Source: https://www.scribd.com/document/82252599/Second-Amended-Complaint
Timestamp: 2018-11-16 10:48:54
Document Index: 250318930

Matched Legal Cases: ['§ 412', '§ 412', '§ 410', '§ 411', '§ 412', '§ 1332', '§ 1332', '§ 1332', '§ 1332', '§ 1332', '§ 101', '§ 1030', '§ 1961', '§ 3', '§ 1391', '§ 1367', '§ 1331', '§ 102', '§ 408', '§ 106', '§ 411', '§ 411', '§ 502', '§ 504', '§ 412', '§ 412', '§ 505', '§ 504', '§ 101', '§ 104', '§ 910', '§ 108', '§ 621', '§ 409', '§ 910', '§ 411', '§ 410', '§ 108', '§ 410', '§ 410', '§ 108', '§ 506', '§ 506', '§ 505', '§ 504', '§ 504', '§ 504', '§ 505', '§ 504', '§ 504', '§ 412', '§ 501', '§ 504', '§ 1030', '§ 1030', '§ 1030', '§ 1030', '§ 1030', '§ 1030', '§ 1030', '§ 1030', '§ 1962', '§ 1961', '§ 1962', '§ 1962', '§ 1341', '§ 1343', '§ 1951', '§ 1951', '§ 1951', '§ 1343', '§ 1341', '§ 1961', '§ 1961', '§ 1962', '§ 1962', '§ 1962', '§ 1962', '§ 1962', '§ 1962', '§ 1964', '§ 1962', '§ 1964', '§ 412', '§ 504', '§ 1', '§ 9', '§ 412', '§ 1961', '§ 1', '§ 101', '§ 42', '§ 6', '§ 8', '§ 1961', '§ 411', '§ 411']

Second Amended Complaint | Copyright Law Of The United States | Copyright
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Case 1:10-cv-12043-GAO Document 26
Filed 03/18/11 Page 1 of 105
UNITED STATES DISTRICT COURT DISTRICT OF MASSACHUSETTS __________________________________________ DMITRIY SHIROKOV, on behalf of himself ) and all others similarly situated, ) ) Plaintiff, ) ) v. ) ) DUNLAP, GRUBB & WEAVER, PLLC; US ) COPYRIGHT GROUP; THOMAS DUNLAP; ) NICHOLAS KURTZ; GUARDALEY, LIMITED; ) and ACHTE/NEUNTE Boll Kino ) Beteiligungs Gmbh & Co KG, ) ) Defendants. ) __________________________________________)
COMPLAINT CLASS ACTION JURY TRIAL DEMANDED Case No. 1:10-cv-12043-GAO
SECOND AMENDED CLASS ACTION COMPLAINT AND JURY DEMAND Plaintiff Dmitriy Shirokov (“Plaintiff”), on behalf of himself and all others similarly situated, by his undersigned attorneys, states and alleges as follows: INTRODUCTION 1. This is a proposed national class action brought by Plaintiff, on behalf of himself and 4,576 similarly situated victims (collectively, the “Class”), against DUNLAP, GRUBB & WEAVER, PLLC (“DGW”); US COPYRIGHT GROUP (“USCG”); THOMAS DUNLAP (“Dunlap”); NICHOLAS KURTZ (“Kurtz”); GUARDALEY, LIMITED (“GuardaLey”); and ACHTE/NEUNTE BOLL KINO BETEILIGUNGS GMBH & CO KG (“Achte”) (collectively, “Defendants”) for their scheme to profit from copyright infringement allegations through fraud and extortion (the “Copyright Scheme”), which
Filed 03/18/11 Page 2 of 105
caused members of the Class to make millions of dollars in excess “settlement” payments and/or incur other directly related expenditures (including retaining counsel). 2. Defendant DGW is a law firm whose attorneys (including Defendants Dunlap and Kurtz) have developed a lucrative trade in monetizing copyright infringement allegations. 3. DGW operates the Copyright Scheme in part through “US Copyright Group,” which the Virginia State Corporation Commission recognizes as a “doing business as” registered alias for DGW and several other corporations with ties to DGW. Defendant USCG is a Virginia corporation managed by DGW in conjunction with Defendant GuardaLey. The GuardaLey partners in USCG are not attorneys. 4. Defendant GuardaLey monitors and records online instances of alleged copyright infringement of motion pictures. USCG provides this “evidence” of infringement to film industry clients, but cautions them that civil prosecution of copyright claims is not “practical,” in light of the financial status of individual infringers. 5. Settlement fraud has proven a far more practical alternative for Defendants. DGW touts its USCG business model to potential clients stating one overriding goal: to “obtain settlement”—not judgments, which would require litigating and proving its allegations. 6. On the basis of GuardaLey’s records, DGW typically files a single civil complaint in the United States District Court for the District of Columbia against hundreds of individuals from all over the country, regardless of the jurisdiction where the alleged infringements took place. Their complaints allege mass online infringement of a client’s film copyright and petition the Court to issue subpoenas to Internet Service Providers (“ISPs”), seeking contact information for the alleged infringers. DGW targeted almost 20,000 people in
Filed 03/18/11 Page 3 of 105
2010 alone.1 Among DGW’s targets are the 4,577 members of the Class, whom DGW identified in a suit it filed on behalf of Defendant Achte related to its motion picture Far Cry, Civ. A. No. 1:10-cv-00453-RMC (D.D.C., filed Mar. 18, 2010) (the “Achte action”). 7. DGW used the private information provided by ISPs to send to Plaintiff, and thousands of others, virtually identical “litigation settlement” demand letters. Defendants used the
demand letters and other means to coerce settlements, routinely demanding $1,500 from each recipient, increasing to $2,500 if not sent promptly, under deceptive threats of impending (and even more expensive) litigation. USCG purports to provide these
services to its clients at no cost, in exchange for a share of any settlements collected. 8. At all relevant times, Defendants have not genuinely intended to fully prosecute the vast majority of these thousands of claims. Indeed, with only thirteen attorneys on staff,
DGW has issued a volume of demand letters that far surpasses its ability to litigate these claims case by case.
In addition to the Achte action (2,094 defendants, later amended to 4,577 defendants, later amended to 140 defendants), which is the basis of the Copyright Scheme before this Court, DGW has filed virtually identical complaints regarding other films, including: Civ. A. No. 1:10cv-00038-HHK-DAR (D.D.C., filed Jan. 8, 2010) (The Gray Man) (749 defendants; withdrawn without prejudice); Civ. A. No. 1:10-cv-00041-CKK (D.D.C., filed Jan. 8, 2010) (Uncross the Stars) (83 defendants, later amended to 195 defendants; withdrawn without prejudice); Civ. A. No. 1:10-cv-00455-RMU (D.D.C., filed Mar. 19, 2010) (Call of the Wild 3D) (358 defendants, later amended to 1,062 defendants); Civ. A. No. 1:10-cv-00481-RMC (D.D.C., filed Mar. 23, 2010) (The Steam Experiment (a/k/a The Chaos Experiment)) (2,000 defendants, later amended to 1,653 defendants); Civ. A. No. 1:10-cv-00569-RJL (D.D.C., filed Apr. 8, 2010) (Smile Pretty (a/k/a Nasty) and other films) (1,000 defendants, later amended to 4,350 defendants); Civ. A. No. 1:10-cv-00873-RMU (D.D.C., filed May 24, 2010) (The Hurt Locker) (5,000 defendants); Civ. A. No. 1:10-cv-01476-CKK (D.D.C., filed Aug. 30, 2010) (Cornered!) (2,177 defendants); and Civ. A. No. 1:10-cv-01520-EGS (D.D.C., filed Sept. 8, 2010) (Familiar Strangers) (171 defendants).
expressly forbids awards of statutory damages and attorney’s fees (collectively. Dunlap procured copyright registration for Far Cry on behalf of Achte under false pretenses by intentionally submitting materially false information in the application. Instead. the effective date of copyright registration (“Effective Date”) when Dunlap’s registration application was completed. the claims for Ineligible Remedies they 4 . 2008 and the United States (the domestic theatrical premiere). December 17. § 412 (“Section 412”). 11. 2010. once DGW/USCG secured Achte’s business. USCG. DGW. or April 14.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 4 of 105 9. knew that it would bar any claims for Ineligible Remedies against any earlier infringers if he stated the truth. Each Defendant in the Copyright Scheme had improper economic and business reasons to make this and other knowing misstatements of material information—to maximize the damage awards that Defendants could pursue. Dunlap did not fill in: • • • October 2.C. who has written articles on Section 412 and its impact on foreign rights. So where the application form requests the film’s date and nation of publication (as required by Section 409(8)). “Ineligible Remedies”) that Defendants claim a right to enforce against members of the Class. Title 17 of the United States Code (the “Copyright Act”). 2009. Dunlap and Achte knew the actual publication history of Achte’s film on (and at all relevant times prior to) January 19. he claimed that Far Cry’s first publication took place on November 24. 12.S. In the Copyright Scheme. Dunlap. 2008 and Germany (the global theatrical premiere). 10. in the United States: the date the DVD was commercially released in America. 2009 and the Netherlands (the first publication of Far Cry on DVD). specifically 17 U.
threats of liability for as much as $150. including Plaintiff. Defendants made baseless threats in demand letters Kurtz sent to members of the Class (the “Letters”). The Class consists of a total of 4. Using the Far Cry copyright registration to provide a patina of legitimacy to their Copyright Scheme. and a warning that settling would be cheaper than retaining an attorney to fight. despite the fatal defects in its registration and the express provisions of the Copyright Act. 16. 13.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 5 of 105 could threaten in demand letters. The Letters. but warn that even consulting an attorney will almost always cost more than settling. namely statutory damages and attorney’s fees. and contains two proposed Subclasses. and other communications and actions made by Defendants in the Copyright Scheme. 14. The Letters direct recipients to settlement websites which suggest seeking counsel. 2009. are designed to facilitate “settlements” on wrongful terms. 15. The Letters falsely claim that the law allows Achte to seek extraordinary forms of relief. 5 . They confront accused infringers with the financial and logistical burdens of defending themselves in a remote jurisdiction. 17.000 plus attorney’s fees. and the volume and amount of extorted “settlements” that would result and in which they could share. The first proposed subclass (“Subclass I”) consists of 917 individuals. by whom Defendants alleged infringements that commenced prior to November 24. which Dunlap claimed in the registration application as the date of Far Cry’s first publication. Defendants alleged in the Achte action that the members of the Class violated Achte’s copyright in Far Cry. for infringing Achte’s copyright for the motion picture Far Cry.577 individuals.
C. the effective date of copyright registration (the “Effective Date”).727 other individuals including Plaintiff. Each claim by Defendants to obtain Ineligible Remedies from members of Subclass II contravenes the law and is fraudulent. Each claim by Defendants to obtain Ineligible Remedies from members of Subclass I contravenes the law and is fraudulent. Under 17 U. no award of statutory damages or of attorney’s fees may be made for infringements that commence after a work’s first publication.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 6 of 105 18. unpublished. the Register of Copyrights must refuse registration to any claim that she determines is invalid. 20. § 412(2). 19. Under its Office Practices. they claim. Under 17 U.C. Yet Defendants allege that each Subclass I member infringed Far Cry when the motion picture was as yet unregistered and. Yet the infringements that Defendants allege by members of Subclass II commenced prior to the Effective Date. 21. which was more than three months after the first publication of Far Cry. Under 17 U.S. the Copyright Office will not accept an applicant’s bare statement as to date or nation of first publication if it has contrary information. § 410(b). 2010. more than nine months before the Effective Date. but before the registration’s effective date.C.S. § 411(b). 2009. Far Cry’s actual first publication date was at least as early as April 14.S. Under 17 U. including the 917 in Subclass I and 2. no award of statutory damages or of attorney’s fees may be made for infringements that commence before the registration of an unpublished work.644 individuals. unless the registration is made within three months of the first publication. by whom Defendants alleged infringements that commenced prior to January 19. a registration certificate that contains 6 . The second proposed subclass (“Subclass II”) consists of 3.C. § 412(1).S.
the Defendants took advantage of the Class members’ shallow pockets and ignorance about their potential defenses. Moreover. Defendants have sought to coerce settlements from the Class members through the Letters and other communications on the basis of expressly barred claims. if known. The registration that Achte and Dunlap obtained by knowing misstatements of material information relied on by the Copyright Office—in short. and (B) its inaccuracy. according to its Office Practices. prior to the Effective Date. the Copyright Office would have known that the claimed date was invalid. if (A) that information was included on the application with knowledge that it was inaccurate. If Achte and Dunlap had not withheld the truth about this material information. every alleged act of infringement by Class members alleged “commenced. and a discovery lawsuit filed in a jurisdiction far from where 7 . by fraud—is invalid. 24. fraudulent. Threatening Ineligible Remedies. Defendants’ claims for Ineligible Remedies from any member of the Class contravenes the law and is fraudulent. like the registration. have been successfully extorted. 23. responding to Defendants’ false claims. Nonetheless.” as that term is used in Section 412.500 or more and/or made other expenditures. They have paid settlements of $1. Each claim by Defendants to obtain Ineligible Remedies from any member of the Class based on that registration contravenes the law and is. Many members of the Class and its proposed subclasses. 22. and would have refused to issue a registration showing the false date.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 7 of 105 inaccurate information does not satisfy the requirements of Section 412. and thus cannot support an award of Ineligible Remedies. would have caused the Register of Copyrights to refuse registration. unaware of the fraudulent registration and the deception critical to the Copyright Scheme’s impact.
and other costs as a direct result of Defendant’s wrongful acts.S.577 members of the Class. 28 U. in order to induce them into settling. and extortionate tactics. See 28 U.000 in aggregate in coerced settlement payments. 28 U.000 in aggregate. JURISDICTION AND VENUE 27. which confers federal jurisdiction over class actions where. DGW. Dunlap and Kurtz.000. USCG.C. This Court has subject matter jurisdiction over this class action pursuant to 28 U. Absent Defendants’ false registration. §§ 1332(d)(2) and (6). “any member of a class of plaintiffs is a citizen of a State different from any defendants” and the aggregated amount in controversy exceeds $5. and the United States District Court for the District of Columbia.S. these four-figure “settlements” would not have happened. members of the Class have spent more than $5. and specifically Achte. the United Kingdom and Germany. 25. § 1332(d)(2)(A). the United States Copyright Office. In this action. false threats.000. § 1332(d).500 or greater from the 4.C. 8 .000. and upon the ISPs.S. 28 U.S. § 1332(d). The amount in controversy exceeds $5.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 8 of 105 most Class members reside. attorney’s fees. Plaintiff and the Class seek to recover damages incurred from Defendant’s unlawful acts and practices. 26. § 1332(d)(2)(C). as here. Plaintiff Shirokov is a citizen of Massachusetts. and injunctive relief to stop the Copyright Scheme. have sought settlements of $1.C.S. while Defendants include citizens of Virginia. Defendants’ Copyright Scheme is predicated on fraud—upon Plaintiff and the Class.C.C. and upon information and belief. as Defendants collectively.000.
Venue is proper in this District under 28 U. systematically and continually conduct business throughout the Commonwealth of Massachusetts. §§ 101 et seq.S. the Copyright Act. 1338(a) and (b). Plaintiff does not have the 9 . Mass. and 1367(a) because this action arises under the Racketeer Influenced and Corrupt Organizations Act. 30. This Court also has supplemental jurisdiction under 28 U. This Court also has original jurisdiction under 28 U. Defendants have no legitimate basis for claiming that jurisdiction would be appropriate in the United States District Court for the District of Columbia. §§ 1030 et seq.S. 17 U. §§ 1961 et seq. and/or directing Letters and other communications to. and the Computer Fraud and Abuse Act. 29.C. § 3.C. either directly or through other Defendants as agents. including monitoring the Internet usage of.C. 31.. Massachusetts residents including Plaintiff.S. 18 U. § 1391(b)(2) because a substantial part of the events that give rise to the claim occurred in this District. and Defendants.S. § 1367. 18 U. because all other claims are so related to those claims over which the Court has original jurisdiction as to form part of the same case or controversy under Article III of the United States Constitution.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 9 of 105 28..S.C. Personal jurisdiction comports with due process under the United States Constitution and the long-arm statute of Massachusetts. Laws ch. 223A.C.C.S. 32. Gen. §§ 1331.
Defendant Nicholas Kurtz (“Kurtz”) is an attorney at DGW. 2010) (offering speculative bases for possible jurisdiction). Berkshire. Leesburg. Limited (“GuardaLey”) is a German company incorporated in England and Wales with its principal office at 5 Jupiter House. an insufficient ground for jurisdiction over any particular allegation of infringement. and offices at 1200 G Street NW. an attorney. USCG is also a registered alias of several corporations with ties to DGW. 10-10453 (D. No. P. Sep. 34. See. Civ. RG7 8NN. Sept. United Kingdom. Naples. Reading. Virginia 20175. DC 20005 and 780 Fifth Avenue South. R. Defendant US Copyright Group (“USCG”) is a Virginia corporation with a principal office at 199 Liberty Street SW. R.g. e. Plaintiff's Statement of Good Cause in Response to Court Order at pp. 45(c)(3) and Motion to Dismiss Pursuant to Fed. GuardaLey is a partner with DGW in managing USCG. Defendant GuardaLey. FL 34102. Defendant Thomas Dunlap (“Dunlap”). Calleva Park. 10-453 (D. 12-18. Virginia 20175.C. PLLC (“DGW”) is a Virginia law firm with its main office at 199 Liberty Street SW. Defendant Dunlap. USCG is a registered alias for a partnership between DGW and GuardaLey. P. Massachusetts. 28. Omnibus Motion & Memorandum to Quash Subpoena Pursuant to Fed.2 nor has he purposefully availed himself of jurisdiction therein. Civ. 10 . Washington. PARTIES 33. is a managing partner at DGW and USCG.D. Leesburg. 9-10.D. 2 Fishing for a connection between Class members and the District of Columbia to support jurisdiction in the Achte action.577 alleged infringing acts may have taken place in that District. 12(b)(2) at pp. Aldermaston. 36. 2010). Defendants argued that some of the 4. 35.. 10. 38.C. Grubb & Weaver. Plaintiff Dmitriy Shirokov (“Plaintiff”) is a citizen of Middlesex County.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 10 of 105 requisite minimum contacts with the District of Columbia. 37. No.
The Copyright Act establishes remedial incentives to encourage copyright holders to register their works. violation of which may constitute copyright infringement. 1237. is a Kommanditgesellschaft.C. or German Limited Partnership. properly registered works enjoy statutory benefits.C.C.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 11 of 105 39. 1241 n. 130 S. and publicly perform the work. ____. 17 U.S. Germany. § 102. D-55130 Mainz. 11 .S. but it is not a condition of copyright protection. Under United States law. 559 U. § 408(a). Muchnick. 1 (2010). Reed Elsevier v.S. LEGAL BACKGROUND 40. a motion picture creator and/or distributor. Registration is permissive. including artistic works such as movies. 6 In case of copyright infringement litigation. allowing the owner of a copyright or any exclusive right in a work to submit an application to the Copyright Office. including the right to reproduce. Ct.5 43. upon their creation. 17 U. copyright attaches to original works of authorship. Copyright law grants copyright holders certain exclusive rights. § 106. Defendant Achte/Neunte Boll Kino Beteiligungs Gmbh & Co KG (“Achte”).3 41. distribute.4 42. The United States has a voluntary system of copyright registration. with its principal place of business at Wormserstrasse 173. including: 3 4 5 6 17 U.S.
