Category Archives: Keith Lipscomb

Malibu Media, LLC appears to be on a $20K/mo. filing budget.

Malibu Media has come back from the dead…

Yesterday, I wrote about how the Malibu Media, LLC filings stopped dead towards the end of April 2016, and continued for three months (~90 days) to be SILENT… NOT EVEN ONE new case was filed.

Until July 21st, where over the next month, Malibu filings came in with a rush of 134 new cases — 75 in the last ten (10) days of July, and then another 59 cases in August — and then again… SILENCE.

Until October, where someone at Malibu pulled a lever, and each of their local attorneys filed roughly ten cases every few days until a total of 109 cases were filed, but then again… SILENCE.

NOTE: BEFORE READING THIS ARTICLE: If you have not already done so, and you are implicated as a John Doe in a Malibu Media, LLC lawsuit, read these first:

1) “Everything You Need To Know in One Page About Your Malibu Media, LLC (X-Art) Lawsuit [FAQ]
2) “In-Depth Malibu Media.  Their Lawsuits, Their Strategies, and Their Settlements

FOR IMMEDIATE CONTACT AN ATTORNEY: To set up a free consultation to speak to an attorney about your Malibu Media, LLC lawsuit, click here.  Lastly, please feel free to e-mail me at info [at] cashmanlawfirm.com, or call 713-364-3476 to speak to me now about your case (I do prefer you read the articles first), or to get your questions answered.

So I thought Malibu Media, LLC was dead… until they started filing again.

After Lipscomb and Malibu Media, LLC parted ways in April, I thought Malibu Media — the largest copyright troll ever (have you ever known any person or entity to file 6,800 cases for ONE CLIENT?) — was dead. But rather than being a dead copyright troll, it occurred to me that not only is Malibu Media, LLC still “alive,” so to speak, but the pattern in which they are filing their cases actually replicates a monster [or troll] BREATHING.

You might ask yourself whether I just claimed that Malibu Media is breathing, and I am answering YES. Every 90 days, they are coming out with roughly 100 cases, like the breath of a dragon, or in in the spirit of their name, like the ebb and flow of the waves that crash across the Malibu shores.

That sounds all artistic, but really, there appears to be a hard-nosed money number behind their filings. $20,000. Malibu Media, LLC appears to be trying to keep their monthly filings costs to $20,000/month.

How? (admittedly, this is a stretch, but there is a point.)
July = 75 filings x $400 per filing = $30,000
August = 59 filings x $400 per filing = $23,600 (-16 cases)
September = ZERO FILINGS. (-75 cases)
October = 109 filings x $400 per filing = $43,600
November = ZERO FILINGS. (-75 cases)
December = ZERO FILINGS. (-75 cases)

TOTAL CASES FILED in two quarters: 243 cases / 5 months = avg 48.6 cases/mo.
~50 cases/mo (rounding up) /6 months = $20,000/mo.

Okay, so what does that mean for me or for you? Nothing… except to expect another 100 filings in January 2017 ...but not in California.

What else can you tell me about the Malibu Media cases?

[2017 UPDATE] The best way to learn about Malibu Media, LLC is to read what happened to them as it happened.  The list of stories below (in the order I listed them) tell the Malibu Media story in a way that you will understand them.


FOR MORE INFORMATION ABOUT MALIBU MEDIA, LLC:Again, if you have been implicated as a John Doe defendant in a Malibu Media, LLC lawsuit, there are TWO (2) main articles you should read immediately:

1) “Everything You Need To Know in One Page About Your Malibu Media, LLC (X-Art) Lawsuit [FAQ],” and then
2) “In-Depth Malibu Media.  Their Lawsuits, Their Strategies, and Their Settlements.”

FOR IMMEDIATE CONTACT WITH AN ATTORNEY: To set up a free consultation to speak to an attorney about your Malibu Media, LLC lawsuit, click here.  Lastly, please feel free to e-mail me at info[at] cashmanlawfirm.com, or call 713-364-3476 to speak to me now about your case (I do prefer you read the articles first), or to get your questions answered.

