Legal Stuff

American Liar

21 January 2015

From Salon:

Chris Kyle, author of the runaway best-seller American Sniper, was a military hero who killed 160 people during his four tours of duty in Iraq and is now the subject of an Oscar-nominated blockbuster. He was also a fabulist. Before his tragic murder in 2013, Kyle told a number of extremely dubious stories.

. . . .

But it wasn’t these fantastical tales of vigilante justice that got Kyle into legal trouble. It was another, much less exciting story—one that wasn’t just unverifiable, but verifiably false. That tale, conveyed in a mere three pages of American Sniper, has put Kyle’s widow on the hook for $1.845 million in damages. And it may soon make Kyle’s publishers wish they approached the veteran’s claims with great deal of skepticism.

Kyle’s legal difficulties emerged from a subchapter of American Sniper titled “Punching Out Scruff Face.” In it, Kyle describes beating up a former Navy SEAL (“Scruff Face”) after the SEAL claims American soldiers deserved to die in Iraq. Early drafts of the book identified the SEAL as Jesse Ventura, former governor of Minnesota and famed professional wrestler, but Kyle’s publishers removed the name for fear of a lawsuit. Nonetheless, in a radio interview following the book’s release, Kyle admitted that “Scruff Face” was Ventura, and he repeated the claim soon after on The O’Reilly Factor.American Sniper shot to the top of Amazon’s best-seller list, becoming a smash hit for its publisher, HarperCollins, selling more than 1.5 million copies by July of 2014.

There was, however, a problem: The Ventura story wasn’t true, and Ventura meant to prove it. So he took Kyle to trial, suing him—and, after he died, his estate—for defamation and unjust enrichment. In the United States, defamation cases are extremely difficult to win, thanks to the First Amendment. When allegedly defamatory statements pertain to a public figure, the plaintiff mustn’t just prove those statements were false. He has to prove the defendant made those statements with “actual malice”—that is, knowledge that they were false—or with “reckless disregard” for their falsity. Very few defamation plaintiffs can make it over the high bar of actual malice.

Ventura made it. On July 29, 2014, a federal jury returned from six days of deliberations to award Ventura $1.845 million in damages—specifically, $500,000 for defamation and about $1.345 million for unjust enrichment. (In other words, Kyle unjustly profited from defaming Ventura, and so his estate must give Ventura some of that money.)

. . . .

For the Kyle family, then, the legal tribulations surrounding American Sniper are probably wrapping up, and Taya Kyle will likely pay some damages but walk away from the affair with many millions of dollars left to her name. ​(HarperCollins’ libel insurance, in fact, will cover her defamation damages.) But for Kyle’s publisher, HarperCollins, the nightmare is just beginning. Several months after the verdict against the Kyle estate, Ventura brought another lawsuit for unjust enrichment, this time against HarperCollins.

. . . .

During the first trial, Ventura’s attorneys uncovered records of HarperCollins’ negligence in fact-checking Kyle’s book, as well as evidence that HarperCollins specifically touted the Ventura story to drum up publicity. Kyle’s ghostwriters spoke with only one person who claimed to have witnessed the fight, a friend of Kyle’s who told a different version of the story that lacked Ventura’s offensive remarks. No one from HarperCollins contacted Ventura or his representatives to verify the story. And though Kyle claimed Ventura appeared at a SEAL graduation afterward with a black eye—where “everybody was laughing” and asking “Who beat the shit out of him?”—HarperCollins never asked a member of the graduating class whether they saw Ventura’s injury. (A photograph from the event shows a clear image of Ventura—with no black eye.)

It gets worse for HarperCollins. Despite the tenuous source of the Ventura story, HarperCollins quickly saw it as a publicity gold mine. After Kyle identified “Scruff Face” as Ventura in a radio interview on The Opie & Anthony Show, HarperCollins editor Peter Hubbard wrote in an email that the publicity from the story was “priceless.” HarperCollins publicist Sharon Rosenblum described the Ventura kerfuffle as “hot hot hot,” immediately arranging for Kyle to retell the tale on The O’Reilly Factor. Sales of American Sniper—which, up to that point, were fairly modest—spiked dramatically, apparently in conjunction with interest in the Ventura story. After theO’Reilly appearance, Ventura publicly denied Kyle’s accusations. Yet Rosenblum arranged for Kyle to tell the story again on The Opie & Anthony Show, and HarperCollins printed several new editions of the book that still featured the “Scruff Face” section. (It was finally removed after Ventura won his suit.)

