Wednesday, June 15, 2011

Judge Sticks Fork In Righthaven-RJ Model Thanks To Stupid Shermy

I really should have known.

Last year, I took the unusual step here and in the Las Vegas Weekly of supporting something that now-disgraced former Stephens Media publisher Sherman Frederick was up to. It surprised many colleagues, but I thought it showed a certain imagination that was both surprising and admirable.

But I should have known. If Frederick was involved -- and especially if he related to the Internet -- then it couldn't possibly be executed properly. And because it wasn't, what could have been an innovative and valuable method of contending with rampant copyright theft on the Internet is probably dead. It is extremely unlikely others will try it now.

The general idea had been that R-J owner Stephens Media assigns over the copyright to R-J work and then this Vegas-based firm called Righthaven, run by public relations moron Stephen Gibson (left via CalvinAyre.Com), would file lawsuits seeking to punish folks all over the Web who believed that they could steal it and post it on their own sites without paying for it. Many whined that it was cruel, that the thieves deserved a warning to pull down the material before they needed a lawyer, and in many cases the lawsuits were filed against very small entities whose readerships were hardly any bigger than what mine would be if I cut something out of the paper and hung it on my fridge.

Still, as a freelancer whose work has been dramatically devalued by a Web culture that believes that anything anywhere is free, I admired the creativity here. The problem is just too extensive to be cost-effective to address internally, so Stephens Media created a profit motive for someone else to behave as their enforcer. Several lawsuits were ham-handed and Gibson never quite understood that a newspaper has certain unusual elements; you don't go suing people who give you terrific scoops just because they posted a copy of the scoop's story, for instance, and you lose the battle in the court of public opinion when you sue cat bloggers or people with mental disabilities.

But when other major news organizations or other journalists who should know better rip off your content, it seemed to be fair game. And it was because of me that we got some of the most entertaining wrinkles in this story, the wonderfully timed lawsuit against Sharon Angle and the efforts to go after several massive sites because of use of the awesome but utterly inaccurate Vdara Death Ray graphic.

Ahh, but I overestimated Sherman Frederick by a factor of many. He wanted to have his cake and eat it, too, and, as usual, everything he touches turns to sand. Good luck, Hawthorne, Eureka and Ely!

Yesterday, a Nevada judge pretty much pulled the plug, declaring that the whole arrangement had been unlawful and announcing he's considering fining Righthaven and Stephens for taking the courts and more than 200 defendants on a bit of a ride. The problem?

Well, Stephens never actually, truly and fully gave up the copyrights. They wanted to give Righthaven the ability to pursue these lawsuits but not real ownership over the material. And then Righthaven opted not to disclose in court that there was a profit-sharing element to these suits and that the R-J was a third, interested party. Here's David Kravets of Wired.Com with the explanation:

[The judge] suggested Righthaven likely duped other judges to allow lawsuits on behalf of Stephens Media copyrights to go forward.

“Making this failure more egregious, not only did Righthaven fail to identify Stephens Media as an interested party in this suit, the court believes that Righthaven failed to disclose Stephens Media as an interested party in any of its approximately 200 cases filed in this district,” Hunt ruled. “Accordingly, the court orders Righthaven to show cause, in writing, no later than two weeks from the date of this order, why it should not be sanctioned for this flagrant misrepresentation to the court.”

An internal agreement between Righthaven and Stephens Media gives the Review-Journal’s owner and Righthaven each a 50 percent stake in any settlements or verdicts. The accord said Stephens Media shall retain “an exclusive license to exploit the Stephens Media assigned copyrights for any lawful purpose whatsoever and Righthaven shall have no right or license to exploit or participate in the receipt of royalties from the exploitation of the Stephens Media assigned copyrights other than the right to proceeds in association with a recovery.”

So here's the thing: Holy shiz. What possible reason did Righthaven withhold that the R-J was interested party or what the business arrangement was? If I recall correctly, Gibson always claimed that such information was "proprietary," that it was the secret sauce of his business model. Except that EVERYBODY ALREADY KNEW that this was the arrangement, everybody except, officially, the court. And the financial deal turned out to be ... a 50/50 split. What's so secret about that? That's what everyone would have assumed, right?

So now, as a parting gift to Stephens Media, the disgraced former publisher Sherman Frederick has left a legal morass that may haunt the company for years and cost it considerably more in legal fees and potential judgments than this arrangement would ever have brought in. If I were allowed, I would honest-to-God consider flying in from my Michigan fellowship to see an inept Frederick fondle a coffee cup while being vivisected on a witness stand over this, so stupid a screw-up was this error.

And the saddest part is that copyright theft on the Internet is killing the media. It's very dangerous. The actual complaints being made by Righthaven, in many instances, were perfectly valid and I was glad someone was making them. This judge is NOT saying that they weren't meritorious.

No, he's saying something worse, that Sherm and his partners were sloppy idiots who failed on a major technicality. And I guess I should've known they would.

There is one promising post-script, however. The Review-Journal, which had really only covered their own unique copyright lawsuit campaign when they sued Angle, did cover this decision. You know, like a newspaper should. And, as of this writing, it's the second-top story on their website, so they're not burying it. Carri Geer Thevenot even got sniveling comments from Gibson such as:

"It's important to recognize that Righthaven respects the judiciary and respects judicial decisions."


"We certainly hope that we will be given that opportunity with respect to the other cases that have standing at issue. But that is with absolutely no disrespect to Judge Hunt and his decision."

It's quite unlikely that Thevenot would've been able to cover this quite so properly if Sherm were still in charge. So there's that.


Michael said...

Good stuff, I have to wonder if those that settled might have an opportunity for some type of countersuit based on this development? Any thoughts of following up that angle?

I think you are right in the fact there needs to be something done to prevent unfair usage by websites, but to me, the tool should be used for that, at the very least, some type of cease and desist, especially for single instances or new violators. I understand your position as a journalist, but I think there needs to be some reason in applying it, and the truth is the web is not going to fit the same mold that reproduction measures would apply to outside of it.