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The Almighty Buck The Courts Crime Media Technology

Rogue Lawyers Made $6 Million Shaking Down Porn Pirates, Feds Say (theverge.com) 128

Posted by BeauHD from the pay-the-price dept.
An anonymous reader quotes a report from The Verge: The copyright violation notice is every pirate's worst nightmare, a clear legal sign that a major copyright holder knows what you've been torrenting and is ready to make you pay for your crimes. But according to an indictment filed today in Minnesota federal court, that system has also opened the door to some very creative forms of fraud. The indictment alleges that two lawyers -- Paul R. Hansmeier and John L. Steele -- used the copyright system to extort roughly $6 million out of porn pirates over the course of three years. Prosecutors say the lawyers uploaded their own pornographic videos to torrent services -- including the embattled Pirate Bay -- then aggressively targeted users who downloaded the content, discovering names through the standard copyright violation process and then threatening pirates with damages up to $150,000 unless they agreed to a settlement. The typical cost of a settlement was $4,000, far less than the cost of challenging the order in open court. Throughout the process, Feds allege that Hansmeier and Steele concealed their role in uploading the videos, although the underlying copyright claim was often legitimate. The duo typically obtained copyright to the videos through shell companies, although in some cases they actually filmed and produced their own pornography as part of the scheme.
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Rogue Lawyers Made $6 Million Shaking Down Porn Pirates, Feds Say More

Rogue Lawyers Made $6 Million Shaking Down Porn Pirates, Feds Say

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  • Link to the porn please (Score:5, Funny)

    by ls671 ( 1122017 ) on Friday December 16, 2016 @09:37PM (#53501097) Homepage

    Could someone provide a link to the porn so I can better evaluate the case and comment appropriately?

    • Re: (Score:2)

      by msauve ( 701917 )
      goatse.cx

      • Re: (Score:2)

        by Mashiki ( 184564 )

        That's a name I haven't heard in a long time. A long time.

        What next? Beowulf clusters? It's the year of linux? Perhaps a in Soviet Russia...

        • Re: (Score:2)

          by sconeu ( 64226 )

          Most of Slashdot has no memory. I posted a Beowulf cluster joke on the 4004 anniversary article a few months ago, and got flamed for it.

        • What next?

          That's obvious: it can only be Tubgirl.

    • Re: (Score:2)

      by mallyn ( 136041 )
      www.disney.com

    • Could someone provide a link to the porn so I can better evaluate the case and comment appropriately?

      Ladies and gentlemen, please meet the only person on the internet who can't find porn.

  • They deserve some serious prison time. (Score:5, Interesting)

    by Whatsisname ( 891214 ) on Friday December 16, 2016 @09:45PM (#53501121) Homepage

    Hansmeier is a serious douche, who also has a penchant for suing companies for supposed lack of ADA compliance.

    http://www.citypages.com/news/... [citypages.com]

    It's pretty sad that attorneys are able to do this shit for so long and for so much damage before the hammer gets dropped on them.

    • Re:They deserve some serious prison time. (Score:4, Informative)

      by Xenographic ( 557057 ) on Friday December 16, 2016 @09:52PM (#53501141) Journal

      There's more good coverage of this on Popehat [popehat.com] which has been covering this since the very start if you look through their archives.

      I'm glad to see the submitter linked to the actual indictment.

      • While agree they are scummy, I'm fuzzy on what's actually illegal? They owned the copyrights, correct? If it's the uploading part, I don't think that's illegal. For example, I could purposefully bend over and place a $100 bill on the floor of a busy mall and walk away and if someone came up and took it they are still, as far as the law is concerned, guilty of theft and liable for criminal prosecution and civil damages. The lawyers were being what lawyers are, but I'm not sure how they actually broke the

        • Re:They deserve some serious prison time. (Score:5, Informative)

          by DarkFencer ( 260473 ) on Friday December 16, 2016 @10:45PM (#53501299)

          They put up the torrents themselves. This isn't leaving a $100 on the floor. This is putting a stack of $100s out with a sign saying "Free - take me!". They can't explicitly give the file out to people, then say you can't take it.

          • Plus they used a bunch of shell companies, some of them run by a guy who either didn't exist or couldn't be located for testimony, to try to fool the court. Rule #1 of going to court is you don't try to fool the court. Judges don't like that, as these cockgoblins are finding out.

            • Re: (Score:2)

              by Ziest ( 143204 )

              I have a nephew who is a lawyer and he has assured me that within the first semester of law school students are told, repeatedly to never, ever piss off the judge. Very bad things happen when the judge is pissed off. I'm guessing these clowns were not paying attention.
               

            • Re: (Score:2)

              by Agripa ( 139780 )

              Plus they used a bunch of shell companies, some of them run by a guy who either didn't exist or couldn't be located for testimony, to try to fool the court. Rule #1 of going to court is you don't try to fool the court. Judges don't like that, as these cockgoblins are finding out.

