Media Copyright Group’s John Steele: Pirate Slayer

CHICAGO—John Steele is a Chicago-based attorney whose main practice focuses on the conventional areas of family law, divorce and consumer bankruptcy. But like a caped-crusader, he has extended his legal aspirations into the relatively new and aggressive arena of copyright infringement lawsuits targeting anonymous infringers who obtain their content from Torrents. While certainly not the only attorney to stake a claim in this area, his Media Copyright Group has seen a lot of action lately on behalf of clients that might not necessarily utilize the services of his “daytime” firm: adult production studios.

Steele is already well into three lawsuits on behalf of adult studios—Hard Drive Productions, Lightspeed Media, and Millennium TGA—and he told AVN that several more are being prepared. The litigious floodgates are wide open, his legal guns are locked and loaded, and as the following interview makes clear, the crosshairs are now centered squarely on the illegal downloader.

You have three lawsuits filed already. Are there more coming down the pike?

Yes, we have about ten lawsuits in various stages of readiness, including three more we will be filing tomorrow morning on behalf of new clients, with larger numbers of John Does, probably closer to a thousand.

Your approach is to file suit, enter discovery and obtain the identifying information of the alleged infringers and then try to negotiate a settlement with them. Could you subpoena ISPs for that information before filing a lawsuit?

No, you have to have an underlying cause of action in order to issue discovery and a subpoena is just one part of discovery.

What happens after you get the identifying information from the ISP? Do you attempt to negotiate with each and every one of the alleged infringers?

Yes, we attempt to reach out to everybody. We get a certain small percentage of people who say, ‘Hell no, we’re going to hire an attorney and fight it,’ and we say, okay, that’s fine, and just proceed along. Of course, statutory figures are in the six figures, so usually that’s just bravado on their part. Other people want to work something out or begin a process of verifying the information that we have, and we understand that, too. People want to make sure about their chances of winning (or losing) before entering into a settlement. We’ll always work with people. Just the other day, a guy said, ‘Okay you got me, but I don’t have the money to pay you off in one lump sum, can I pay it off in three payments?’ We said, sure. We want to minimize the effect of this on everyone. Even if they brought it upon themselves, there’s no reason to make a mountain out of a molehill.

You mentioned six figures? Are most of the targeted people multiple offenders or are some of them people who downloaded once or twice?

First, I would bet—though I don’t have any proof—that everyone we’ve gone after is a multiple offender, but we only go after people for one violation that we have caught them doing. There are certain statutory damages that are allowed under U.S. Copyright law, and the damages can go up to $150,000. But there is a range [of fines], and in the end it depends on the judge and the judgment and a lot of factors, but it can go up that high.

How seriously do you take the security of the data or identifying information of accused illegal downloaders? I’m thinking of the British law firm in trouble for allowing similar information to be stolen by hackers.

I would first say that to the extent that any law firm doesn’t protect the data in keeping with whatever statute there is, they are liable for bad conduct. I don’t necessarily blame them for having their data stolen because obviously that happens to a lot of companies. But yes, we take data security very seriously, and we protect the data that is sent to us to the best of our ability. 

Do ISPs send you the information about these people in encrypted form?

No, they usually do not. There is no requirement that I am aware of that they have to do anything other than simply mail us the information. We get much more incriminating information from other lawsuits all the time. Besides, the name and phone number of someone who has an IP address is just one little piece of the entire evidence puzzle.

What about the people who simply deny that it was them doing the downloading, or that you got the wrong IP address, or that sort of thing?

We are not like the recording industry in that we get a lot of false positives; in fact, I don’t believe we’ve had a single one. Our software is very advanced; it’s all customized and proprietary, so we have an amazing amount of incriminating data and information about each one of the people we’re going after. By the time we have had a conversation with these people, they have long since stopped denying that they did it, let’s just put it that way.

On another note, I read a study recently that said 99 percent of all BitTorrent content is illegal, so I have a real problem when people say they didn’t know it was illegal, or people saying we’re picking on people downloading. It’s like the Napster argument. We all know that when you get a hundred million dollar movie like Batman for free because you went to this sketchy looking website that didn’t have anybody’s ownership on it, you know that’s not legitimate. If you’re going to argue that you didn’t know, you’re like the guy who gets pulled over for speeding and says he didn’t know. Well, too bad, you were speeding, and our legal system says that ignorance is no defense.

I’ve had a lot of conversations with people who have called the office and said, ‘Oh, this is what happened, my son downloaded it, or whatever.” Well, the court system here thankfully puts the responsibility on the car driver for the purposes of speeding tickets, and on the owner of the ISP account for the purpose of illegal downloading. In almost all contracts with internet service providers, people promise not to engage in illegal activity with the bandwidth that the ISP provides them, and the ISP then gives them dynamic IP addresses that change every two days or so.

The technology sounds new. Are these basically test cases for the effectiveness of your technology in court?

All I can say is that the technology we have does make it practically impossible to have a false positive, but obviously the details are a trade secret. Regarding whether or not the evidence will hold up in court, our research and experience shows us that because of the way it is compiled and the way the data is grabbed from the defending party, we don’t see how there could be any argument to exclude it. Obviously, if the evidence is excluded, we don’t have much to present to the court that the person is a defender, but thus far the courts have ruled in our favor on almost every issue relating not only to our evidence but also our right to find out the identities of the offenders.

Why are all of these adult cases happening now?

I think part of it is that there were some decisions handed down in the District of Columbia that made it easier for these lawsuits, but I also think the technology has caught up with the problem. It took us nine months to develop our software, but since the beginning of the year we’ve realized that for the first time the legal precedent exists to be able to go after multiple John Does at the same time, and also to obtain their information through the ISPs.

