Judge Grants Defendant's Motion To Explore Alleged Fraud By Prenda Law 81
An anonymous reader writes "Prenda Law — one of the most notorious copyright trolls — has sued hundreds of thousands of John Doe defendants, often receiving settlements of thousands of dollars from each. Prenda Law principal John Steele has reportedly made a few million dollars suing BitTorrent file-sharers. Prenda Law has been accused in federal court of creating sham offshore corporations using the identity of his gardener. In other words, it is alleged that the law firm and their client are the same entity, and that Prenda law has committed identity theft and fraud. Now, a judge in California has granted a John Doe defendant's motion to further explore the connection between the offshore entity and the law firm."
Bad Day (Score:1)
For John Steele. LOL.
Capitalism. (Score:3, Interesting)
If you promote the quality of selfishness, you'll end up with a world of selfish people.
Time to promote long-term altruism, the natural and uniquely human quality, and the reason we're not still living in caves.
Re:Capitalism. (Score:4, Insightful)
That won't maximize shareholder returns, so good luck lobbying for that.
Re:Capitalism. (Score:4, Insightful)
The person that originally bought the shares helped the company do something, eg raise capital to start producing.
Re: (Score:3)
Re:Capitalism. (Score:4, Insightful)
I dislike the whole mechanism of the stock market as much as the next guy; but theoretically, at least, it DOES serve a social purpose: The shareholder invests in a company, giving it the capital to expand its business. This is presumably good for the economy, and society as a whole.
In practice, of course, the "day trader phenomenon" does make the whole thing look like money for nothing. I've been told I'm completely insane by people active in the stock market, but I think it would be worth experimenting with a minimum holding time for stocks you "invest in". If you had to hold your shares for six months, you'd be more interested in the usefulness of the company and its products, and less in how some stupid statement on the morning news made them dip 2%.
Re:Capitalism. (Score:5, Insightful)
I dislike the whole mechanism of the stock market as much as the next guy; but theoretically, at least, it DOES serve a social purpose: The shareholder invests in a company, giving it the capital to expand its business. This is presumably good for the economy, and society as a whole.
In practice, of course, the "day trader phenomenon" does make the whole thing look like money for nothing. I've been told I'm completely insane by people active in the stock market, but I think it would be worth experimenting with a minimum holding time for stocks you "invest in". If you had to hold your shares for six months, you'd be more interested in the usefulness of the company and its products, and less in how some stupid statement on the morning news made them dip 2%.
It wouldn't even need to be a 6 month period. If everybody was forced to hold shares for a single day, that would outright kill High-Frequency and Algo-based Trading. Hell, a mandatory holding period of 1 hour would probably do that.
Re: (Score:2, Informative)
It wouldn't even need to be a 6 month period. If everybody was forced to hold shares for a single day, that would outright kill High-Frequency and Algo-based Trading. Hell, a mandatory holding period of 1 hour would probably do that.
It certainly would do what you claim, but you havent justified why you would want to kill algorithmic trading.
The effects of algorithmic trading [berkeley.edu] have been studied, and its shown that the practice reduces the spreads between bids and asks, which translated directly into you getting better prices both when buying and selling than you would have gotten otherwise.
Please explain why you want to pay higher prices when buying and get less money when selling.
I realize that you probably didnt know that this w
Re:Capitalism. (Score:5, Informative)
While it may increase the liquidity of the market, it doesn't necessarily promote good ideas.
Society benefits when good ideas are promoted through shareholder investments. The stock market did just great for 100 years without algorithmic trading, and the intro to algorithmic trading has caused several large instabilities in just the past two years:
http://en.wikipedia.org/wiki/2010_Flash_Crash [wikipedia.org]
http://en.wikipedia.org/wiki/Knight_capital [wikipedia.org]
This amazing graphic illustrates the effect of this type of trading on the volumes, and ...I believe that instabilities will only get worse with this type of activity.
http://www.nanex.net/aqck/2804.HTML [nanex.net]
As the underlying article states the growth of "Quote SPAM" is really the problem. Most of this is "testing the waters" where a quote is tossed out to see the response and immediately cancelled with no resulting trade.
