Litigation is always a risky endeavor. One can never be entirely sure how a judge will interpret case law and rule, and should the case proceed to trial, juries are even harder to read. Filing over a thousand lawsuits, therefore, is even riskier. Should a handful of rulings go the wrong way, it could jeopardize the numerous other cases currently in the system.
This is a dilemma faced by the RIAA in its war against suspected file sharers. The hundreds of cases filed have all proceeded along the same lines, with which most of us are all too familiar. The music industry's exit strategy from cases it deems undesirable to pursue—due to mistaken identity, poor likelihood of winning, or other factors—has been just as consistent. The record labels file for a dismissal without prejudice and everybody goes their own ways, footing their own legal bills, and no one is officially cleared of wrong-doing. Recent events may be casting a shadow over the wisdom of the RIAA's strategy.
A new tactic
One such event is yesterday's news from the world of file-sharing litigation. Faced with the prospect of having to pay attorneys' fees in cases it has no interest in pursuing, the RIAA appears to be trying a new tactic. In the case of Warner Bros. v. Tallie Stubbs, the record labels have said that they "now covenant not to pursue claims against Defendant" for copyright infringement and that the defendant's counterclaim should be dismissed.
Tallie Stubbs was sued by the RIAA last year after the trade group's investigators traced a Kazaa shared folder back to her with the help of an ISP. After what it described as "further investigation," the record labels apparently concluded that they had either misidentified her or didn't have sufficient evidence to proceed with the case, and decided to move for dismissal without prejudice. When contacted by Ars and asked the reasons behind the dismissal, the RIAA declined to comment.
But Stubbs wanted something more than a mere dismissal: complete exoneration. She filed a counterclaim seeking a declaratory judgment that she had not infringed on the record labels' copyrights. Earlier this month, Judge Vicki Miles-LaGrange split the difference. She granted the plaintiffs' motion to dismiss without prejudice while denying their motion to dismiss the counterclaim, ruling that "there are independent bases for subject matter jurisdiction over Defendant's declaratory judgment counterclaim." In other words, the defendant can seek to have her name cleared of any wrongdoing, regardless of the plaintiff's decision to dismiss.
By promising not to sue Stubbs again and keeping the dismissal without prejudice on the books, RIAA hopes to avoid the same fate it met in Capitol v. Foster (Debbie Foster is being represented by the same attorney as Tallie Stubbs) and faces in Elektra v. Santangelo: a ruling that the defendant is the prevailing party and therefore entitled to attorneys' fees. In Warner v. Stubbs, the labels are arguing that since they are promising never to sue her for infringement again, there is no need to continue the legal wrangling and the judge should therefore dismiss Stubbs' counterclaim. In other words, no harm, no foul.
In choosing this course of action, the RIAA is taking a calculated risk. Dismissing a case without prejudice while promising not to bring further legal action could be interpreted as the functional equivalent of a dismissal with prejudice. As a result, the judge may very well decide to dismiss the case with prejudice after all. She could also then dismiss Stubbs' counterclaim, as a dismissal with prejudice would mean that she is the prevailing party and leave the labels vulnerable to an attorneys' fees awards.
Last week, we noted that the RIAA found itself in a difficult situation with Elektra v. Santangelo because the judge had ruled that Patti Santangelo was entitled to a shot at vindication, either via trial or a dismissal with prejudice. If Judge Miles-LaGrange issues a ruling exonerating Tallie Stubbs of infringement, it would be a worrisome trend for the RIAA. The music industry has become accustomed to having its way with those it accuses of file-sharing, quietly dropping cases it believes it can't win. It looks as though the courts may be ready to stop the record labels from just walking away from litigation when it doesn't like the direction it is taking and give defendants justice by fully exonerating them of any wrongdoing.