Bribery, gay porn, and copyright trolls: The rise and fall of a lawyer (2015)
Bribery, gay porn, and copyright trolls: The rise and fall of lawyer Marc Randazza

    
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      Arbiter says Randazza "negotiated" a bribe, lied to employer, and must pay $600k.
    

    

    
            
              
            
    
    
      Marc Randazza, from his website after a public appearance. 

              
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          Marc Randazza / Illustration by Aurich Lawson

                  
          
  
          

    
    
    
      Marc Randazza, from his website after a public appearance. 

              
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          Marc Randazza / Illustration by Aurich Lawson

                  
          
  
  



  

  
      
    
    
                      
                      
          
The way attorney Marc Randazza tells it, his relationship with Jason Gibson started breaking down in the spring of 2012. Gibson, the CEO of gay porn studio Liberty Media, had hired Randazza as general counsel three years earlier. The two became the closest of friends; their families socialized together, and Randazza's kids even called Gibson "uncle."
But that April, Gibson arranged to use Randazza's office for a porn video shoot.
Randazza would later describe the scene as a humiliating bacchanal, calling it "harassment." An arbitration claim he later made against Liberty said that Gibson had forced Randazza, "who is a heterosexual family man with two young children, to witness homosexual activities" and that Gibson filmed "such activities in Mr. Randazza's private office... on his desk and on top of photos of his wife and toddler children." Later, Randazza said the shoot included a woman urinating on his desk.
"No matter what the industry," the complaint read, "there is a line over which conduct becomes extreme and outrageous."
During his time at Liberty, Randazza had become famous in the tight circles of First Amendment lawyers and their admirers. Most notably, he had taken down Righthaven, a "copyright troll" that became notorious for suing hundreds of small-time bloggers.
But he also became a lightning rod for controversy when he spoke up for Liberty's own copyright lawsuits against tens of thousands of Internet users accused of downloading porn illegally. Company executives now claim that the Liberty lawsuit campaign was actually a smokescreen for Randazza's own misbehavior.
Liberty COO Brian Dunlap admitted to Ars that the video shoot in Randazza's office did happen, but he said that shooting in offices was standard—everyone knew it, and Randazza even encouraged it. According to Dunlap, Randazza's personal items weren't even touched, and there was no urination. Instead, he claimed that the relationship between Liberty and its lawyer actually fell apart later, in August 2012, when Gibson first suspected that Randazza might be ripping him off.

          
                      
                  
                    
        
          
    
    
          
          
Randazza had recently wrapped up a legal settlement against a website called Oron.com, a cyberlocker that Liberty accused of copyright infringement. Oron had agreed to pay Liberty $650,000—but, according to the invoice, another $75,000 would go to Randazza personally.
"Jason [Gibson] wrote, 'Who gets this?' on the document," Dunlap said. "Then he walked off and said, 'What the hell did I just read?'"
Later that month, Randazza left the company. "Given our now openly adversarial relationship, it seems appropriate that I withdraw from representing Liberty in any further matters," he wrote to Gibson.
Gibson took that as a resignation letter. "It is unfortunate matters have come to this," he responded in an e-mail that also demanded Randazza hand over all Oron settlement funds to Liberty immediately.
Instead, Randazza filed his arbitration claim against Liberty for back pay, expenses, and damages arising from harassment and wrongful termination. Randazza was represented by another prominent First Amendment lawyer, Ken White, who blogs at Popehat and who took the case on a contingency basis.
"I was doing my client's will, for my client's benefit," Randazza told Ars about Liberty's mass copyright litigation, one of few on-record responses he provided by telephone. Randazza and White instead offered Ars many court documents to lay out their view of the situation. Randazza added that he couldn't "fairly respond" to comments about Liberty's lawsuits against torrenters and its related amnesty program due to attorney-client privilege.
Randazza also said he wouldn't provide an image for this story. "I can't see why I'd be inclined to provide a photo for a story that appears like it's going to be the worst fucking thing that's happened to me this year," he said. "I don't want to authorize the use of any images that I hold copyright to."
In the end, the arbitration with Liberty didn't go according to plan. The man who had taken down Righthaven was caught in a no-holds-barred legal fight with the employer who had helped him do so. And this last dispute, which Randazza initiated, would ultimately lead to the attorney's own downfall—while shedding an unusual amount of light on the way mass copyright litigation campaigns are designed and run.