CONTACT FORM: If you have a question or comment about what I have written, and you want to keep it *for my eyes only*, please feel free to use the form below. The information you post will be e-mailed to me, and I will be happy to respond.

NOTE: No attorney client relationship is established by sending this form, and while the attorney-client privilege (which keeps everything that you share confidential and private) attaches immediately when you contact me, I do not become your attorney until we sign a contract together.  That being said, please do not state anything “incriminating” about your case when using this form, or more practically, in any e-mail.

Was Malibu Media’s settlement extortion scheme profitable?

Lipscomb claimed that the Malibu Media, LLC cases were not profitable.

In my last article, I mentioned that “On April 18th, 2016, Keith Lipscomb told all of his local counsel that he is no longer representing Malibu Media, LLC (citing a lack of profitability).”

NOTE: BEFORE READING THIS ARTICLE: If you have not already done so, and you are implicated as a John Doe in a Malibu Media, LLC lawsuit, read these first:
1) “Everything You Need To Know in One Page About Your Malibu Media, LLC (X-Art) Lawsuit [FAQ]
2) “In-Depth Malibu Media.  Their Lawsuits, Their Strategies, and Their Settlements

FOR IMMEDIATE CONTACT AN ATTORNEY: To set up a free consultation to speak to an attorney about your Malibu Media, LLC lawsuit, click here.  Lastly, please feel free to e-mail me at info [at] cashmanlawfirm.com, or call 713-364-3476 to speak to me now about your case (I do prefer you read the articles first), or to get your questions answered.

Was Lipscomb right? Were the Malibu Media LLC v. Doe lawsuits no longer profitable?:

I thought a lot about this one, and I will answer it using fuzzy numbers (rough estimates).

Malibu Media, LLC filed 6,800+ lawsuits in federal courts.  Since the start of their lawsuit, the cost of filing a lawsuit increased to $400.

$400 filing fee/case x 6,800 cases = $2.7 Million in filing fees (likely $2.4 mil based on the fee change because the filing fee was not always $400).

6,800 cases, estimate 10% pay a settlement fee (one out of every ten John Doe Defendants), and assume an average settlement amount of $10,000.  [6,800 cases x .1 settlement rate = 680 settlements x $10K/settlement = $6.8 Million in settlement funds received].

But what if the average settlement was $8,000 but they didn’t tell you about that, and only 5% actually paid the settlement?  Then the numbers would look like this: [6,800 cases x .05 settlement rate = 340 settlements x $8K/settlement = only $2.72 Million in settlement funds received].

Now the local attorneys who “extract” the settlement likely get a 30% piece of the settlement.  So let’s assume 30% in commissions goes to the local counsel. [$2.72 Million in settlements received x .7 [that’s 70% after the 30% attorney cut] = $1.9 Million Left for Lipscomb].

Subtract the $1.9 Million Left for Lipscomb from the $2.7 Million in filing fees paid, and Lipscomb has a loss.  Likely a businessman like Lipscomb would see this coming and would not allow 6,800 cases to be filed if they were not significantly more profitable.  Thus, I think my original numbers were more accurate (if not, Lipscomb was not a smart businessman and is about to file for bankruptcy).

Going back to the original numbers, even if you take the original assumptions of a 10% settlement rate, and an average settlement of $10K (=$6.8 Million), minus the local counsel’s 30% cut, that leaves a net profit of $4.76 Million Left for Lipscomb.  Minus the $2.7 Million in filing fees from the $4.76 Million Left for Lipscomb, and that leaves a $2 Million Net Profit, but Lipscomb only paid Malibu Media $100,000 (which would be a 5% commission rate to Malibu Media, LLC).

