A copyright shakedown outfit lead by M. Keith Lipscomb and his German counterparts recently filed 99 Bittorent cases “on behalf” of Good Man Productions, Inc. Those lawsuits were filed in eight districts in November-December 2014, and the plaintiff alleged infringement of a direct-to-DVD movie Good Man featuring Steven Seagal:

On 1/14/2015 it came to our attention that querying Good Man Productions, Inc. information on the web portal of California Secretary of State revealed that this entity was dissolved. As soon as I reported it, the company suddenly re-appeared, albeit with a different entity number:





Naturally, we were skeptical about the fact that registering a new corporation with the same name would solve a potentially fatal problem. So I postponed further investigations pending the Certificate of Dissolution request. Now I have it (thanks to a community member who purchased a copy):

So, Good Man Productions, Inc., despite being a plaintiff in 99 cases, was voluntarily dissolved on 12/22/2014. Note that Jordan Rushie filed corporate disclosure statements in all “his” cases around that time, in one instance — two days after the dissolution.

If not for us publicizing this finding, the lawsuits would likely continue with a ghost plaintiff and its ghostly standing. Re-registration on 1/15/2015 was meant to mend the situation. But did it? In a doubt, I posted a question on Avvo:

Can a dissolved copyright holder corporation continue litigating as a plaintiff in infringement cases? A CA corporation filed dozens of copyright infringement lawsuits in Nov-Dec 2014. On 12/22/2014 it was voluntarily dissolved. Nonetheless, the cases continue, and the courts were not notified.

Are any laws or regulations broken here? After those who actually steer the litigation made aware of publicity in this matter, they re-registered this corporation on 1/16/2015. The name and the agent remained the same, yet the entity number is different. So the second question: did this move “cure” the issue? Is it a matter of interest for the tax authorities?

One of the answers from an experienced business attorney from California, Frank Chen, confirmed what we suspected (emphasis is mine):

Nope. I assume the corporation was voluntarily dissolved (as opposed to being suspended or involuntarily dissolved through a court decree). A suspended corporation can be revived by paying back taxes, penalties and interest, and filing back tax returns. However, a dissolved corporation cannot be revived. A dissolved corporation would no longer have standing to pursue a lawsuit. Re-registration creates a new corporation, but even if the name and agent for service of process are the same, the entity is not the same entity which was the plaintiff in the lawsuit. The move does not “cure” the issue.

How should we call a corporation that can’t be revived but nonetheless walks around? A zombie troll I guess…

Some of the Good Man cases were already settled. Is it a rhetorical question to ask where the money went?

While I think that defense attorneys should try to leverage this information, it is far from certain that the lawsuits will be killed. Witnessing how much leeway US judges provide to attorneys (including copyright blackmailers), I’m pessimistic about any impact this apparent fraud will have on these and similar cases. The plaintiff was voluntarily dissolved a month after filing a blizzard of lawsuits? Oops, your Honor, here is a brand new corporation; I hope you won’t look into the details…

The travesty is that defendants don’t enjoy this kind of lenience from trolls. If Mr. Lipscomb was sincere in his laments that his goal is to stop piracy, he would kindly ask first instead of demanding arm and leg from hapless file-sharers and innocents alike. A warning can go a long way: for example, according to the Canadian ISPs’ statistics, 89% stop infringing activity after the first warning. But such warnings would actually help reducing piracy — an outcome hardy desired by the drivers and passengers of the Bittorent shakedown gravy train.

Update

2/10/2015

Unbelievable arrogance! Instead of dismissing the fraudulent Good Man lawsuits, Lipscomb filed 11 more in the FLSD!

2/11/2015

Another attorney, Matthew Howard Schwartz from Georgia answered my question on AVVO:

If the dissolution of the corporation was completed, it cannot be revived and it cannot continue as a plaintiff in a lawsuit. If the dissolution was merely “in process,” but was later withdrawn before completion, it can still prosecute its claims in the existing lawsuit assuming it remains in good standing with the Secretary of State’s office and the CA Franchise Tax Board. Merely being in default with the Secretary of State or the Franchise Tax Board are curable conditions — but a full-fledged corporate dissolution is irrevocable. Assuming the corporate dissolution was perfected, the current lawsuit should be subject to dismissal. However, the next issue to be considered would be “what was the disposition of both the copyright and the copyright infringement claims in the corporation’s dissolution?” Both the copyright and the attendant infringement claims are ASSETS that could have been transferred to another party by way of an assignment. So, even though the current lawsuit would be subject to dismissal, you may still have to be concerned about a new lawsuit that could be filed by an assignee of the dissolved corporation (this would be a person or an entity to whom the plaintiff corporation transferred its copyright and attendant infringement claims). However, in that event, you may have a statute of limitations defense available to a new lawsuit filed by the assignee. Furthermore, depending upon the circumstances of the dissolution, you may be able to show that the copyright and attendant infringement claims were not properly transferred to the putative assignee. For example, if the corporation did not properly satisfy all the claims of its creditors during the dissolution process, there may be a question about whether the assignee actually owns all rights, title and interest in the copyright. There are several possibilities for defeating the assignee’s claims under these circumstances.

2/13/2015

I just learned that yesterday Mr. Rushie filed five Good Man Productions, Inc. lawsuits after I brought to Flynn|Wirkus|Young partners’ attention that this “client” is a faux, voluntarily dismissed entity that has no standing to sue. One thing is to learn about the fatal problem after the fact, another one is to show the middle finger to the court and knowingly continue filing fraudulent cases. I call it Chutzpah.

So, all this begs the question whether Mr. Rushie’s employer cares about its reputation or not. I’m leaning towards the latter.

2/14/2014

I procured one of the new Rushie’s complaints. It is word-to-word as the ones filed in December.