          
                  
                    
        
          
    
    
          
          
Serving many masters
Randazza was hired by Liberty in 2009, leaving behind a private law firm in Florida where he worked. His employment contract (PDF), attached as an exhibit in court papers, included a clause saying that Randazza would “taper down” all outside client work with a few exceptions.
"We told him, 'We need you to be devoted to us,'" Dunlap told Ars.
The private clients he was allowed to serve were extremely small-time, Dunlap stressed. “An old lady who runs a bookstore” was one, and Randazza said he’d be billing an hour a month for that. Per his contract, the extra work was all to be outside regular hours. Dunlap said that no one at Liberty thought Randazza would be doing for-pay work for porn studios that Liberty viewed as competitors.
But as the backpay arbitration eventually proceeded through discovery, Liberty learned that Randazza was working up to 80-90 hours a month for outside clients. The arbitrator, in siding with Liberty, noted that Randazza's outside work included companies like Titan Media, Kink.com, and Bang Bros. The most striking example was Xvideos, a company Liberty was seriously considering suing for copyright infringement not long after it hired Randazza, Dunlap said.
Liberty has never been shy about using courts to go after those who pirate its content, though management first wanted to focus on "big offenders"—businesses like Xvideos, which ran a “tube” site that allegedly hosted Liberty's content without permission. Xvideo’s alleged infringement was one of the first issues Randazza had to address as general counsel, because by early 2010, Liberty’s porn flicks were showing up on Xvideos left and right. Liberty employees and friends in the industry would see those videos and forward links to Dunlap and Gibson.
"Are we pursuing these guys?" Gibson asked Randazza by e-mail in February 2010.
"I am pursuing them, yes," Randazza replied. "But, this guy, I'm building a little trap around."

          
                  
                    
        
          
    
    
          
          
One year later, Liberty-owned Corbin Fisher videos were still popping up on the Xvideos site. Randazza didn't want to move forward legally against the company, saying that Xvideos was “protected” because it had signed on to use Vobile, a digital fingerprinting system that Randazza promoted to them. “They’ve actually been the poster child for tube sites that behave,” Randazza wrote in an e-mail. In a separate message, he explained further, “The system truncates them [Corbin Fisher videos] to 3 min, because that is what we set our rules to.”
Reading that answer, Gibson lost it.
"No video content is allowed, EVER," he wrote to Randazza. "NEVER EVER… Who authorized them to use our content like this? Any fucking idiot knows that 3 minutes is an eternity to get off to... CUT THE VIDEOS OFF.”

    
              
                
              
                Brian Dunlap, COO of Liberty Media and its production company Excelsior. The company is in a legal dispute with Marc Randazza, its former general counsel.
                                  
                    Credit:
                                          Liberty Media / Excelsior
                                      
                              
            
                  
          
    
    
      Brian Dunlap, COO of Liberty Media and its production company Excelsior. The company is in a legal dispute with Marc Randazza, its former general counsel.

              
          Credit:

          
          Liberty Media / Excelsior

                  
          
  
        
            
While Dunlap shared some documents from the arbitration with Ars, he didn’t share documents related to Randazza’s Xvideos work due to ongoing legal proceedings. However, Dunlap said that those documents show Randazza took a $35,000 retainer from Xvideos—and continued to bill that company every month. While advising Liberty not to sue Xvideos, Randazza had been working for the company.
For his part, Randazza doesn’t deny working for Xvideos. But he claims the work wasn’t a conflict, despite the language in his contract promising to “taper down” outside work.
"[Liberty's] Corbin Fisher contemplated and encouraged Mr. Randazza to maintain an outside legal practice," Randazza wrote in his arbitration claim. "Randazza was under no obligation to clear any other representation with Gibson or Corbin Fisher, and in many circumstances did not... Nevertheless, Randazza never entered into representation where a conflict was present, and if any conflict were to appear, resolved it by discharging the other client."
Randazza concluded that his "tenure at Corbin Fisher was, by all metrics, a resounding success."

