from the troll-defeated dept

It’s been whereas since we’ve had an old school copyright troll nonsense story round right here, and boy do we have now a doozy for you immediately. Common Techdirt readers know that we’ve lined Paul Levy’s work for years—the person who the Washingtonian as soon as dubbed “the web bully’s worst enemy” has been taking down copyright trolls with surgical precision for over a decade. However this newest victory in opposition to Ready Meals Pictures could also be his most full evisceration but.

The quick model: a copyright troll that has been shaking down small companies for years with fraudulent claims about its licensing charges simply needed to pay its personal goal to make a lawsuit go away. And within the course of, Levy has doubtlessly opened the door for a whole lot of earlier victims to sue for fraud. It’s lovely. And that’s not even revealing the entire juicy bits.

Let’s dive into the scrumptious particulars, courtesy of Levy’s characteristically thorough (and thoroughly entertaining) write-up on the case.

Ready Meals Pictures (PFP) has been operating a basic copyright troll operation for years. The corporate would discover companies utilizing inventory photographs, then ship threatening demand letters claiming large damages based mostly on their supposed “$999 per thirty days minimal” subscription payment. Small companies, fearful of federal court docket litigation, would pay up fairly than combat.

There was only one drawback: it was all a lie.

And someway, Ready Meals Pictures and its copyright trolling partner-in-crime, “CopyCat Authorized,” didn’t appear to suppose anybody would ever uncover that through the course of litigation. Oops.

Greater than two years after Prepared Food Photos sued Pool World in federal court docket in Spokane Washington, alleging {that a} retailer had infringed Ready Meals Pictures’ copyright in a inventory photograph of greens on a grill, Ready Meals Pictures has agreed to pay Pool World for its consent to dismissal of the motion.  Pool World agreed to maintain quantity of the fee confidential.

You learn that proper. The troll needed to pay the goal to permit it to dismiss the case. You realize issues are going badly when that’s the consequence. But it surely will get so a lot better.

As I defined in my most up-to-date weblog put up, the declare of a $999 per thirty days minimal, and therefore the argument that Ready Meals Pictures was entitled to $11,988 in precise damages for every year of alleged infringement, was a rip-off. (Certainly, we discovered lately that, for a time period in 2019, PFP was even providing a subscription to its whole database of photographs for as little as $29.99 per month, a proposal restricted to small retailers with not more than three areas)

So, sure, they have been claiming a $999 per thirty days minimal whereas really charging some prospects $29.99? That’s not simply aggressive litigation — that’s straight-up fraud.

What makes this case so satisfying is how methodically Levy dismantled PFP’s whole enterprise mannequin by way of discovery. The corporate tried each trick within the e-book to keep away from having to supply paperwork that will expose their lies:

Ready Meals Pictures continued to delay the litigation, first by way of dragged out mediation about which it was by no means critical, then shifting to dismiss the swimsuit whereas paying solely taxable prices, which we  successfully opposed  on the bottom dismissal would deprive Pool World of its entitlement to hunt an award of legal professional charges.  After that motion was denied, Ready Meals Pictures stalled on document discovery searching for to point out that many of the subscription agreements have been entered to settle claims of previous infringement.  After our movement to compel that discovery was granted, Ready Meals Pictures produced monetary information that have been heavily redacted. The unredacted paperwork had to be compelled by a movement to implement the sooner discovery order. Then, on the eve of depositions, they needed to be cancelled. the primary time as a result of Ready Meals Pictures represented that its fundamental witness had had a family crisis that prevented her from touring,  and the second time, three months later, on the bottom that its president had been hospitalized. In some way, there was at all times a cause why Pool World couldn’t cross-examine PFP’s witnesses.

Traditional troll habits—they’re nice at threatening individuals however horrible after they really need to defend their claims below oath.

When the paperwork lastly got here out, the scope of the fraud turned crystal clear, and PFP’s attorneys began to backtrack.

