Now Accepting Bitcoin (and Litecoin)

Greetings.

FirmEquity is excited to announce that we are now accepting Bitcoin as a form of payment for our legal services. Given that many of our clients are tech savvy individuals and startups, it makes sense for us to be one of a growing number of companies accepting Bitcoin as a payment.

We have not yet created a wallet to be able to accept Litecoin, but we will do so if it is a form of payment you wish to use.

If you are curious about paying for legal services in Bitcoin or Litecoin, send an email to billy@firmequity.com for more information.

Understanding Copyright Trolls: Transforming Online Piracy into a Sue-to-Settle Business Model or Zealously Defending Authors’ Digital Rights?

Log on to your personal laptop while at your residence, place of business, on a non-password protected wireless connection, or even at local coffee shop that provides complimentary Wi-Fi ancillary to their main business.  Subsequently, perform a basic Internet search for your favorite movie or television program and include the phase “watch online free.”  Almost instantly, online users are able to practice the most rudimentary form of online copyright infringement originating from various wireless routers as access points.  Further, countless cybernauts regularly practice such infringing activities on a daily basis in order to circumvent paying a noncommercial use levy.  This can theoretically transform today’s average Internet user into a “grand larcenist” due to the fact that on an average day “even the most law-abiding American engages in thousands of actions that likely constitute copyright infringement.”[1]  Additionally, Internet users are able to download copyrighted material online with ease through various peer-to-peer file-sharing services such as PirateBay and BitTorrent.[2]  However, the growing possibility exists that the account holder for the wireless service used to download the copyrighted material- whether it be a parent, roommate, or even you- could find a settlement letter in the mail in the near future.

Taking a page directly from the patent trolls, “copyright trolls” seek to transform copyright infringement suits into a revenue model by employing the threat of statutory damages to extract rapid settlements from Internet users accused of online copyright infringement.[3]  It is important to note that these trolling firms are generally not the original owners of the copyrighted work.  Instead, they acquire the exclusive bundle of rights afforded to the content creators by the Copyright Act of 1976 (“ Copyright Act”) in order to pursue copyright infringement actions against alleged infringers.  These settlement letters disbursed on behalf of the rights holders or the trolling firms typically request several thousand dollars to settle the matter out-of-court regardless of whether you personally downloaded the protected work in question.  Strategically, these settlement amounts are less than the cost of hiring an attorney to defend against the claim in court.  Within a boilerplate settlement letter, the account holder to the wireless router or alleged downloader will be accused of willful copyright infringement, which is subject to $150,000 in statutory damages under 17 USCS § 504(c)(2) Remedies for Copyright Infringement.[4]  Simply put, “copyright trolls” seek to file muddy infringement claims that still lead to the discovery phase in litigation.  Many of these firms employ forensic companies to monitor and harvest vast amounts of Internet Protocol (“IP”) addresses associated with downloading the rights holder’s copyrighted work from websites such as BitTorrent.[5]  Ultimately, once an IP address has been associated with infringement of a protected work, trolling firms will be able to send a subpoena to the account holder’s Internet Service Provider.  These subpoenas will request the release of personal information relating to the identities and addresses of countless alleged infringers who have been associated with copyright infringement through their IP addresses.[6]

Conversely, this business model of sending settlement letters to alleged infringers on a large scale embodies the substantial risk of “false positives.”  This is a contention that an IP address registered to an individual is not sufficient to support a claim that the individual is guilty of copyright infringement.[7]  The US District Court for the Central District of California Judge Otis Wright stated, “[an] IP address alone may yield subscriber information. . . But that will only lead to the person paying for the Internet service and not necessarily the actual infringer, who may be a family member, roommate, employee, customer, guest, or even a complete stranger.”[8]  As a result, the vexatious practices of firms branded as copyright trolls create the unjustified possibility of ensnaring countless innocent Internet users into costly litigation.  Fortunately, the growing trend adopted by judges in multiple jurisdictions is to recognize that an IP address alone does not identify an individual.

