The Raining Champ
The client came in sweating. She was scared. She had gotten a very official looking and threatening letter from a solo practitioner in California advising her that he held enforcement rights for a particular boxing match on cable TV. After taking the time to educate her on the potential $100,000 penalty under federal law and his willingness to sue them in Federal District Court, he graciously offered to let them off the hook if they called to discuss an amicable figure to resolve the matter. He warned, however, that he was only likely to be in this amicable frame of mind for 10 days, after which time he would call a rain of chainsaws and hand grenades down on their little restaurant (the legal equivalent of a rain of chainsaws and hand grenades, at any rate). That was September. As the business was changing hands and the permittee had retired, the letter was ignored. The attorney had not forgotten, though, and wrote to them in August to remind them that he was awaiting a check; they just had to agree on an amount to put on it. The new permittee came to me with the letters, believing it to be some kind of lawsuit.
I noted that the same person in the "Law Offices of Thomas P. Riley" had signed the letter, that he didn't have a website, and there were no other attorneys listed. While very official looking, he also was the only attorney mentioned on the letterhead. When I "googled" him, I found various generic listings indicating that he was a general practice attorney in Pasadena. His name also popped up on a website for private investigation assignments, http://www.pimall.com/nais/nl/n.cablepiracy.html. The website stated that private investigators across the country are notified of restricted cable programs; then they peruse the local papers looking for advertisements as to where the show is being broadcast. The investigators then go to the bars and take pictures. The website describes everything an investigator needs to do. Attorney Riley is described on the website as the only attorney in the country who has the rights to bring these claims. Once the materials are together, they are sent off to the attorney. According to the website, the attorney pays $250 for an affidavit, two photos, and liquor license information. The web article ends with "Good luck, or should we say 'Good Hunting.'" Attorney Riley's letter to my client's predecessor made quite clear that he had an affidavit from an investigator to back up his claim. What a coincidence!
What kind of money are we talking about here? The cost to watch the fight for residential customers is $15 or $20. The cost to show it in public was $5,000. The possible penalty under federal law for paying the residential rather than business rate, according to Attorney Riley's letter, was $100,000. Attorney Riley was willing to settle for $42,000. Nice work if you can get it. Attorney Riley got it. Interestingly, if a person broke into your business, robbed the cash register, smashed the furniture, and stole the TV, the financial penalty would be less than watching Attorney Riley's TV show with a patron.
In general legal terms, there is an old English concept called Champerty. The definition is "an unenforceable agreement by which a person with otherwise no interest in a lawsuit agrees to aid in or carry on its litigation in consideration of a share of the subject matter of the suit (as property or damages)." Champerty is frowned upon in most states. Connecticut frowned upon it in Gurski v. Rosenblum and Filan, LLC, 276 Conn. 257, 885 A.2d 163 (2005). Rhode Island frowned upon it in Toste Farm Corp. v. Hadbury, Inc., 798 A.2d 901, 905 (R.I. 2002). While there's no question in my mind that what Attorney Riley is doing is absolutely legal under the various federal intellectual property protection laws, that doesn't mean I think it's a good thing.
So what would Attorney Riley do with his claim if a target bar didn't pay? Let's lie on our backs, look at the fluffy clouds, and daydream. He's in Pasadena and I'm in Connecticut. Not likely that he'd drive to New Haven to file a federal court action. If I had to guess, and I do have to guess as we're just daydreaming here, I would think he'd refer the case to a Connecticut attorney in return for a cut of the recovery. Plenty of folding green for everyone. While I can't guess the outcome of such a lawsut, I think I would question the word of an investigator who got paid $250 to go out and look for people to sue. I might also wonder how a judge, or particularly, a jury, might feel about a web advertisement which encourages investigators to "good hunting" in finding people to sue. That cloud looks like a catfish. Did you now that catfish are bottom feeders? They live on the scum they suck from the bottom of lakes. I might also daydream about the interaction of the old English concept of Champerty and federal digital property laws. Best as I can tell from the cases, Champerty came about as buying lawsuits from the real parties offends public policy. Federal intellectual property laws, on the other hand, were developed to protect the cable rights of the very, very, very rich.
So what to do if you get a letter from Mr. Riley expressing his concern about your TV watching habits? I wouldn't know. As the client who came to see me was not connected with the bar at the time of the showing, it was not her problem. As they say, it's always raining somewhere, just not here today.