Link to the rest at Salon and thanks to Matthew for the tip.

A few points:

  1. Under standard Big Publishing contracts, Kyle would be responsible for paying any and all expenses of HarperCollins in the Ventura suit, including any damages HC pays to Ventura.
  2. If the article is true, it appears that Kyle’s attorney had HC add a provision to the contract that named Kyle as an additional insured under HC’s publisher’s liability insurance policy. This is always a good idea, but something most publishers won’t do without being asked.
  3. Even with the liability insurance policy in place, most such policies include a large deductible – $500,000 – $1,000,000 deductibles are typical. Under a standard Big Publishing contract, Kyle would be responsible for paying the deductible.
  4. Boilerplate in most Big Publishing contracts gives the publisher the right to have an attorney conduct a pre-publication legal review. The author is required to change anything the lawyer finds problematical. PG hasn’t read whether or not such a review was conducted in this case. Given that the book referenced living persons and their behavior, it would be an extraordinarily bad decision for HC not to have conducted such a review. If anyone sees a news account that mentions whether a legal review was conducted or not, please send a link to PG via the Contact Page.
  5. The publishing contract provisions PG mentioned are typically contained in a section called something like Warranties or Warranties and Indemnities. Most authors tend to breeze through such provisions (in part because they’re really boring), but this story demonstrates that every part of a publishing contract has consequences.
  6. In PG’s prodigiously humble opinion, the warranties required of authors in most publishing contracts are among the most unfair provisions in those contracts.

I Am Being Sued for Nearly $500,000 by a Model I Photographed

13 January 2015

From PetaPixel:

My name is Joshua Resnick. I am a stock photographer, but what I am going to tell you potentially affects all photographers. I wanted to bring to your attention a lawsuit I am involved in that I think could put the whole industry at risk if things don’t go well.

I am being sued in federal court for hundreds of thousands of dollars by a model I worked with in January 2013. This is a model that I paid, and who signed a release allowing me to sell her images through stock photo agencies. Why I am I being sued? It revolves around images that got misused or were just outright stolen and the model is blaming me for it.

It seems that many of her pictures ended up on erotic book covers, escort ads, and strip club ads. To my understanding she is claiming I either sold these directly to these people or through Shutterstock. As for myself, I only sold her images through a stock agency with a terms of service that did not allow pornographic/defamatory use — I have never sold an image of hers directly to someone.

The images I took were also posted by the model on her Facebook page, and eventually I even found pirate sites giving away the images for free. So it is very possible these misuses could have been from her Facebook or from those pirate sites, and it is also possible someone could of bought the image from an agency but potentially broke the TOS. I don’t know exactly what happened yet, but that’s my best guess.

. . . .

If they had not ignored my side of the story, here is what they would have reported: the model was an experienced lingerie and implied nude model, appearing on a magazine cover in such apparel. I told her agent before the shoot it would be used for stock photography.

During the shoot I also told the model that the images would be for sale for stock photography and explained how stock photography works. I explained to her that these agencies prohibit pornographic use in their terms of service.

Link to the rest at PetaPixel and thanks to India for the tip.

gov.uscourts.ohnd.209347.1.0

Authors Guild Gives Up Trying To Sue Libraries For Digitally Scanning Book Collection

12 January 2015

From TechDirt:

Back in June we wrote about how the Second Circuit appeals court totally demolished the Authors Guild’s arguments against a bunch of university libraries for scanning their book collections digitally, in order to enable better searching of the contents. The lawsuit was against Hathitrust, an organization set up to manage the book scanning program for a group of university libraries. In 2012, a district court said that what the libraries/Hathitrust were doing was obviously fair use and the appeals court re-enforced that strongly. The Authors Guild is basically giving up in this case, saying that should the libraries change their practices, it may want to revisit the issue. But for now, it’s giving up the case while “reserving” its position.