              I do not think the judges care until it gets enough publicity.

        • Re: They deserve some serious prison time. (Score:1)

          by Anonymous Coward

          The misunderstanding is the same one hat everyone has with pirating versus stealing. In your analogy you no longer have the $100. In the actual case, the attorneys posted materials that they COULD legally spread online and clicked through the notice that anything they posted was free to view. Since they were the copyright holder, they could legally do that but then no one can break the law by doing what they have explicitly allowed. They setup an illegal extortion racket.

        • > For example, I could purposefully bend over and place a $100 bill on the floor of a busy mall and walk away and if someone came up and took it they are still, as far as the law is concerned, guilty of theft

          If some of the facts were a bit different, it would be theft. Your exact example wouldn't be, for a couple of reasons.

          California Penal Code 485 is the same as common law in this regard:

          --

          One who finds lost property under circumstances which give him knowledge of or means of inquiry as to the true ow

        • > I'm fuzzy on what's actually illegal?

          See, this is why I'm glad the submitter actually included the indictment [justice.gov] because it goes over everything law the government believes these guys broke.

          Some of the more damning allegations are the different ways they've been charged with lying to the courts.

    • Re: (Score:2)

      by ls671 ( 1122017 )

      Thanks for the link! That made me wonder: When is the next season of "Better call Saul" beginning?

    • Hansmeier had is law license taken away about a year ago. He's not suing anyone anymore.

    • Re: (Score:2)

      by Agripa ( 139780 )

      It's pretty sad that attorneys are able to do this shit for so long and for so much damage before the hammer gets dropped on them.

      Let this be a lesson; government lawyers hate competition.

  • bittorrent design flaw allowed legal liability (Score:1, Interesting)

    by Anonymous Coward

    There wouldn't have been any copyright infringement if the downloaders were only downloading, but the bittorrent protocol is specifically designed to upload while it downloads, and uploading infringes copyright.

    Bittorrent is flawed. Stop using bittorrent.

    • the bittorrent protocol is specifically designed to upload while it downloads, and uploading infringes copyright.

      Unless you can point to an actual court case, I doubt if this is true. Despite perception to the contrary, courts tend to apply common sense to situations like this. Just because something is true in a pedantic technical sense, doesn't mean it is valid in court. For instance, if you look at a picture, that picture is copied onto your retina. No court would consider that copyright infringement.

      • "... No court would consider that copyright infringement" . . . yet.

      • I used to have a link to an actual decision that proved this idiot wrong. Since I can't remember the details, it could have been overturned by now. But I'm assuming it is still there, since we haven't seen a supreme court decide otherwise.

        As always, ask a real lawyer before you quote horseshit that sounds like it might be true. And don't trust AC without references.

      • Unless you can point to an actual court case, I doubt if this is true.

        Various Dallas Buyer's Club, LLC v. Does lawsuits. Here is one example: https://dockets.justia.com/docket/washington/wawdce/2:2014cv01819/207565/ [justia.com]

        Mr. Nydam, along with several other defendants, is alleged to have participated in a peer-to-peer network using the BitTorrent protocol to download and share Dallas Buyers Club ... Plaintiff has alleged and presented evidence that the IP address assigned to Mr. Nydam copied and distributed pieces of the film.

        The court ruling makes clear that the defendant is gui

    • Bittorrent is not to be used for theft. Stop using bittorrent for that purpose.

      FTFY. I have happily used bittorrent on many occasions to copy and share material that is legally unencumbered. (Linux ISOs, for example.)

    • There wouldn't have been any copyright infringement if the downloaders were only downloading, but the bittorrent protocol is specifically designed to upload while it downloads, and uploading infringes copyright.

      But it also is designed to upload only little pieces of content.

      My gripe is with the legal claims that EACH torrent participant is responsible for MANY or ALL of the downloads. On the average, each is the source of a tiny fraction less than the data in ONE other person's download. (Earlier particip

      • Re: (Score:2)

        by DaHat ( 247651 )

        There was a time in the US that moving pictures did not have special copyright protection... as a result some owners would make it a point to register a copyright for each and every frame in the film, the idea being that existing law could still enforce their rights with existing law, though eventually copyright law caught up.

        How is this any different? Even if the illicit downloader only uploads a fraction of the total film, they are still distributing parts of it which are still copyrighted, and without a

        • Re: (Score:2)

          by sjames ( 1099 )

          Nobody's disputing that a copyright infringement takes place, it's a question of magnitude.

          Since most people leave the default ratio of 2.0 in place, they should surely not be liable for more than double the cost of the item at retail unless evidence exists that they set the ratio higher. Even going with the common practice of tripling that as a punitive damage, that's going to be under $500 (a lot less if it's made it's way to the bargain bin) for a movie and under ten bucks for a song.