000 are available for each infringed work if the infringement was committed willfully.C. are exempt from the registration requirement. unless the copyright holder seeks statutory damages and attorney’s fees. No.12 45.S. 17 U. § 411(a).9 • • 44.11 The Copyright Act provides more limited remedies in certain circumstances.10 An injunction may be imposed against a copyright infringer. § 411(a). Section 412 of the Copyright Act provides in full: 17 U. 17 U.C.000 are available for each infringed work. Supp. § 502. 04-C-5719 (N. §§ 504(c)(2). July 24.S. Id.S.S. Ill. 8 9 7 17 U. statutory damages and attorneys’ fees are not available as remedies for infringement of any copyrighted work that was published more than three months prior to its registration. 2d 690. D.S. § 412: Registration as prerequisite to certain remedies for infringement In any action under this title. “Works first published outside the United States . 17 U. § 412(2).C. When an infringement commences prior to registration.. other than an action brought for a violation of the rights of the author under section 106A(a).Case 1:10-cv-12043-GAO Document 26 g Filed 03/18/11 Page 12 of 105 • • Enforcement in federal court is available for “United States works.C.S. 17 U. a court may reduce a statutory damages award to as little as $200 in a case of “innocent infringement”—that is.” 7 Statutory damages awards of between $750 and $30. 12 10 11 12 . where the infringer was not aware and had no reason to know that his or her acts constituted infringement of copyright.8 • Statutory damages awards of up to $150.C.” Rudnicki v. WPNA 1490 AM. 580 F.S. However. 2008).. an action for infringement of the 17 U. § 505. § 504(c)(1).C. The prevailing party in litigation may recover attorneys’ fees and court costs.C.
publication does take place if the purpose is further distribution. 101-650). or by rental. or public display. unless such registration is made within three months after the first publication of the work. § 101. The Copyright Office further explains that. U.”15 13 The statutory exceptions to Section 412 are not applicable to Defendants’ claims. A public performance or display of a work does not of itself constitute publication. 4. lease.14 47. broadcasters. (b) based on a preregistered work under Section 408 (f). because the civil action DGW filed on behalf of Achte was not (a) brought under Section 106A(a) (the Visual Rights Act of 1990.copyright. The Copyright Act defines the “publication” of a work as follows: Publication is the distribution of copies or phonorecords of a work to the public by sale or other transfer of ownership. or public display constitutes publication.pdf. or motion picture theaters.S.S. L. 13 . or lending. public performance.13 no award of statutory damages or of attorney’s fees. Copyright Basics.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 13 of 105 copyright of a work that has been preregistered under section 408(f) before the commencement of the infringement and that has an effective date of registration not later than the earlier of 3 months after the first publication of the work or 1 month after the copyright owner has learned of the infringement. 46. Copyright Office.C. No. The offering to distribute copies or phonorecords to a group of persons for purposes of further distribution. available at http:// www. p. nor (c) instituted under Section 411(c) (which allows claims on behalf of live televised broadcasts). “when copies or phonorecords are offered for sale or lease to a group of wholesalers. Circular 1. as provided by sections 504 and 505. or an action instituted under section 411(c).gov/circs/circ01. public performance. 14 15 17 U. Pub. shall be made for— (1) any infringement of copyright in an unpublished work commenced before the effective date of its registration. or (2) any infringement of copyright commenced after first publication of the work and before the effective date of its registration.
Copyright Office. 17 U. 51. 14 . including that. on the date of first publication. § 104(b)(2). under the Copyright Office’s guidelines an application covering a work first published outside the United States should state the date of first publication there.S. or any other period prescribed by the statute. Id. Where the applicant is uncertain as to which of several possible dates to choose.C. Copyright Office. 18 19 Compendium II § 910. An application for a registration of copyright in a published work requires a statement of the date of first publication. to avoid implication of an attempt to lengthen the copyright term.18 50.17 Specifically. § 108. Compendium II: Copyright Office Practices (“Compendium II”) §§ 621. it will generally accept without question the date and nation of first publication given by the applicant: 16 17 17 U. it is generally advisable to choose the earliest date.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 14 of 105 48. including if “the work is first published in the United States or in a foreign nation that. Compendium II: Copyright Office Practices.S. U. the nation of first publication should also be given. 910. § 409(8). The Copyright Office ordinarily does not make findings of fact with respect to publication.09.05.S. and should be accompanied by a copy or phonorecord of the foreign edition as first published. is a treaty party.”16 49. The Copyright Office’s manual of practices and procedures states its general practices with respect to publication.S. Section 904.C.19 Instead. There are several grounds for protection of published works (including motion pictures) under the Copyright Act. U.
However.C.S. such evidence may be rebutted with evidence that the registration was obtained through fraud or material misrepresentations or omissions.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 15 of 105 The Office will correspond with the applicant if it has information inconsistent with the statement used by the applicant as the basis for the date given.23 56. 606. 17 U. 17 U. 15 . § 910. if the Copyright Office has information (whether provided by the applicant or not) clearly inconsistent with the applicant's statement. 24 20 21 22 23 24 Id.C. The Copyright Office will not register an invalid claim. the Copyright Office will not register a claim if it has information that the date and nation of first publication listed on the application are incorrect. An applicant who knows that the copyright certificate of registration contains inaccurate information cannot use it as a basis for a civil action for infringement if the inaccuracy would have caused the Register of Copyrights to refuse registration.09. 55. it will not generally accept the statement.21 53. 17 U. Similarly. A certificate of registration from the United States Copyright Office is prima facie evidence of a copyright’s validity. 54.01. 57. § 411.22 In short.20 52. Id. unless it appears to be clearly inconsistent with the facts stated by the applicant or the information which the Office has with respect to the place of first publication.S. § 410(b). the Copyright Office will generally accept the statement of the applicant on nation of first publication. However. Compendium II §§ 108. § 410(c).S.C.
including the law regarding copyright registration. 21. 25 26 See http://www.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 16 of 105 STATEMENT OF FACTS A.”26 Announcing one of its film copyright lawsuit filings in 2010.html (last visited Nov. DGW Purports to Have Special Expertise in Copyright Law. the DGW website includes two separate forms (an “intake form” and a “questionnaire”).S.dglegal. DGW specifically portrays itself as well-versed in copyright law. 21.”27 True and correct copies of these DGW web pages are attached as Exhibit A.com (last visited Nov. Copyright Office. 2010). the firm declared on its blog page. 60. 59. emphasizing the firm’s proximity to the U.”25 DGW’s web page detailing the firm’s copyright services declares its lawyers “uniquely qualified” in the field. This is not limited to its self-branded alias as “US Copyright Group” (“USCG”). 2010). “we have a team of intellectual property lawyers who are experienced in prosecuting these cases.” and its “extensive experience negotiating and drafting agreements involving copyrighted works.dglegal. See http://www. 58. “We are a boutique law firm that handles intellectual property prosecution.dglegal. its practice “counseling clients to obtain protection and rights to use and profit from copyrighted material. Advertising the firm’s copyright registration services.com/services/intellectual-property/copyright (last visited Nov. litigation and business law matters on a national and international scale. 21. 16 . 2010). 27 http://www. and in copyright law specifically. Defendant law firm DGW holds itself out as having special expertise in intellectual property law.com/dgw-blog/copyright-holders-fight-back. The home page of the DGW website declares.
please describe the circumstances. See http://www. asking of applicants: If the material has been published or publicly distributed. The questionnaire poses the question of first publication more elaborately: Have copies of this work been publicly distributed or given to another for purposes of distribution to the public? If so.com/DGW__-_File_A_Copyright. please give the date of the first publication or earliest distribution and the nation of the first publication or earliest distribution. as the need arises. 17 28 . B.com/uploads/ DGW_Copyright_Engagement___350_or__1_000_. 14. and be assured that your application will be submitted by actual intellectual property attorneys who can and will be there for you in the future to assist with the registration process. 2010) (the “intake form’). and the location. See Exhibit C. True and correct copies of the intake form and questionnaire are attached as Exhibits B and C. 62. 2010) (the “questionnaire”). 14. The intake form also recognizes that the date and nation of a work’s first publication are material information in a copyright registration. and http://ustrademarkgroup. See Exhibit B. and give the date (month/day/year) when this first occurred.ustrademarkgroup. 63.pdf (last visited Nov. See Exhibit B.28 61. DGW and Dunlap Have Demonstrated an Acute Awareness of the Significance of Section 412 of the Copyright Act. Section 8. The intake form assures prospective clients of DGW’s intellectual property specialization: We are confident that you will find our online application process easy to use. respectively.html (last visited Nov.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 17 of 105 a prospective client may fill out either to authorize DGW to handle their copyright registration.
66. For years. tdunlap@dglegal. 2010).Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 18 of 105 64. Substantive rights may be established as of the filing date of a US copyright application.html (last visited Nov. as long as it is registered within three months after publication. particularly within ninety days of publication or before actual infringement occurs. 65. Dunlap.com: Under the Berne Convention (the US joined in 1989) you have a common law right to protection. Defendant Dunlap has been personally aware of the bar on statutory damages imposed by Section 412. 18 . Dunlap posted the following comment in the “Free Legal Advice” section of the website Avvo. Get to a lawyer today and register that copyright with the US Copyright Office ASAP! 29 29 Posting of Thomas M. In 2009. or within the Section 412 safe harbor.avvo. This questionnaire suggests DGW’s acute awareness of how Section 412 affects the value of a copyright claim against infringers. Id. DGW informs potential clients. to http://www. however in order to potentially recover statutory and punitive damages you need to register your copyright immediately (happy to help) as you generally only have 90 days from the date of the infringing publication to do so (17 USC 412).com. A true and correct copy of the posting is attached as Exhibit D.com/legal-answers/ lyrics-dspute--134378. Atop the questionnaire. 8. which allows a copyright owner to seek the full range of remedies against infringers even if the work has already been published. This passage references the statutory benefits to registering copyright before any infringement occurs.
19. Intellectual Property Primer for CEOs. available at http://www. You can’t collect your attorney’s fees and statutory damages (of up to $150. A good example of that is the case where someone wrote a thesis as part of a doctoral program [] didn’t publish it. 69. punctuation for punctuation. published it with a book publisher and sold it at Barnes and Noble. In 2007.org/article. Dunlap wrote in the Primer. just like trademark there is a public notice of the ownership of the work. Dunlap focused on an issue that USCG would later make a selling point to its prospective clients: the possibility of settlements far in excess of actual damages. “[w]ith out registration you can be awarded actual damages and lost profits only. and Corporate Counsel” (“Primer”). “Intellectual Property Primer for CEOs.” See Exhibit E. and Corporate Counsel (Aug. the author bio below the article specifically identifies Dunlap as the author. every large bookseller you could think of about ten years later. In the Primer. The person waited too long after the infringing publication to copyright the work and was reduced to making common law claims.hg. Dunlap generally sought to distinguish copyrights and trademarks under American law and discuss the benefits of registration. 19 . 31 30 “The most important thing that an executive needs to know at the end of the day.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 19 of 105 67.000 per incident!) if you have not registered. Though the byline above the article states that the article was written by DGW. filed it with his University. Managers. Amazon.asp?id=4788. In describing the value of copyright registration. Dunlap. Dunlap discussed the significance of Section 412 at length in an online article entitled.31 Discussing copyright law. It turns out the profits from the sales of that book were about a thousand dollars. well under the amount of the tens of thousands of dollars in Thomas M. Managers. 68.30 A true and correct copy of the Primer is attached as Exhibit E. is that registration of both trademark/ brand names and of copyrightable material is important.” Id. 70. 2007). Another person copied the thesis word for word. Dunlap highlighted details of the only specific case law discussed in his Primer: Other advantages of registering [a copyright]. At several points in the Primer.
until you have vetted the trademark to make sure that you are not infringing. 72. Soon after publishing this Primer. or as soon as you put the original work of authorship in a tangible medium. Benjamin Perino. So the registration was really important there. DGW’s US Copyright Group Facilitates a Business Model Based on Volume Settlements of Alleged Copyright Infringement. Ten dollars of prevention is worth ten thousand dollars in legal fees. as a practical matter.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 20 of 105 attorneys fees required to enforce the matter. However. 10.” Documents on file with the Virginia State Corporation Commission indicate that DGW registered “US Copyright Group” as a fictitious name.. Dunlap reiterated the value of registration toward the end of the Primer: You have common law right as soon as you use a trademark in Commerce.32 Jeffrey Weaver.. in conjunction with GuardaLey. the common law rights are practically worthless as the exercise of this protection often fails a cost benefit analysis. Dunlap. Weaver. 2009). If you haven’t registered your trademark or copyright. then you’re eating that cost of enforcement even if you win. S244979-3 (Nov. 73. C.. manages and does business as USCG. Id. PLLC. until you have actually gone through the registration process. Dunlap. is also a managing director of Virginia State Corporation Commission. filed the application for trademark registration for the service mark “US Copyright Group. 20 32 . Grubb & Weaver. The cost of litigation are high. LLC ID No. At least one of the managers of USCG. See Exhibit E. DGW does business under the alias “US Copyright Group.” DGW. We recommend that businesses protect anything they can get their intellectual property claws on. a name partner at DGW. and others at DGW developed a new way for businesses to “get their intellectual property claws on” alleged infringers. 71.
com.35 74. Indep. w h i t e h o u s e .”34 The USCG page on LinkedIn lists DGW’s Washington.000 if the accused doesn’t settle within a few weeks. p. App. 20.org. office as USCG’s headquarters. http://www. Mar. 36 Nate Anderson. 20.com/in/tomdunlap (last visited Nov. 22. available a t h t t p : / / w w w.ars) (last visited Nov.”) and Public Comment Letter from Jean M.” ars technica (June 2010) (available at http://arstechnica. 35 LinkedIn. 2010).D.savecinema. 21 . “The RIAA? Amateurs..linkedin.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 21 of 105 GuardaLey. 2010). and features a hyperlink to one of USCG’s settlement websites. Intellectual Prop. In the face of increasing concern over Internet infringement.C. 2010).. 2010) (“I am one of four Managers of the US Copyright Group . 34 33 LinkedIn. 10-453 (D. D. Under its USCG moniker. D. Prewitt.S. Here’s how you sue 14. 24. DGW/USCG has actively solicited film production and distribution companies to join in its scheme to turn infringement claims into a windfall. under the heading “Company Website.linkedin. 18. DGW has “turned P2P prosecution into revenue generation in order to ‘SAVE CINEMA. “The model couldn't be simpler: See Declaration of Benjamin Perino in Support of Plaintiff’s Motion for Leave to Take Discovery Prior to Rule 26(f) Conference.com/company/uscopyright-group (last visited Nov. ¶ 1. http://www. www. 2010). Enforcement Coordinator. Thomas Dunlap Public Profile.pdf (last visited November 8. 6 (Mar. 76. Dunlap’s public profile page identifies him as a USCG partner and co-founder.33 On LinkedIn. Film & Television Alliance to U. 2010) (identifying Perino as Managing Director of GuardaLey).com/tech-policy/news/2010/06/the-riaa-amateursheres-how-you-sue-p2p-users. US Copyright Group Public Profile.C. g o v / s i t e s / d e f a u l t / f i l e s / o m b / I P E C / f r n _ c o m m e n t s / IndependentFilmTelevisionAlliance. No.000+ P2P users. USCG offers the film industry a new revenue stream: a share of the proceeds from “litigation settlement” demand letters with accusations that the recipient has engaged in peer-to-peer copyright infringement online and threats to pursue damages awards of up to $150.’”36 75. and identifies Dunlap as its main contact.
send out subpoenas to reveal each Doe's identity. www. filed with the United States Patent and Trademark Office as a specimen of use in the application for the trademark “US COPYRIGHT GROUP” [Registration No. 2009). SaveCinema. AT NO COST TO OUR CLIENTS. As per this solicitation.savecinema..org . THE US COPYRIGHT GROUP WILL: IDENTIFY ILLEGAL DOWNLOADERS BY ISP ADDRESS SUBPOENA IDENTIFYING CONTACT INFORMATION SEND A CEASE & DESIST LETTER TO DEMAND PAYMENT OF DAMAGES OBTAIN SETTLEMENT OF APPROXIMATELY $500 . 22 . 37 38 Id. demand that each person pay $1.000 PER INFRINGER & PROMISE TO CEASE FUTURE ILLEGAL DOWNLOADING PROCESS SETTLEMENTS & PROVIDE RECORDS TO THE CLIENT DISBURSE CLIENT’S PORTION OF THE DAMAGES ALL SERVICES PROVIDED ON A CONTINGENCY OR FLAT-FEE BASIS AT NO COST TO THE CLIENT 38 78.” splitting the proceeds with the client.$1.Solutions.org: . http://www. 3779792].html (as of Nov. who is charged nothing..Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 22 of 105 find an indie filmmaker.500 to $2. USCG and its clients envision their relationship as one in which USCG will “obtain settlement” from alleged infringers and “process settlements.500 to make the lawsuit go away. USCG outlined each step of its copyright settlement business model in an online solicitation to potential clients posted on one of its websites.org/index-3. convince the production company to let you sue individual ‘John Does’ for no charge.savecinema. A true and correct copy of the specimen pages in the trademark application is attached as Exhibit F.”37 77. 19. set up a website to accept checks and credit cards. split the revenue with the filmmaker.
until the SaveCinema. the film and entertainment industry loses prodigious amounts of revenue to the world of illegal downloading.” USCG’s website further explained to potential clients the logic behind its avoidance of actual prosecution of individual claims: Copyright infringement and the Federal and state laws surrounding its enforcement are complex and difficult to implement. which means that the solutions are complex and the legal fees are expensive. USCG promotes a cost-benefit analysis in which alleged infringers are generally not worth suing. On its LinkedIn page. Under the heading “Capital Recovery. 39 40 Id. USCG further expands upon its goals: Our unique partnerships allow us to monitor filing sharing [sic]. LinkedIn. Then. 23 . Research suggests that once a copyright infringer is forced to pay settlement damages far in excess of the actual cost of the stolen content. we obtain the infringers' identities through ISP subpoenas. USCG steers film studios away from litigation and toward mass 81. (2) file suit against unnamed accused infringers (“John Doe defendants”) en masse.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 23 of 105 79. More than any other industry. (emphasis added). he will never steal copyrighted material again. As a practical matter each individual infringer lacks the assets. In practice. settlements. 40 82. In this mission statement.org efforts of the US Copyright Group.39 80. logging incidents of alleged infringement of client copyrights. http://www.linkedin. net worth and earning capacity to make civil prosecution practical . 2010). US Copyright Group company page. USCG explains that its copyright settlement business model is predicated on settlements far in excess of any actual damages suffered. A true and correct copy of the LinkedIn page is attached as Exhibit G. the USCG mass settlement business model proceeds by these steps: (1) monitor file sharing... uploads and downloading. 83. finally resulting in "cease & desist" letters with a demand for payment of damages being sent to the illegal downloaders on a massive scale.com/company/uscopyright-group?trk=null (emphasis added) (last visited November 8. uploading and file-sharing.