Fundamentally, it is simply gambling.
Re: (Score:2, Insightful)
These only effect people who ARE algorithmic trading. The prices bounce back to their real market valuation again and again...
Re: Knight Capital
A company lost money with flawed algorithmic trading... which means someone else gained. Whats the problem?
Re: "amazing graphic"
Is this supposed to be evidence of bad things? Perhaps you could enlighten us on the assumptions that you are using to declare them bad, so that maybe we can agree with them or refute them.
Re: "Quote SPAM"
You
Re:Capitalism. (Score:4, Interesting)
Unless you happen to have an open stop-loss order. Then you can be badly burned, as I have been personally.
In another flash crash, I made a lot of money due to a very low open bid, but then the SEC decided to nullify all trades during that particular flash crash. You can't win.
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Unless you happen to have an open stop-loss order.
Translation: Unless you are algorithmic trading.
You do know that stop losses are an algorithm, right?
if(price < threshhold) sell();
Then you can be badly burned, as I have been personally.
So you were personally burned trying to take advantage of algorithmic trading, so fuck everyone that wants to take advantage of algorithmic trading? Doesntg that make you a hypocrite?
In another flash crash, I made a lot of money due to a very low open bid, but then the SEC decided to nullify all trades during that particular flash crash.
Not an argument against algorithmic trading. An argument against the SEC nullifying trades.
Re:Capitalism. (Score:4, Interesting)
Fine, but only the initial sale of stock to the very first investors actually delivers capital to the company (company itself is selling to the investors). No trade from investor to investor results in more capital to the company--at that point it's just gambling, and the existence of the shares no longer serves any social purpose.
Require an investor to purchase shares directly from the company and hold them forever, and you'd have a different stock market.
Re: (Score:2)
Not quite. Companies routinely issue stock after the initial offering.
Also as you sort of get at, why should I be prohibited from selling my shares? I can sell everything else I own. Markets create liquidity.
I'm currently holding a cherry 1960 Chrysler Saratoga survivor. How much is it worth? No idea. Last trade I'm aware of was a (incorrectly) restored one (the one on youtube), so not really comparable. Current value: What I can get someone to pay for it. No, I don't want to sell it.
It would suck if
Re: (Score:2)
Oh, I agree.. Not saying it wouldn't suck. Just disputing the claim that the stock market (in general) serves a "societal good". Certainly the initial stock sale (and subsequent stock issues) benefit society by allowing companies to be financed, and if you really stretch you can say that the ability for someone to invest and receive interest and dividends is good for society. But taken as a whole, including high-frequency trading, derivatives, futures, securitization of all sorts of crazy assets etc. the st
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A nice example of this right now are solar stocks. The fundamentals haven't changed at all over the past few months, yet some of the stocks are up 75% or more over the past few weeks. There's nothing going on anywhere in the world to make that happen, yet volume is suspiciou
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Actually - shares aren't as bad as you paint them to be. Startups need capital, so you induce people to gamble that your startup will work. No one wants to invest millions in an unheard of company, so you offer shares. A lot of people are willing to invest a dollar, ten dollars, maybe a hundred dollars. Fewer people are willing to invest thousands. So, they invest, you get started, working on their money.
They gambled, you won, so they win. The guy who "loaned" you a dollar gets his winnings, whether i
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But the scenario you described only happens when there is an IPO, or when a company subsequently releases shares. If you invest in a company before it's IPO you'd better have a damn good lawyer to make sure your investment isn't diluted to nothing.
And nearly all trades that happen on the stock market are just people trading the lottery tickets they'd bought. The company they are supposedly investing in doesn't see a cent of it.
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Let's take a page from the RIAA book.