This is hardly a surprise. However, while it’s given up on the Hathitrust case, the case against Google for basically the same thing is still ongoing. And, yes, it’s so far lost there as well.

Link to the rest at TechDirt

Jesse Ventura goes after ‘American Sniper’ publisher now

18 December 2014

From TwinCities.com

With a win against the estate of late Navy SEAL sniper Chris Kyle behind him, former Minnesota Gov. Jesse Ventura now has his sights on HarperCollins, the publisher of the bestselling memoir “American Sniper.”

Ventura filed a lawsuit Monday against the New York publisher, alleging the publicity generated by the book with a “false and defamatory” segment “substantially increased sales of ‘American Sniper,’ thereby generating millions of dollars in revenues and profits for Harper Collins.”

HarperCollins does not comment on pending litigation, a spokesperson said Tuesday.

A federal jury in St. Paul found in July that a segment of the book — about an alleged bar fight in California between Kyle and “Scruff Face,” later identified as Ventura — was false and defamatory.

The 8-2 verdict, delivered in U.S. District Court in St. Paul, awarded Ventura more than $1.8 million from Kyle’s estate for harm to his reputation and unjust enrichment. HarperCollins announced soon after that it would pull the section from the book.

Two HarperCollins employees — the book’s editor and publicist — testified during the trial. They said the Ventura story was a minor element of the book that had little to do with its success.

But email exchanges showed the story, and the attention it attracted, caught the publishing company’s eye. At one point, an editor sent a link to a news article about the Ventura story, calling it “priceless.”

Other emails discussed a possible online marketing campaign that would include keywords tied to the Ventura story.

One message from the publicist said the incident “has helped the book go crazy.”

Link to the rest at TwinCities.com

PG will note that, under standard publishing contracts, the author of this book would be required to pay all of HarperCollins’ damages and attorneys fees. In this case, however, the author is deceased.

Apple faces trial in decade-old iTunes DRM lawsuit

2 December 2014

From ITWorld:

The past is coming back to haunt Apple, as a nearly 10-year-old class-action antitrust lawsuit accusing the company of trying to monopolize online music distribution is headed to trial.

The Apple iPod iTunes antitrust litigation accuses Apple of violating U.S. and California antitrust law by restricting music purchased on iTunes from being played on devices other than iPods and by not allowing iPods to play music purchased on other digital music services.

. . . .

The original January 2005 complaint in the case references a music distribution industry that no longer exists nearly a decade later. The document refers to iTunes competitors Napster, Buy.com, Music Rebellion and Audio Lunch Box, along with digital music players from Gateway, Epson, RCA and e.Digital.

The opening paragraphs of the complaint talk about defunct CD seller Tower Records.

“It would be egregious and unlawful for a major retailer such as Tower Records, for example, to require that all music CDs purchased by consumers at Tower Records be played only with CD players purchased at Tower Records,” the complaint said. “Yet, this is precisely what Apple has done.”

Apple has monopoly market power, lawyers for plaintiff Thomas Slattery wrote. “Apple has rigged the hardware and software in its iPod such that the device will not directly play any music files originating from online music stores other than Apple’s iTunes music store,” they wrote.

Link to the rest at ITWorld and thanks to BS for the tip.

Free case result publishing service offered to US lawyers

11 November 2014

From PR Web:

Online Legal Marketing announced today a new, free service for lawyers and law firms, dedicated to providing lawyers and law firms the opportunity to publish and promote their work. The new service, available now, is a Settlement, Verdict and Judgment Publishing Tool that allows lawyers and law firms to self-publish their settlements, verdicts and judgments to millions of readers online.

The Settlement, Verdict and Judgment form is entirely free for lawyers and law firms to use. The forms can be filled out online at OnlineLegalMarketing.com and are published to both the Lawyers and Settlements news stream and to the Settlements section of the Lawyers and Settlements website, usually within one day of submission. Lawyers and Settlements is a trusted Google News source, meaning the forms will also be indexed on Google News.

