June 11, 2013
AF Holdings, LLC, a St. Kitts and Nevis limited liability company, Plaintiff,
David Harris, Defendant.
G. MURRAY SNOW, District Judge.
The Court has granted Plaintiff's Motion to Continue Show Cause Hearing, (Doc. 68), under circumstances that require additional explanation as set forth below. Because the hearing will be postponed, however, the Court supplements the questions to which it wishes Plaintiff to respond. In its previous Order, the Court ordered Plaintiff to show cause why this Court should not dismiss this case and "[t]o the extent that Plaintiff asserts a right in the continuation of this case, Plaintiff is ordered to identify: (1) the persons who signed Exhibit B in the names of Raymond Rogers and Alan Cooper; (2) all persons who hold any interest in Plaintiff; and (3) if Exhibit B to the Complaint is in fact not signed by Alan Cooper and/or Raymond Rogers why Plaintiff and/or counsel should not be sanctioned pursuant to the Court's inherent power and Fed.R.Civ.P. 11 for filing a fraudulent document with this Court." (Doc. 51 at 2.)
Plaintiff is further ordered to respond to these additional concerns of the Court at the continued hearing:
(1) Plaintiff apparently pursued litigation against Defendant Harris and 1, 140 Doe Defendants for their involvement in the same "BitTorrent swarm" in another district. See AF Holding v. Does 1-1140, 1:11-cv-01274-RBW, Doc. 1 at 4-5; Doc. 1, Ex. A at 20. (D.D.C. July 13, 2011). Plaintiff voluntarily dismissed that case, stating that "Plaintiff is currently engaged in settlement negotiations with a substantial number of putative Doe Defendants." Id., Doc. 34 at 2. The court in that case authorized Plaintiff to serve subpoenas against the ISPs to identify the subscribers to the IP addresses involved in the same BitTorrent swarm that is the subject of this lawsuit. To the extent that Plaintiff previously sought and received such discovery in the action in the other district, why should the Court re-authorize it here?
(2) Pursuant to 17 U.S.C. § 504, Plaintiff may not pursue actual damages against some Defendants in a lawsuit and statutory damages against other Defendants while maintaining all Defendants as parties to the same suit. See Nintendo of Am., Inc. v. Dragon P. Int'l, 40 F.3d 1007, 1010 (9th Cir. 1994). To the extent that Plaintiff elects to pursue statutory damages in a lawsuit, it is allowed a single recovery for "all infringements involved in the action, with respect to any one work, for which any one infringer is liable individually, or for which any two or more infringers are liable jointly and severally." 17 U.S.C. § 504(c)(1). In such cases, the minimum amount of statutory damages for all acts of infringement for which joint and several liability are sought to be imposed is merely $750. Id. The maximum amount of statutory damages is $30, 000. Id. Plaintiff has already brought a suit against infringers involved in the same BitTorrent swarm in which Defendant was involved, but then dismissed that suit after settling its claims against a number of persons who participated with Defendant in that swarm. To the extent that Plaintiff has now reasserted the same claims resulting from the same swarm in a different court, would those previous settlements have caused Plaintiff to forfeit, or otherwise affect Plaintiff's current claims in this case?
(3) By the same statute, the award election allows Plaintiff certain benefits and detriments with respect to either remedy chosen by the Plaintiff for copyright infringement. That is, there are certain benefits to Plaintiff to electing statutory damages, (e.g. minimum damage amounts), accompanied by certain detriments (e.g. maximum damage amounts for all infringing activity). There are certain benefits to Plaintiff to electing actual damages (e.g. no maximum damage amounts) accompanied by certain detriments (no minimal damages amounts). Why would it not be an abuse of Congress's purposes in allowing such elections, and an abuse on the federal court system, to allow Plaintiff to file suits against the same Defendants in multiple districts for participation in the same BitTorrent swarm, conduct settlement of such claims in some districts without making the election, and then continue to prosecute such claims in other districts without acknowledging that they have independently settled some of the claims against some of Defendants alleged co-conspirators?