Let's introduce a fee for each transaction and part of the fee goes to the company whose stock is changing hands.
After all, if the company did not have any stock, the person seling it would not be making any money. By making its stock available, the company is allowing the stockholder to profit, therefore the company should be able to profit as well.
The fee would add to the company capital.
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Good idea. And since the fee goes to the company, the traders can't complain as much about the 'tax', since it should increase the value of the stocks.
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That would make as much sense as roasting realtors over an open fire to send a message to homeowners...owning real estate leads to death - thears.
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For some reason this reminds me of a particularly amusing speech by some pacific island muslim leader a few years back. He went on a tear about all the things jews have done...but not "Oh those horrible jews", it was "Look how smart those jews are, we should be smart like them", but... came off totally badly.
I believe he even credited Jews with inventing the concept of human rights, because they have suffered so much. It was pretty funny actually.
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Re:Capitalism. (Score:5, Interesting)
People are selfish by nature. Capitalism exploits that fact, and makes the "Selfish thing to do" something that's good for the public as a whole. But Capitalism doesn't work without transparency. Secrets allow you to game the system. If you look at any particular situation, like this one for example, and you see lots of secrecy, you can be sure someones trying to cheat.
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"People are selfish by nature"
People are also altruistic by nature.
It's just that selfishness is easier.
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People are complex. One of their features is selfishness. Environmental factors can either encourage or discourage this.
Also, people are not uniform. Different people will react differently (mainly in degree of change, but not entirely) to the same stimulus. And the reaction is non-linear WRT the stimulus. (There are complex feedback and feedforwards loops.)
You can be sure that any simple model is wrong. But people won't understand any model that isn't simple. And many people won't trust any model th
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"People are selfish by nature " is not a quantifiable statement of causality; it's cop out when people want to short circuit investigating why people act as they do.
People can be either very or somewhat or not very much at all selfish. All these states are "by nature" since nothing we do is outside of nature.
But the known facts are that people are more or less altruistic / selfish / egalitarian / violent depending on the environment they find themselves in that either rewards or prepares them for one se
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And what exactly is the difference between unrestrained capitalism and anarchy? Can you have an economic system when the only law that matters is the one you can enforce yourself?
In such a system Prenda wouldn't try to sue you. They'd hire a few mercs and have them kill you and take your stuff.
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My friend, this is the exact opposite of capitalism. You are thinking of crony capitalism, or corruption, or rent-seeking (look it up).
The solution wasn't vox populi vox dei, a meme that allows massive powers to be wielded through government by the powerful. It was simply disallowing government many powers that connected or powerful or wealthy people could use to swing to their favor.
If this seems like working hand-in-hand with capitalism, you haven't learned much from history,
Liar (Score:2, Insightful)
. Who gives billions in aid to the world? Capitalist countries. Meanwhile, the communist and extreme socialist governments are comprised of the most selfish bastards on the planet.
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. Who gives billions in aid to the world? Capitalist countries. Meanwhile, the communist and extreme socialist governments are comprised of the most selfish bastards on the planet.
Cuba offered to give the U.S. money after Katrina, and we declined. China gives out an enormous amount of money to aid other Asian countries.
You could even argue that the more socialist a Western, industrialized country is, the more they give out in foreign aid (as a percentage of their GDP.) [gatesfoundation.org]
But don't let crazy facts get in the way of your uninformed rants.
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"Comprise" Versus "Compose" [quickanddirtytips.com].
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And which countries, do you think, make many times that much by exploiting the inequalities of cheap foreign labor?
Altruistic Animals (Score:5, Insightful)
While I generally agree with your your comment, I disagree with the following part:
Animals show altruistic behaviours. [wikipedia.org] Even more interesting, I've read about examples like the vampire bats that share blood who will remember and punish other bats that don't share in return.
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Even more interesting, I've read about examples like the vampire bats that share blood who will remember and punish other bats that don't share in return.