Thus, based on what the real numbers actually were, I do see how Lipscomb may be able to claim that the copyright trolling campaign was not profitable for him.  My best guess is that the truth of what the numbers really were are somewhere in between my estimations, however, the only way we will be able to learn the truth is 1) if it comes out in discovery in the Malibu v. Lipscomb lawsuit, or 2) if the feds analyze their books.

What else can you tell me about the Malibu Media cases?

[2017 UPDATE] The best way to learn about Malibu Media, LLC is to read what happened to them as it happened.  The list of stories below (in the order I listed them) tell the Malibu Media story in a way that you will understand them.


FOR MORE INFORMATION ABOUT MALIBU MEDIA, LLC:Again, if you have been implicated as a John Doe defendant in a Malibu Media, LLC lawsuit, there are TWO (2) main articles you should read immediately:

1) “Everything You Need To Know in One Page About Your Malibu Media, LLC (X-Art) Lawsuit [FAQ],” and then
2) “In-Depth Malibu Media.  Their Lawsuits, Their Strategies, and Their Settlements.”

FOR IMMEDIATE CONTACT WITH AN ATTORNEY: To set up a free consultation to speak to an attorney about your Malibu Media, LLC lawsuit, click here.  Lastly, please feel free to e-mail me at info[at] cashmanlawfirm.com, or call 713-364-3476 to speak to me now about your case (I do prefer you read the articles first), or to get your questions answered.

CONTACT FORM: If you have a question or comment about what I have written, and you want to keep it *for my eyes only*, please feel free to use the form below. The information you post will be e-mailed to me, and I will be happy to respond.

NOTE: No attorney client relationship is established by sending this form, and while the attorney-client privilege (which keeps everything that you share confidential and private) attaches immediately when you contact me, I do not become your attorney until we sign a contract together.  That being said, please do not state anything “incriminating” about your case when using this form, or more practically, in any e-mail.

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Did Malibu Media almost go out of business in April 2016?

So we all thought the Malibu Media, LLC lawsuits were dead this summer after Malibu Media sued their attorney Keith Lipscomb (a.k.a., the “kingpin” and “mastermind” behind the 6,800+ lawsuits filed against single “John Doe” defendants)). If you want a quick summary, here seems to be the jist of what happened.

  • Malibu Media, LLC hired Lipscomb to run their copyright infringement / settlement extortion scheme utilizing his network of attorneys spanning the federal courts across the US.
  • Lipscomb appeared to have pulled in hundreds [maybe thousands] of settlements, each settlement likely amounting to $10,000-$30,000, or more.
    (NOTE: This dwarfs the settlement monies collected by Steele & Hansmeier, now arrested for mail fraud, wire fraud, and perjury allegedly committed in the furtherance of their copyright troll scheme.)
  • Lipscomb apparently paid Malibu Media, LLC only $100,000 in commissions (the equivalent of ten settlements [10 x $10,000 = $100K]), but then never paid Malibu Media again.

[HINDSIGHT: MALIBU MEDIA LLC CONTINUED FILING AFTER THIS, BUT JUST WITH A NEW ‘INVESTOR’.  FOR IMMEDIATE CONTACT WITH AN ATTORNEY: Click here for more general information about Malibu Media, LLC lawsuits, their tactics, and their strategies.  To set up a free consultation to speak to an attorney about your Malibu Media, LLC lawsuit, click here.  Lastly, please feel free to e-mail me at info [at] cashmanlawfirm.com, or call 713-364-3476 to speak to me now about your case (I do prefer you read the articles first), or to get your questions answered.]

What caused the lawsuit between Malibu Media, LLC and Lipscomb?

The relationship between Lipscomb and Malibu became sour when Malibu Media, LLC became suspicious as to how they only earned $100K in commissions.  They demanded an accounting to determine whether they were being paid properly (this is still being litigated, but my guess is no; namely, that Malibu was being cheated by the lawyers they hired to extort others). Lipscomb claims that Malibu actually owes him money (to simplify the numbers, think — 6,800 lawsuits filed x est. $400/filing = $2.7 Million in filing fees alone). Malibu sued Lipscomb, they went to court, and in late April 2016, new Malibu Media, LLC filings stopped dead.