. (4) collect contact information for John Doe defendants from ISPs. Defendants have collectively and systematically executed the mass settlement business model advertised by USCG against thousands of John Doe defendants. because of the value of the mark defendant may be willing to spend more to defend its actions and plaintiffs may be willing to spend more to enforce. and (6) collect and distribute settlement payments. and Corporate Counsel” who might have copyrights and trademarks to register. It is a cost benefit analysis on both sides . you could file a complaint and have a licensing agreement or settlement two weeks later. (5) send letters to John Doe defendants threatening damages. judges don’t want to hear cases that can settle. and have a license agreement or settlement letter without even filing a complaint. .41 41 Exhibit E. A complex more valuable trademark could cost more to prosecute and defend. Managers. you are looking at spending anywhere from fifty to a hundred thousand dollars at the typical simple end of the spectrum. Facts often win cases in advance and there is a lot less risk to both parties in settlement. 24 . or you could send an infringement letter.is the mark is an essential part of the business? How much has the company spent on the mark and making in known to the public or in the industry? What happens if the business suddenly loses the mark? Can it cost less? Certainly. Federal courts like settlement. Dunlap offered such prospective clients a theme that also features in USCG’s client recruitment materials: that infringement trials are expensive but rare. Failing that. Dunlap’s Primer was addressed to “CEOs. while settlements are fast and common: These matters often resolve prior to a final trial in the form of a settlement agreement or licensing agreement. In fact it is rare when parties don’t settle outside of court. Typically speaking to prosecute or defend a trademark or copyright claim. 84. 85. you have to go through the litigation process.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 24 of 105 (3) obtain court approval to issue third-party subpoenas to ISPs..
inserting case-specific information into template documents. 89. Achte is a German film production company that has made over twenty featurelength motion pictures. as per the cost-benefit analysis it promotes to clients.S. the copyright for each of those motion pictures prior to Far Cry had been duly registered with the U. 90. Tactics that Dunlap promoted (encouraging settlement and discouraging litigation) also benefit DGW in the USCG cases. motion papers. D. Defendants also seek to achieve economies of scale and minimize costs through a cookiecutter litigation model: DGW uses form texts for complaints.com/attorneys (last visited Nov. 25 . Achte’s Failure to Timely Register Its Copyright for Far Cry Posed a Problem for the USCG Business Model. Defendants’ cookie-cutter litigation tactics are not appropriate in cases that do not raise identical issues. DGW lists a total of thirteen attorneys on its website. To date. 87.dglegal. Which Dunlap Sought to Mask Through Fraud. and threatening letters sent to thousands of defendants across its film copyright infringement cases.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 25 of 105 86. the Achte action was not like their other cases. 2010). anywhere near the volume of copyright litigation it has threatened. third-party subpoenas. 88. as individual claims. 91. DGW’s direct stake in USCG’s proceeds gives it a financial incentive to maximize its reward by obtaining as many settlements as possible for as much money as it can get. But as Defendants knew. DGW is not built to handle. 42 See http://www. Copyright Office.42 The small number of attorneys at DGW belies any claim that it honestly intends to pursue full-blown litigation against any more than a small fraction of the John Doe defendants. Upon information and belief. 21. Far Cry is the only foreign film to serve as a basis for the DGW/USCG business model.
Filed 03/18/11 Page 26 of 105
Achte was one of the producers of Far Cry, a movie based on a video game of the same name. Uwe Boll, the director of Far Cry, has directed several other films based on video games. Upon information and belief, Uwe Boll is a partner in Achte.
No application for copyright registration had been submitted to the Copyright Office for Far Cry at the time Achte first retained DGW and USCG.
DGW submitted the Far Cry copyright registration application for Achte.
information and belief, it has not handled the copyright registration process for films underlying its copyright litigation business model other than Far Cry. 95. Far Cry had been published more than three months before its U.S. copyright registration. 96. As a result, by operation of Section 412, infringements that commenced prior to that registration date are not subject to statutory damages (including damages for willful infringement) or attorney’s fees. Remedies that DGW routinely seeks on behalf of other plaintiffs in its copyright litigation campaign are Ineligible Remedies in the Achte case. 97. 98. 99. Despite these unusual aspects of the Achte case, DGW tried to make it fit the mold. Far Cry was filmed in Canada in the summer of 2007, with dialogue in English. Far Cry was first released in theaters in Germany on October 2, 2008. 43 It premiered on over 200 different screens in its first week of release.
See The Internet Movie Database, Far Cry (2008) Release Dates, http://www.imdb.com/title/ tt0400426/releaseinfo (last visited Nov. 15, 2010); Wikipedia, Far Cry (film), http:// en.wikipedia.org/wiki/Far_Cry_(film) (last visited Nov. 15, 2010). True and correct copies of these Internet Movie Database and Wikipedia pages are attached as Exhibits H and I, respectively.
Filed 03/18/11 Page 27 of 105
Far Cry was first released in United States theaters on December 17, 2008. See Exhibits H and I.
The first publication of the film on DVD was on April 14, 2009, when the DVD was offered for sale to the public by commercial release in the Netherlands. See Exhibit H.
The DVD was again published in the United Kingdom, where it was offered for sale to the public by commercial release on September 7, 2009. See Exhibits H and I.
Again, in Italy, on October 14, 2009, the DVD was offered for sale to the public by commercial release. See Exhibit H.
The film was commercially released on DVD in both the United States and Canada on November 24, 2009. See Exhibits H and I.
That history posed a problem for DGW/USCG when it was first retained by Achte. Dunlap was aware that filing a copyright registration so long after publication would prevent Achte from obtaining the Ineligible Remedies. An honest registration would have cut into the potential settlement proceeds that Achte and USCG could share.
In its USCG work, DGW attempts to maximize its intake of settlement proceeds, while minimizing protracted legal battles that will require significant time investments and legal risk.
Because Far Cry was first published outside of the United States, Achte would have had standing to bring claims for copyright infringement even absent a registration. But such claims would be limited to actual damages.
The USCG business model is less lucrative if the Ineligible Remedies are not available. As Dunlap stated in his Primer, “until you have actually gone through the registration
Filed 03/18/11 Page 28 of 105
process … the common law rights are practically worthless as the exercise of this protection often fails a cost benefit analysis.” See Exhibit E. 109. The registration certificate would not support Achte’s claim for Ineligible Remedies if it accurately represented the Far Cry publication history. 110. 111. Dunlap sought to resolve this problem by perpetrating fraud upon the Copyright Office. Dunlap submitted a registration application for Far Cry that falsely claimed a first date of publication of November 24, 2009. 112. The Copyright Office issued a registration certificate for the copyright of Far Cry. A true and correct copy of the registration certificate is attached as Exhibit J. The certificate, based on information in Dunlap’s filing, discloses the following: (1) the registration number, PA 1-658-618; (2) the motion picture was created in 2007; (3) the motion picture was first published on November 24, 2009, in the United States; (4) the motion picture had not been previously published; (5) that no material in the motion picture was excluded from the copyright claim as previously registered or published; (6) the Effective Date of registration was January 19, 2010;44 (7) that neither the registered work nor any earlier version was registered prior to the Effective Date; (8) Achte’s claimed authorship of the work, the entire motion picture, as “employer-forhire”; and
See 17 U.S.C. § 410(d).
115. 113. Upon information and belief. 118. 116. The motion picture had been published through theatrical release no later than October 2. Upon information and belief. Achte had already missed out on the benefits of Section 412. in which he claimed that the domestic release date of the DVD was the motion picture’s first date of publication. Neither version had been registered with the Copyright Office. and that its first nation of publication was the United States. When DGW began soliciting film studios as USCG in late 2009. 114. 117. The DVD of the motion picture had been released no later than April 14. The intake form on DGW’s web page includes a request that prospective copyright applicants provide the following information: 29 . Dunlap—an attorney who holds himself out as an expert in copyright law—should have known that he was required to state the earliest actual publication date worldwide on the Copyright Office registration form. Material falsehoods in the copyright registration that Dunlap secured for Far Cry are fatal to DGW’s claims that Achte is entitled to seek Ineligible Remedies in litigation to enforce that copyright. Dunlap knew that he was required to state the earliest actual publication date worldwide on the Copyright Office registration form.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 29 of 105 (9) Dunlap’s contact information. Defendants knew that the Far Cry DVD had been previously published in at least one foreign country more than three months before Dunlap filed a copyright registration application on behalf of Achte. listed for any parties seeking rights and permissions. 2008. 2009.
See http://www. Copyright Office. shall be fined not more than $2.ustrademarkgroup. 120. 46 45 Compendium II § 108. Dunlap made assertions of fact that were false in precisely the manner proscribed by DGW when instructing its prospective clients on how to apply for copyright registration. 14. 2010. § 506(e): Any person who knowingly makes a false representation of a material fact in the application for copyright registration provided for by section 409.46 It is this practice that Dunlap relied on when he falsified the registration. copyright claimant.C. or the authorized agent of the author. and require applicants to sign a certification as follows: 17 U. or in any written statement filed in connection with the application. In applying for the Far Cry copyright.com/DGW__-_File_A_Copyright. I certify that I am the author.S. Copyright Office registration forms include a recitation of 17 U. See Exhibit B.html (last visited Nov. § 506(e).09. A true and correct copy of Form CO is attached as Exhibit K. U. Dunlap made this certification on behalf of Achte on January 18. copyright claimant. Form CO.S. 121.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 30 of 105 If the material has been published or publicly distributed.S.C. the Copyright Office typically accepts an applicant's statement as to the date and nation of first publication. please give the date of the first publication or earliest distribution and the nation of the first publication or earliest distribution.500. 122. In practice. or owner of exclusive rights. or owner of exclusive rights.45 119. 2010) (the “intake form’). (emphasis in original). of this work. and that the information given in this application is correct to the best of my knowledge. Despite the false statements in his application. 30 . Application for Copyright Registration.
Defendants Have Used the False Copyright Registration to Provide Illusory Support for their Application of USCG’s Standard Mass Settlement Strategy Against Alleged Far Cry Infringers. Dunlap contrasted the review of examining attorneys at the United States Patent and Trademark Office for trademarks with what he depicts as an absolute lack of examination for copyrights: Copyright registration is a simpler and much less expensive process.. . The copyright office just takes registration [sic] and registers it. or if you are plagiarizing something.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 31 of 105 123. Unlike trademark registration. a copyright filing is not examined by anyone. seeking to obtain for Achte rights that are unavailable under the law for tardy applicants. .47 E. In his Primer.. They don’t look at other copyrights to see if you are infringing on something that is already registered. 127. as provided by sections 504 and 505” for “any infringement of copyright 47 Exhibit E. Absent this falsehood. Dunlap obtained Achte’s copyright registration for Far Cry by making false representations of material facts to the U. 124. Section 412(2) prohibits any “award of statutory damages or of attorney’s fees. they just register it. Copyright Office.S. including the right to seek statutory damages and attorney’s fees in subsequent infringement actions. in that the copyright office just registers your copyright.. As long as the proper procedures are followed the copyright is registered and the filing party gets federal copyright protection. 125.. Dunlap was well aware of this practice prior to the Far Cry registration. Defendants could not have plausibly claimed that infringers of Far Cry are subject to any Ineligible Remedies. 31 . By its plain language. 126. Upon information and belief. Copyright is a little bit different then trademark. Dunlap made a false assertion to the Copyright Office of a publication date within three months of the date of application. due to the automatic effect of Section 412.
134. alleging infringement of the motion picture Far 32 .” 128. 133. and in turn. Achte engaged USCG. to document instances of purported infringement of Achte’s copyright in the motion picture Far Cry. more than nine months later. USCG retained GuardaLey.094 anonymous individuals (“John Doe defendants”). Far Cry was first published no later than April 14. Defendants have claimed to be eligible for the same sort of remedies allowed in other USCG cases. 129. and declarations. Defendants have filed complaints. 2009. 130. 2010.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 32 of 105 commenced after first publication of the work and before the effective date of its registration. DGW filed the Achte action: a suit in the United States District Court for the District of Columbia on behalf of Achte against 2. that recite verbatim language Defendants use in their other cases. Defendants cannot seek statutory damages or attorney’s fees from anyone whose infringement “commenced” between those dates. Because Achte failed to register the copyright for Far Cry within three months of its publication. any infringement commenced between April 14. In the Achte case. motions. Section 412(2) of the Copyright Act prohibits it from obtaining the Ineligible Remedies “for any infringement of copyright commenced after first publication of the work and before the effective date of its registration”—that is. 2010. 131. and registered effective on January 19. On March 18. 132. and employed subpoenas and threatening Letters. 2009 and January 19. unless such registration is made within three months after the first publication of the work. 2010. Aided by the falsely obtained registration.
. 2010). On the same date. 49 48 The signature block on the original complaint also included two other DGW associates: Ellis Bennett and David Ludwig. 137.C. 2010). When an ISP provides DGW the subpoenaed private subscriber contact information. 51 136.50 The court granted permission on March 23. DGW sought leave of court to serve subpoenas on ISPs across the country. DGW sends a Letter to the ISP subscribers.094 targets of the original complaint filed on behalf of Achte by DGW. Overall. Mar.094 John Doe defendants in the spreadsheet exhibit to Defendants’ original complaint were 1.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 33 of 105 Cry. but the signature block named Defendants Dunlap and Kurtz.D.990 members of Subclass II. included 1. No. 10-453 (D. the 2.D. DGW began to serve subpoenas on ISPs soon thereafter. Order Granting Plaintiff’s Motion for Leave to Take Discovery Prior to Rule 26(f) Conference. Motion for Leave to Take Discovery Prior to Rule 26(f) Conference. and an additional 984 individuals listed with an alleged date of infringement prior to the Effective Date. 18.C. A true and correct copy of the original complaint is attached as Exhibit L. describing their status as John Doe defendants and the potential consequences that DGW contends they face. January 19. members of Subclass I). 2009 (i. No. phone numbers. 2010) (the “original complaint”). 135. 138. Among the 2.e. 33 51 50 . 2010.48 The original complaint was not signed. Mar. 23. to determine the John Doe defendants’ names and contact information. Dunlap. addresses. 10-453 (D. and email addresses) for ISP subscribers whom DGW claims infringed its clients’ copyrights. Mar. seeking contact information (including names.D.49 and included Dunlap’s phone number and email address. and Kurtz. No. 10-453 (D. Complaint for Copyright Infringement. 17.006 individuals listed with an alleged date of infringement prior to November 24.C. 2010.
C.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 34 of 105 139.” Exhibit L ¶ 14 (emphasis added). It also states a prayer for judgment “against each Defendant” that includes “actual damages or statutory damages pursuant to 17 U. The original complaint fails to distinguish between its allegations against pre-registration and post-registration infringers when stating the remedies Achte can seek.93. Later communications from Defendants to Plaintiff.75. raising to 4. The exhibit identified Plaintiff as “Doe 1910. 2009. 142. “As a result of each Defendant’s infringement of Plaintiff’s exclusive rights under copyright. Dunlap signed the Amended Complaint. 2010. § 505. DGW filed a First Amended Complaint for Copyright Infringement (“Amended Complaint”) on behalf of Achte.S. Plaintiff was one of the members of Subclass II whom Defendants sought to identify in the spreadsheet exhibit to the original complaint. 140.C.094 John Doe defendants. The original complaint indiscriminately staked a right to pursue statutory damages and attorney’s fees from each of the 2.” Id.. 5-6. Plaintiff is entitled to relief pursuant to 17 US. named his ISP (Verizon Internet Services). as well as in its prayer for judgment. whether they were among the 95% of alleged infringers within Subclass II or among the less than 5% of alleged infringers whom Achte claimed infringed after the Effective Date. § 504 and to its attorneys’ fees and costs pursuant to 17 US. 34 .84.577 the alleged number of infringers of the motion picture Far Cry. A true and correct copy of the Amended Complaint is attached as Exhibit M. and alleged an infringement at 3:26:18 AM on December 11.” listed his Host IP Address as 72. The original complaint states. stated that Plaintiff’s ISP identified him as the subscriber with that IP address (“Internet Protocol address”). including the Letter. at the election of [Achte]” and “[Achte’s] reasonable attorney’s fees.C. pp. § 504. On May 12. 141.
577 Class members.577 alleged infringers in the Class. at the election of [Achte]” and “[Achte’s] reasonable attorney’s fees.S. by virtue of the dates on which Defendants alleged they committed infringing acts.C. 2009. 5-6. the Class List lists 917 (the members of Subclass I) with an alleged infringement date prior to November 24. “As a result of each Defendant’s infringement of Plaintiff’s exclusive rights under copyright. The Amended Complaint fails to distinguish between its allegations against preregistration and post-registration infringers when stating the remedies Achte can seek. 144.” Exhibit M ¶ 14 (emphasis added). Of the 4. § 504 and to its attorneys’ fees and costs pursuant to 17 US. Plaintiff is entitled to relief pursuant to 17 US. § 505.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 35 of 105 143. Approximately 20% of the alleged infringers listed are in Subclass I.C. In both the original complaint and the Amended Complaint. Achte could not recover the Ineligible Remedies. 35 . from any member of either Subclass. which bars Achte from obtaining Ineligible Remedies from any of the 3. and the alleged date and time of infringement. 147. § 504. as a matter of law. 145.. pp. as well as in its prayer for judgment.644 members of Subclass II.C. for each of the 4. The Amended Complaint states. the identification of Ineligible Remedies as remedies available to Defendants from members of Subclass II is fraudulent. 146. Even if Defendants’ infringement claim were valid. The Amended Complaint included an Exhibit (“Class List”) identifying an ISP and IP address. Those remedies are legally unfounded pursuant to Section 412.” Id. It also states a prayer for judgment “against each Defendant” that includes “actual damages or statutory damages pursuant to 17 U.
