Righthaven Lacks Standing to Bring Copyright Infringement Suit

A federal court in Nevada has tossed out one of Righthaven’s many copyright infringement lawsuits ruling that the company lacked standing to even bring the suit. The court stated that the company was not a legal or beneficial owner of the relevant rights despite an agreement between parties which purported to make Righthaven a legal owner.

The court noted that it is established law that only a “legal or beneficial owner” of a copyright is entitled to bring a copyright infringement suit. Moreover, a copyright holder is prohibited from assigning the right to sue in isolation from the other rights in a work. Righthaven attempted to circumvent this law by structuring its deal with Stephens Media in two steps — an assignment with a license-back. In the first step, Stephens Media assigned ALL the Copyrights in designated works to Righthaven. In the second step, Righthaven returned the favor by licensing all the rights back — except the right to sue. The net result of the deal was that Righthaven could not use the works, license them to others or do anything except sue for copyright infringement. Nonetheless, the two step deal allowed Righthaven to claim that it was technically the “legal owner” of the copyrights while at the same time not interfering in Stephens Media’s use of the works.

The court, however, was not persuaded that the two step structure of the deal was any different than a naked assignment of the right to sue. In reaching its conclusion, the Court essentially disregarded the parties’ documents and focused instead on the net effect of the deal with respect to the rights.