In June 2013, President Obama personally condemned this predatory practice used by patent and copyright trolls inundating the courts with infringement claims by stating that these companies “don’t actually produce anything themselves,” and instead create a business model “to essentially leverage and hijack somebody else’s idea and see if they can extort some money out of them.”[9]  Clearly, this extortionate sue-to-settle business model subverts the constitutional Framers’ original underlying purpose instilled within the Copyright Act, which intended copyright itself to be the “engine of free expression” in creating a “marketable right to the use of one’s expression, copyright supplies the economic incentive to create and disseminate ideas.”[10]

The Copyright Act grants rights holders two options for remedies in the event there is an infringement on any of the owner’s exclusive rights.[11]  The owner may elect to recover either actual damages or lost profits resulting from the infringement, which are accompanied by any profits gained by the violator that are attributable to the infringement.[12]  In the alternative, the copyright owner may elect statutory damages, which are typically within the continuum of $750 to $30,000 as the court considers just.[13]  Moreover, in the event the rights owner establishes the burden of showing that the infringer acted willfully, the court in its discretion may increase the damages award up to $150,000.[14]  This explains why alleged infringers are threatened with the possibility of paying such large and seemingly disproportionate figures.

FirmEquity, in its efforts to restore the original policy-backed intentions instilled within the Copyright Act, seeks to represent those who have been unfortunately targeted by trolling firms’ efforts to extract quick settlements regardless of the alleged infringer’s culpability.  Furthermore, we strive to provide several cost-effective solutions when defending alleged infringers against these claims based on tenuous evidence.  Although an IP address is not a person, evidence that an infringement occurred through that IP address is sufficient file an infringement claim in Federal Court.  Furthermore, even one firm that employs this business model of suing large groups of John Doe alleged infringers in efforts to secure rapid settlements boldly admitted, “It is possible that someone other than the subscriber is the infringer.”[15]  We are ardent proponents of this league of thought: substantial ethical implications arise from this sue-to-settle business model adopted by many non-author plaintiffs filing countless claims because even if an IP address has been associated with an alleged infringement, that does not mean the account holder is liable to a reasonable degree of certainty.  Consequently, we feel that this unethical behavior, which poses a substantial risk of entangling numerous innocent Internet users into costly litigation or settling without warrant, is reprehensible and demands the public’s attention.

 


[1] John Tehranian, Copyright Reform and the Law/Norm Gap, 2007 Utah L. Rev. 537, 538 (2007) (emphasizing that the “ease of digital reproduction” has generated piracy on a level never before seen in human history while stressing the “fundamental disconnect between our copyright laws and our copyright norms [that] has grown increasingly apparent and has highlighted the need for reform.”).

[2] AF Holdings v. Does, 286 F.R.D. 39, 54 (D.D.C. 2012).  BitTorrent is an online peer-to-peer file-sharing protocol that enables the ability to download files through a “piecemeal system with multiple pieces of data coming from peer members [] usually referred to as a ‘swarm’. . . [and] any seed peer that has downloaded a file prior to the time a subsequent peer downloads the same file is automatically a source for the subsequent peer so long as that first seed peer is online at the time the subsequent peer downloads a file.”

[3] Kashmir Hill, How Porn Copyright Lawyer John Steele Has Made ‘A Few Million Dollars’ Pursuing (Sometimes Innocent) ‘Porn Pirates,’ Forbes (Oct. 15, 2012, 2:09 PM), http://www.forbes.com.  John Steele, Prenda Law attorney, “proudly” stated in an interview with Forbes Magazine that he is “considered the original copyright troll” and has sent settlement letters to over 20,000 Internet users.  Id.  Even if the person isn’t the downloader, Steele believes that the person still plays a role in the infringement and requests that they settle the case for around $3,000.  Id.  Steele stated, “Don’t let people commit criminal acts on your network… If you lend your gun to someone who commits a crime, you’re responsible.”  Id.