That would make the bats better at enforcing basic civility than we are. We've regressed to championing those who can maximize what they get out of the system while minimizing (or eliminating) what they put back in.
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That's because the bats can't hide herds of cattle in their larder, while sharing the blood of the starved mouse they found on their way back to the cave.
Re:Capitalism... dot dot dot (Score:2)
Re: (Score:3)
If you promote the quality of selfishness, you'll end up with a world of selfish people. Time to promote long-term altruism...
The problem is that selfishness promotes itself in the form of amassing wealth, luxury, and power, and conspicuous demonstrations of these things seem to appeal to base parts of human nature.
Maybe (Score:1)
If a defendant agrees to a settlement that might rule out fraud. And if a court has found in favor of a suit the notion of fraud becomes a bit shaky as well.
I also have to wonder that when we see lawyers walk a way from a conflict with huge sums while the client receives very little is the client is not normally an inconvenient stooge that lawyers use on their way to pay day.
It's still fraud (Score:4, Informative)
Law firms aren't allowed to invent fictitious plaintiffs (or commit identity theft) in order to initiate lawsuits. (And there are very strict rules on recruiting named plaintiffs for class actions.) It may not be a fraud against the defendants (though probably is), but it can still be a fraud against the courts; that's completely separate from the actual merits (or lack thereof) of the case. Fraud against the court is something a lawyer does; normal fraud is something defendants get accused of doing.
The penalty for fraud against the court starts with monetary sanctions (in addition to getting your case dismissed), and can end with a recommendation for disbarment. (I don't know if a judge can impose jail time without a DA involved (like with contempt of court)... I doubt it.)
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Law firms aren't allowed to invent fictitious plaintiffs (or commit identity theft) in order to initiate lawsuits. (And there are very strict rules on recruiting named plaintiffs for class actions.) It may not be a fraud against the defendants (though probably is), but it can still be a fraud against the courts; that's completely separate from the actual merits (or lack thereof) of the case. Fraud against the court is something a lawyer does; normal fraud is something defendants get accused of doing.
The penalty for fraud against the court starts with monetary sanctions (in addition to getting your case dismissed), and can end with a recommendation for disbarment. (I don't know if a judge can impose jail time without a DA involved (like with contempt of court)... I doubt it.)
I would think Fraud against the court would be one of the highest contempt of court you could do.
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(I don't know if a judge can impose jail time without a DA involved (like with contempt of court)... I doubt it.)
The prosecutor does not have to be a DA. If the DA is not interested, the judge appoints a lawyer to prosecute.
Usually criminal contempt sentences are short, but judges can issue jail sentences with terms like "until the defendant complies with the court's order," which makes for an indeterminate sentence, until (another) judge decides that you really really aren't going to comply with the court's order and sets you free.
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Hmmm...What would Barbosa do? (Score:1)
This will go nowhere (Score:2)
The strategies Steele is using are the same as those used by all large corporations. Only if his lawyers were stupid in setting it up will there be a problem.
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changes ahead (Score:3)
maybe they're getting ready to change names from "Prenda Law" to "Pretenda Law"?
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Predator Agenda.
Seen him in full preacher mode (Score:5, Informative)
I have worked for the porn industry and seen this guy preaching at industry conventions, once supposedly on a forum that was to discuss how to approach copyright infringement as a porn company/copyright holder. (there are other approaches the best working focusing on having your customers become loyal fans of your brand, so they want to pay, beg you to pay)
It wasn't a discussion really, as I sat by as 3rd party (I do servers for whatever reason you might have and I make the same amount whether those servers are payed for by copyright owners, commercial pirates, amateurs or cat pictures) and was amazed to see him preach to the converted... well... up until the point you start asking for numbers. There are a LOT of porn producers, a shit load more content and a near infinite amount of downloaders. The internet may consist of cat pictures but torrents are for porn. Yet he has done at the time only a few thousand cases. That is NOTHING! It ain't even a drop in the bucket. The RIAA was doing fastly more cases.