52 Original Complaint ¶ 3. 149 F. This piecemeal system with multiple pieces of data coming from peer members is usually referred to as a ‘swarm. 331 (4th Cir. § 504(c)(1).”) (citing cases). Johnson v. Any settlement obtained by Defendants from any member of the Class on the basis of threats of liability for Ineligible Remedies is fraudulent. Any act of infringement alleged as part of such a continuing chain “commenced” with the first act of infringement. 2007) (“Because a statutory damages award covers ‘all infringements involved in the action . 150.. first ellipsis in original)...”) (quoting 17 U. Defendants alleged that “each new file downloader is receiving a different piece of the data from each user who has already downloaded the file that together comprises the whole. See Bouchat v.’”52 149. no member of the Class is subject to the Ineligible Remedies sought by Defendants. namely.53 In the Class List. Because any infringements alleged against any member of the Class commenced prior to the Effective Date. as described by Defendants. more than four months prior to the Effective Date. Second Amended Complaint (verbatim). Inc. 36 53 . 506 (6th Cir.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 36 of 105 148.C. In the Achte action. Bon-Ton Dep’t Stores. Any infringement based on a file downloaded from any prior downloader.3d 315. 151. Defendants alleged acts of infringement commencing on September 18. 506 F. 1998) (“Every court to consider this question has come to the same conclusion. was part of a continuing chain of infringement that links any acts of infringement that occurred before the Effective Date to later. Amended Complaint ¶ 3 (verbatim).3d 494. it is appropriate to treat the earliest date of infringement by any participant in a line of related copyright violations as the date of commencement. derivative infringements. 2009.. Jones. for which’ infringers are liable .S. that infringement ‘commences’ for the purposes of § 412 when the first act in a series of acts constituting continuing infringement occurs..
From certain ISPs. Upon information and belief. Defendants have never had a genuine intention of filing suit in any case where the relief available would be limited to actual damages. 2010 Effective Date. 154. DGW sent a subpoena to SBC Internet Services upon receiving leave of court. 155. DGW obtained discovery even though it made no allegation that any customer used those ISPs to infringe rights that would justify more than actual damages. at the time the Amended Complaint was filed. For example. 156. through their Letters and their settlement websites. DGW employed the court’s third-party discovery procedures without regard to Section 412. Defendants had no genuine intention of litigating claims for actual damages against members of Subclass II at the time Defendants sent Letters to 37 . Defendants have been able to make further fraudulent claims and extortionate threats directly to the Class members. 2009—all before the January 19. F. Upon information and belief. Upon information and belief. 157. Using that information. The false claims in Achte’s copyright registration and court filings share one purpose: to enable DGW/USCG to obtain the contact information of alleged infringers.. 153. Defendants Have Used Complaints and Subpoenas Supported by False Claims to Make More False Threats Directed to Class Members. Defendants did not intend to name any Class members as defendants in any case where the relief available would be limited to actual damages. on information and belief. The Class List shows that all 386 acts of infringement that Defendants alleged in connection with SBC Internet Services transpired between September 25 and December 28.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 37 of 105 152.
of Irving.cnet. address.com/2300-1023_3-10003610-8. and the date by which DGW demands payment. http://news. upon information and belief. 2010. and the Letter Kurtz sent to Plaintiff is but one instance of a form demand letter sent to thousands of John Doe defendants. substantially identical in all but certain factual allegations specific to each defendant. beyond those specific factual allegations. On or about May 19. 161. Defendant Kurtz sent a Letter to Plaintiff. See Exhibit N. substantially all statements made in the Letter addressed to Plaintiff have been repeated in each Letter DGW has sent to members of the Class. the name of the motion picture allegedly infringed. A true and correct copy of that published Letter is attached as Exhibit O. and IP address. Therefore.cnet.cnet. Texas dated May 21. 54 Compare the virtually identical Letter from DGW sent to Jon Harrison. 38 .html. Upon information and belief.html (last visited November 1. 2010. the date and time of the alleged infringement. A true and correct copy of the Letter is attached as Exhibit N. ISP. 2010). DGW sends virtually the same demand letter to the defendants in each of its lawsuits on behalf of its film clients. including: the subscriber’s name. Sr. a file hash factor allegedly associated with the subscriber.com/2300-1023_3-10003610-7. 2009. the peer-to-peer software that DGW alleges the subscriber used. 159.com/ 2300-1023_3-10003610-6. It was signed by Kurtz on behalf of DGW. The Letters. accusing him of infringing the copyright in Far Cry at 3:26:18 AM on December 11. The Letter was sent to Plaintiff via first class mail by DGW. which threaten litigation for Ineligible Remedies against each person addressed.html. fraudulently conceal Defendants’ true intent. and http:// news.54 160.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 38 of 105 them. as published by CNET News at http://news. It was printed on DGW letterhead. 158.
the file size and the GUID. 163. The Letters offer not just a means of prompt resolution of the claim.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 39 of 105 162. Specifically. The Letter informed Plaintiff that DGW had already filed suit in the United States District Court for the District of Columbia on behalf of its client Achte against John Doe Defendants. It further claimed. 39 .” Id. 164. identifying him “as one of the Defendants who has illegally obtained or shared our client’s copyrighted motion picture through a peer-to-peer network [Gnutilla. the Letter sent to Plaintiff bore several claims that it was “for settlement purposes only” and inadmissible as evidence.” Id.]. but threats of severe consequences if the recipient fails to cooperate: “[w]e are sending you this letter as a courtesy before we are required to take more formal legal action which would involve adding you as a named Defendant to the lawsuit. the Letter informed Plaintiff that.” Id. BitTorrent etc. DGW frames its Letters as mere settlement offers. The Letter closed by stating. “[w]e have also obtained the file name of the movie. “we look forward to resolving our client’s claim against you in an amicable fashion. 165.” Id. you have placed a media file which contains the copyright-protected film content for our client’s motion picture entitled Far Cry in a shared folder enabling others to download copies of this content. “[a]ccording to our records. For example. and that Plaintiff’s ISP had supplied DGW with Plaintiff’s contact information.” Id. all corresponding to an IP address that was assigned to your ISP account at the time the infringing activity occurred. through settlement. (emphasis in original).
The Letter Kurtz sent to Plaintiff.500: In exchange for a comprehensive release of all legal claims which will enable you to avoid becoming a named defendant. dated May 19. … So essentially.500. Upon information and belief. but this increased settlement offer will expire on June 30. The Letter warned that if Plaintiff did not “settle by June 30th. 2010. If forced to do so. you can avoid being named a Defendant in the lawsuit if you act before June 30th. each Letter afforded its recipients only a similarly short window of time to assess the factual and legal merits of the claims and threats. This offer will expire at 5pm EST on June 11.” Id. we may add you to the list of defendants to be served with a lawsuit. each Letter specifically and repeatedly links its demand for payment to threats for Ineligible Remedies: [I]f you do not comply with the above requests we may be forced to name you as a Defendant to the lawsuit and proceed directly against you on behalf of our client. 2010.000 per illegally downloaded film. 167. 169.500 as full settlement for its claims. 40 . Upon information and belief.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 40 of 105 166. Upon information and belief. Thereafter. 168. 170. which is up to $30. our client will accept no less than the sum of $2. offered a release of all legal claims for $1.500 to settle this matter. Id. but allowed Plaintiff only until June 11 (23 days later) to comply. 2010. plus attorneys’ fees and costs of litigation. at which point the price of settlement would increase to $2. our firm is authorized to accept the sum of $1. Exhibit N (emphasis in original).” and claims that this subjects the accused to enhanced statutory damages penalties: “In the event we are able to prove the infringement was intentional. our client will be seeking to recover the maximum amount of fees provided under the Copyright Act for copyright infringement. each Letter claims that the alleged infringement “requires deliberate action.
Tenenbaum (D. (emphasis added). 171. 172. Tenenbaum (D. Mass.500 per illegally-shared song. in the case of Sony BMG Music Entertainment v. 41 . attorneys’ fees and costs. The Tenenbaum damages award was subsequently held to violate the Due Process Clause. and other recipients of the Letter.000 jury verdict against a Boston University graduate student for illegally downloading and sharing 30 songs was recently upheld.). Id.) [1:07-cv-11446]. Having warned Plaintiff. a $675. This means that the jury awarded $22. and the award was reduced by 90 percent. Sony BMG Music Entertainment v. 2010). To justify their demands. No. For example. or $2. 1:03-cv-11661-NG (filed July 9. Because the Tenenbaum award was for statutory damages. 175.250 per song infringed (three times the statutory minimum of $750). out client is acting reasonably and in good faith.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 41 of 105 our client will be seeking the maximum statutory damages allowed by the Copyright Act in the amount of $150. 174. A. 173.500. Civ.500 instead of having to incur thousands of dollars in attorneys’ fees and being at risk for a high jury verdict.500 settlement offer is extremely reasonable. it has never been relevant to the allegations and threats Defendants have made to the members of the Class.” Id. that the Tenenbaum damages award “was recently upheld. Defendants go to great lengths to raise the specter of large statutory awards and attorney’s fees. to $67.” Kurtz has failed to clarify that his prime example of a typical recent verdict has since been found unconstitutionally excessive and decimated. the Letters make extensive reference to one recent copyright infringement case in which statutory damages were awarded: We feel that in light of the verdicts awarded in recent cases. Defendants have thereby fostered the false impression that the original Tenenbaum award was legitimate and relevant to the Letter’s recipients. our client’s $1. We think that by providing our Doe Defendants an opportunity to settle our client’s claim for $1. Mass.000 per infringement.
The Letters’ frequent misleading references to statutory damages. Sections 101 through 1332. Exhibit N. the Letter mentions the Act only once. 179. and then only mentions a few Sections.C. However. However.” i. Each Letter misdirects its recipients in citing the relevant law. 177. they were directly relevant to Defendants’ implicit purpose: frightening and intimidating Letter recipients into hasty settlements under false pretenses. as follows: The law provides protection for copyright owners through the Federal copyright statute found at 17 U.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 42 of 105 176. The Copyright Act is found at Title 17 of the United States Code. 180. were irrelevant to any claims Defendants could have brought in the Achte action. which allows the copyright owner to impound your material. inclusive. §§ 501-506.” respectively. That limited statutory citation was intentionally misleading as used in the Letter. recover their attorney’s fees. The Letters’ identification of statutory damages and attorney’s fees as remedies available to Defendants from members of the Class is fraudulent. are available “[e]xcept as otherwise provided by this title. because it omits any reference to the extensive limitations stated in the Copyright Act. No member of the Class is “at risk of a high jury verdict” like the one initially awarded against Tenenbaum.. depending on the circumstances of the infringement. because the Ineligible Remedies are categorically off limits. The Copyright Act states that statutory damages.e.S. and “a reasonable attorney’s fee to the prevailing party. including the limitations on Ineligible Remedies set out in Section 412. including their multiple citations to the statutory maximums and uncorrected references to unconstitutionally excessive jury awards.000 per work. by the 42 . 178. and seek damages of $750 $150.
“we will most certainly have a computer forensic expert inspect your computer. making no reference to the Fourth Amendment’s limitations on such seizures. the Letter emphatically demands that no files be removed until settlement is finalized: Please consider this letter to constitute formal notice that until and unless we are able to settle our client’s claim with you. the Letter’s bare statement that the Act “allows the copyright owner to impound your material” threatens the accused with an unwarranted invasion of privacy.” Id.” Id. 43 . 181.S. (boldface and italics in original). 184.” and further threatens that.C.55 The Letter misleadingly omitted reference to the limitations “otherwise provided” in Section 412. Be advised that if we were to prevail on this additional claim. 182. The Letter threatens that as part of litigation.” Id. evidentiary sanctions and reasonable attorneys’ fees. The Letter conditions “settlement” on its demand that “you must remove the file from the shared folder or location where our client’s film can be shared or copied within three (3) days of paying a settlement. Exhibit N. we demand that you not delete any media files from your computer. Id. 183. upon evidence suggesting premature removal of media files. But by insisting that accused infringers retain any 55 17 U.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 43 of 105 Copyright Act. The Letter claimed that Plaintiff had placed an infringing file “in a shared folder enabling others to download copies. §§ 504(a) & 505. Moreover. the court could award monetary sanctions. Any harm Defendants might claim to justify this threat of impoundment is undercut elsewhere in the Letter. Achte “will amend its complaint to add a spoliation of evidence claim against you. But in the meantime.
specifically its FAQ section: 56 Defendants anticipated that infringements would continue. Each USCG website prominently notes.56 185. Thus.com (the “Far Cry website”).Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 44 of 105 infringing files in such folders until released by Defendants. including among others http://www. where the complaint may be viewed. Rather. The Letter directed Plaintiff and others in the Class to the Far Cry website. obligating recipients to allow further infringing downloads. http://www. on the belief that “the information obtained in discovery will lead to the identification of additional infringing parties to be added to this Complaint as defendants. Second Amended Complaint ¶ 9 (nearly verbatim). The complaints on the USCG websites cannot be viewed without a password. and pleaded for the opportunity to add more targets. each Letter affords Defendants opportunities to later amend their complaints to target subsequent downloaders (who could then be sent similar Letters mandating further open access to infringing files. 44 . 186. the Letter seeks to perpetuate and multiply any harms from the alleged ongoing infringement. obligating the accused to leave the files available to others for up to three days. Amended Complaint ¶ 8 (verbatim).” Original Complaint ¶ 8. and where the accused may obtain a release from legal claims by entering their credit card information.org (collectively. the “USCG websites”).copyrightsettlement. since monitoring of online infringement of Plaintiff’s motion picture is ongoing. ad infinitum). the Letter mandated that the alleged infringement would continue. Each website displays a phone number and hyperlinks to email DGW for login information.” 187.savecinema.farcry-settlement.info and http://www. DGW’s settlement demand letters do not include the underlying complaints as enclosures. By inducing the harm it claims to prevent. “All Major Credit Cards Accepted. they direct the accused to one of several claim settlement websites that feature a USCG logo.
farcry-settlement.com. Exhibit P (emphasis added).500 settlement would “almost always” cost less than defending the claim. Though the Letters told the John Doe defendants that they had not yet been named as defendants. the FAQ section of the Far Cry website made it clear that they had been sued indeed. There are several aspects of settling the copyright infringement claim against you that you might find beneficial. Settling the claim allows you to pay a relatively nominal. As in the Letters. I have received a letter in the mail about a lawsuit. Are there potential benefits to settling this claim? We are not your attorneys and we are not providing you legal advice. but without being served: 2. If you pay the settlement amount and accept the terms of the settlement agreement proposed on your case then you will be dismissed from the lawsuit and your information will remain anonymous. DGW/USCG couches its coercive tactics on its settlement websites as financial and procedural benefits to the accused: 5. Exhibit N. True and correct copies of pages from the Far Cry website. A lawsuit has been filed against you in the United States Federal District Court for the Federal District of Columbia for copyright infringement as a result of information about your infringing download of a motion picture. one-time lump sum payment to completely resolve the claim. as they appeared on August 27. which will provide additional information and hopefully answer many of the questions you have. 188. 2010.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 45 of 105 You should visit the Frequently Asked Questions web page we have posted at www. Why did I get this letter? This letter is a demand letter. We strongly recommend that you seek advice from an attorney. are attached as Exhibit P. 189. If you do not accept the settlement agreement you may subsequently be served with the lawsuit and expected to defend the claim of copyright infringement as alleged in the complaint. without having to defend 45 . The FAQ section of the Far Cry website also informs the accused that a $1.
omitted any reference to actual damages. if the infringement was not willful. That threat is legally baseless and fraudulent as to Plaintiff and each other member of Subclass II (who Defendants accuse of infringing Achte’s Far Cry copyright prior to its Effective Date).000 per infringed work. 191. your settlement. Third. identity and contact information will remain private. 192. as asserted in the Complaint filed in this case. The legal fees incurred in defending a copyright infringement claim will almost always exceed the settlement amount demanded by our client. which will certainly be several thousand dollars more. for willful infringement) and include an award of our client’s attorneys’ fees. Id. settling allows you to resolve the claim quickly and easily. Id. misleadingly emphasizes Ineligible Remedies. in that we will not release your information to any third party unless legally required to do so. like the Letter.000. 190. (emphasis added).000. damages may be as much as $150. over the Internet or by mail. which will certainly be several thousand dollars more. USCG’s limited statement to Class members. Second. that “the consequences or damages that can be awarded” are statutory damages.000 per infringed work. as well as the entire Class (whose alleged infringements commenced 46 . The FAQ section. you will avoid the potential for a jury verdict against you that could exceed the amount of the settlement (up to $150. What are the consequences or damages that can be awarded in a copyright infringement case? Statutory damages are available to the owner of a registered work under Title 17. The FAQ section restated the Letter’s threat that not accepting the demands could lead to “a jury verdict against you that could exceed the amount of the settlement (up to $150. Section 504 of the United States Code in an amount of between $750 and $30.” Id. as if they were pertinent to members of the Class directed to the Far Cry website: 4. for willful infringement) and include an award of our client’s attorneys’ fees.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 46 of 105 yourself in court. Finally. (emphasis added). If the infringement was willful. by settling.
2010) (extending time to name and serve defendants until November 18. 195. 4(m). No. irrelevant. Achte asserted through counsel that the Class members (who had not been named to the court 57 Fed. but did not name. and fraudulent.D. maneuvering to prolong the pendency of the Achte action against thousands of Class members. R. 193. each Class member as a defendant. G. which served to reinforce the falsehoods raised in the Letter. Each member of the Class and each Subclass who viewed the complaint on the Far Cry website was subjected to its fraudulent misrepresentations of liability for Ineligible Remedies. July 22. Defendants Attempted to Keep Alleged Infringers in a State of Legal Limbo to Pressure Them to Settle. 58 See Minute Order. 2010. including the thousands against whom its claims for Ineligible Remedies were barred. and was not relevant or pertinent to any legitimate claim Defendants might have raised in litigation over the copyright. 47 .C.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 47 of 105 prior to the Effective Date). Civ. The complaint DGW filed on behalf of Achte was also posted on the Far Cry website. 57 But Defendants repeatedly sought to extend the time for service. Achte filed its original complaint on March 18. 2010). 10-453 (D. 58 196. 194. Ordinarily. More than six months after filing the original complaint in the Achte action. but failed to properly serve either the original complaint or the Amended Complaint on the Class. 2010. a civil action must be dismissed if plaintiffs fail to serve a summons on the defendant within 120 days of the complaint. 197. Defendants sent Class members Letters with directions on viewing the complaint online. P. and its Amended Complaint on May 12. The Amended Complaint designated.