(4) It occurs to the Court that if Plaintiff wishes to make separate elections as to multiple defendants involved in the same BitTorrent swarm, then it must bring separate lawsuits, or at the least, separate claims in which it does not pursue a theory of joint and several liability. See Nintendo, 40 F.3d at 1010; Louis Vuitton Malletier, S.A. v. Akanoc Solutions, Inc., 658 F.3d 936, 947 (9th Cir. 2011). If Plaintiff asserts the right to make separate elections in separate lawsuits, why shouldn't the Court take into account the amount of settlements already achieved by Plaintiff with respect to the other participants in the same BitTorrent swarm? Further, why should the Court not require Plaintiff to file separate lawsuits as against each separate Defendant against which it asserts a claim? In such a case on what basis should the Court grant Plaintiff's request for discovery?
(5) Plaintiff will identify all other suits it has filed in any worldwide jurisdiction involving the participants in the same BitTorrent swarm that is the focus of this lawsuit. Further, with how many defendants and/or users has Plaintiff settled in those other suits, including the D.D.C. case, based on the same BitTorrent swarm, and what were the nature and amounts of those settlements?
(6) The Court has obtained information that leads it to believe that Plaintiff has already issued civil subpoenas to the ISPs that possess information regarding the IP addresses of users allegedly involved in the same BitTorrent swarm as Defendant. ( See Doc. 44-1.) How many users on that list of IP addresses has Plaintiff previously sued as a Doe Defendant or otherwise? With how many of those users, if any, has Plaintiff engaged in settlement discussions in relation to this lawsuit, and what are the nature and amounts of those settlements?
(7) To the extent that Plaintiff nevertheless requests discovery as to Defendant's "co-conspirators" for copyright infringement involved in the "BitTorrent swarm, " ( See Doc. 39 at 1), the Court is inclined to require Plaintiff to provide a Notice, attached to this Order, describing this case and the subscribers' rights, to be provided to the ISP subscribers along with a copy of the Complaint. If Plaintiff objects to the issuance of the Notice to subscribers or any language therein, it may bring such objections at the hearing to the Court's attention.
(8) Plaintiff states in its Response to the Court's Order to Show Cause that "[Alan] Cooper participated in a limited number of transactions in the latter half of 2011, including acknowledging two assignment agreements on behalf of AF Holdings." (Doc. 56 at 7.) Plaintiff is ordered to identify those two assignment agreements and the circumstances surrounding Alan Cooper's signature on those assignments. The Plaintiff is further ordered to identify whether and if so how, either of those two assignment agreements included the assignment attached to the Complaint in this matter.
(9) State the nature of the authority that Alan Cooper has or had as a corporate representative of AF Holdings and the financial interest that he has or had, if any, in AF Holdings and/or its dealings. Provide any documents in the custody of AF Holdings that demonstrate any interest held in AF Holdings by Alan Cooper prior to the date of his execution of the assignment at issue here.
(10) Identify the representative(s) at AF Holdings from whom Plaintiff's counsel is receiving direction as to this litigation and the nature of their involvement. (11) As it pertains to the medical treatment sought by the Plaintiff the day before the hearing, on June 6, 2013, the Court notes that the documentation provided seems to be inconsistent in at least some respects with the Motion. The Court therefore requires Plaintiff's counsel to lodge under seal, a supplemental pleading stating: (a) the medical condition for which he sought treatment; (b) all documentation concerning any visits he made to medical professionals on June 6, 2013; (c) identify who cautioned Plaintiff against traveling until being evaluated by a specialist; and (d) all documentation concerning any visits he subsequently made to a specialist as a result of the medical condition for which he sought treatment on June 6, 2013.
IT IS THEREFORE ORDERED setting an Order to Show Cause Hearing to address the above matters on June 21, 2013 at 2:00 p.m. in Courtroom 602, Sandra Day O'Connor U.S. Federal Courthouse, 401 W. Washington St., Phoenix, Arizona XXXXX-XXXX.