with in ethics class. Who knew you'd still be blogging about legal ethics seven years later?

  32. Regular Guy says:

    It appears to me that Prenda was doomed in those states that allow for a bond the second they refused to post a bond. This was a major signal that Prenda could not afford their business model if a sufficient number of cases reached that stage. And of course word would have gotten out thanks to the Internet.

    I also went back and read the tweets from the "Bull". If it was indeed Mr. Steele, I am amazed at the bravado now that we have an idea of what was behind the curtain.

  33. James says:

    One question I have had with this case is whether Prenda could have avoided all of this by arranging their affairs differently. As a hypothetical . . . Suppose that I (not an attorney) located several women of easy virtue and produced cinematic masterpiece involving lots of naked people. Then I made bona fide, but feeble, attempts to market the product publicly while suspecting (knowing?) it would get shared via bit torrent.

    Now comes my old high school chum who happens to be an IP attorney. I engage him to sue the downloaders and we manage to divide the spoils either through legal fees negotiated with a "wink wink nudge nudge" arrangement, explicit contingency fees, or some other friendly arrangement that does not rise to the level of champerty.

    That would be equally sleazy copyright trolling but wouldn't it avoid all the problems that Prenda is facing here? They would have a legitimate client and would be making boatloads of fees for extracting settlements, so are they just being incredibly stupid?

  34. joe pullen says:

    I like this Cathy also. Thanks for the write up. This was great. Requiring the undertaking was a smart move by Navasca's council but considering the pace of the current Prenda implosion, I'm beginning to wonder if they'll ever be able to make good on it.

  35. Dr.Tom says:

    @James: I think this has been raised before on these boards and the assertion was made that what Prenda et al were up to would have been legal (slimy, but legal) if they had not hidden their presumed ownership in the entities that owned the copyrights. In particular, their alleged use of Alan Coopers name without his consent particularly tripped them up.

    IAMAL, but there seems to be little to keep them from doing this all again with different companies and different porn titles other than the issue of finding defendants via IP addresses which (hopefully) will be extinguished soon.

    I mean, since in some class action work where Paul H apparently used his father and his wife as plaintiffs, he could easily have done so in these cases.

    Of course, who wants it to be known that your wife or your father own copyrights to pornography…? I presume that was the point of this 'who owns what' shell game they have been playing.

    If anyone with a better understanding of the law (and this includes nearly everyone except my dog, and she's been studying!) wants to correct me, I would appreciate the education.

  36. Lucy says:

    Thank you Patrick and Dan. That helps my understanding the strategy of insisting they plead the 5th in a criminal proceeding rather than in a civil matter. Judge Wright, and everyone in the world for that matter know perfectly well what these guys are up to.

    On a side note, the shell company game question came up in another blog with respect to it being a rather a new phenomenon in the courts. Not true. Dead beat parents have been cheating child support orders exactly this way for many years. The probate courts are still easily swayed by this game and it still works unless there are aggressive lawyers to push the issues. The tried and true outcome here is whoever has the most money wins. Merit is much less a factor.

  37. He really said that...?!? says:

    One question I have had with this case is whether Prenda could have avoided all of this by arranging their affairs differently.
    @James
    They could have but I suspect greed and hubris charted their course.

  38. adam says:

    I can't believe you forgot the "ding ding!" San Francisco treat, indeed.

  39. Michael Mock says:

    Woohoo! Thanks, Cathy, for writing this up.

  40. Thanks Cathy! There is another AF Holdings case that is still open in the district of AZ – AF Holdings LLC v. David Harris, 2:12-cv-02144. http://dietrolldie.com/2013/03/13/af-holdings-llc-the-spin-off-cases-212-cv-02144-az-harris-update-13-mar-13/ Harris answered the complaint and now Prenda is trying to use it to find out subscriber information on 71 AZ Does.

    DTD :)

  41. MCB says:

    Regarding the ethical issue about taking the Fifth and then showing up for a hearing, wouldn't that be a conflict of interest?

  42. AZMos says:

    LOTRLCatted. Did I do this right? http://qkme.me/3tzr4l

  43. That Anonymous Coward says:

    OHAI! DTD!

  44. eigenperson says:

    Wait… you served Carreon? Shouldn't we give you a medal of honor or something?

  45. E Meyer says:

    Beautifully written, and so informative! Thank you.

  46. mcinsand says:

    If only Duffy's first name could have been Wynn, that would have just been too appropriate!

    Orvis Barfley, I'm not sure that a horse is the best metaphorical runaway item. I rather think that it's one of Wile E. Coyote's runaway falling anvils. Prenda is now fighting over whether to be riding the anvil to the desert floor as opposed to being underneath it, waiting for it to hit.

  47. JT says:

    "Duffy's Rocks and Hard Places"
    This is about porn after all.

  48. Nicholas Weaver says:

    I view Duffy showing up and talking as nothing short of reckless.

    I don't. It was, both tactically and strategically, the right move.

    If he didn't show, or if he took the Fifth, it would have been Game Over here in San Francisco: there would be an open invitation for a motion to dismiss with prejudice and a motion for an award of fees, payable jointly and severally by AF Holdings, Prenda Law, and probably Duffy personally.

    Instead, I think the hope is to keep up the story that AF Holdings is independent so that any award of fees is only payable by AF Holdings or, at worst, AF Holdings & Prenda Law.

    So far better to stick to a consistent story and say nothing new. Since everything is being shared by all Prenda defendants, all that matters is not adding anything new to the record. But repeating old stuff is fine, as long as he is consistent.