60 Declaration of Patrick Achache in Support of Plaintiff’s Motion for Leave to Take Discovery Prior to Rule 26(f) Conference. No.D. albeit ones named by their IP addresses. June 2.60 identifying the ISP of each accused infringer.C. Defendant GuardaLey compiled the IP addresses of purported infringers of the copyright in DGW/USCG’s client’s films. the date and time of each alleged copyright infringement. 10. No. reside in this District. including in its Letters (“Your contact information was provided to us by your ISP as one of the Defendants . 198.. 2010). 10-453 (D. pp.C. R.”).”63 59 Plaintiff’s Opposition to Motions to Dismiss. 63 Memorandum of Amici Curiae in Support of Third Party Time Warner Cable’s Motion to Quash or Modify Subpoena.59 This sophistry directly contradicted claims Defendants made to the Class.62 Indeed. No. Mar. 10-453 (D. 24. and the film each one allegedly uploaded or downloaded. “the very information upon which [Achte relied] as a basis for seeking the identity of the Doe defendants – their Internet Protocol (IP) addresses – indicates that few. if any..Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 48 of 105 and not been formally served) were “not yet named parties” and therefore had no standing to seek its dismissal. 12(B)(2) at pp. 45(C)(3) and Motion to Dismiss Pursuant to Fed. R. 2010) (describing the process of using ISP addresses to determine geographic locations). ¶¶ 10. P.D. p. No. 5. 10-453 (D. 18. Sep.. The Class members were parties to the Achte action.C. Civ. 2010). 8-9. 13.D. Those IP addresses include sufficient identifying information to allow Defendants to determine the home states of those they accuse.. 10-453 (D. P. 2010).61 199. Sept.”) and the Far Cry website (“A lawsuit has been filed against you . even without the aid of subpoenas.C. ¶¶ 6-7.D. See Omnibus Motion & Memorandum to Quash Subpoena Pursuant to Fed. 48 . 8-12. Civ. 61 62 Id.
including at least ten Id. On September 10.”64 201. with only a small fraction of them in or near Washington.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 49 of 105 200.. the truth about jurisdiction was unavoidable when Defendants addressed and mailed Letters to Class members at addresses across the country. [Achte] could have discovered that hardly any of the Does it has sued appear to reside in this District .C. certain John Doe defendants. Order. 2010. No. Even had they not done so.C. D. and that therefore the case against them was likely not properly brought here. The geo-coded IP addresses that GuardaLey compiled made the shortcomings of Achte’s jurisdictional claims easy to ascertain: [W]ith minimal investigation. Defendants were aware that that almost no one accused of infringement in the Achte action is subject to jurisdiction in Washington. apparently seeking to force almost all of the Doe defendants to incur the expense and burden of defense in a foreign District (or to settle in order to avoid that expense). 204. the court in the Achte action ordered Achte to show cause why Class members who had submitted affidavits regarding their remote locations should not be dismissed. so they could avoid the expense of fighting litigation in a remote jurisdiction. Sept. Defendants could have conducted such a review before filing the original complaint or the Amended Complaint were filed.D. at 6. Nonetheless.C. D. Defendants continued demanding and receiving settlement payments from Class members who thereby avoided a formal appearance in the District of Columbia. 49 64 65 .. 10.65 On the same date. [Achte] improperly sued them here. Defendants were aware that filing the Achte action in the District of Columbia would pressure settlement from Class members for even unfounded claims. 203. 2010). 202. 10-453 (D.
Sep.C.C. R. 2010. 2010. 8 (D. in its opposition to the omnibus motion. 2010). even for John Doe defendants whose alleged dates of infringement preceded the Effective Date. Id. at pp. By that argument and others. 207.67 205. 10-453. 2010). 12(b)(2). 10. 8-12. 50 . 206. and Kurtz certified service to the moving defendants. R. filed an omnibus motion to quash a subpoena issued by Achte and dismiss the moving defendants from the Achte action.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 50 of 105 whose alleged infringements preceded the Effective Date. Civ. the last day of its already-extended time to name and serve defendants. Achte did not do so. P. On September 24. and explained that geographic location information available in the IP addresses. 67 68 Plaintiff’s Opposition to Defendants’ Motion to Dismiss. Defendants protracted the Achte action and extended their window of opportunity for settlement.C. 24. No. Sept. P. 45(c)(3) and Motion to Dismiss Pursuant to Fed.68 Dunlap signed the opposition memorandum on behalf of Achte. No. 10-453 (D. p. at the time that Defendants alleged infringement.D. Instead. Civ. it asked the court to extend time for service on 66 Omnibus Motion & Memorandum to Quash Subpoena Pursuant to Fed. On November 18. revealed that each of the moving defendants was located outside of Washington.66 The motion sought dismissal on jurisdictional grounds. which served as a basis for the Achte action. Achte argued (through DGW) that “it would not make practical sense to dismiss particular Doe Defendants on a piecemeal basis before” the court-ordered deadline to name and serve all defendants. D.D.
Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 51 of 105 the defendants for five years. most protesting this Court’s jurisdiction over persons in other parts of the country. Nov. 19.” 209.70 The court also required Achte to submit a status report by February 18. 2011 as to any Class members for whom it did not yet have identifying information from the ISPs. 69 208. 2010. At the same time.C. 69 Motion for Order for Further Extension of Time to Name and Serve Defendants. 10-453 (D. arguing that it should not be forced to actually litigate its case against any Class member until every Class member had been identified. 18. 51 70 71 . 2010). Achte filed its Second Amended Complaint on December 6. out of the 4.71 In it.D.577 Class members whom Achte had identified by IP address in its Amended Complaint on May 12. 10-453 (D.” or.C. On November 19. 2010) (granting in part and denying in part Achte’s motion for extension of time to name and serve defendants in the Achte action). Achte filed a notice of dismissal of its claims against all other members of the Class.D. No. 10-453 (D. 2010 (dated December 3. The court noted that “many individuals have entered the case as ‘Interested Parties’ and have moved to dismiss all allegations against them.C. if it did not have that information. No. No. Nov. Second Amended Complaint. Order. the court in the Achte action ordered Achte to file a second amended complaint “identifying by name and address Defendants over whom it reasonably believes the Court has personal jurisdiction and whom it wants to sue. 2010). Dec. 2010).D. In response to that Order. 6. along with 139 unnamed “John Doe” defendants. Achte named just one Class member as a defendant in the Achte action. 2010. the IP addresses of those over whom the plaintiffs continued to claim the Court had jurisdiction.
212. 2010. which directly addressed the issue of Achte’s pursuit of Ineligible Remedies in the Achte action. On December 14.com/news/91477/us-copyright-group-reduces-p2p-lawsuits-tojust-140/) (last visited Feb.” and listing IP addresses of John Doe defendants from Honolulu. Many of the remaining John Doe defendants in the Achte action exhibit the same tell-tale signs that Achte’s claims of jurisdiction are inappropriate. Illinois. 2010). Achte’s Second Amended Complaint alleged only dates of infringement after the Effective Date. 2010. 73 See Jared Moya. they have IP addresses that are not located within the District of Columbia. Dec.74 214. For the one named defendant and each of the other 139 unnamed defendants. 10-453 (D. namely.zeropaid. 74 52 . Ohio. Dec. 211.C. Hawaii.437 dropped claims. 10-453 (D.73 213.D. 14. After the vast majority of its claims against Class members in the Achte action were dismissed. 7.D.72 The next day. Achte filed suit against eight Class members as named defendants in 72 Order. 2010) (noting that “even the amended list includes a number of IP addresses well beyond [the court’s] jurisdiction.C. No. 15. Dec. The Second Amended Complaint in the Achte action was filed shortly after November 24. California). No. 2010 (available at http://www. US Copyright Group Reduces P2P Lawsuits to Just 140. the court entered an order approving Achte’s dismissal of its claims against all other members of the Class—4. Columbus.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 52 of 105 210. 2010). Chicago. and Carson. when Plaintiff filed his initial complaint in this Court. the accused infringers’ outstanding motions to dismiss for lack of jurisdiction were denied as moot in light of Achte’s withdrawal. Minute Order. 8.
1:11-cv-00347-WYD-CBS (D. Achte has not renewed its claims against any members of Subclass I. 2010). from 3. 2010). 2010). 19. 2010 in other jurisdictions. Minn. 75 76 Case No. filed Jan. 216. Case No. 2011) (alleging infringement on April 22. 25. Case No. For any Infringement of Its Copyright that Commenced Prior to Valid Registration. H. despite Section 412. 218. filed Feb. 2011) (alleging infringement on December 13. 2011) (alleging infringement on March 11. 2. Achte seeks awards of statutory damages and attorney’s fees. but prior to the Effective Date.644 individuals (Subclass II) whom they allege infringed Achte’s copyright prior to January 19. 217. Since the mass dismissal of claims in the Achte action.D. Achte alleges an infringement after Achte’s claimed date of first publication. filed Feb. Va. Ill. 2011) (alleging infringement on March 16. Colo.76 In that case. In the recital of facts and the prayer for relief in each complaint Achte has filed alleging copyright infringement. 2010). 1:11-cv-00903 (N. 3:11-cv-00075 (S. 21. 2. filed Feb. 2011) (alleging infringement on February 10. 2010). Case No. 8:11-cv-00213-RWT (D. 2011) (alleging infringement on January 25.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 53 of 105 individual lawsuits in other courts. Case No. W.000.D. Achte’s True Remedy Is Limited to Some Fraction of $26. Va. 215. 9. 9. 9.D. 1:11-cv-00076 (S. Defendants threatened to seek statutory damages of up to $150.99. Md.D. filed Feb.75 Most of those filings were made by and through DGW. Case No. W. Va. 2011) (alleging infringement on February 15. 2010). Case No. including its original and amended complaints in the Achte action and its eight complaints filed since December 14. 53 . filed Jan. 2011) (alleging infringement on February 1. and attorney’s fees. filed Jan. filed Feb. 0:11-cv-00138-JRT-JJK (D. 2009). 2010). and has filed only one case against a named member of Subclass II. Ill. 3:11-cv-00055-HEH (E. 2010. In its prayer for relief in each of its eight lawsuits against individual defendants. and whose alleged infringements therefore commenced prior to that See Case No. 1:11-cv-00898 (N.D. Seven of those complaints allege infringements after the Effective Date. Achte has staked a claim for Ineligible Remedies against the Class members.
221. the actual damages available to Achte for any infringement alleged in the Complaint would be some fraction of the retail list price of a DVD. which (at some fraction of $26. but whose infringements they alleged derived from those of earlier infringers. DGW. Upon information and belief.99) would be more than 50 times lower than the settlement offer Defendants presented to members of the Class..99. Dunlap and Kurtz.99 is a far cry from $1. $26. 223. Upon information and belief. no Class members would have entertained a settlement offer anywhere near $1. USCG. including at least DGW. USCG. Upon information and belief. Achte. and therefore also commenced prior to that date under the Copyright Act. 219. the most Achte can hope to recover for any such alleged pre-registration infringement would be actual damages. and Achte have a direct financial incentive to avoid settling claims in the amount of any actual damages Achte may have incurred. 220.99 was at stake. 224. as a measure of Achte’s lost profits. the list price of a new DVD of Far Cry is $26. Because Achte cannot legitimately seek statutory damages for any of the copyright infringements it alleges by members of the Class. through DGW and Dunlap. knew that Achte did not have that right. claimed a right to make such claims in court filings in the Achte action and subsequent litigation. But Defendants. 54 . 222.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 54 of 105 date.500 if the Letters they received had honestly informed them that no more than a fraction of $26. Defendants made the same threats against 933 other individuals in the Class whom they allege infringed Achte’s copyright on or after January 19.500. 2010.
000) were irrelevant. and that its “settlement offer” is less expensive than attorneys would charge merely to begin a litigation defense.500. CONCLUSION 228. DGW capitalizes on fear and aims to intimidate. DGW is well aware of the extremity of the damages awards it claims in its demand Letters. none would have entertained a settlement offer anywhere near $1. 227. The false elements of Defendants’ claims predominate the Letters. I’ve never used it. 17. if the Letters had honestly informed the Class members that the statutory damages award amounts referenced therein (up to $150. 229. ‘I’ve never heard of Far Cry.com/tech-policy/news/2010/05/far-cryinnocence.77 there is still money to be made by Defendants.000. but Kurtz never mentioned actual damages.ars) (last visited Feb.’ says P2P defendant. Kurtz repeatedly referred to exorbitant penalties to which Achte has no legal right. The DGW/USCG revenue model does not require that each individual claim has merit. Achte’s true remedy. 2011) (discussing accused infringer who “insists that the lawyers got it wrong. “Exclusive: ‘I’ve never heard of Far Cry. I’ve never heard of any of the BitTorrent technology. such that even noninfringers will be likely to pay up rather than risk higher fees and damages.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 55 of 105 225. $26. Nonetheless.99 is a far cry from $150. or when particular accused individuals are wholly innocent. 78 See Nate Anderson.” ars technica (May 2010) (available at http://arstechnica. 226.’”) 77 78 See id. Even when its allegations have no basis in the copyright law. 230. (“The prospect of massive court judgments works like a stick to bludgeon people into settlement—who could risk losing at trial with so much at stake?”) 55 . Upon information and belief.
and costs. Defendants have already collected millions of dollars in settlements from members of the Class. Upon information and belief. are directly attributable to Defendants’ fraudulent activity. Defendants have colluded to implement the USCG copyright settlement business model indiscriminately. Plaintiff has not paid to settle the claims. obtaining a certificate of registration 56 . much of it on the basis of claims made by Defendants that they knew. 237. members of the Class have paid Defendants millions of dollars in extortion money. and further agreed that breaching the settlement agreement’s confidentiality would be subject to $15. Copyright Office. or should have known. 232.000 in automatic liquidated damages. spent untold further sums on legal counsel. he has incurred costs in retaining counsel. and borne other incidental costs in reliance on Defendants’ fraudulent statements. 234. to be false. 233. Upon information and belief. However. in reliance on the false allegations of the Letter and in order to determine any merits of its claims. members of the Class who accepted Achte’s demands agreed not to disclose the terms of settlement. members of the Class would have avoided those expenses if not for Defendants’ fraudulent statements. extorting thousands of alleged infringers without due regard for the legal foundation of their threats. Defendants have sought to paper over the missing foundation for their threats to the Class by perpetrating fraud on the U. attorney's fees. The costs of counsel that Plaintiff has borne. Upon information and belief.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 56 of 105 231. Plaintiff would have avoided those costs had the Letter been truthful. 235.S. 236. Upon information and belief.
without which their threats would have rung hollow. Plaintiff seeks to certify the following class and subclasses: (a) a class of all 4. 241. 2010. The class period is limited to the applicable statute of limitations for the claims at issue. pursuant to Rule 23 of the Federal Rules of Civil Procedure. tainting their complaints. and (c) a subclass of all 3. subpoenas. 2010. coercive demand Letters and websites—all the tools of Defendants’ Copyright Scheme. which questions predominate over any questions affecting only individual class members.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 57 of 105 under false pretenses that lists false information. The putative Class is so numerous as to make it impracticable to join all members of the class as plaintiffs. January 19. (b) a subclass of all 917 persons (“Subclass I”) who Defendants allege infringed the Achte copyright prior to its claimed date of publication. CLASS ACTION ALLEGATIONS 239. 238. There are questions of law and fact that are common to all members of the purported class.577 persons (the “Class”) who Defendants allege infringed the Achte copyright prior to May 12. 242. the date on which Defendants filed their Amended Complaint. 240. The principal common issues include the following: 57 . Plaintiff brings this action on behalf of a class of all other persons or entities similarly situated. 2009. Fraud has infected each stage of Defendants’ actions since that false registration.644 persons (“Subclass II”) who Defendants allege infringed the Achte copyright prior to its effective date of registration. November 24.
if any. that Achte could legitimately seek in a copyright infringement action against any Class members. 243. Dunlap and Kurtz. whether Dunlap committed fraud on the Copyright Office that invalidates the copyright registration Achte has used to support its claims. (b) (c) whether the copyright registration certificate is valid. and/or misappropriation of funds from the Class members.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 58 of 105 (a) whether Defendants wrongfully asserted rights to statutory damages and attorney’s fees for acts of alleged copyright infringement. extortion. wrongfully threatened Class members on the basis of fraudulent and/or negligent omissions and/or misrepresentations. (g) (h) whether acts by some or all Defendants constitutes a conspiracy. (e) whether acts by some or all Defendants constitute fraud. DGW. (f) whether settlements obtained by Defendants from members of the Class were obtained. and Defendants have a database identifying each Class member whose contact information they have obtained and employed. on the basis of Defendants’ fraudulent and/or negligent omissions and/or misrepresentations. and whether payments by Class members to retain counsel were made. through its agents USCG. In this case there is no question as to the identification of class members because the Class is limited to the 4. (d) whether Achte. abuse of process.577 John Doe defendants whom Defendants contend infringed Achte’s copyright. copyright misuse. and the form and amount of damages and costs. There is also no issue as to the 58 .
the expense of litigating each Class member’s claim individually would be so cost-prohibitive as to deny Class members a viable remedy. 244. including attorney’s fees and other legal costs associated with resolving exaggerated claims. Plaintiff brings this action under Rule 23(b)(3) because common questions of law and fact (identified in paragraph 242 above) predominate over questions of law and fact affecting individual members of the Class. and in coercive communications with Class members nationwide.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 59 of 105 amount of the Class members’ damages because the amount of each wrongful settlement is contained within Defendants’ records. Plaintiff will fairly and adequately protect the interests of all Class members in the prosecution of this action and in the administration of all matters relating to the claims stated herein. Plaintiff has retained counsel knowledgeable in copyright law and experienced in trial work in general. have any interest that may cause them to not vigorously pursue this action. To that end. nor counsel. The claims of Plaintiff are typical of the claims of all the members of the Class because all claims are based on the same legal and remedial theories. the United States District Court for the District of Columbia. 245. the predominant issues in this action are whether Defendants are violating and have violated the law by pressing illegitimate claims in the United States Copyright Office. In addition. 246. Plaintiff is similarly situated with. and the Class members can demonstrate the amount of any additional damages suffered individually. Neither Plaintiff. 59 . Plaintiff believes that he has been wronged. Indeed. wishes to obtain redress of the wrong and wants Defendants stopped from reaping ill-gotten gains. and has suffered similar injuries as. the members of the Class that he seeks to represent.
does not justify individual lawsuits. (d) (e) concentration of the litigation concerning this matter in this Court is desirable. Certification under Rule 23(b)(3) is appropriate because: (a) the individual Class members may not be aware that they have been deceived and are thus unable to prosecute individual actions. Defendants will continue to gather 60 . sums likely no greater than $2.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 60 of 105 247. but had not named any Class member as a defendant individually. thereby making final injunctive relief concerning the Class as a whole appropriate. In the absence of appropriate injunctive and/or declaratory relief.500. Plaintiff also brings this action under Rule 23(b)(2) because Defendants have acted or refused to act on grounds generally applicable to all members of the Class. in that Court or any other. (f) (g) a failure of justice will result from the absence of a class action. and the difficulties likely to be encountered in the management of this class action are limited. at the time this action was filed. the claims of the representative Plaintiff are typical of the claims of the members of the purported class. (c) Defendants have sought discovery from third-party ISPs regarding all Class members on the basis of the complaints and supporting documents filed in the United States District Court for the District of Columbia and have threatened to further litigate its claims against Class members. 248. (b) the amount of money Defendants have wrongfully collected from each Class member who assented to settlement.
Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 61 of 105 contact information for alleged infringers. through its agents DGW. abetted. aided. (c) Dunlap falsified information on the copyright registration that obscured the fraudulent aspects of Achte’s claim against each Class member. Defendants’ uniform conduct towards Plaintiff and the other members of the Class makes certification under Rule 23(b) (2) appropriate. threatening Ineligible Remedies to secure wrongful settlements. Dunlap. (d) Kurtz sent fraudulent Letters to members of the Class. Defendants’ wrongful acts are unlikely to be remedied absent a class action. and Kurtz. Achte. 249. and collect settlements stemming from the same activity. in courtroom filings and in uniform letters Kurtz addressed to the Class members individually. an alias for DGW. and further agreed that breaching the settlement agreement's confidentiality would be subject to $15. including but not limited to: (a) (b) GuardaLey has uniformly accessed Class members’ IP addresses and other data. Moreover. threaten them with illegitimate claims.000 in 61 . (e) DGW and Dunlap developed USCG. members of the Class who accepted DGW’s demands agreed not to disclose the terms of settlement. has uniformly employed data compiled by GuardaLey to justify claims for statutory damages and attorney fees. which facilitated. and/or conspired with DGW and Achte’s pursuit of fraudulent settlements from each Class member. Many Class members who paid to settle Achte’s claims may not yet be aware of the extent of Defendants’ wrongdoing.
on behalf of himself and all others similarly situated. (a) threatening to file suit against members of the Class as named defendants in other lawsuits without seriously intending in good faith to do so. (b) threatening to pursue claims against members of Subclass I for Ineligible Remedies. despite the absolute bar of Section 412(1). on a class-wide basis. The Defendants made numerous false representations. and costs. despite the absolute bar of Section 412(2).Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 62 of 105 automatic liquidated damages. In contrast. attorney's fees. both orally and in writing. 252. (d) threatening to pursue claims for Ineligible Remedies against all Class members for alleged acts of infringement that commenced prior to the Effective Date. incorporates by reference all allegations contained in this Complaint. 250. 62 . Defendants have reaped huge monetary gains by uniformly and systematically collecting settlements on the basis of fraud and extortion. to the Class members. making it unlikely that they would risk breaching those agreements to redress Defendant’s damaging actions. Plaintiff. (c) threatening to pursue claims against members of Subclass II for Ineligible Remedies. including: (a) threatening to name members of the Class as defendants in the Achte action without seriously intending in good faith to do so. CLAIMS FIRST COUNT FOR RELIEF Fraudulent Misrepresentations 251.
nor paid counsel for legal advice and assistance regarding those claims. 255. 254. 257. 63 . 256. Had the Class members known that these representations were not true. At the time Defendants made these representations. (f) claiming that the copyright registration for Far Cry is valid despite material misrepresentations made by Defendants in the application. The Defendants made the false representations knowing them to be false or being aware that the Class members did not know whether the representations were true or false. the Defendants kept plaintiffs ignorant of the material misrepresentations in Achte’s copyright registration and in their communications with the Class members. The Defendants made the false representations with the intent that the Class members would rely on the false representations. The Defendants willfully and consciously disregarded the truth of these false representations. the Class members did not know that they were false and fraudulent. they would not have agreed to Defendants’ terms for settlement. These false representations were material to decisions by Class members to settle Achte’s claims and/or expend money on counsel.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 63 of 105 (e) claiming that the Ineligible Remedies are available to Achte to remedy alleged acts of infringement regardless of whether they commenced prior to the Effective Date. 253. and (g) threatening to file suit against members of the Class to pursue claims for Ineligible Remedies on the basis of a certificate of registration that does not satisfy Section 411(b). In order to ensure that reliance.
or losses in an amount to be determined at trial. and Defendants’ intent to not pursue the vast majority of unsettled claims. 64 . willful. 263. on behalf of Achte. The Class members relied on the Defendants’ false representations in deciding to settle or make other expenditures. Specifically. concealed. and they had a right to rely on the Defendants’ false representations. SECOND COUNT FOR RELIEF Fraudulent Omissions/Nondisclosure 262. reckless indifference to or reckless disregard for the rights of others. 259. 260. pertinent and material information regarding the falsity of certain claims made by Defendants. and engaged in a scheme to keep the Class members ignorant of. The Defendants failed to disclose to and concealed from the Class members. when they would not have done so had they known the truth about Achte’s copyright registration.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 64 of 105 258. The Class members are entitled to punitive damages because the Defendants’ conduct was malicious. on behalf of himself and all others similarly situated. the Class members suffered injuries. damages. and the Class members’ reliance on those false representations. intentional. Defendants’ knowledge of that falsity. the Defendants failed to disclose and concealed from Class members pertinent and material information that includes but is not limited to the following: (a) Dunlap. The Class members’ reliance was reasonable and justified. when he filed the application to register the copyright for the motion picture Far Cry. as part of DGW and USCG. 261. evidencing evil motive. incorporates by reference all allegations contained in this Complaint. wanton. As a direct and proximate result of the Defendants’ false representations. and outrageous. Plaintiff.
with claims for Ineligible Remedies.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 65 of 105 omitted and failed to disclose material information concerning its date and country of first publication. when they filed suit against the Class and served discovery requests on the Class members’ ISPs. whether they settled or not. By failing to disclose to. omitted and failed to disclose that they never intended to file suit against the vast majority of Class members individually. omitting and failing to disclose that any infringement claim by Achte would. which knowledge and information was not reasonably available to the Class members and could not have been discovered through ordinary diligence. on behalf of Achte. and (d) Defendants concealed. omitted. The Defendants had superior knowledge and information about that pertinent and material information. Defendants had a duty to speak and to inform the Class members of the truth about the non-disclosed. (c) Defendants then threatened members of the Class. concealing. 265. limited to actual damages. in fact. and DGW. 264. omitting. Having made materially false representations to the Class members. Kurtz. concealed. and its lack of 65 . (b) Dunlap. and concealing from the Class members the true facts regarding the scope of Achte’s copyright. and concealed facts. the falsity in its registration. including Subclass I and Subclass II. omitted and failed to disclose the falsity of the registration and the bar against statutory damages and attorney’s fees (the Ineligible Remedies) for works published more than three months prior their copyright registration.
268. and using that registration as a license to claim Ineligible Remedies from Class members. 266. (b) intimating. (c) filing a single complaint in the District of Columbia against thousands of John Doe defendants nationwide. and/or would not have paid to retain counsel. omissions. among other expenditures. in the FAQ section of the Far Cry settlement website. 267. they would not have agreed to Defendants’ terms for settlement and would not have entrusted funds to the Defendants. the Defendants intended to create a false impression of the actual facts in the minds of the Class members. The Defendants knew that: 66 .Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 66 of 105 intent to fully litigate its claims. had the members of the Class known the truth. that the fees for representation by counsel to defend the claim “will almost always exceed the settlement amount”. The Defendants’ nondisclosures. The Defendants sought to ensure that members of the Class would not discover the truth by: (a) filing a materially misleading application to register the copyright for Far Cry. and (d) maneuvering to prolong the action in the District of Columbia against thousands of Class members from remote jurisdictions and against whom the Ineligible Remedies are barred. though Defendants knew that would be a remote location for almost every Class member. and concealments were material because.
willful. omissions. and the members of the Class were not in a position to discover the truth about DGW and USCG’s operations. reckless indifference to or reckless disregard for the rights of others. 272. The Class members’ reliance was reasonable and justified under the circumstances. or losses in an amount to be determined at trial. wanton. The Class members are entitled to punitive damages because the Defendants’ conduct was malicious. and outrageous. the Class members suffered injuries. (b) (c) the members of the Class were ignorant of this material information. incorporates by reference all allegations contained in this Complaint. and concealments when the Class members made settlement payments and other expenditures that they would have avoided had they been aware of the truth. 270. omissions. on behalf of himself and all others similarly situated. and they had a right to rely on the facts as they believed them to be absent knowledge of the fraudulent nondisclosures. 271. The members of the Class relied on the Defendants’ fraudulent nondisclosures.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 67 of 105 (a) this information would have been highly material to the members of the Class in deciding whether to settle and/or retain counsel. THIRD COUNT FOR RELIEF Conspiracy to Commit Fraud 273. 269. damages. intentional. As a direct and proximate result of the Defendants’ fraudulent nondisclosures. evidencing evil motive. omissions. and concealments. and the Class members’ reliance on the assumption that the concealed and undisclosed facts did not exist or were different from what the facts actually were. 67 . and concealments. Plaintiff.
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The Defendants each knowingly and willfully conspired and agreed to engage in the Copyright Scheme.
The Defendants committed and caused to be committed one or more overt and unlawful acts in furtherance of the conspiracy, including but not limited to the acts described in this Complaint.
As a direct and proximate result of the Defendants’ conspiracy to commit fraud, members of the Class suffered injuries, damages, or losses in an amount to be determined at trial.
Members of the Class are entitled to punitive damages because the Defendants’ conduct was malicious, willful, wanton, intentional, and outrageous, evidencing evil motive, reckless indifference to or reckless disregard for the rights of others. FOURTH COUNT FOR RELIEF Computer Fraud and Abuse Act, 18 U.S.C. § 1030 et seq.
Plaintiff, on behalf of himself and all others similarly situated, incorporates by reference each and every allegation contained in this Complaint.
Defendants knowingly and with the intent to defraud, accessed the secure, protected computers of the Class members’ Internet Service Providers (“ISPs”), or other protected computers, or caused others to access the secure, protected computers of members of the Class, or other protected computers, without authorization or in excess of their authorized access, and in furtherance of the intended fraud obtained confidential information and/or other valuable information which has a value exceeding $5,000 in a one-year period, in violation of 18 U.S.C. § 1030(a)(4).
The subpoenas obtained by Defendants in the Achte action were directed to the ISPs of the Class members.
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In deciding to authorize the subpoenas requested by the Defendants, the Court reasonably and justifiably relied on the intentional representations and misrepresentations Defendants made, including DGW, Dunlap, Kurtz, and Achte in the complaint and the motion requesting subpoena power, and Achte, DGW and GuardaLey in GuardaLey’s declarations in support of Achte’s motion for leave to take discovery prior to Rule 26(f) Conference. Had the Court known the truth regarding the Defendants’ knowledge of the falsity of its copyright registration, their ability to determine that the vast majority of John Doe defendants were outside the Court’s jurisdiction, and the ulterior or illegitimate purposes for which they sought subpoenas, it would not have authorized the subpoenas in the Achte action.
The falsely obtained subpoenas were part of the Defendants’ Copyright Scheme and essential to obtaining the contact information of the Class members. Using that information, Defendants did, and continue to, make further fraudulent claims and extortionate threats directly to the Class members.
Defendants intentionally accessed the protected computers of members and/or of the ISPs and/or other protected computers, and, as a result, intentionally and without authorization, caused loss to the secure, protected computers of ISPs and/or other protected computers in violation of 18 U.S.C. §§ 1030(a)(5)(C).
Defendants intentionally accessed the secure, protected computers of members of the Class, or other protected computers, without authorization or exceeding their authorization, and thereby obtained information from those protected computers, in
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violation of 18 U.S.C. § 1030(a)(2)(C), including, but not limited to, the personal identities and contact information of the Class from their respective ISPs. 285. Since the Defendants obtained access to the computers in unintended ways—specifically through fraudulently obtained subpoenas—which were not related to their intended function, they were operating “without authorization.” Even if the subpoenas had been valid, extortion and/or fraud is not an intended function of their issuance, thereby Defendants “exceeded” their authorized access under the Act. 286. All computers used by Defendants without authorization or in excess of authorized access, were at all relevant times used in interstate commerce and are protected computers pursuant to the Computer Fraud and Abuse Act, 18 U.S.C. § 1030(e). 287. “Obtaining information” in the context of the Act includes mere observation of the data. By merely viewing the identities and contact information of the Class members, without or in excess of authorization, the Defendants violated the Act. 288. Defendants ascribed varying value ranges on the information they obtained, including $1,500 to $2,500 in the event of settlement, and $30,000 to $150,000 in the event of litigation. 289. Defendants, through their actions in violation of 18 U.S.C. §§ 1030(a)(2), (a)(4), and (a) (5)(C), have caused Class members to incur losses in responding to and investigating Defendants’ misconduct, including settlement payments and costs associated with retaining counsel, exceeding $5,000 during a one-year period in violation of 18 U.S.C. §§ 1030(g) and (c)(4)(A)(i)(I).
on behalf of himself and all others similarly situated. damages. as described in this Complaint. restraining and enjoining Defendants and all those in privity. 295. concert or participation with Defendants from engaging in such wrongful acts. 291.000 threshold. incorporates by reference all allegations contained in this Complaint. members of the Class are also entitled to injunctive relief pursuant to 18 U. willful. the Class has suffered damages as alleged above. intentional. evidencing evil motive. In addition to an award of compensatory damages. 294. the Copyright Scheme as a whole. that stem from the same act: the issuance of the subpoenas. 296. which in aggregate far exceed the $5. or losses in an amount to be determined at trial. Each Defendant knew about the Copyright Scheme. § 1030(g). As a direct and proximate cause of Defendants' deliberate misconduct. Class members are entitled to punitive damages because the Defendants conduct was malicious. wanton.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 71 of 105 290.S. The Defendants have caused to suffer losses. 292.C. and outrageous. Plaintiff. The investigation of such losses continues. and actively participated in it by knowingly providing encouragement and substantial assistance in perpetration of the fraud. members of the Class suffered injuries. reckless indifference to or reckless disregard for the rights of others. or alternatively. FIFTH COUNT FOR RELIEF Aiding and Abetting Fraud 293. SIXTH COUNT FOR RELIEF 71 . As a direct and proximate result of the Defendants’ encouragement and substantial assistance in perpetration of the fraud.
§ 1962(c). For purposes of this claim. (d) USCG. certain RICO “enterprises” are associations-in-fact consisting of (a) Thomas Dunlap.C. including their directors. (c) deriving profits from the activities of the Enterprise. § 1961(3). 18 U. (c) Achte.C.S. the Defendants conducted the affairs of certain association-in-fact enterprises identified herein. 298. the affairs of which affected interstate commerce through a pattern of racketeering activity. 18 U. Plaintiff.C. which alleges violations of Section 1962(c) of RICO. (e) GuardaLey. 299. and (f) DGW. and (d) perpetuating use of a fraudulently obtained copyright registration to threaten statutory damages and attorney’s fees against alleged 72 . is asserted against the Defendants on behalf of Plaintiff and the Class. (b) implementing the Copyright Scheme. Plaintiff.S. (b) Nicholas Kurtz. These associations-in-fact are sometimes collectively referred to herein as the “Enterprise. the members of the Class. § 1962(c) 297.” The Enterprise is an ongoing and continuing business organization consisting of both corporations and individuals that are and have been associated for the common or shared purposes of (a) publishing or otherwise disseminating settlement demands to alleged infringers.” as that term is defined in 18 U. This Count.S. § 1962(c). incorporates by reference all allegations contained in this Complaint. employees and agents. and the Defendants are each “persons. At all relevant times. in violation of 18 U.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 72 of 105 Violations of RICO. which the Enterprise typically accomplishes by disseminating fraudulent misrepresentations and using extortionate tactics. The Enterprise 301. 300.C. on behalf of himself and all others similarly situated.S.
and reaped profits from that conduct. knew at all relevant times the nation and date of first publication of Far Cry. as producers of the film. were knowing and willing participants in that conduct. 302. There is a common communication network by which the Defendants share and continue to share information on a regular basis. (b) Achte has filed. Defendants functioned as a continuing unit for the purposes of implementing the Copyright Scheme and to continue its existence.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 73 of 105 infringers. or caused to be filed. (c) DGW. Defendants were aware of each other’s conduct. 73 . 303. Defendants each have a common purpose of perpetuating the use of the fraudulently obtained Far Cry copyright registration to coerce “settlements” from alleged infringers in lieu of statutory damages or attorney’s fees. In addition. The Enterprise has a systemic linkage because there are contractual relationships. This awareness comes from the following sources: (a) Achte. Dunlap and Kurtz all hold themselves out as copyright experts. At all relevant times. Typically this communication occurs by use of the wires and mails in which Defendants discuss and agree on the continuation and management of the Copyright Scheme. copyright registrations for many of its other films in accordance with U.S. Defendants used the wires and mails to implement their Copyright Scheme directly against alleged infringers. financial ties. Defendants were aware that the Far Cry copyright registration was obtained fraudulently to aid in coercing inflated “settlements” from alleged infringers as part of the Copyright Scheme. copyright law. and continuing coordination of activities between the Defendants.
GuardaLey’s knowledge can be imputed. The foregoing evidences that each Defendant was a willing participant in the Enterprise. Mails and Interstate Wire Facilities 18 U. mails and interstate wire facilities. including the transmission and publication of false and misleading information concerning the United States District Court for the District of Columbia’s jurisdiction over the Class. i. § 1341 and 18 U.S. who filled out the Far Cry registration.S.C. This structure was the basis on which the enterprise operated. 304.e. through USCG’s management and operation of the Enterprise and Defendant DGW’s status as copyright attorneys.S.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 74 of 105 (d) Dunlap. 74 . and the transmission and publication of false and misleading information concerning the application of the Ineligible Remedies to the Class. the obtaining of subpoenas on a fraudulent basis. As a partner in USCG. products and funds by the U.C. and their agreement to a structure as to how the operation of the Enterprise would be conducted. The Defendants’ illegal conduct and wrongful practices were carried out by an array of employees. who necessarily relied upon frequent transfers of documents and information. 306. § 1343 305. that each had a common purpose and interest in the establishment and operations of the Copyright Scheme. The Defendants’ Use of the U.. has published knowledge of Section 412 and its impact on foreign rights holders. so it is only logical it too had knowledge.S. working across state boundaries. The Enterprise engaged in and affected interstate commerce because it engaged in and conspired to and engage in activities across state boundaries. (e) USCG is an alias of DGW.
