Prenda shell ordered to pay $9,425 in attorney’s fees

When it's time to collect, will the coffers at AF Holdings be empty?

by Joe Mullin - May 24 2013, 3:10pm EST

• Copyright
• Lawsuits

http://arstechnica.com/tech-policy/2013/05/prenda-shell-ordered-to-pay-9425-in-attorneys-fees/

redteam / flickr

Who's behind Prenda Law?

• Identity theft lawsuit against Prenda Law abruptly ends
• Prenda blows sanctions deadline, ordered to pay an extra $1,000 per day
• Prenda lawyer Paul Hansmeier asks appeals court to delay sanctions
• Prenda can’t find that darned “Salt Marsh” signature
• New Prenda letter threatens to tell neighbors about porn accusations

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AF Holdings is one of several shell companies linked to Prenda Law, which threatened thousands of Internet users with lawsuits over downloading pornography. Now Prenda's on the ropes and the key lawyers behind it have been hit with a tough sanctions order telling them to pay $81,000. They haven't paid, and now those sanctions are growing at a rate of $1,000 per day, per person.
Another nail in Prenda's coffin has been hammered down today. AF Holdings was ordered to pay $9,425 in attorney's fees to Nick Ranallo, a defense lawyer working on several Prenda defense cases. That's exactly what Ranallo asked for in his March motion requesting fees be paid, plus an extra $1,000 for drafting a later document.
The order by US District Judge Charles Breyer isn't in the public docket yet, but the outcome was tweeted by Kurt Opsahl, an Electronic Frontier Foundation lawyer who observed the hearing. Prenda lawyer Paul Duffy was allowed to appear at the hearing by telephone.
"I'm obviously pleased with the outcome and look forward to the collections process," Ranallo told Ars via email. "The award recognizes the important role played by defendants, like Mr. Trinh, who choose to stand up for their principles and defend their innocence rather than give in to [the] cost of defense settlements."
In a brief interview, Opsahl told Ars the judge was "businesslike" during the short hearing, only asking whether the Wright sanctions order had been appealed (it has). Duffy then spent some time arguing that the amount of sanctions was too high, as Ranallo could use similar arguments in his other cases.
"For what it's worth, $9,400 for the amount of work Ranallo put in was a bargain," opined Opsahl. "Any major law firm would have charged three or four times that amount, and the court probably wouldn't have batted an eye."
The question, of course, will be whether Ranallo can collect any of the fees. The Prenda-linked shell companies were likely set up to hold little or no cash. Prenda mastermind John Steele said in an interview with Ars that he gets a "flat fee" from certain Prenda-linked companies, although not from AF Holdings.
This case, AF Holdings v. Trinh, was originally filed (PDF) in May 2012. The copyright assignment was signed by Alan Cooper, Steele's former housekeeper. Cooper was presented as an officer of AF Holdings, but he claimed he never signed the papers and that his identity was stolen. Now Prenda says AF Holdings is owned by Mark Lutz, Steele's former paralegal.