“We’re excited to provide this new service as we know how important it is for our readership to have access to key verdicts and settlement news, without having to pay for a subscription to a legal industry source, or having to search public legal documents,” says Stephen King, CEO of Online Legal Media.

Link to the rest at PR Web

I’m now clear to write in my world again!

5 November 2014

From author Holly Lisle:

I didn’t want to say anything about the fact that I was pursuing the removal of the non-compete clause from my contract until I heard one way or the other.

I got the news today. The non-compete clause for my Scholastic contract is dead,and I’m now free to write stories in that world again.

Link to the rest at Holly Lisle:Writer and thanks to PD for the tip.

Here’s a link to Holly Lisle’s books

Class Action Suit against Harlequin by its Authors Moves a Step Forward

23 October 2014

PG has just learned that the judge hearing Keiler et al v. Harlequin Enterprises Limited et al, a class-action suit brought by a group of Harlequin authors against HQ alleging a massive underpayment of royalties, has formally certified the authors as a class.

This means that the lawsuit, which was previously dismissed then reinstated in part by an appellate court, can move forward.

Here’s the order docket entry:

U.S. District Court

Southern District of New York

Notice of Electronic Filing

The following transaction was entered on 10/23/2014 at 3:00 PM EDT and filed on 10/16/2014

Case Name: Keiler et al v. Harlequin Enterprises Limited et al
Case Number: 1:12-cv-05558-WHP
Filer:
Document Number: 49

Docket Text:
STIPULATION AND ORDER REGARDING CLASS CERTIFICATION:… Pursuant to stipulation of the parties, and based on the allegations in the Fourth Claim for Relief of the First Amended Complaint filed November 5, 2012 (“Complaint”) and submitted by proposed class representatives Barbara Keiler, Mona Gay Thomas, and Linda Barrett, the Court hereby certifies the claims and issues in the Complaint for class treatment under Fed. R. Civ. P. 23, as more fully set out in this Order. When fashioning an order under Rule 23, the Court must satisfy itself that the prerequisites of Fed. R. Civ. P. 23(a) have been satisfied… Once the prerequisites of Fed. R. Civ. P. 23(a) are satisfied, a class action may only be maintained if the action falls within one of the categories enumerated within Fed. R. Civ. P. 23(b)… Accordingly, the Court makes the following findings and conclusions as stated herein. THE COURT HAVING READ AND CONSIDERED the Stipulation of the parties, and finding that the requirements of Rules 23(a) and (b) are satisfied, IT IS HEREBY ORDERED that the class is certified, defined as follows as set forth herein. IT IS FURTHER ORDERED that Barbara Keiler, Mona Gay Thomas, and Linda Barrett are designated as Representative Plaintiffs for the class; IT IS FURTHER ORDERED that DavidWolfLaw PLLC and Boni & Zack LLC are appointed Class Counsel; and IT IS FURTHER ORDERED that Class Counsel are directed to submit within thirty (30) days of the entry date of this Order, a proposed plan concerning Notice of Pendency of Class Action to be given to the members of the class. (Signed by Judge William H. Pauley, III on 10/16/2014) (ja)

 

It’s not the end of the lawsuit, but, as mentioned, this is a major step forward for the authors.

The class covers authors from the US, Canada, UK, Republic of Ireland, Australia and New Zealand who signed standard HQ publishing contracts between 1990 and 2004 that included the following language in the All Other Rights clause:

On all other rights exercised by Publisher or its Related Licensees
fif typercent (50%) ofthe Net Amount Received by Publisher for
the license or sale of said rights. The Net Amount Received for the
exercise, sale or license of said rights by Publisher from a Related
Licensee shall, in Publisher’s estimate, be equivalent to the amount
reasonably obtainable by Publisher from an Unrelated Licensee for
the license or sale of the said rights;

Which contracts also provide that New York law will apply and include no arbitration clause. The class covers those authors whose works have been published as ebooks.

The full order is set out below (click the four-arrows box in the lower left corner for a larger version):

 


HQ Order (Text)

The exciting world of the TRO

23 October 2014

From author Courtney Milan:

A brief recap of where we are in the EC/DA litigation.