          
                  
                    
        
          
    
    
          
          
Where Randazza saw success and an understanding he'd work elsewhere, Liberty saw serious betrayal.

Pursuing “thieving little shits”
The lawsuit against Xvideos never materialized; instead, Randazza developed an alternative strategy to go after individual Internet pirates. His plan was initially met with skepticism at Liberty but was ultimately embraced.
"We trusted him to develop a plan to pursue infringers, and he came up with these plans to go after individual torrenters," Dunlap said. "Well, it didn't take much research to know, none of that ended well for MPAA and RIAA. But he was adamant that it was sound legal theory. Despite objections, we allowed him to proceed."
It turned out to be a bad move, Dunlap said, with the expense of the lawsuits wiping out any possible profits. "It was a mess," he said. "We made absolutely nothing off that. He went and hired his friends as local counsel."
Mass-copyright lawsuits were—and are—a controversial business, but Randazza told the press that he was doing them the right way. He offered an “amnesty” program, promising that downloaders who paid $1,000 to Corbin Fisher wouldn't be sued.
While the litigation itself was a bust, Dunlap recalled the amnesty being fairly effective. He doesn't remember the number of people that paid, but he estimated it in "the dozens." The numbers were high enough that Randazza wanted to proceed to a second round, one where the amnesty cost would rise.
This didn't happen. Instead, Liberty's campaign against pirates came under heavy fire. Longtime critics of “copyright trolls” were joined by some gay bloggers and writers, all claiming Corbin Fisher was using extortionate tactics against a vulnerable population.
"When these firms’ lawyers come hunting for people illicitly sharing porn movies, inevitably they will turn up the names and addresses of gay kids still living a closeted life under their parents’ roof," the blog Queerty wrote in a 2011 post. Soon after, the blog featured posts by a gay man who said he was terrified of being outed by Corbin Fisher lawsuits.

          
                  
                    
        
          
    
    
          
          
"It blind-sided us," said Dunlap. "We discussed what do we do if someone reaches out and says—'I'm not of age. The reason I torrent stuff is because I can't get it legally.' We had a policy that if someone reached out directly, we'd drop it. But it was a valid concern."
Randazza was less forgiving in his own response to Queerty. "Liberty Media produces straight content, too," he wrote. "So any thieving little shit who gets caught can very easily lie to his parents that he was looking at straight porn."
In response, Queerty pointed out an obvious fact: in any copyright lawsuit, Liberty would have to cite exactly what content was being infringed.
Randazza's "response was harsh, and callous, and rude," Dunlap said. "It was typical him. And it was a mess."
In the company's view, the PR damage from the "thieving little shits" comment was serious. Randazza was told not to make any more public statements about the anti-piracy campaign. Later that year, it fizzled out.
Dunlap said that, in hindsight, the campaign was "not the right approach." He came to believe that the whole thing had been devised by Randazza since the "legitimate targets" were off-limits. "Going after a torrenter made no sense," Dunlap said, "but it helped justify his salary and keep him busy."
For his part, Randazza said the campaign was simply him carrying out Liberty's orders. In his arbitration claim, he suggests he didn't care for the job, writing that "Mr. Gibson redefined Mr. Randazza's position as one focused on 'trolling' for copyright infringement settlements."

    
                  
                  
          
    
    
      Remember these folks? Ah, memories.

          
  
        
            

A troll-slayer's bounty
Randazza's role in defending the Corbin Fisher mass-copyright lawsuits was a surprise to copyright law observers, in large part because he was making a name for himself by defending bloggers against one of the most well-known "copyright trolls," a veritable lawsuit factory called Righthaven.