[4] Letter from Paul Duffy, Attorney & Counselor at Law, Duffy Law Grp., (Apr. 18, 2013), available at http://fightcopyrighttrolls.com/2013/04/23/lw-system-v-hubbard-from-adam-urbanczyks-signed-agreed-order-to-the-new-breed-of-demand-letters/comment-page-1/  (identifying that a specific copyright troll’s settlement letter employed threats claiming similar cases also involve over $100,000 in legal fees and defendants’ names will be “forever associated” with the lawsuit regardless of the outcome).

[5] Robert Z. Cashman, Malibu Media, LLC- Friend or Foe? Foe., TorrentLawyer (Apr. 3, 2012),  http://torrentlawyer.wordpress.com/tag/malibu-media-subpoena/ (explaining that Malibu Media utilizes a software forensic company that gathers IP addresses from Bittorent trackers and monitors IP addresses that download large numbers of pornographic films).

[6] See, e.g., Kurt Opsahl, EFF Moves to Quash Subpoena in Copyright Troll’s Retaliatory Lawsuit, Elec. Frontier Found. (Apr. 18, 2013), https://www.eff.org/deeplinks/2013/04/eff-moves-quash-subpoena-copyright-trolls-retaliatory-lawsuit (stating that Prenda Law has successfully subpoenaed ISPs for the identities of tens of thousands of alleged online infringers at the discovery stage in order to mass-mail settlement letters).

[7] See Discount Video Center, Inc., v. Does 1-29, 285 F.R.D. 161, 166 (D. Mass. Aug. 10, 2012) (“the improper assertion. . . that subscribers are Defendants is significant in that it might well cause innocent subscribers . . . to accede to unreasonable settlement demands.”); See also Digital Sin, Inc. v. Does 1-176, 279 F.R.D. 239, 242 (S.D.N.Y. 2012) (explaining that the “risk of false positives” creates the opportunity for potentially unjust settlements extracted from innocent defendants who simply seek to avoid having their identities publicly associated with downloading pornography).

[8] Order Vacating Prior Early Discover Orders and Order to Show Cause at 2-3, Ingenuity 13, LLC, v. John Doe, No. 2:12-cv-8333-ODW(JCx), available at http://fightcopyrighttrolls.com/2013/02/08/judge-otis-write-is-fed-up-with-brett-gibbss-and-prendas-frauds-hints-at-incarceration/ (emphasizing that the Court has an inherent “duty to protect the innocent citizens of this district from this sort of legal shakedown, even though a copyright holder’s rights may be infringed by a few deviants.”).

[9] See White House, Fact Sheet: White House Task Force on High-Tech Patent Issues (2013), available at http://www.whitehouse.gov/the-press-office/2013/06/04/fact-sheet-white-house-task-force-high-tech-patent-issues

[10] U.S. CONST. art. I, § 8, cl. 8; see also, Eldred v. Ashcroft, 537 U.S. 186, 219 (2003)

[11] 17 USCS § 504(c)(2) (2013) (remedies for infringement: damages and profits).

[12] Id.

[13] Id.

[14] Id.

[15] Plaintiff’s Written Response to the Court’s Memorandum/Order [CM/ECF 9] at 7, Malibu Media, LLC v. John Doe subscriber assigned IP address 68.50.250.243, (No. 8:13-cv-00360-RWT), available at http://dietrolldie.files.wordpress.com/2013/03/mm_response_00360md.pdf

How Much Should You Pay an Attorney to Settle a BitTorrent Case?

Greetings.

Our firm has represented around 200 John Does in BitTorrent cases over the past year and a half. I have tried to keep our rates reasonable during that time. If you are looking for a BitTorrent defense attorney, I hope you will consider retaining FirmEquity, however, if you choose another firm I have some advice.