  1. Jane wrote a post about Ellora’s Cave and whether it continues to be a viable business.
  2. As a result of that post, Ellora’s Cave filed suit against Dear Author, alleging defamation. EC also asked for a temporary restraining order (“TRO”) against Jane. (Note that I use the words “Jane” and “Dear Author” throughout to refer to the defendants.)
  3. There was an initial, brief hearing on the TRO in state court, at which point the state court decided that evidence would need to be presented. That hearing was set for October 27th.
  4. On October 20th, Dear Author removed the case to federal court on diversity jurisdiction grounds. (Diversity jurisdiction basically means that if one party is from one state and the other party is from another state, and there’s a lot of money at stake, parties can choose to go to federal court instead of state court.)
  5. EC again refiled its motion for a TRO in federal court.
  6. The TRO hearing in federal court is set for October 29th at 1:30 PM.
  7. Last night, Marc Randazza, Jane’s lawyer, filed an opposition to the motion, alongside seven exhibits (Exhibit A, from Jane, with a correction regarding the name “Red Rose Publishing”; Exhibit B, from an editor;Exhibit C, from an author; Exhibit D, from an author; Exhibit E, from an editor; Exhibit F, from an editor; Exhibit G is a true copy of tax liens and Workers’ Comp liens against EC.)

This blog post discusses the memos in support and in opposition to the motion for a temporary restraining order.

. . . .

Here’s my take:

  • On the basis of the exhibits currently available to the court, someone has to be lying.
  • In general, I think a judge would be extremely unlikely to squelch speech at this stage when there exists evidence from multiple people stating that the blogpost is substantially truthful.
  • EC is missing proof of a vital part of their case–namely, that Jane acted with actual malice–and I don’t know how they will ever be able to prove it, but they seem to think that proving that Jane dislikes EC is proof that she acted with actual malice. No.

. . . .

I said on Twitter the other night that there’s a difference between a good lawyer and a merely competent one, and that the lawyer for Ellora’s Cave (I refer to the party and the lawyer as “EC” throughout) has all the hallmarks of being competent, while Marc Randazza is a very good one.

. . . .

This is a perfectly competent motion for a TRO. It is also an exceedingly sloppy motion for a TRO. (In fact, when I first read Randazza’s opposition, I thought there were some sloppy elements in construction—but when I went back and looked at things from start to finish, any sloppiness in his opposition is due to the fact that the underlying motion is fundamentally sloppy to begin with. Slop begets slop.)

What do I mean by sloppy? Well, if you’re going to enjoin someone from engaging in conduct, you should really be very, very specific about what it is that you want them to do. For instance, if you’re seeking a restraining order against a vindictive ex, you want that restraining order to say things like, “Don’t come within 50 feet of me,” and “stop calling me at work.” You don’t want to say, “stop being a bad person” even if you want them to stop being a bad person, because what does that even mean?

On its face, this is a motion for a “stop being a bad person” kind of restraining order.

. . . .

Part of the problem is that the attorney for EC appears to be use the word ‘publish’ in a way that does not track typical usage. The blog post in question was published. It is not currently “being published” as anyone understands that word. The act of publication is not continuous: It was published once, it does not need to be continually republished day after day in order to persist, and so if you want it taken down, you should ask for only that. If you ask for someone to not publish things in the future, you’re actually asking to track everything they might say in the future. Is this what EC really wants?

. . . .

There are other things that a good opposition to a preliminary motion will do.

  1. It will explain the law to the judge and tell him where he can verify that the lawyers are telling the truth.
  2. It will explain the facts (and in so doing, paint a vivid picture of who/what/where/when/why).
  3. It will explain how the facts apply to law, and in doing so tell a story of the litigation at present.
  4. It will immediately sum up the litigation and give the judge a working explanation for what is going on.
  5. In some cases, it will also educate opposing counsel about things they do not appear to understand.