    So he stuck with the "Salt Marsh" trust story rather than the "Lightspeed LLC" story, and otherwise stick with the Sgt Schultz defense present in Hansemeier's deposition.

    I also wonder if Duffy, like Gibbs, should be in "Save My License" mode, which pleading the 5th about his client (unlike Ingenuity 13 where Gibbs, not Duffy is the attorney of record) would be a just about guaranteed bar license killer.

    Prenda and Duffy are a relatively late player to the game, and it wouldn't surprise me if the sale of Steele & Hansemeier to Prenda included some profit sharing or similar clauses that keep a bulk of the money going back to Steele and Hansemeier. (No sale sales, like, eg, buying only the right to sue, does seem a popular tactic amongst some lawyers.)

    So unlike the Steele and Hansemeier, Duffy may not have made enough to retire already.

  49. Kat says:

    I bet they're crying like babies right now.

  50. orvis barfley says:

    mcinsand, i like your analogy, too, but if you've ever been on a runaway horse (crossing a state highway, mind you) you'll know what sinking feeling that is.  at that point, you're just there for the ride.  hang on and hope for the best.

  51. Matthew Cline says:

    @Patrick:

    I respond, "No, I killed Jimmy Hoffa, but they've never caught me, the stupid bumblers. I committed the perfect murder!"I respond, "No, I killed Jimmy Hoffa, but they've never caught me, the stupid bumblers. I committed the perfect murder!"

    Well, that certainly beats out Ken's measly squirrel molestation.

  52. Nobody says:

    > (No sale sales, like, eg, buying only the right to sue, does seem a popular tactic amongst some lawyers.)

    I thought the Righthaven case dispensed with that particular shenanigan, at least with respect to copyrights?

  53. earthclanbootstrap says:

    Was the use of "soundbyte" in the filing opposing the posting of bond an attempt to be cute or stupidity?

  54. That Anonymous Coward says:

    @Nobody – Prenda had a way of trying the same thing over and over hoping for a new result. After it was made nearly crystal clear that no court would entertain damages for negligence for not securing a router (I mean other than there is no portion of the Copyright Act offering those kinds of damages) they kept the claim in their filings and in the lovely letters in which they sent to people hoping to have large sums of money given to them for not attaching that persons name to a porn title in a Google search.

  55. MCB says:

    "Salt Marsh" now has an owner. That owner is prenda paralegal and "corporate representative" of sunlust pictures Mark Lutz.

  56. SJD says:

    Yes, I just made a quick post featuring the hilarity. I avoided any analysis in order not to ridicule myself in anticipation of Ken's post. Also, there are many tasty tidbits that I did not mention (like "EFF tempering [sic] witnesses").

  57. Jim Tyre says:

    Also, there are many tasty tidbits that I did not mention (like "EFF tempering [sic] witnesses").

    EFF does not heat up witnesses so that they harden into a smooth, glassy shell.

  58. SJD says:

    By tempering witnesses EFF does a great favor to the justice: not tempered witnesses are easy to bend.

  59. Matthew Cline says:

    So Lutz created a non-beneficiary trust with his children as the beneficiaries the trust doesn't have. Children which don't exist. And named the trust for his non-existent children after the boyfriend of the sister of a friend.

  60. MCB says:

    "So Lutz created a non-beneficiary trust with his children as the beneficiaries the trust doesn't have. Children which don't exist. And named the trust for his non-existent children after the boyfriend of the sister of a friend."

    More or less. Then in his position as total owner of the trust he decided to have John Steele's crazy housekeeper be the CEO. And then–somehow–nobody really knew who controlled the trust or who the CEO was to answer clear and direct questions about them in court and at depositions. And nobody really is sure what happens to the settlement money that goes to the trust with the non-defined, yet defined, but also not-currently-existing beneficiaries except pay for the legal fees in the law firm Lutz works for.

    See, it's all above board!

  61. Matthew Cline says:

    @MCB:

    Then in his position as total owner of the trust he decided to have John Steele's crazy housekeeper be the CEO.

    Wait, I thought Cooper was (allegedly) the CEO of a different company (Livewire?), and merely the corporate representative of a AF. Or does Salt Marsh also own the other company?

  62. MCB says:

    I may be getting confused.

  63. SJD says:

    People on Twitter suggested the reason behind both Nazaire's motion and Lutz's affidavit: look at the date of filing (today's date): 4/20! 420!

    Everything is clear now.

  64. Jim Tyre says:

    People on Twitter suggested the reason behind both Nazaire's motion and Lutz's affidavit: look at the date of filing (today's date): 4/20! 420!

    Everything is clear now.

    420 is for smoking pot, not crack.

  65. That Anonymous Coward says:

    @MCB – You can't keep the players straight without a program.

    As I mentioned over on FCT, I really think people need to be looking to see if Lutz filed to adopt Steele and the other players recently.

  1. April 19, 2013

    [...] Cathy Gellis, guesting at Popehat, has a long post on the latest in the Prenda Law saga. A relevant paragraph: [...]

  2. April 21, 2013

    [...] I wrote about one of the recent chapters in the Prenda Law saga at the Popehat blog last week. For posterity, and people who read this blog but not that one, here's what I wrote. [...]

  3. May 1, 2013

    [...] When we last left our heroes Paul Duffy had managed to appear in open court and yet somehow seemingly not directly inculpate himself in Prenda Law's affairs, at least no more than he had done so previously. He was there because Prenda Law is now running for the exits, seeking to dismiss AF Holdings' case against defendant Joe Navasca "without prejudice" — meaning, with the option to re-file. In this particular case it needed the court's permission to do so. As Judge Chen noted in his devasting-to-Prenda ruling today: [...]