However in meantime, we have been in a position to receive adequate discovery to serve a motion for Rule 11 sanctions, which compelled Ready Meals Pictures to amend its criticism. Initially, Ready Meals Pictures initially proposed to amend in a approach that maintained its fiction of a $999 per thirty days minimal, see Exhibit AAA in this document, however after we warned PFP’s lawyer that such an modification would nonetheless be inclined to a Rule 11 movement, PFP amended to drop both the allegation that it had been charging a minimal of $999 per thirty days, and the allegation that its fundamental enterprise was creating fantastic pictures and licensing entry to such pictures. 

They needed to actually rewrite their criticism to take away the lies. After which they needed to cope with some pretty uncomfortable information in court docket:

Regardless that depositions continued to be postponed, our doc discovery enabled us to maneuver for abstract judgment, displaying more than a hundred undisputed facts that painted an unflattering portrait of Ready Meals Pictures. These included that (1) many of the work achieved by Ready Meals Pictures workers entailed looking for alleged infringers and making infringement claims, (2) that roughly 95% of Ready Meals Pictures’ revenue comes from threatening and bringing copyright infringement claims, (3) that Ready Meals Pictures was not authoring any new pictures – in different phrases, that Ready Meals Pictures is a basic copyright troll.

The undisputed information additionally established that Ready Meals Pictures had been securing this enforcement revenue (4) by mendacity in demand letters and court docket filings about its subscription insurance policies and (5) through the use of intentionally misleading and coercive statements meant to intimidate the recipients of its demand letters and lawsuits into paying extreme settlements far in extra of the extent of damages that Ready Meals Pictures may moderately count on to get well in contested litigation with educated counsel on the protection aspect.

In addition they found that Getty Photographs, which the copyright holder had beforehand licensed the photographs by way of earlier than starting this trolling scheme, used to license the photographs for subsequent to nothing, demolishing the claims of damages. Neglect the $999 per thirty days and even the $29.99 per thirty days. These photographs’ licensing worth apparently was really measured in pennies.

As well as, we secured paperwork from Getty Photographs, the corporate that had beforehand licensed the photograph at concern on this case, together with some 4700 different photographs, for common license payment of a couple of greenback per use – of which Ready Meals Pictures’ predecessor Adlife acquired a tiny fraction, as little as twelve cents. THIS was the misplaced license payment that Ready Meals Pictures would correctly be awarded ought to the case go to trial.

So their whole enterprise mannequin was based mostly on lies and intimidation. It’s fairly one thing how copyright trolls at all times turn into even sleazier and extra problematic than they first seem.

The monetary comparability from after they have been licensing issues usually to after they started shaking small companies down is fairly rattling stark:

These paperwork afforded some spectacular numerical comparisons. Over the course of six years from 2010 to 2016, Adlife acquired barely greater than $11,000 per yr in complete revenue from Getty Photographs for licensing 4700 photographs (amongst them the Grilled Vegetable Picture at concern on this case), however in 2023 alone PFP bullied a single firm named “Wholesome’s” into paying $10,000 to settle a single infringement declare to be used of the Grilled Vegetable Picture. And though the documentation we secured in discovery confirmed that Ready Meals Pictures was making roughly $50,000 per yr in subscription revenue – most of it from subscriptions obtained as a part of settlements of claims for previous infringement – it was garnering much more in infringement settlements, practically two million {dollars} per yr as soon as CopyCat Authorized had begun masterminding its enforcement technique.

One settlement for a single photograph netted them nearly as a lot as they legitimately earned in a yr from licensing 1000’s of photographs. That’s some enterprise mannequin.

When Levy filed for abstract judgment, PFP realized they have been screwed:

At this level, Ready Meals Pictures blinked. An opposed ruling on the statute of limitations would have made Pool World the prevailing get together, triggering a doable software for an award of legal professional charges in a really great amount. However a ruling on Pool World’s damages argument would arguably have been much more threatening to Ready Meals Pictures, as a result of a dedication that its argument for damages within the tens of 1000’s of {dollars} per infringement was improper as a matter of regulation may have been cited as res judicata in all future instances, endangering the premise for its income mannequin.