In this instance, there’s a sixth goal. Technically a motion for a TRO is not the same thing as a trial on the merits. You could win on the merits and lose a TRO. You could lose on the merits and win a TRO. But realistically a TRO hearing is kind of a mini-merits trial in the sense that it gives the parties an idea of whether the arguments will sink or swim. If the judge agrees with Randazza and says, “I cannot see how Ellora’s Cave has a prayer of a chance of prevailing on the merits,” that sends a certain message to opposing counsel. So another goal is to win the mini-trial, because that could influence whether the opposing party decides to continue with the lawsuit or dismiss it. Just about any case with a TRO contains a little dance to this effect: “Yes, this isn’t a real trial on the merits, but we all know that this could easily decide the case. We are going to pretend it won’t because reasons, but it usually does. So.”

. . . .

Now, finally, we get to the opposition motion. This is the first chance that Randazza has to introduce the concept of Dear Author and what it means to the romance community. He does. He explains that Dear Author “has become a respected source for news and information for the romance novel community.” He immediately positions Jane as a reporter who investigates facts. He talks about the things she has accomplished in the community–as being someone who provides information to authors without a legal background, and who lets them know what will happen in scary situations, and simultaneously as someone who provides a springboard for discussion of those issues.

(I’m glad that this was included as background, because up until this point, there has been little discussion in the case itself of what the DA community is and does–and there’s no way a federal judge will understand that unless it’s explained up front. Like it or hate it, there is a DA community, and it provides a place where authors and readers can discuss the changing publishing industry and what that means at large. The remedy that EC asks for would have a huge effect on that community.)

. . . .

Randazza sums up the litigation—including showing that he’s aware that EC has a motion on its face and a shadow motion that it might be trying to make instead—with this: “Ellora’s Cave is understandably concerned about any negative view of its business, but it has no right to ask this Honorable Court to use its equitable powers to suppress the truth, to suppress fair comment, and to suppress future unknown statements. The First Amendment protects [Jane’s] right to publish on matters of public concern, and her mission mandates that she share her findings with the author community. Given that her writing is a matter of public concern, about a public figure, [Jane]’s First Amendment rights are given an exalted position – one which makes sustaining a defamation claim against her in this context a virtually impossible task.”

Link to the rest at Courtney Milan

Here’s a link to Courtney Milan’s books

Courtney does an excellent job of discussing both sides of this litigation and the underlying law. PG will add that sometimes good attorneys are made to look not so good because they have problem clients.

So you have everything in the same place, PG has inserted Dear Author’s Opposition Motion and all of the Declarations below. A Declaration is a written statement summarizing what the person making the declaration would say if called to testify in court.

If you click on the box with four arrows in the lower left corner of each embedded document, it will open to a larger size.

 


Opposition Motion (Text)

.
.


EC Declarations 1 (Text)

Ellora’s Cave vs. Dear Author Suit Removed to Federal Court

22 October 2014

PG has previously posted about the lawsuit that Ellora’s Cave filed against Dear Author and its proprietor, alleging that Dear Author had defamed Ellora’s Cave in a blog post describing EC’s financial problems.

Dear Author has just removed the case from the Ohio state court where it was originally filed to the relevant U.S. District Court in Ohio claiming diversity jurisdiction is present in the case.

PG will not discuss diversity jurisdiction in detail because it’s pretty boring, but, in a nutshell, if a party (individual, corporation, etc.) sues a party that is a citizen of another state and the amount in controversy is more than $75,000, the defendant has the right to remove the lawsuit to federal court. Wikipedia has a mostly-correct discussion of diversity jurisdiction in layperson’s terms if you want more.

There are a wide range of reasons that a defendant might want to remove a lawsuit to federal court, but, as a general proposition, many attorneys feel that the quality of federal judges and magistrates may be higher than that of state judges (although PG will attest to exactly the opposite being the case on many occasions) and that some state court judges may tend to give the benefit of the doubt to a local litigant (ditto for exactly the opposite).

At a minimum, this indicates to PG that Ellora’s Cave will have a real fight on its hands. He is not familiar with Ohio laws and practices, but many federal courts have the reputation for not putting up with a lot of smoke and mirrors on the part of parties or their attorneys. In prior litigation in state court, EC reportedly was extremely dilatory in responding to requests for financial documents, etc. PG would not have wanted to try to defend such behavior in most of the federal courts where he appeared in past years.

An upset federal judge sitting in his/her court can be an intimidating presence.

Here’s the Notice of Removal:



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