Indeed. mails and interstate wire facilities to perpetrate the Copyright Scheme involved potentially thousands of communications including. mails and by interstate wire facilities.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 75 of 105 307. an essential part of the successful operation of the Copyright Scheme alleged herein depended upon secrecy.S. which DGW. mails and interstate wire facilities (and corresponding RICO predicate acts of mail and wire fraud) have not been disclosed and cannot be alleged without access to these Defendants’ books and records. Plaintiff can generally describe the occasions on which the RICO predicate acts of mail fraud and wire fraud occurred. 309. The Defendants’ use of the U.S. necessarily required those headquarters to communicate directly and frequently by the U. (c) Written representations and telephone calls between Defendants and members of the Class and/or their counsel regarding the Copyright Scheme. which was orchestrated out of the corporate headquarters of each Defendant. inter alia: (a) Marketing materials about USCG’s services. However. Plaintiff describes this below. Many of the precise dates of Defendants’ uses of the U. (b) Written representations and telephone calls between Defendants regarding the Copyright Scheme. sent to prospective clients located across the country. (d) E-mails between Defendants agreeing to or effectuating the implementation of the Copyright Scheme. and how those acts were in furtherance of the Copyright Scheme. The nature and pervasiveness of the Copyright Scheme. 308.S. 75 .
employing the threat of Ineligible Remedies and other fraudulent and ﬁnancially burdensome threats of litigation.S. 312. Government agencies and courts that fraudulently misrepresented what the Ineligible Remedies were.S. communicated through use of the U.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 76 of 105 (e) Written and oral communications directed to U. § 1951. verbally and by written communication. mails and by interstate wire facilities.S. In addition to the above-referenced RICO predicate acts. In addition. have demanded and/or received money from the Class members. mails and interstate wire facilities – the wrongful proceeds of the Copyright Scheme.S. each Defendant has. Defendants.C.C.S.500. § 1951 311. Typical money demands from the Defendants contained in the Letters range from $1. Defendants. and (f) Receipts of increased profits sent through the U. in furtherance of the Copyright Scheme. Further. The Defendants’ Use of Extortionate Tactics 18 U. their agents and/or others acting at Defendants’ direction and on their behalf. or that were intended to deter investigations into the true nature of the Copyright Scheme. In furtherance of the Copyright Scheme.500 to $2. it was foreseeable to each Defendant that DGW would distribute the Letters containing false and extortionate representations through the U. mails and by interstate wire facilities with their various offices.S. have conspired to and have in fact extorted or attempted to extort “settlement payments” from members of the Class and/or have caused them to otherwise foreseeably part with property in violation of 18 U. 310. it was foreseeable to the 76 .
would rely on them. Had they known that Defendants’ threats 77 . (d) Defendants’ statement that it would almost always cost less to settle than to seek counsel. without mentioning that the award in that case was found unconstitutionally excessive and reduced by 90 percent. 314. The Defendants. and (f) Defendants’ use of the Tenenbaum case in the Letters to raise the specter of large statutory awards and attorney’s fees. which were material to their decisions to settle and/or retain counsel. including the costs and expenses related to retaining counsel. 315. (c) Financially burdensome legal expenses imposed by Defendants’ filing and then moving to dismiss claims that they did not genuinely intend to pursue. Financially burdensome legal expenses imposed by Defendants’ filing suit in a remote and improper jurisdiction.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 77 of 105 Defendants’ that Class members would suffer additional economic harm as a direct result of their Copyright Scheme. Members of the Class did rely on Defendants’ wrongful threats. as lay persons. made the threats with the intent that members of the Class. including but not limited to: (a) (b) Fraudulent claims for Ineligible Remedies. 313. under the guise of attorneys. (e) Defendants’ statements to the Class and to the press that they would pursue Class members who did not settle. Members of the Class consented to enter into “settlement agreements” and/or other foreseeable economic harm under the wrongful acts of Defendants.
There is no dispute in these cases that Defendants interfered with. 78 . in violation of RICO Section 1962(c). (d) DGW and Dunlap intended to and did file a false copyright registration in furtherance of the Copyright Scheme. in the following ways: (a) (b) Each of the Defendants had a degree of control concerning the Copyright Scheme. and other materials used to inform prospective clients as to its services. sales. as well as the USCG websites and other materials used to communicate with. The Defendants’ activities caused economic harm to the Class. disrupted.S. (c) USCG has directly controlled the creation and distribution of marketing. Achte knew the date of first publication for its film. Far Cry. At all times relevant. copyright law.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 78 of 105 were without substance. and in some instances completely deprived Class members of their ability to exercise their property rights. The Defendants have exerted control over the Enterprise and. the Defendants have conducted or participated in the conduct of the affairs of those RICO enterprises. and collect payments from. which affords the Class members standing under Section 1964(c). Conduct of the RICO Enterprises’ Affairs 317. the Class members would not have settled and/or suffered other foreseeable economic harm. 316. directly or indirectly. and had previously filed or caused to be filed copyright registrations for other films in accordance with U. Class members targeted in the Copyright Scheme.
including acts that are indictable under 18 U.C. § 1951. outside the jurisdiction of the Achte action. relating to mail fraud. The Defendants’ Pattern of Racketeering Activity 320. The Defendants’ pattern of racketeering likely involved thousands of separate instances of use of the U. § 1343.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 79 of 105 (e) USCG/DGW. and was integral to increasing Defendants’ profits for the reasons set forth herein.C. that most of the Class members resided. mails and by interstate wire facilities.S. and (f) Defendants have allowed USCG/DGW to exert control over the Enterprise knowing that the Far Cry copyright registration was fraudulent. 319. and/or most of the alleged acts of infringement occurred.S. Each of the Defendants conducted and participated in the affairs of the above referenced Enterprises through a pattern of racketeering activity.S. relating to extortion. mails or interstate wire 79 . and/or that the dates of infringement alleged by Achte undermined its claims for Ineligible Remedies.C.S.S. In violation of Section 1962(c) of RICO. The Enterprise appears to have a hierarchical decision-making structure headed by USCG regarding the Copyright Scheme and each other Defendant accepted those instructions despite knowing of their falsity. each Defendant conducted the affairs of the Enterprise with which it associated by establishing the Copyright Scheme which was then published and disseminated nationwide to members of the Class. Dunlap and Kurtz intended to and did distribute their Letters containing false claims of Ineligible Remedies and jurisdiction through the U. 18 U. 318. § 1341. relating to wire fraud. and 18 U. USCG/DGW controlled the Enterprise because forcing settlements is its business.
involved 80 . § 1961(5). 322. the Copyright Office. and by subsequently failing to disclose such practices to the individual Class members. By intentionally and fraudulently obtaining the copyright registration and therefore the services of the court. at all times the Defendants were cognizant of the fact that recipients of the Letters and the court sand ISPs.S. mails and/or interstate wire facilities and each extortionate act employed by the Defendants was related. with similar pattern and purpose.C. the Defendants engaged in a fraudulent and unlawful course of conduct constituting a pattern of racketeering activity. Each of these fraudulent mailings and interstate wire transmissions and extortionate acts constitutes a “racketeering activity” within the meaning of 18 U. and would do so in excess of any actual damages Defendants suffered. In designing and implementing the Copyright Scheme.S. Defendants calculated and intentionally crafted the Copyright Scheme to ensure that many members of the Class would pay to settle the claims. 323.C.” within the meaning of 18 U.S. the ISPs. Collectively. 321. had similar intended purposes. and the United States District Court for the District of Columbia. The Defendants’ racketeering activities amounted to a common course of conduct. in which the Defendants intended to defraud and extort Plaintiff. these violations constitute a “pattern of racketeering activity.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 80 of 105 facilities and extortionate acts in furtherance of the Copyright Scheme. § 1961(1)(B). even if wholly innocent. Each separate use of the U. members of the Class and other intended victims. intended to deceive the Plaintiff and members of the Class. would rely on the integrity of the copyright registration and any representations Defendants made when purportedly speaking as attorneys.
SEVENTH COUNT FOR RELIEF Conspiracy to Violate RICO under 18 U. The Defendants sent the Letters and other communications essential to the Copyright Scheme through the U.S. Plaintiff and members of the Class have made inflated “settlement payments” in reliance on the false and extortionate statements contained in the copyright registration. communications including the Letters and the USCG websites. 326.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 81 of 105 similar participants and methods of execution. Damages Caused by the Defendants’ Copyright Scheme 324.S. the Defendants are jointly and severally liable to Plaintiff and other members of the Class for three times the damages that they have sustained. Each of the Defendants has engaged in the pattern of racketeering activity for the purpose of conducting the ongoing business affairs of the Enterprise. The Defendants’ violations of federal law and their pattern of racketeering activity have directly and proximately caused Plaintiff and other members of the Class to be injured in their business or property because Plaintiff and other Class members have been coerced into paying many millions of dollars in inflated “settlements” and/or have incurred related expenses defending themselves against the Copyright Scheme as described herein. Under the provisions of Section 1964(c) of RICO. and elsewhere and/or have otherwise been deprived of their property as a direct and proximate result of the Copyright Scheme. mails or by interstate wire facilities and reported information by the same methods in furtherance of their Copyright Scheme. 325. § 1962(d) 81 . and had the same results affecting the same victims. including reasonable attorneys’ fees. plus the costs of bringing this suit.C. including Plaintiff and members of the Class.
333. As a direct and proximate result of the overt predicate acts of racketeering and of the Defendants’ violation of 18 U.S.S.C. 328. § 1962(d).C. mail fraud. the Defendants conspired to and agreed personally and/ or through the conduct of their agents and/or others acting at their direction and on their behalf. § 1962(a) by agreeing to use or invest income received. This agreement was in violation of 18 U. Each of the Defendants conspired to violate 18 U. on behalf of himself and all others similarly situated. § 1962(d). Each of the Defendants also conspired to violate 18 U. 82 .S. Speciﬁcally. and wire fraud.C. 329.S. the affairs of the Copyright Scheme through a pattern of racketeering activity.S. As a result of their conspiracy in violation of 18 U. the Class members have been injured in their business or property within the meaning of 18 U.C. and to participate directly or indirectly in the conduct of.C. as described above. 330.C. the Defendants are liable to the Class members for their losses. § 1962(c) by agreeing to conduct. Plaintiff.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 82 of 105 327. directly or indirectly. to engage in repeated acts of extortion. including but not limited to the acts described in this Complaint. in an amount to be determined at trial. § 1962(d). incorporates by reference all allegations contained in this Complaint.S.S. 332. from a pattern of racketeering activity in the operation and furtherance of the Copyright Scheme and their respective businesses. The Defendants committed and caused to be committed a series of overt predicate acts of racketeering in furtherance of the conspiracy. This agreement was in violation of 18 U. § 1964(c). 331.C. § 1962(d).
The Defendants thus owed a duty to disclose to the Class members all pertinent and material information relevant to the decision of whether to settle. Defendants sought to dissuade the Class members from retaining counsel and instead to rely on the Defendants’ representations as statements intended to benefit both the Class members and Achte. pursuant to 18 U. Plaintiff. 338. it became foreseeable that the Class members would in fact so rely. because they owed Achte a duty to avoid embroiling it in tortious acts. Defendants informed the Class members. Once Defendants took steps to induce the Class members’ reliance. 336. By these and other communications. despite caveats to the contrary. plus costs and attorney’s fees from the Defendants. on behalf of himself and all others similarly situated. such as the duties of DGW. In the course of their business. § 1964(c). through the Far Cry website. 337. Dunlap and Kurtz to their law client Achte.” This message was expressly framed as a statement of “potential benefits” to the Class members.S.C. the Defendants supplied information to Class members that was relevant and material to the Class members’ determination of whether to enter into a settlement agreement. the Class members are entitled to recover threefold their damages.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 83 of 105 334. In addition. Defendants’ duty did not conflict with any intervening duties. incorporates by reference all allegations contained in this Complaint. EIGHTH COUNT FOR RELIEF Negligent Misrepresentations and Omissions 335. that “[t]he legal fees incurred in defending a copyright infringement claim will almost always exceed the settlement amount demanded by our client. 83 .
At the time they were made. This failure to disclose material information was tantamount to supplying false information. was materially misleading in negligently misrepresenting and/or omitting the true facts pertinent and material to that decision. Achte’s publication of Far Cry long before it claimed in its application to register the copyright. and Achte’s limited remedies under the Copyright Act. the Class members reasonably and justifiably relied on the information. The Defendants negligently made misrepresentations and failed to disclose material information to the Class members with the intent that they would rely on the misrepresentations and omissions and agree to settle. 343. Each of Defendant’s thousands of communications with the Class members concerning the copyrighted work. including the negligent misrepresentations. among other things. and Achte’s copyright registration. 344. including the facts regarding. provided by the Defendants. the Defendants: (1) provided false and misleading information to the Class members. the Class members did not know that the representations were false and did not know the information that the Defendants negligently failed to disclose. Had the Class members known that these misrepresentations were not true or known the material information that the Defendants had a duty to disclose and failed to disclose. attorney’s fees.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 84 of 105 339. and (2) failed to disclose to the Class members pertinent and material information regarding statutory damages. In deciding to enter into settlement agreements and/or retain counsel. 342. 341. 340. including the Letters. Due to the Defendants’ failure to exercise reasonable care. 84 .
on behalf of himself and all others similarly situated. The United States District Court for the District of Columbia (the “Court”) relied on the Attorney Defendants’ misrepresentations and fraudulent acts. and engaged in a fraudulent scheme to keep the Court ignorant of. and the Class members’ reliance on those misrepresentations and their reasonable belief that the concealed and undisclosed facts did not exist or were different from what the facts actually were. 85 . 348. damages. 345. incorporates by reference each and every allegation contained in this Complaint. DGW. The Attorney Defendants intentionally failed to disclose to and concealed from the Court. 350. omissions. Plaintiff. Plaintiffs suffered injuries. 346. pertinent and material information regarding the Attorney Defendants’ knowledge of the falsity of certain claims and the ulterior or illegitimate purposes for which they sought subpoenas. or losses in an amount to be determined at trial. Dunlap and Kurtz (the “Attorney Defendants”) are and have been at all relevant times officers of the Court in the Achte action.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 85 of 105 they would neither have agreed to settle nor make significant expenditures to obtain legal advice. which they would not have done had they been aware of the true facts. As a direct and proximate result of the Defendants’ negligent misrepresentations. The Class members in fact relied upon the Defendants’ omissions and nondisclosures by agreeing to settle and/or making significant expenditures to obtain legal advice. 349. NINTH COUNT FOR RELIEF Fraud on the Court 347. and nondisclosures.
USCG. Specifically. USCG. 86 . The settlement funds Defendants collected from members of the Class were used to further the Enterprise. which was initiated by the Attorney Defendants. at all relevant times. and Achte instituted the actions as a vehicle to discover the Class members’ identities and contact information. if the Register of Copyrights had known of the falsity.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 86 of 105 351. (d) the Attorney Defendants did not seriously intend to name the vast majority of Class members as defendants in the Achte action. (b) the Attorney Defendants. In deciding to authorize the subpoenas requested by the Attorney Defendants. which are Ineligible Remedies as to the members of the Class and each Subclass. 353. and Achte’s shared intent. would have occasioned a rejection of the registration application. the Court reasonably and justifiably relied on the representations and misrepresentations they made. was to use that information to improperly coerce the Class members into entering settlement agreements. 352. and (d) certain claims for relief prayed for by Achte were false. (c) Dunlap knowingly obtained a certificate of copyright registration for Far Cry on the basis of materially false information which. the Attorney Defendants failed to disclose and concealed from the Court pertinent and material information that includes but is not limited to the following: (a) the Attorney Defendants. including Achte’s claim for statutory damages and attorney’s fees.
the Court’s reliance thereon. Defendants have made knowing misrepresentations in each complaint filed against the Class members. In the eight complaints filed against individual defendants since the bulk of Achte’s claims were dismissed.C. incorporates by reference each and every allegation contained in this Complaint. 2010.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 87 of 105 354. omissions. 357. Defendants filed their original complaint against 2. In its original complaint. Defendants pleaded claims for the Ineligible Remedies despite knowing those claims were barred. and its assumption that the concealed and undisclosed facts did not exist or were different from what the facts actually were. despite the restrictions imposed by 17 U. TENTH COUNT FOR RELIEF Abuse of Process 356. Had the Court known the truth of the Attorney Defendants’ misrepresentations and the material information that the Attorney Defendants had a duty to disclose and failed to disclose. As a direct and proximate result of the Attorney Defendants’ fraudulent misrepresentations. members of the Class suffered injuries. 2010. and has elected to pursue statutory damages in lieu of actual damages under 17 U. and Second Amended Complaint in the Achte action. 355.094 Class members on March 18. Plaintiff. and filed their Amended Complaint against all 4. on behalf of himself and all others similarly situated. Defendant has likewise pleaded claims for the Ineligible Remedies. and nondisclosures. or losses in an amount to be determined at trial. § 412. 358.577 Class members on May 12. § 504(c)(1). Amended Complaint. On December 6. damages.S. 2010. the Court would not have authorized the subpoenas in the Achte action.C. in the Court-ordered Second Amended Complaint in the 87 .S.
360. and the ulterior or illegitimate purpose for which the complaints were employed in the Copyright Scheme. where the complaint was posted. The Defendants intentionally failed to disclose to and concealed pertinent and material information regarding Defendants’ knowledge of the falsity of certain claims raised by or on behalf of Achte. 361. and omissions. 363. The website is password-protected. This structure enabled Defendants to employ the complaint for an ulterior purpose: not to initiate the process of litigation. Specifically. Defendants provided (without serving) the operative complaint to the Class members by mailing them Letters that directed them to the Far Cry website. 362. Defendants Defendants willfully abused.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 88 of 105 Achte action. who became the first Class member that Defendants even attempted to provide with service. In the intervening months. 359. Defendants used the materially false complaints to extort from the Class members settlements far greater than any actual-damages awards that would have been at stake. misrepresentations. the Defendants failed to disclose and concealed pertinent and material information that includes but is not limited to the following: 88 . Through coercive tactics. had Defendants in fact used the complaint to litigate its claims. Defendants for the first time named an accused infringer as a defendant. misused and/or misapplied the process for an end other than that which it was designed to accomplish. but to forestall it. while enabling Defendants’ extortion of Class members. USCG limits access to the complaint to Letter recipients who provide identifying information.
individually and collectively. (c) Defendants improperly coerced members of the Class into entering settlement agreements under extortionate threats of financially burdensome lawsuits and fraudulent threats of remedies that are prohibited as a matter of law. regardless of the individual merits of each case. ELEVENTH COUNT FOR RELIEF Fraud on the Copyright Office 366. damages. As a direct and proximate result of the Defendants’ conduct. (b) upon receiving that information.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 89 of 105 (a) Defendants instituted the Achte action as a discovery suit: a vehicle to discover the identities and contact information of Class members. Plaintiff. Defendant’s complaints facilitated these ulterior purposes. Defendants threatened members of the Class with claims for statutory damages and attorney’s fees. 364. though those remedies were categorically prohibited. but rather intended to prolong the Achte action and move to dismiss claims after securing the greatest amount of settlements possible. members of the Class were forced to expend a significant amount of time and money in settling and defending against frivolous claims. incorporates by reference each and every allegation contained in this Complaint. and thereby suffered injuries. 365. or losses in an amount to be determined at trial. and (d) Defendants did not seriously consider in good faith litigating claims against any member of the Subclass I or Subclass II as a named defendant. 89 . on behalf of himself and all others similarly situated.
and that Defendants’ claims for Ineligible Remedies were baseless. 373. but not limited to. though Defendants knew the registration contained false information that was material to the Class members decisions involving the Achte action. Class members are entitled to relief including. Had the Copyright Office known of the misrepresentation.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 90 of 105 367. 370. Defendants intentionally and fraudulently failed to submit the proper date of first publication in the application for copyright registration for the motion picture Far Cry. and prejudgment interest. 90 . 368. Defendants caused members of the Class to expend significant time and money in defending and/or settling frivolous and/or meritless claims. 372. 369. Defendants’ actions constituted fraud upon the Copyright Office. injunctive relief including: a declaration that the copyright registration was procured by fraud and is invalid. 371. Upon information and belief. actual damages (trebled. Defendants intentionally and fraudulently submitted an incorrect date of first publication in the application for copyright registration for the motion picture Far Cry. it would not have issued a copyright registration for the movie Far Cry. The Class members reasonably and foreseeably relied on the asserted validity of the registration as filed. Upon information and belief. that willful misrepresentations in the copyright application constituted bad faith. at the Court’s discretion). frivolous. and/or brought in bad faith. statutory costs and attorneys’ fees. Defendants knowingly made a misrepresentation of a material fact in the application. By submitting an incorrect date of first publication.
