Recent Court ruling may impact Zuffa anti-piracy litigation

March 30, 2014

A recent federal court ruling could pose a problem for Zuffa in its legal strategy to go after end users that steal its pay per views.  A federal judge in a Florida court has thrown out a lawsuit by adult film company Malibu Media due to lack of jurisdiction.

Malibu Media sues hundreds of people claiming that they have illegally downloaded its product. It employs a strategy of finding the alleged illegal users through tracking of individuals’ IP addresses.  Essentially, it files lawsuits all over the country in venues where it has tracked down where the alleged infringer is living.  But, the basis for the filing of the lawsuit is premised upon its location of the plaintiff via IP address.  Malibu argued that the reliability that the plaintiff is located in the venue where the lawsuit is filed is reliable due to the time of the use and the location of the address.  The IP addresses were obtained from Comcast Cable.  However, the Court, on its own accord, determined that Malibu Media must show good cause why the Court should rely on its geolocation of the defendants (alleged infringers). Notably, Malibu Media had sued the individuals as “John Doe” with only an IP address to identify the individual.

Based on the IP address would Malibu Media then request that it obtain the name of the individual with the account that is linked with the IP address.   The Court ruled that Malibu Media could not provide sufficient evidence for the Court to rely on to show that the actual infringer of the company’s copyright.  Thus, without the alleged infringer providing a response, the Court threw out the lawsuit.

Zuffa has taken down web sites illegally streaming UFC PPVs and has obtained user information such as usernames and IP addresses in order to track down the individuals for possible lawsuits.

Payout Perspective:

Even before evaluating the merits of the lawsuit, the party filing suit must establish that it is in the correct jurisdiction.  The Malibu Media ruling in Florida may be either an isolated or persuasive ruling for other venues to follow suit.  In general, in order for Zuffa to sue in a particular court, the person it must sue must reside in that district.  The viewership of the illegal stream must occur in the place where it happened.  But, the ruling states that despite the location of the IP address, Malibu Media could not establish the actual person that is purportedly watching the illegal stream.

Zuffa indicated that more than 50% of the individuals targeted for allegedly illegal streaming UFC events settle out of court according to MMA Junkie. And while the issue that it loses millions of dollars from illegal streaming is a reality, the legal procedure that it seeks to recoup its losses may be taken into question.  While Zuffa has been able to shut down illegal streaming sites and have gone after end users which has resulted in either out of court settlements or default judgments, the Malibu Media ruling in Florida may be an impediment to suing claimed infringers.  If a Court does not rely on an IP address to establish the jurisdiction of the claim, then it becomes harder to sue.

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