They couldn’t danger a court docket ruling that will destroy their whole rip-off operation. So that they did what bullies at all times do when confronted by somebody who fights again: they folded and agreed to pay an undisclosed sum to get Pool Worlds to comply with allow them to dismiss the case (with prejudice, in fact). The one concession PFP was in a position to get was that the quantity they paid stays secret.

However ultimately, Pool World, the small enterprise PFP tried to shake down, ended up making them pay for the privilege of strolling away.

This isn’t only one victory — it’s doubtlessly opened the floodgates for all of PFP’s earlier victims:

Third, now that the falsity of its claims a couple of supposed $999 minimal subscription payment have been uncovered, Ready Meals Pictures is doubtlessly susceptible to countersuits by the businesses that have been tricked into paying giant settlements by the false statements in demand letters about PFP’s subscription minimal. Section 164 of the Restatement of Contracts  offers {that a} contract that’s procured by fraud will be voidable on the choice of the defrauded get together, and now that we all know that PFP was mendacity to the numerous companies that acquired the CopycatLegal demand letters in regards to the information of its subscription agreements, it appears fairly doable that companies that paid many 1000’s of {dollars} to keep away from being sued for utilizing a photograph whose market worth was just a few {dollars} might properly be capable to void their settlement agreements, then dare PFP to sue them and face the identical consequence as in Pool World, WeNeedaVacation or Jaber.

Translation: each enterprise that paid them based mostly on their fraudulent claims about subscription charges may doubtlessly get their a reimbursement and sue for extra.

Furthermore, inspection of the CopyCat Authorized ledgers exhibits that there have been a number of hundred such victims, and the quantity whose settlement fee was $11,988 exhibits that they should have been influenced by the lie a couple of $999 per thirty days minimal payment (recognized to PFP to have been false all alongside, and recognized to CopyCat Authorized to have been false as soon as it produced the subscription agreements in discovery through the fall of 2023). And, as a result of there was a standard scheme to defraud – nearly the identical letters have been transmitted on greater than two thousand completely different instances – a lawsuit would possibly properly be introduced as a category motion.

This might get very costly for PFP in a short time.

In fact, when your popularity turns into too poisonous even for the copyright troll enterprise, what do you do? Rebrand!

For the reason that starting of this calendar yr, Ready Meals Pictures has not filed a single infringement lawsuit. As an alternative, about two dozen fits over infringement of photographs within the PFP database have been filed by an organization named Rockefeller Pictures, and certainly I’ve seen numerous CopyCat Authorized demand letters over such infringements despatched within the title of Rockefeller Pictures. Though the complaints in these instances recite that Rockefeller Pictures represents the pursuits of numerous {photograph} homeowners, as far as I’ve seen, Ready Meals Pictures is the one such firm. It seems that Joel Albrizio, the proprietor of PFP, can be the proprietor of Rockefeller Pictures, and equally the officers of PFP are the officers of Rockefeller Pictures.

It isn’t clear why Rockefeller Pictures has been created, however it’s my guess that the stench of PFP’s popularity as a copyright troll has turn into so nice that Rockefeller Pictures is an try and create a brand new persona with out the identical reputational baggage. Within the circumstances, the entire defenses that doubtlessly apply to PFP will apply to Rockefeller Pictures as properly

Levy notes how this reminds him of the notorious Righthaven copyright troll whose try and sport the copyright system by successfully promoting a naked proper to sue collapsed so badly its homeowners had to sell the copyrights to one of many publications they’d sued to pay for their very own authorized charges.