375. Defendants attempted to extend the effect or operation of Achte’s copyright beyond the scope of the statutory right by improperly coercing members of the Class into entering settlement agreements with threats of statutory damages awards. Defendants DGW.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 91 of 105 TWELFTH COUNT FOR RELIEF Copyright Misuse 374. and financially burdensome lawsuits. 377. and/or paying to retain counsel. on behalf of himself and all others similarly situated. and wrongfully procured a registration certificate that appears to permit greater protections than the Copyright Act in fact allows. 91 . Defendants threatened Plaintiffs with statutory damages of up to $150.000 and attorney’s fees. 376. when they threatened infringement penalties that exaggerated and misstated the law. attorney’s fees. incorporates by reference all allegations contained in this Complaint. Specifically. though Achte’s remedy would be limited to actual damages in any case where Defendants were able to prove their claims. Defendants misled and defrauded members of the Class into paying settlements many times greater than the Copyright Act permits. regardless of the individual merits of each case and the absolute statutory bar on the extraordinary forms of relief that Defendants nonetheless deceptively claimed. The Defendants engaged in abusive and/or improper conduct in exploiting or enforcing Achte’s copyright. and Achte misrepresented the date of first publication when Dunlap submitted the application for copyright registration for Far Cry. Plaintiff. Dunlap. The Defendants also engaged in abusive and/or improper conduct in the registration of Achte’s copyright.
382. but prior to the effective date of registration (January 19. which would entitle Achte to seek statutory damages and attorney’s fees for any acts of infringement that commenced after the fraudulently claimed date of first publication (November 24. Achte has threatened to seek those heightened remedies in litigation against Plaintiff and other members of Subclass II. so infringements that commenced between those dates generally cannot obtain those extraordinary remedies. 379. it appears to qualify Achte for the statutory grace period. As a direct and proximate result of the Defendants’ extortion threats and false representations. members of the Class suffered injuries. 2010.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 92 of 105 378. 2009. and Class members’ reliance on those threats and false representations. 381. 380. falsely listed November 24. and the registration was not effective until January 19. 2009). The certificate of copyright registration issued with that false date. On its face. 92 . damages. Far Cry was first published no later than April 14. whom Achte alleges infringed its copyright between those two dates. When registering the copyright Achte. or losses in an amount to be determined at trial. allowing those remedies if the work is registered within three months of publication. 2009 as the date of first publication. Section 412(2) of the Copyright Act generally bars awards of statutory damages and attorney’s fees when a published work is infringed after the first publication but before the copyright registration is effective. But Section 412(2) includes a three-month grace period. 2010). Achte’s bald attempt to expand its copyright monopoly by deception and avail itself of unwarranted remedies constitutes copyright misuse. through its agents DGW and Dunlap.
Each Defendant has acted in concert and participated in a common plan to achieve the unlawful acts described above. THIRTEENTH COUNT FOR RELIEF Civil Conspiracy 384. and were engaged by Achte to apply that business model to a motion picture. on behalf of himself and all others similarly situated. Each Defendant has collaborated in false representations designed to cloak their claims. whose copyright had not yet been registered. 386. Members of the class are entitled to declaratory relief that Achte’s copyright registration is invalid and barring Defendants from advancing any claims for Ineligible Remedies unless and until it obtains a registration based on accurate information. Plaintiff. including thousands whose alleged acts of infringement took place when Dunlap and DGW knew claims of statutory damages would be barred. 385. incorporates by reference each and every allegation contained in this Complaint.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 93 of 105 383. that they would not have had if acting independently. Far Cry. Specifically: (a) Dunlap and DGW established USCG in partnership with GuardaLey to enable a copyright claim business model of mass settlements under the guise of litigation. against Shirokov and each other member of the Class. (b) Knowing that Achte had not yet registered its copyright in a film released more than three months earlier. Dunlap and DGW nonetheless engaged GuardaLey to collect information on alleged infringers. over Shirokov and the Class. 93 . in color of right. They thereby acted in unison to exercise coercive powers.
389. FOURTEENTH COUNT FOR RELIEF Unjust Enrichment 391. including Shirokov. DGW and Dunlap supplied knowingly false information to the U. 390. which employed unlawful conduct to cause damage to Shirokov and to other members of the Class. the remedies available to Achte. Shirokov and other members of the Class have been and will continue to be damaged. (d) DGW. on behalf of Achte. and/or the basis for Achte’s claims of jurisdiction over members of the Class. (e) DGW. The Defendants’ concerted actions constitute a civil conspiracy. 387. made knowingly false statements to Shirokov and other members of the Class concerning the copyright. Dunlap.S. Plaintiff. on behalf of Achte. and/or the basis for Achte’s claims of jurisdiction over members of the Class including Shirokov. 94 . made knowingly false statements in court concerning the copyright. The Defendants’ concerted actions caused harm to Shirokov and to other members of the Class that could not have been caused by any Defendant acting alone. and GuardaLey.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 94 of 105 (c) On behalf of Achte. and USCG. 388. incorporates by reference each and every allegation contained in this Complaint. Kurtz. The Defendants’ concerted actions have at all times relevant to this action been willful and/or knowing. the remedies available to Achte. As a direct and proximate result of Defendants’ concerted actions and civil conspiracy. Dunlap. Copyright Office to obtain registration. on behalf of himself and all others similarly situated.
The Defendants were enriched and benefited by appropriating payments they received from the Class. The Defendants received benefits in various ways. including through direct payments. 399. to the detriment of the Class members. accepted. encouraged. 395. monies. incorporates by reference each and every allegation contained in this Complaint. and assets unjustly retained. knew of. 398. and/or facilitated fraudulent and illegal conduct—it would be inequitable and unjust for the Defendants to retain the benefits they received at the expense of the members of the Class. 394. monies. and disgorgement of profits or gains on such fees. on behalf of himself and all others similarly situated. members of the Class incurred unnecessary and unwarranted financial damages. The Defendants recognized. the money received by Defendants was intentionally. Because of the Defendants’ actions. Plaintiff. Defendants received settlement payments from members of the Class. FIFTEENTH COUNT FOR RELIEF Money Had and Received 397. and retained all these benefits at the Class members’ expense and did not provide equitable recompense. As described in this Complaint. fraudulently. 95 .Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 95 of 105 392. Given the circumstances described in this Complaint—including the fact that each Defendant directed. including restitution of all fees. 396. and/or assets. 393. The members of the Class are entitled to all lawful and equitable remedies attendant to the Defendants’ unjust enrichment. or converted for the Defendants’ use. and illegally appropriated for the Defendants’ use.
401. SIXTEENTH COUNT FOR RELIEF Conversion 402. 406. plus interest calculated from the time of conversion. members of the Class are entitled to recover the value of the converted funds. or assets purchased with the monies unlawfully had and received. and disgorgement of profits generated by the fees. 96 . monies. The funds were placed in the custody of USCG for the specific purposes of compensating the rights-holder Achte to avoid litigating its claims for awards of statutory damages and attorney’s fees. 403. Members of the Class had a right of ownership and entitlement to the immediate possession of funds they paid to Defendants under settlement agreements.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 96 of 105 400. 405. monies or assets. 407. The Defendants thereby received or obtained possession of money which in equity and good conscience belongs to the Class members. including restitution of all such fees. on behalf of himself and all others similarly situated. incorporates by reference all allegations contained in this Complaint. Plaintiff. As a result of the Defendants’ conduct. 404. The Defendants diverted and misappropriated the funds for the other and different purposes of using the funds for their own use and different business interests that were in conflict with and unrelated to the purpose of deterring infringement through awards of statutory damages. The Class members are entitled to all lawful and equitable remedies attendant to the Defendants’ misconduct. The Defendants’ misappropriation of the funds deprived members of the Class of their possessory rights to the funds.
and order an equitable accounting of such property. wanton. induced members of the Class into paying money and entering into settlement agreements under the threat of statutory damages that Defendants could not obtain as a matter of law. intentional. The Defendants have retained property which rightfully belongs to members of the Class. and outrageous. 413. 410. incorporates by reference all allegations contained in this Complaint. and accounts and property owned by each entity. The Class members request the Court impose a constructive trust on the Defendants’ property. EIGHTEENTH COUNT FOR RELIEF Violation of Massachusetts General Laws. on behalf of himself and all others similarly situated. et seq. including accounts and real and personal property of each individual Defendant. 411. Plaintiff. 97 . evidencing evil motive or reckless indifference to the rights of others. The Defendants.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 97 of 105 408. on behalf of himself and all others similarly situated. 412. willful. § 1. incorporates by reference all allegations contained in this Complaint. Plaintiff. SEVENTEENTH COUNT FOR RELIEF Constructive Trust 409. through their fraudulent conduct. 414. Members of the Class are entitled to punitive damages because the Defendants’ conduct was malicious. The Defendants wrongfully diverted monies from members of the Class in violation of statutory and common law and used the proceeds for their legitimate businesses and to further their Copyright Scheme. Chapter 93A.
which acts are uncured. At all relevant times. with the ulterior motive of forcing “settlements” from the Class members.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 98 of 105 415. Defendants knowingly and intentionally engaged in unfair or deceptive conduct within the meaning of Chapter 93A. The Defendants’ unfair and/or deceptive practices caused members of the Class to suffer an ascertainable loss of money. and the loss arose from the Defendants’ concealment from and failure to disclose to the Class the true facts regarding the scope of Achte’s copyright. 418. The Defendants’ unfair. Defendants then used the complaint as leverage against the Class’ ignorance as to their potential defenses. and that Defendants did not intend to fully litigate most. claims. 416. 419. 417. as did the injuries of other similarly situated Class members. Defendants filed suit as part of the overall Copyright Scheme. unlawful. that the Court lacked jurisdiction over the Class members. and deceptive practices occurred in the course of the Defendants’ Copyright Scheme and the challenged practices directly caused actual damages and injury to Class members. Plaintiff’s injuries occurred in Massachusetts. that certain remedies they claimed— again. statutory damages and attorney’s fees—were barred. Defendants filed suit in the United States District Court for the District of Columbia despite the knowledge that their copyright registration (a requirement before filing claims for statutory damages or attorney’s fees) had been fraudulently obtained. The Defendants’ misrepresentations and deceptive acts had a tendency to or were capable of deceiving the Class members—which they did. if not all. the falsity in its registration. the lack of jurisdiction and/or its lack of intent to 98 . The Class members relied on the Defendants’ misrepresentations and deceptive acts.
attorney fees and costs as provided by Chapter 93A. punitive damages. Plaintiff and other Class members and the public will be unable to obtain the information necessary to make informed decisions regarding their rights.” 420. Money damages will not compensate Plaintiff and other Class members for their current lack of information and such information and the ability to disseminate such information is in the exclusive control of Defendants. The provision of such information will afford Plaintiff and other Class members the opportunity to make informed decisions regarding their rights and prevent Defendants from further perpetrating the Copyright Scheme. No thirty-day demand letter was required in this matter per § 9(3) of Chapter 93A. 422. 421. 423.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 99 of 105 fully litigate its claims—all done with the intent to file suit in order to facilitate “settlements. injunctive relief. Plaintiffs also seek permanent injunctive relief as a result of the Defendants’ ongoing violations of Chapter 93A. Plaintiff and other Class members are entitled to treble damages. 424. waiver of any and all non-disclosure terms in the settlement agreements and the identities of all Class members. Absent a court order. including an order directing Defendants to provide Plaintiff and members of the Class with all material facts relating to Defendants’ Copyright Scheme. including any and settlements received. By reason of the foregoing. A monetary award will fail to provide full relief to the Class. because the Defendants do not maintain a place of business or keep assets in the 99 .
and this claim is asserted by way of counterclaim. They contended that each member of the Class could be held liable for statutory damages and attorney’s fees in litigation over infringement of the motion picture Far Cry. They had an improper purpose in bringing and continuing claims against the Class. 428.C. Achte identified 4. Defendants had no probable cause to make that claim. Dunlap. an improperly filed suit. § 412. by and through Defendants DGW. on behalf of himself and all others similarly situated. they could not have reasonably believed that claim was valid under applicable law. The court ordered Achte to amend its complaint to press claims against only those whom Achte reasonably believed to be subject to the court’s 100 . Alternatively. 430. brought a civil action against each member of the Class. and/or did so to force settlements that had no relation to any merits of their claims. incorporates by reference each and every allegation contained in this Complaint. this action was filed in response to the Achte action. USCG. 429. Defendant GuardaLey materially contributed to the malicious prosecution by compiling and providing to other Defendants information about alleged acts of infringement. Plaintiff. They instituted the action against the Class when they did not believe their claims to be meritorious. Defendants brought the claim with malice. In light of 17 U. and by attesting to its acts in court affidavits by its principals and/or employees. 427. Achte. NINETEENTH COUNT FOR RELIEF Malicious Prosecution 425.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 100 of 105 Commonwealth. and Kurtz. including thousands that occurred prior to the Effective Date.577 John Doe defendants (the Class) in its First Amended Complaint in the Achte action. 426.S.
S.C. 431. 17 U. Defendants caused damages to members of the Class. 2) Damages in an amount to be proven at trial. §§ 1961 et seq. Plaintiff seeks the following remedies: 1) An order certifying the Class and any appropriate subclasses thereof under the appropriate provisions of Federal Rule of Civil Procedure 23. including but not limited to compensatory and consequential damages.577 Class members. including all members of Subclass I and Subclass II. § 1 et seq.C. only one of whom was named. 3) Treble damages under RICO. 432. § 101 et seq.. and Massachusetts General Laws ch. 18 U.. leaving claims in that court against only 140 accused infringers. RELIEF REQUESTED WHEREFORE. including Plaintiff. Achte and its counsel moved to dismiss their claims against 4. 93A.437 of the Class members. Defendants’ claims against 4. 101 .S.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 101 of 105 jurisdiction. by imposing legal costs on them that would have been avoided absent Defendants’ misrepresentations.. and appointing Plaintiff and his counsel to represent the Class. in Achte’s Second Amended Complaint. 433. the Copyright Act.437 of the 4. 4) Punitive damages on any and all causes of action permitting such damages. Defendants caused damages to members of the Class by forcing settlements that had no relation to any merits of Defendants’ claims. were terminated in favor of the proposed Class members when Achte abandoned its claims against them in the Achte action. more than 95% of the defendants they had once identified.
Injunctive relief to reveal the identities of all known proposed Class members. profits.G. fraudulent. 223.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 102 of 105 5) 6) Actual or statutory damages at the election of the Class members. attorney fees. c. 102 . and any and all Class members‘ litigation expenses. 10) An attachment against the Defendants’ property. deceptive. and costs as provided by M. § 42 and respective state statutes.L. 7) Reimbursement of all money that members of the Class spent on legal representation. 12) 13) 14) Injunctive relief to stop the Copyright Scheme. 11) Injunctive relief preventing the sale or disposition of Defendants’ assets acquired through the Copyright Scheme. including accounting to Class members for any and all gains. and/or omissions. including reasonable attorney fees and the costs of this action. 8) The imposition of a constructive trust on all monies provided by Class members to the Defendants and all assets acquired with such funds. Attorney fees and costs incurred by members of the proposed Class in settling or otherwise responding to claims brought by Defendants. and advantages derived by Defendants from the Copyright Scheme. misleading. and/or negligent statements. court costs and other expenses that would have been avoided if not for Defendants’ false. Restitution of all money that Defendants obtained from members of the Class in settlements based on fraudulent statements and extortionate threats. representations. 9) Equitable accounting.
18) A notice issued by this Court to the Register of Copyrights requesting advice on whether the inaccurate information.G.L. and Kurtz.C.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 103 of 105 15) An order declaring Defendants committed fraud on the court and supporting dismissal of the Achte action and any subsequent case brought by Achte against any member of the Class.S. and respective state statutes.C. including but not limited to this Court and the U. M.S. § 6F.S.C. c. § 8. § 1961. would have caused the Register of Copyrights to refuse registration. 16) An order enjoining Defendants from bringing suit or advancing claims against any member or members of the Class in any court.S. and the imposition of joint and several liability for the damages caused by their actions. Pre-judgment and post-judgment interest as provided by pursuant to 28 U. 19) An order declaring the certificate of copyright registration for Far Cry invalid due to Defendants’ fraud on the Copyright Office and/or copyright misuse. c. 17) An order declaring that Defendant Dunlap. § 411(b)(2). included inaccurate information on the application for copyright registration with knowledge that it was inaccurate.L. Achte. § 411(b)(1). District Court for the District of Columbia. M. 231. Dunlap. if known. as agent for Defendant Achte.G. pending full resolution of this matter. GuardaLey. 235. pursuant to 17 U. 22) 23) Attorney fees and costs incurred by the Class in prosecuting this action. A finding that US Copyright Group is an alter ego for others including but not limited to DGW. and 103 . pursuant to 17 U. 20) 21) Waiver by Defendants of all settlement agreements with members of the Class.
Booth (BBO# 672090) Jason E. JURY DEMAND Plaintiff. Booth /s/ Jason E. hereby demand a trial by jury in this case. on behalf of himself and all other similarly situated. 2011 DMITRIY SHIROKOV /s/ Daniel G. Sweet (BBO# 668596) BOOTH SWEET LLP 32R Essex Street.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 104 of 105 24) Additional and/or alternative relief as the Court may deem to be just. equitable and appropriate. Dated: March 18. MA 02139 Telephone: (617) 250-8602 Facsimile: (617) 250-8883 Attorneys for Plaintiff and Proposed Class 104 . Sweet Daniel G. Suite 1 Cambridge.
I further certify that true copies of the aforementioned documents will be timely served upon Defendants US Copyright Group. Sweet Jason E. Guardaley. Grubb & Weaver PLLC. and Nicholas Kurtz by Notice of Electronic Filing through the ECF system.Case 1:10-cv-12043-GAO Document 26 Filed 03/18/11 Page 105 of 105 CERTIFICATE OF SERVICE I hereby certify that on March 18. 2011. Suite 1A Cambridge. Thomas Dunlap. plus Exhibits A through P. and that a true copy of the aforementioned documents will be served upon counsel of record for Defendants Dunlap. Sweet (BBO# 668596) BOOTH SWEET LLP 32R Essex Street. /s/ Jason E. Limited. and Achte/Neunte Boll Kino Beteiligungs Gmbh & Co KG. I electronically filed the foregoing Second Amended Complaint. MA 02139 Telephone: (617) 250-8602 Facsimile: (617) 250-8883 105 . by using the ECF system.
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