While the audience was agreeing with him, you could see most didn't have a clue as to the real issues and the developments with regards to copyrights and enforcing them. The porn industry likes to pride itself on being cutting edge, VHS, online payments but really that is just a tiny segment, the rest are slobs who figured out sex sells. The moment the forum was over, I talked to some porn producers and asked what they though considering judgements like the then current claim of movie copyright infringenment costing several times more then the entire world economy.
Or the cases of sueing children, veterans and other people who might get the sympathy of the public. If the public chooses the side of dirty pirates against wholesome music executives... what chance does a porn peddler stand? Most porn producers are well aware that they are skirting the edge of public acceptance, they know they can only accept credit cards if they meet the decency requirements of the processing company, can only host with parties that accept adult content. They didn't like it one bit when I linked them on my tablet to some John Steele publicity stunts, no porn company wants attention from Fox News about harrasing some grandma who left her wifi open as it was installed by her grandson who died in Afghanistan. No thank you sirree, that is NOT worth gathering a few bucks, especially when all the lawyer fees have been payed you end up owing the lawyer for bad publicity.
That I wasn't the only doom spreader for dealing with John Steele is proven by the fact only a handful of companies deal with him. When you talk to him, he does his name justice google his picture, say his name and what you think he will be like is how he is. A boisterous overconfidant man who speaks so loud that he doesn't hear anyone asking him to explain some details about cases thrown out of court and how does not QUITE work on a contingency basis (he gets more if he wins but he ALWAYS get payed), how a settlement doesn't include paying lawyer fees. If you lose in court and are ordered to pay 5000 in damages you often ALSO have to pay lawyer fees. If you settle for 1000, that is it, the lawyer still wants paying. John Steele certainly does.
It is no secret that copyright infringement happens, on a MASSIVE scale. And porn has an issue the mainstream media does not have. I once came up with a nice way to put but we are all males here so here it is "You can cum on a trailer".
Some Hollywood movies have trailers that tell you the entire movie and a few where the trailer is better then the movie but on the whole, the trailer make you hungry for more.
In porn, the trailer is enough for most and just makes you sleepy. Watching a full movie on youtube is a hassle (well it was until they removed the ten minute limit) but for porn tubes... how many minutes do you need? Oh wait, I forgot my audience. Seconds?
Sharing the entire movie on a torrent is far less of an issue to the industry then all those porn tube sites that contain
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Given that all men look at porn[*], and always have since Ugg and Ogg first carved a pair of boobs and a vulva, I think any "solution" will have to take into account that this is a natural thing, which shouldn't be punished.
If a company who produces it doesn't want it to be spread and looked at, they need to prevent it from being spread and looked at, not punish those who follow their natural instincts of looking at porn wherever it can be found. This is like dangling a piece of prime rib over a dog pen an
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Thanks for being one of the good guys. Not that you had a very hard sell, as you so lucidly pointed out.
Still, it's amusing to see porn remains on the cutting edge, as always. First to VHS, first to online payments, first to understand that bittorrents are exposure and publicity. Literally free advertising. The fans are using their very own bandwidth and disk space, which they pay for and the producer doesn't have to pay a dime for, to spread the word about your content. They couldn't ask for a better
Here's a primer (Score:5, Informative)
Prenda Law (aka Steele Hansmeier aka Anti-Piracy Law Group) is not really a law firm as such, but a sophisticated scam. For those of you who came in late, here's how it works: Prenda's stooges, who are ostensibly copyright holders, upload a porno clip to BitTorrent. They they record the IP addresses of everyone who downloads the torrent. Then Prenda Law sues all the IP address holders as John Does in a federal copyright lawsuit, for example Hard Drive Productions vs. John Does 1 through 1495. They aren't really interested in suing, just in issuing subpoenas to ISPs to get the names and addresses of the downloaders. They then send demand letters requesting thousands of dollars. People pay up, because the amount is just below what it would cost to hire a lawyer, because the porno downloaders are afraid their wives will find out, and because they are afraid of being on the receiving end of massive Jammie Thomas [wikipedia.org] -type civil judgments.