          
                  
                    
        
          
    
    
          
          
Righthaven burst onto the scene in 2010 with a surprising plan to save newspapers from declining revenues. The company, led by Las Vegas attorney Steve Gibson (no relation to Liberty CEO Jason Gibson), acquired copyrights from big papers in Las Vegas and Denver and then sued small bloggers who reproduced the content on their sites.
Randazza defended several of those bloggers pro bono with Liberty’s blessing and support.
"We felt if we help out with free speech cases, help the little guy, it could offset negative PR and be a good gesture," Dunlap said. "We're all believers in the First Amendment—we produce adult content."
In the interviews he gave about Righthaven, Randazza didn't often mention that he was general counsel at Liberty, but the work was done in Liberty Media's office, just down the hall from Dunlap and Gibson. All the while, Randazza’s website continued to show Randazza Legal Group as a law firm, even though it wasn’t registered with the state of Nevada as such. Corbin Fisher was listed as only one of many clients.
"We thought that was a paperwork kind of thing—housekeeping," said Dunlap. "[Randazza] said it would shield us from certain kinds of liabilities."
Righthaven collapsed when a judge found that its copyright assignments were invalid. The company ultimately paid Randazza $55,000 in legal fees, which he kept. In the later arbitration, Liberty said that since he was doing pro bono work as an employee, that cash should have gone to the company. But Randazza argued that the work was done “100 percent by my law firm" and that he was justified in keeping the money. The arbitrator disagreed, ordering the money to be paid back to Corbin Fisher and finding that Randazza was "unjustly enriched" by his "ostensibly pro bono representation" in the Righthaven cases.

“At least used BMW money”
The multi-year arbitration that revealed all the information above ended this summer. It was disastrous for Randazza. The arbiter ultimately found (PDF) that Randazza "secretly negotiated" a $75,000 bribe that did not result in payment, Randazza did unauthorized outside work, and he wrongly kept that $55,000 payment from Righthaven. The arbiter ordered Randazza to pay his former employer more than $600,000. Now, Randazza also faces state bar complaints in Nevada and Florida accusing him of unethical behavior, which could threaten his ability to practice law in those states.

          
                  
                    
        
          
    
    
          
          
The whole dispute seems to have ended so poorly for Randazza that it’s easy to forget he was the party who began it. When Randazza filed a claim shortly after he departed from the company in 2012, Liberty had actually offered him money to settle it.
"He wanted to run us into the ground," Dunlap said. "At one point, we offered him money, over $200,000 just to go away. We didn't feel like he was entitled to it, but we knew he was an attorney and could make things unpleasant."
Randazza didn't fare much better on his "hostile workplace" claims. In addition to the porn shoot in his office, Randazza claimed that CEO Jason Gibson and another Liberty exec engaged in oral sex in the back of his car while Randazza was driving back from a company party, greatly upsetting him.
"Don't jizz on my briefs," wrote Randazza .
Dunlap said the car sex never happened. As for the sex in Randazza's office, that was run-of-the-mill hijinks at the porn studio—and he said Randazza was aware of it.
"It was standard practice for us to use most any space in the office to film scenes," said Dunlap. "He was told about it. In fact he offered up his home and office, just to mix up the scenery."
"Don't jizz on my briefs," wrote Randazza in a series of texts about the shoot that came out during the arbitration. The arbiter called it a "crude possible sexual/legal 'double entendre,'" while Dunlap pointed to such joking as proof that Randazza approved.
The arbiter didn't directly address whether the sex claims were true, but he did rule that any sexual allegations "had nothing whatsoever to do with any decision… to terminate Mr. Randazza's employment."
The final matter was the settlement from Oron, the cyberlocker site that agreed to pay Liberty $650,000—and that inadvertently tipped Gibson off to Randazza's side work. It wasn't the first time Randazza had asked for extra payments in exchange for not suing. In an e-mail chain that Dunlap showed to Ars, regarding an earlier lawsuit against a site called TNAFlix, Randazza was adamant about how much he'd need to be paid to ensure no more lawsuits would be filed.