          Note that that's bei

        • Re: (Score:2)

          by tepples ( 727027 )

          Each frame? I'm surprised. I thought a storyboard consisting of one representative frame from each shot would be enough to establish authorship of a motion picture. Plus you can sell copies of that as a "graphic novelization".

  • Lawyers routinely fuck their clients... (Score:4, Funny)

    by chmod a+x mojo ( 965286 ) on Friday December 16, 2016 @09:50PM (#53501135)

    although in some cases they actually filmed and produced their own pornography as part of the scheme.

    Next step up from fucking your clients over... record it and use it to fuck over others too!

  • Comment removed (Score:3)

    by account_deleted ( 4530225 ) on Friday December 16, 2016 @10:11PM (#53501191)
    Comment removed based on user account deletion
  • Linking to Popehat. Read about this on Popehat long before it was even clear what they were doing.

    https://popehat.com/2016/12/16/the-prenda-saga-goes-criminal-steele-and-hansmeier-indicted-on-federal-charges/

  • I've been waiting to see crap like this (Score:5, Insightful)

    by rsilvergun ( 571051 ) on Friday December 16, 2016 @11:22PM (#53501395)
    since I read that our schools have been graduating lawyers in record numbers. Law degrees are highly desirable to schools. They're cheap as hell for the school (a book and a bunch of teachers to read it and grade papers) and expensive as hell for the student. Pure profit really. I haven't looked but I bet if I did I'd find law departments expanding while more useful departments (medicine, education, Comp sci) contracting.

    All these lawyers mean we've got a glut of the damn things. Thousands of highly educated people with no scruples (they're taught out of them so they can focus on their clients interests) and with no job prospects? Yeah, that's some bad ju-ju right there...

    • Re: (Score:2)

      by SeaFox ( 739806 )

      since I read that our schools have been graduating lawyers in record numbers. Law degrees are highly desirable to schools. They're cheap as hell for the school (a book and a bunch of teachers to read it and grade papers) and expensive as hell for the student.

      Is that really just the school driving that? Maybe American students are wising up. "Why study anything in science and technology? All those jobs are just being outsourced anyway. People don't respect the trades. Guess I should study law if I want to make good money without fear of someone in Asia taking my job."

  • but is this really fraud? After all, even if they post it that doesn't mean they gave permission for it to be downloaded. I don't think we've ever settled those 'deep linking' cases completely. But regardless US copyright law tends to err on the side of the copyright owner.

    That said people like porn but they don't like pornographers, so these guys don't have a prayer if they go in front of a jury.
    • When the copyright owner puts it up for torrenting, it's granting (implied) consent for others to download. It would be legally equivalent to putting your collection of star wars action figures in a blue box by the curb, and then charging anyone who took them with theft.

      • Re: (Score:2)

        by dknj ( 441802 )

        PIRATING IS NOT THEFT [torrentfreak.com]

      • that's theft, right? I'm just saying that once this hits the courtroom it's not so cut and dry anymore.

        Ultimately it'll come down to who the jury likes best. I'm guessing the law firm will lose, but if they picked their targets carefully enough (say a stereotypical basement dwelling neck beard) it could play out differently. Remember that woman who lost to the RIAA because they claimed (with nothing but an IP address) that she downloaded MP3s? She's still paying on the multi million dollar settlement (s

    • Re: (Score:2)

      by caseih ( 160668 )

      The fed apparently think it really is fraud. Their indictment is apparently very thorough and comes at them from several angles. The popehat link referred to in previous comments is very insightful and gives a good overview of the indictment.

    • The fraud was in how they represented themselves to the court when they sought the orders to force the ISPs to turn over identifying information. They did not disclose that they themselves had uploaded the material, so the court would never have even wondered about whether that uploading carries implied permission to download or not.

    • It's fraud because they created shell companies, claimed to be independent lawyers when in fact they were the owners and they induced people to download it and then lied about the whole thing in court (lied on the stand or in writing around a dozen times to several federal judges). Doing that gets you two charges, Fraud and Perjury and because there were two of them, you get a conspiracy charge for each. This happens for every single case they file so the number of counts can get rather astronomical after a

    • Re: (Score:2)

      by sjames ( 1099 )

      Actually, posting the material up to a file for sharing implicitly indicates that you are granting permission for it to be shared AND that you are claiming that it is within your legal power to do so.

  • ... more than three times and you are playing with it.

  • Suits just threats to create public records? (Score:3)

    by leftover ( 210560 ) on Saturday December 17, 2016 @12:55PM (#53503305) Homepage

    On first glance my presumption was that the threats to sue for copyright infringement were barely disguised shakedowns to avoid public embarrassment. Actually going to court for a questionable infringement claim would be expensive and time-consuming for the bandits.

    They would be exposed as well but they don't seem to have any shame.

  • Star Wars and bait porn should never be in the same sentence

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