For the last couple of years, Prenda and its associates have made millions of dollars this way, as federal judges from coast to coast have (up to now) rubberstamped their extortionate business model.
Recently, however, the greed, stupidity, incompetence and unethical conduct of Prenda has finally caught up to it.
Read all about it at sites such as fightcopyrighttrolls.com [fightcopyrighttrolls.com], dietrollsdie.com [dietrollsdie.com], etc.
You've gotta read the transcript from November 27, 2012 in Sunlust Pictures v. Nguyen [fightcopyrighttrolls.com]. It is the funniest federal court hearing transcript, ever, as federal judge Mary S. Scriven puts one participant after another under oath... it is as funny as an Abbott and Costello routine....
Re: (Score:2, Interesting)
http://dietrolldie.com/ no s
You left off Steele using a robodialer to harass does, sending scary letters, and generally making people miserable.
A post here in previous coverage lead to this story on FCT.
fightcopyrighttrolls.com/2012/08/03/a-disabled-victim-of-a-copyright-troll-threatens-to-kill-himself/
The methods are evil, but there is a growing community of Does and Former Does helping people fight off the fear... than and mocking Steele at every turn.
On the upside he's been real quiet as of late... he m
Re:Here's a primer (Score:5, Interesting)
So that's John Steele. Then there's this whole deal with Guava cases. The summary you provided was a tactic that worked well until judges started getting wise to the tactics. Now judges are mitigating the extent that Prenda can extort people by providing protections to defendants, such as the ability to remain anonymous while fighting subpoenas on their identifying information. Most recently one offshore client, AF Holdings, was required to post a $40,000 bond to proceed with a case. This severely hampers their ability to operate.
Now they are using a fake company named Guava LLC to bring hacking and conspiracy charges to state courts, instead of copyright infringement charges to federal courts where courts are wisening up. Problem is the hacking charges are all seeking relief as if they were copyright claims, using rights granted specifically by the copyright act. They have sued thousands of pele using this dirty trick.
So that's where we are now. With this latest ruling, hopefully good lawyers will start digging into Steele's history and uncover misdeeds grave enough to send him to prison and strip him of all his ill-gotten gains.
Oblig (Score:5, Funny)
LOL (Score:2)
Can guarantee his punishment is gonna cost less than what me made.
article linked to really biased (Score:1)
" I suspect Prenda Law will fight tooth-and-nail to avoid answering any questions, which in my opinion, further suggests that their “ethically challenged” attorneys are guilty as alleged."
So the writer suspects Prenda Law might do something in the future, and therefore immediately assumes they are already guilty.
While the alleged facts would be damning if proven true, and I hold no love for copyright (or patent) trolls, let's not rush to judgement until the facts are on the table.
I would have pr
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" I suspect Prenda Law will fight tooth-and-nail to avoid answering any questions, which in my opinion, further suggests that their “ethically challenged” attorneys are guilty as alleged."
So the writer suspects Prenda Law might do something in the future, and therefore immediately assumes they are already guilty.
While the alleged facts would be damning if proven true, and I hold no love for copyright (or patent) trolls, let's not rush to judgement until the facts are on the table.
I would have prefered that Slashdot use some discretion before allowing this post.
Mr. Steele, is that you?
From experience, no (Score:3)
For a lawyer, John Steele both as a speaker in public and in normal conversation is more the bully coach/preacher type, he talks so loudly and without pause nobody gets a chance to say anything in return. He tries to win customers in the porn industry and knows that there are a LOT of geeks in the porn industry advising the porn producers who know his record, just see above. He has been losing cases for years but he doesn't tell you that and the porn peddlers don't know to ask. It is only when they come hom