In order to settle these cases, it does take a few hours of billable time, especially if a lot of negotiation is involved. Just today I decided to raise our flat fee from $425 to $500 to handle all BitTorrent plaintiffs except for Malibu. Given that it usually takes 2-3 weeks of back and forth to obtain the lowest possible settlement amount, I decided to increase our flat fee to $750 for Malibu cases. This is a decision we did not make lightly, given that many people are still struggling during the Great Recession. It will apply both to our settling and shield services, both of which you can read about at www.firmequity.com/copyright

However, we do want to issue a warning. Several firms out there seem to be charging $1,000 – $4,000 to settle these matters. Regardless of whether you choose to hire FirmEquity, please be sure to call around to find an attorney that charges $500 or less. There are plenty of options in that price range. Settling these matters does not require an amount of time that can justify a large flat fee. Charging high retainer fees to represent John Does, particularly the numerous innocent ones, compounds the injustice and injury that the copyright trolls inflict upon thousands of Does. If an attorney does want to charge you more than $500 to settle your BitTorrent case, ask them what additional value they provide than comparable attorneys who charge $500 or less.

If you are not able to afford $500 or $750 (for Malibu only), we can make a payment plan to spread the fee over several months. In cases of financial hardship, we will also offer our old rate of $425. Please don’t hesitate to ask about those options.

If you are involved in a BitTorrent download case, feel free to call me at 847-207-9064 or email me at billy@firmequity.com. Hope you are well.

Best,
Billy

What to Look for in an Attorney

Finding the right attorney can be one of the most difficult tasks a person can undertake. There are thousands of licensed attorneys in every state in the country, and finding the one that is best suited to assist you can feel a little like a daunting challenge. With that in mind, there are three basic things to consider when speaking with an attorney about representing you:

(1) Trust and Comfort

Is the attorney honest and forthcoming about their experience and knowledge, what is their approach to advocacy, and how do they bill clients? While no one attorney is perfect for every potential client, and every attorney needs to make a living at what they do, it is important to work with an attorney that is honest about what they do, why they are doing it, and how much they charge for what they do. Attorneys are human beings, and consequently just as flawed and imperfect as anyone else, but you must, first and foremost, be able to trust and be comfortable with the attorney you are working with.

(2) Timeliness and Communication

Your legal matter is important to you, or you would not be working with an attorney in the first place. A competent and responsible attorney will take your legal matter seriously and be able to respond promptly to reasonable requests for information, and be able to do so in a way that makes sense to you. While attorneys can be busy (particularly if they are in court a lot), an attorney should be able to return calls or emails the same day that they receive them, if only to schedule a time to talk in more detail with you in the near future. At a minimum, you should receive a response within 24 hours from the attorney so that you are not waiting for (and worrying about) an answer to your question.

(3) Client-first mentality

At its heart, the role of attorney is one of advocate and counselor. As a part of this role, an attorney should provide sound advice, useful information and diligent advocacy, but ultimately final decisions must be left to the client (always within the realm of reason, attorneys may not assist in or advocate for unethical or illegal actions). The attorney may know more about the state of the law and the process of the law, and any prudent client generally heeds the advice of their attorney. However, ultimately final decisions must be made by the client, in consultation with the attorney.

Choosing the right attorney can feel difficult, and understandably so. However, using the 3 basic criteria above can help you narrow down your choices and find the attorney you work well with. While there are no perfect attorneys, with a little diligence and some forethought, you can and will find the attorney that is right for you. To talk about how to find an attorney or to discuss your legal issues, please do not hesitate to contact me at (773) 726-1402, or by email at gratchlaw@gmail.com.

(Copyright 2013 by Adam J. Gratch.  All rights reserved.  The contents of this post are the sole property of Adam J. Gratch.  No portion of this post may be reproduced or transmitted in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without the prior express written consent of Adam J. Gratch)

The New FirmEquity Blog

Hello World! That is the phrase that launches the FirmEquity blog. Ben and I hope to write about an array of issues. We hope to not have the typical law firm blog that only discusses the boring issues related to our current practice. We plan to write about the broad legal challenges facing the future of America and the world. In particular, we are both interested in whether the law is applied equally to all members of society.

As always, if you’re interested in hiring a couple of Chicago attorneys, visit the FirmEquity homepage to learn more about us.