Righthaven’s Retreat On ‘Partial Copying’ Cases Shows Firm’s Vulnerability

In a sign that Righthaven is on the defensive, the controversial copyright enforcement company has offered to permanently drop one of its lawsuits-provided it doesn’t have to pay legal fees to the attorneys defending the website it sued, Democratic Underground. The move shows the startup company’s concerns about the potential for mounting legal bills.

If Righthaven were forced to pay legal fees in even one or two of its dozens of cases, it could cripple the firm’s chances of turning copyright lawsuits into a for-profit business. News reports say that Righthaven generally gets less than $5,000 per settlement, and copyright defense bills can routinely be in the tens or even hundreds of thousands of dollars.

As part of their argument that attorneys’ fees are unwarranted, Righthaven promises in the same 26-page motion that it won’t file any more lawsuits unless the defendant has copied at least 75 percent of the text of an article that Righthaven owns the copyright to. Even though the partial-copying suits represent a small part of Righthaven’s overall campaign to make money off infringements of newspaper copyrights, those suits have engendered controversy.

Righthaven was formed earlier this year in Las Vegas as a company that enforces newspaper copyrights. It has filed more than 150 lawsuits to date, mostly based on copyrights it acquired from the Las Vegas Review-Journal newspaper. The R-J also is part owner of Righthaven. In court papers, Righthaven lawyer Joseph Chu said that of the 69 Righthaven copyright lawsuits still pending, only four involve copying of less than 75 percent of the article.

Among those four is the one lawsuit that Righthaven has already flatly lost-Righthaven v. Realty One, which is against a real-estate broker who reproduced eight sentences from a 30-sentence news article. A Nevada federal judge on Oct. 20 deemed that “fair use” and thus legal [PDF].

Another partial-copying suit is the one against Democratic Underground, which involves a user who copied five sentences from an article called “Tea Party power fuels Angle,” which is more than 50 sentences long.

Generally, when defendants win in U.S. courts, they aren’t able to recoup their legal fees unless the plaintiff filed a frivolous lawsuit or engaged in some type of misconduct. But the Copyright Act is different because it has special provisions making it easier for parties to win attorneys’ fees. In the case against Righthaven, Democratic Underground is being defended by experienced copyright lawyers from the Electronic Frontier Foundation.

Separately, the Review-Journal’s upper management is getting a major shakeup, as Sherman Frederick-who endorsed the Righthaven approach to copyright enforcement-has stepped down as publisher and CEO of Stephens Media Group, which owns the R-J. Frederick will continue on as a columnist and consultant to the R-J. Speaking to the Las Vegas Sun, Righthaven CEO Steve Gibson said Frederick’s departure from the publisher’s role “in no way diminishes the Righthaven business model.”