Once we made the porn studios aware that we might be able to assist them, it was basically the beginning and end of our marketing effort, because quite frankly I doubt I go three days without a studio asking us to work with them. We haven’t made a call to a studio since the first week that we started working on this project.

What is your strategy with respect to naming alleged infringers publicly?

Well, as you know, we are only naming people in the lawsuits as anonymous John Does. We don’t put any person’s real name in there until it becomes apparent that we can’t work anything out. My attitude is, let’s try to resolve this with the least amount of litigious behavior. I was just speaking to someone yesterday and he said, ‘Look, I want to resolve this, I work with the Boy Scouts, I didn’t download anything inappropriate or illegal.’ He didn’t want to deal with the problem and have to hire an attorney, and we were able to resolve the issue and come to a resolution. In that case, no one is ever going to know his name other than our staff, and we much prefer that, because we don’t think anyone is served by losing their job or being ridiculed or whatever.

At the same time, if our clients have had content stolen from them and they lost money because of it, we have to protect their rights. I think it’s a balancing act between making sure people are not embarrassed but also make sure our clients don’t go out of business, because it’s a free-for-all right now on the internet.

Do you recognize that there are some people in the industry who don’t agree with the tactic of suing people who watch porn, using basically the same argument the music industry faced when it started suing illegal downloaders?

Yes, of course, I’ve heard this argument made a lot, but I have to respectfully disagree with the people who say we’re going after [the industry’s] customers. People who are very comfortable using BitTorrent and taking content for free are not going to ever pay for it. Our research is very clear on that point.

Our argument is very basic. We believe that using Torrent sites to watch copyrighted content is theft, and we are just going after the people who do that so they can compensate our clients for stealing something. It’s like we’re going after a car thief. We don’t care that it’s a car that’s a certain color or brand; we’re going after him because he stole a car.

There are also a lot of people in the mainstream who don’t believe in going after end-users, because it somehow lessens the freedoms inherent in the internet.

In fact, it is by allowing pirates to simply bankrupt or at least cripple this entire industry that reduces freedoms by preventing the law-abiding citizen from getting access to content. At this rate there won’t be any high quality, high-definition porn, but only recycled stuff from the 80s and 90s, because it will no longer worth it to make new movies.

What about the claim that was made in the Yahoo! News article that implied you want to shame illegal downloaders publicly for the type of content they are watching as part of the strategy to get them to settle?

I think it’s muddying the water to say that we’re trying to shame someone; it’s an effort to take people’s eye off the ball, because at the end of the day unless you can confuse people it boils down to the fact that someone stole something that wasn’t theirs. And that’s something that I think people can understand, and certainly so far the judges have no problem understanding that. Quite frankly, I’m surprised at how fair the judges have been. I have absolutely never felt in any of these cases that the judges were not giving us the full protection of the law because of who we happened to represent.

Here’s how we look at the issue. Some of our producers make content that some people may not feel is mainstream content, such as transsexual content. But our clients believe in their content. They’re not embarrassed by the fact that they make it, and they’re certainly not embarrassed that people come and pay them for it. But I do think that any upstanding citizen would and should be embarrassed to go into federal court to defend illegally downloading Titanic, because he committed a crime and if he gets a judgment against him and works at a bank or for the government, he could have trouble at his job. So there’s always an embarrassment factor when you’re caught breaking the law and that’s what we’re going after.

In the larger sense, I can’t speak to what a downloader may or may not feel embarrassed about because when I download porn I’m not embarrassed about it at all. I did it, I want to watch it and if you don’t like it, well, I guess you don’t have to be my friend. I would be personally offended if someone were to come to me and say, John, you can’t watch transsexual content. Excuse me, but we’re in the United States. I want people to have complete freedom.

I just think it’s important to get back to the basic issue here. We have to prove that these people stole something. If we make an allegation in federal court that we have no way of proving, we’re going to get in a lot of trouble. So the accused is defending himself on an action that we have a lot of evidence that he did. If he’s that embarrassed about downloading porn, then maybe he shouldn't do it, but that’s a separate issue. The fact is, I don’t care what he downloaded. If he downloaded Rosetta Stone to learn to speak Spanish; if he downloaded Titanic; if he downloaded transsexual porn; if he did any of these downloads illegally and he’s caught, he should be punished according to the U.S. Copyright statutes.

In light of your success in the courtroom thus far, do you expect to hear from any mainstream studios?

We actually have received a couple of calls from studios out in California, but we’re not sure if we’re going to go in that direction. We are very busy right now with the clients we have, and I’ve always believed it’s dangerous to worry about your next client and not about your current client. But yes, our technology would allow us to go after any illegal downloader of anything, and the only limiting factor would be our ability to scale up.

So why do you think some law firms—like the one litigating The Hurt Locker case—are having more difficulties than you are? A federal judge in South Dakota just blocked their attempt to get information from ISPs in the state. 

A part of that may have been about how they went about doing it. Litigation doesn’t have to be about shouting at one another and being hostile. If you go to third parties that are just trying to make money providing internet service or whatever, and you act like a jerk with them, they may not like that. We try to work with third parties and don’t see the upside in threatening them or throwing lawsuits around at the people we need as partners in this. I mean, I don’t think ISPs want to be a conduit to massive bandwidth usage for illegal purposes because they would then have to increase their infrastructure. Illegal downloaders hurt ISPs as much as anyone else. So we point that out to them, and say, if you lose one tenth of one percent of the people who are mad because we’re suing them, you’re also going to get rid of 80 percent of your client problems, at which point you can send us a thank you card.