Andersen v. Atlantic Recording Corporation

In plaintiff’s action against record companies alleging various claims related to the wrongful initiation of civil proceedings, summary judgment is granted in favor of defendants where the Noerr-Pennington Doctrine protected the record companies’ right to file suit without fear of liability.

Defendant Atlantic Recording Corporation represents a class of major record companies who adopted an Enforcement Program designed to identify and pursue individuals who directly infringed on their copyrighted works through the use of P2P networks. The record companies engaged MediaSentry, Inc., to observe and to document infringing activity by logging on to P2P networks and downloading copyrighted works while recording the Internet Protocol (IP) address of the computer or router where the shared folder was located. In May 2004, MediaSentry, using this process, downloaded several of defendants’ copyrighted works from an IP address assigned to a specific router or computer. After obtaining the IP address, the record companies filed Caroline Records, Inc. v. Does, against the alleged infringers. Based on the Doe lawsuit, the record companies obtained a subpoena requiring Verizon Online, the Internet Service Provider responsible for assigning the IP address, to identify to whom they leased the IP address. Verizon disclosed to the record companies that the IP address was leased to plaintiff Tanya Andersen on the date MediaSentry downloaded the copyrighted material.

Based on the information from Verizon, the record companies filed a complaint alleging that Andersen infringed their copyrights. In turn, Andersen filed complaint against the record companies in the present matter, which alleged various claims of civil conspiracy, wrongful initiation of civil proceedings, abuse of legal process, and negligence. In their motion for summary judgment, the record companies argued that Andersen’s claims arising from the record companies’ initiation of the first action were barred under the Noerr-Pennington Doctrine. The court, therefore, construed the record companies’ motion only against those claims arising from defendants’ initiation of civil proceedings, leaving for another day, the issue of whether Noerr-Pennington barred Andersen’s claims arising from defendants’ continuation of civil proceedings.

In commencing its analysis, the court explained that the Noerr-Pennington doctrine “allows private citizen to exercise their First Amendment rights to petition the government” without fear of liability. The doctrine, the court continued, applies in all contexts—not only to petitions sent directly to the court in the course of litigation, but also conduct incidental to the suit. The court noted, however, that an entity looses Noerr-Pennington immunity if it falls within on of three recognized “sham” exceptions. In urging the court not to accord the record companies immunity, Andersen asserted arguments under each exception.

Andersen’s first contention was that the record companies’ pre-litigation conduct, demand letter, and first action were objectively baseless, precluding protection under Noerr-Pennington. In order to establish sham litigation, the court noted, Andersen must establish that “no reasonable litigator could realistically expect success on the merits.” To that end, Andersen alleged that the record companies’ enforcement program did not accurately identify potential infringers, and therefore, there was not “a chance” that a claim of infringement against an identified user would be upheld. The court disagreed, holding instead that under circuit precedent, the record companies need only demonstrate “a chance” that the enforcement program had correctly identified Andersen. Moreover, the court reiterated that linking P2P sharing of copyrighted works to an individual through that individual’s registered IP address has been accepted by several courts as constituting probable cause for the initiation of copyright-infringement proceedings. Accordingly, the court concluded that the record companies reasonably believed there was a chance that their copyright-infringement claims against Andersen might have been held valid.

Next, Andersen argued that the record companies brought a series of actions without regard to the merits or unlawful purpose of the proceedings, precluding protection under Noerr-Pennington. Here, Andersen contended that the enforcement program targeted many individuals in a substantially similar manner as the manner in which Andersen was targeted. In rejecting this argument, the district court that where the alleged behavior is the filing of a series of lawsuits, the question “is not whether any one of them has merit,” but whether they are brought as part of a pattern or practice of successive filings undertaken essentially for purposes of harassment. In this regard, the court noted, the record companies’ success in every case brought to trial was determinative. In addition, many of the matters were settled. In spite the large number of proceedings that the companies instituted, the court found that their theory in each was at least capable of producing a favorable result.

Third, Andersen argued that the record companies engaged in intentional misrepresentations that preclude protection under Noerr-Pennington. Specifically, Andersen alleged that that the record companies misrepresented in the Doe action that MediaSentry’s process could be conducted by any computer user and that MediaSentry was able to identify individual infringing users on the basis of its process. These initial misrepresentations, Andersen asserted, tainted all of the actions filed thereafter. Under this sham exception, the court explained, Andersen must make specific allegations that demonstrate that the record companies “so misrepresented the truth that the entire proceeding was deprived of its legitimacy.” The court concluded that Andersen had not established that the record companies to such a degree as to discredit the legitimacy of the first action.

Finally, Andersen asserted that the enforcement program did not consist of activities “incidental to the conduct of a lawsuit, but were undertaken in pursuit of commercial activity, and therefore, preclude immunity under Noerr-Pennington. The court, however, determined that defendants “undertook their investigations, obtained their subpoenas, and issued their pre-litigation letters for the purpose of resolving the problem.” In Sosa v. DirecTV, Inc., the court noted, the circuit court held that almost identical activities were incidental to the conduct of a lawsuit. The court, therefore, concluded that on the record, the record companies’ enforcement program was incidental to the conduct of a lawsuit.

As a peripheral matter, the court also considered Andersen’s motion to compel the production of documents related to the enforcement program. Andersen alleged that the documents would demonstrate defendants were aware of other, more effective prophylactic measures to prevent Internet piracy of defendants’ copyrighted works. The district court, however, rejected this argument, noting that the awareness of other effective measures for combating piracy does not belie the existence of probable cause sufficient to institute civil copyright-infringement proceedings.