As we discussed two years ago, Righthaven LLC was set up to acquire copyrights from various entities and then sue alleged infringers who used any or all of the copyrighted works. In particular, Righthaven purported to obtain assignments from the Las Vegas Review-Journal. However, these assignments were nothing more than a bare right to sue with restrictions. Righthaven obtained no right to exploit the copyrights or obtain any royalties. Instead, the paper retained essentially every meaningful right associated with the copyright, including an exclusive license, the right to veto any potential copyright litigation, the right to receive proceeds from any litigation, and the right to revert ownership back to itself should it choose.
Nonetheless, Righthaven proceeded to sue hundreds of individuals who used some or all of these copyrighted works. Eventually, as the result of discovery and inquiries by the Court, the true nature of Righthaven’s rights became apparent. At that point, the District Court determined that Righthaven was not, in fact, the true owner of the copyright and dismissed Righthaven’s copyright claims. Righthaven appealed this determination to the Ninth Circuit, which affirmed.
Under the Copyright Act, only the “legal or beneficial owner of an exclusive right under a copyright” has standing to sue for infringement. 17 U.S.C. § 501(b). An assignment of a bare right to sue is not sufficient to confer standing. To determine whether a party has sufficient exclusive rights, courts are to look at the substance and effect of any contract purporting to assign ownership, rather than the words or labels given by the parties.
In this case, the Ninth Circuit found that Righthaven held none of the exclusive rights typically associated with a copyright owner. Instead, it only had a bare right to sue, which was insufficient to confer standing.
With this finding, it appears that the Righthaven experiment in copyright trolling is over. It will be interesting to see if others take up the mantle or whether this was a fleeting experiment.