          
                  
                    
        
          
    
    
          
          
"I think that there needs to be a little gravy for me," Randazza wrote in an e-mail to the attorney for TNAFlix, who would later represent Oron as well. "And it has to be more than the $5K you were talking about before. I'm looking at the cost of at least a new Carrera in retainer deposits after circulating around the adult expo this week. I'm gonna want at least used BMW money."
In a follow-up e-mail, Randazza continued to push fees. "I spoke to my partner, who was adamant that we should earn $100K if we're to never be able to sue FF Magnat, Bochenko, Novafile.com, oron.com, etc. forever and ever," he wrote. "I got him to go with $75K. But for that, we'll provide some really great value—including a jurisdiction derailing plan that you'll drool over. What do you think?"
At one point, Randazza said the $75,000 was to be released to a trust "for a settlement with me personally." He explained, "It's not a retainer for services, but rather a settlement. That might work."
The TNAFlix $75,000 was never paid, but the demand resurfaced in the Oron litigation. This time, the $75,000 eventually appeared on the invoice seen by Gibson, though that too was never paid. Indeed, Randazza said, it was never meant to be paid.
In court papers, Randazza said the negotiations for the $75,000 were "a bluff, to increase available settlement funds" and that there was no proof "he intended to consummate such a negotiation."
But the arbiter characterized the money as a "bribe."
"Defendants in my copyright cases frequently ask if they can hire me once the case is over," Randazza told Ars. "I jokingly refer to that as, 'They want to bribe me to never sue them again.' They [Liberty] knowingly took it out of context."

    
              
                
              
                Ken White, First Amendment lawyer and founder of Popehat.com, is representing Randazza. 
                                  
                              
            
                  
          
    
    
      Ken White, First Amendment lawyer and founder of Popehat.com, is representing Randazza. 

              
          Credit:

                      
          
          TheFIREOrg on YouTube

                      
                  
          
  
        
            

Big money
The arbitration went against Randazza on every point; he was ordered to pay Liberty more than $600,000. That amount included a penalty of $275,000 plus interest for the Oron case, along with $197,000 for various other violations, including representing Xvideos.

          
                  
                    
        
          
    
    

        
        
          
          
"His decision is such a one-sided screed… that it cannot be taken as a reliable evaluation of Mr. Randazza's work or his character."
Randazza continues to deny any wrongdoing and is fighting the award in Nevada state court. In the meantime, he has filed for bankruptcy despite having earned more than $1.5 million over his three-year stint at Liberty. (His hiring contract showed a starting salary of $208,000 plus bonuses for resolving cases, and Dunlap said the salary neared $300,000 by the time of his departure.)
"Randazza is on the record condemning others for attempting to use bankruptcy as a means to avoid judgments and avoid the consequences of their own wrongdoings," Dunlap said. "Now we’re seeing Randazza do precisely what he chided others for doing in the past."
Randazza continues to do pro bono free speech work, and he still has prominent supporters in the legal community. Those supporters include White, who has known Randazza for about eight years and worked with him on pro bono cases. In a letter (PDF) to the Law Society of Upper Canada supporting Randazza's admission to the bar there, White told Canadian regulators that his friend shouldn't be evaluated by the outcome of the arbitration.
"In my 21 years as an attorney I have lost cases before," White wrote. "There is a category of decisions so extreme, so bizarre, so angry that they exist outside of differing interpretations of fact or law. This is such a case, one of only two or three I have seen in my entire career. With all due respect to the Arbitrator, his decision is such a one-sided screed… that it should not and cannot be taken as a reliable evaluation of Mr. Randazza's work or his character."
CORRECTION: After this story was published, Marc Randazza contacted Ars to dispute that he regularly worked 80-90 hours a month for outside clients. Randazza says that amount of work happened one month in three years and that other months were substantially less. Randazza also disputed that he "took" a bribe. The arbiter's ruling says that Randazza "secretly negotiated" a bribe, but it notes that the $75,000 from the Oron case did not result "in an actual bribe payment." The article's wording has been updated.


          
                  

                  
          


  
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    Liberty Media / Excelsior
  




  
  
          
  

  
    

    
      Joe has covered the intersection of law and technology, including the world's biggest copyright and patent battles, since 2007. 
    
  



  
    
    
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