Consider it or not, however there’s much more to this story that I didn’t embody right here. Levy recounts the main points of two different instances involving PFP that go fairly badly as properly, together with a PFP consultant falling apart during cross-examination, the place she has to repeatedly admit to “errors” within the declaration she signed below oath. My favourite little bit of that transcript:

Q. Now, ma’am, in that doc, you indicated that there have been — and I’m going to learn it — “For any picture,” and then you definately put in parentheses, “(together with the 16 at concern on this lawsuit),” comma, “the plaintiff photographer spent hours specializing lighting, gear and take dozens if not a whole lot of photographs.” We’re not speaking about 16 photographs. We’re speaking about one {photograph} of a pork chop; proper?

A. Appropriate.

Q. However you indicated on this affidavit that there have been 16 completely different photographs which are at concern on this lawsuit, did you not?

A. There was an inadvertent six.

Q. Pardon?

A. There was an inadvertent six that was included.

Q. However — nevertheless it’s written S-I-X-T-E-E-N. It’s not inadvertent to jot down S-I-X — S-I-X-T-E-E-N, is it?

A. No. It was an error. It’s by no means been disputed that there’s just one picture concerned.

That is the type of Perry Mason second litigators dream about. She tried to say she unintentionally added a “6” to show “1” into “16” in her sworn declaration, apparently forgetting that “SIXTEEN” was written out in full. If you’re caught mendacity below oath about primary information in your personal case, that’s often an indication your litigation technique has some issues.

Whereas Levy (and the opposite attorneys who helped him, together with Phil Malone at Stanford’s Juelsgaard Authorized Clinic and Steve Kirby) deserve huge credit score for this masterpiece of litigation, as Levy factors out, the actual heroes right here have been Pool World, which may have simply folded fairly than combat:

However the actual hero of this protection is Pool World. It may simply have paid a small tribute to resolve this case, however its proprietor and its administration have been dedicated to defending this case to the hilt, hoping to avoid wasting different small companies from the form of bullying to which Ready Meals Pictures was attempting to topic it. From my very first dialog with them, it was clear to me that they and I have been on the identical web page about why this case was value doing from a public curiosity perspective. An affidavit from business manager Pat Flynn  defined Pool World’s motivations on this case, together with the choice to not refer the case to their insurance coverage firm lest Ready Meals Pictures be paid off of their firm’s title. Pool World’s leaders by no means flinched after they needed to dedicate intensive employees time to discovery responses, or paying professional witness charges and, prospectively, paying for its attorneys’ journey bills and deposition prices.  They learn each paper earlier than it was filed to make sure accuracy.

There’s an under-discussed tidbit in there that reveals a key a part of the troll enterprise mannequin: Many authorized bullies depend on the truth that nearly any firm they sue will make a declare with their insurance coverage firm, and so they’re betting on insurance coverage firms’ risk-averse calculus favoring fast settlements over pricey litigation.

This explains why the authorized trolling enterprise mannequin is so profitable and protracted. It’s not simply preying on small companies’ lack of authorized sophistication — it’s systematically exploiting insurance coverage firms’ short-sighted willingness to maintain feeding the trolls fairly than preventing again. Pool World’s determination to explicitly keep away from their insurance coverage and combat on precept breaks this cycle.

However that is what it takes to cease copyright trolls — somebody keen to face up and combat, even when it will be cheaper to only pay the extortion payment.

Levy additionally notes that copyright trolls depend on recipients of their shakedown letters rolling over and simply paying up, as a result of copyright trolls are bullies, and bullies usually don’t need truthful fights.

Both approach, Levy’s story here’s a masterclass in tips on how to destroy a copyright troll operation. By meticulous discovery work, Levy didn’t simply win one case, he doubtlessly dismantled a whole fraudulent enterprise mannequin and created a roadmap for a whole lot of earlier victims to get justice.

And ultimately, watching a copyright troll need to pay its personal goal to make a case go away? That’s the type of poetic justice that makes all the opposite irritating copyright tales value enduring.

Properly performed.

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Corporations: copycat legal, pool world, prepared food photos, rockefeller photos


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