Magistrate Judge Improperly Analyzed Fogerty Factors, Putting Improper Emphasis On General Dislike of BitTorret Litigation In General And On Conduct Of Plaintiff’s Counsel In Other Cases.
Evolving technology has always presented interesting new developments to intellectual property law given that it did not necessarily see how technology will impact protected uses. One of the developments involves digital pirates unlawfully downloading and distributing movies online through use of the BitTorrent protocol with respect to peer-to-peer networks. Copyright holders then sue for recourse, with many involving “copyright trolls” who buy up copyrights to adult films and then sue masses of unknown BitTorrent users for illegally downloading pornography. This has become so rampant that at least one federal court, the District of Oregon, has a special case management order establishing special procedural rules for peer-to-peer copyright infringement cases. In the next case we review, a federal magistrate judge denied attorney’s fees to a successful plaintiff—not a copyright troll—based on what the Ninth Circuit felt was a jaded analysis of factors guiding discretionary award of attorney’s fees in copyright cases (with the seminal case being Fogerty v. Fantasy, Inc., 510 U.S. 517 (1994), which factors are): frivolousness, motivation, objective unreasonableness (both factual and/or legal); need to advance considerations of compensation and deterrence; the degree of success obtained in the litigation; the purposes of the Copyright Act; and whether the chilling effect of attorney’s fees may be too great or impose an inequitable burden on an impecunious litigant.
Glacier Films (USA), Inc. v. Turchin, No. 16-35688 (9th Cir. July 24, 2018) (published) was a situation where a film production company (Glacier) sued a single user who illegally downloaded and distributed repeatedly the Hollywood action movie American Heist by using the BitTorrent protocol. Glacier tracked an infringing IP address to Oregon, suing a John Doe owner in Oregon federal court and subpoenaing records from Comcast to ascertain that the Doe was Mr. Turchin. After a motion for default was filed, the district court appointed pro bono counsel for Turchin, with settlement negotiations taking place and with defendant denying liability and asserting several affirmative defenses (many of which likely lacked merit). Eventually, the parties reached a stipulated consent judgment by which (1) Turchin stipulated to allegations that gave rise to liability for infringement; (2) Turchin stipulated to $750 in statutory damages; and (3) the court permanently enjoined Turchin from using the Internet with respect to American Heist and ordering him to immediately delete any unlicensed copies of the movie in his possession. Glacier moved for costs of $791.70 and attorney’s fees of $4,833.35. The magistrate judge awarded costs but denied any attorney’s fees, primarily reasoning that (1) Glacier had minimal success; (2) there was no need for further deterrence; (3) the goals of the Copyright Act were not promoted; (4) the court was overall not a fan of BitTorrent litigation in general; and (5) Glacier’s counsel in other cases had overlitigated or happened to be overaggressive in nature.
The Ninth Circuit reversed and remanded for a further look at the fees request.
It was particularly disturbed by the magistrate judge’s consideration of irrelevant concerns relating to a general dislike of BitTorrent litigation and to a dislike of what Glacier’s attorneys had done in other cases. The panel believed that Glacier indeed had obtained total success in the litigation against Turchin, with the amount of statutory damages—even if small—not showing a lack of success. The Ninth Circuit, however, did not follow a Seventh Circuit presumption that a prevailing party is presumptively entitled to fees in which monetary stakes are small, finding that it conflicted with SCOTUS’ guidance in Kirtsaeng, 136 S. Ct. at 1988-1989 [our Leading Case No. 20]. Also, the injunction against one user was found to be the best possible result under the Oregon case management order such that a broader injunction did not indicate a lack of success. Deterrence also was shown given that Turchin continued to download right up until a deposition and agreed permanently not to do it again. With respect to the magistrate judge’s view that overaggressive assertions of copyright claims could allow for fees denial, the Ninth Circuit found that the judge misstated a passage in Kirtsaeng and that aggressive assertion of meritorious claims should be recognized as promoting the goals of the Copyright Act. It also believed that the magistrate judge should have focused on some of Turchin’s positions and conduct, given that they would have led to an opposite result when ruling on Glacier’s fee motion.
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