On April 18th, 2016, Keith Lipscomb told all of his local counsel that he is no longer representing Malibu Media, LLC (citing a lack of profitability), meaning that each of his local counsel were no longer representing Malibu Media, LLC, or so we thought. Wrong. Various local counsel continued the lawsuits already filed, but very few new suits were filed.

Here are the number of case filings since:
April 2016 Filings: 97
May 2016 Filings: ZERO!
June 2016 Filings: ZERO!
July 1- July 20 Filings: ZERO!
July 21 -> [end of month] filings: 75
August Filings: 59
September Filings: ZERO!
October Filings: 109 — FULL SPEED AHEAD? Nope.
November Filings: ZERO.
December Filings: ZERO…?

So, we are now in December (six months later), and Malibu Media LLC lawsuits are far from dead, or are they?!?

Here’s what I understand:
1) Lipscomb is no longer in charge of the Malibu Media, LLC lawsuits.
2) Individual attorneys (formerly, local counsel) appear to have taken Malibu Media, LLC as their own client, meaning that Malibu is creating relationships with each attorney, and each attorney appears to have a “territory” or a federal district court in which s/he practices.
3) I still think there is someone at Malibu Media, LLC headquarters (maybe Elizabeth Jones) still directing all of the attorneys.

In sum, Malibu Media, LLC and their lawsuits are not dead, at least not yet, but they continue to plague the federal courts and the accused downloaders with their high-ticket settlement prices, and thus they still need to be taken seriously, at least for now.

NEXT: Let’s go into the recent cases themselves to get an idea of what is going on with the last set of cases filed…

Sources:
Arstechnica: “File-sharing lawsuit numbers drop by more than half; both Malibu Media and Prenda Law have run into different roadblocks.” on 7/19/2016.

Techdirt: “Malibu Media Sues Its Former Lawyer Over Missing Funds, Breach Of Bar Rules,” on 6/29/2016.

Arstechnica: “Porn studio that sued thousands for piracy now fighting its own lawyer,” on 6/28/2016

Fight Copyright Trolls: “Malibu Media sues its former counsel Keith Lipscomb and his firm for professional negligence and breach of fiduciary duty,” on 6/28/2016


FOR MORE INFORMATION ABOUT MALIBU MEDIA, LLC:If you have been implicated as a John Doe defendant in a Malibu Media, LLC lawsuit, there are TWO (2) main articles you should read immediately:

1) “Everything You Need To Know in One Page About Your Malibu Media, LLC (X-Art) Lawsuit [FAQ],” and then
2) “In-Depth Malibu Media.  Their Lawsuits, Their Strategies, and Their Settlements.”

FOR IMMEDIATE CONTACT WITH AN ATTORNEY: To set up a free consultation to speak to an attorney about your Malibu Media, LLC lawsuit, click here.  Lastly, please feel free to e-mail me at [email protected], or call 713-364-3476 to speak to me now about your case (I do prefer you read the articles first), or to get your questions answered.

CONTACT FORM: If you have a question or comment about what I have written, and you want to keep it *for my eyes only*, please feel free to use the form below. The information you post will be e-mailed to me, and I will be happy to respond.

NOTE: No attorney client relationship is established by sending this form, and while the attorney-client privilege (which keeps everything that you share confidential and private) attaches immediately when you contact me, I do not become your attorney until we sign a contract together.  That being said, please do not state anything “incriminating” about your case when using this form, or more practically, in any e-mail.

*2017 UPDATE* What ended up happening with the Malibu Media cases?

With hindsight, we can now tell the Malibu Media, LLC “story,” as it happened.  The list of stories below (in the order I listed them) tell the Malibu Media story in a way that you will understand them.

CEG-TEK and Lipscomb – Star Crossed Lovers

As an attorney, unfortunately there is often information that I need to be tight-lipped about when discussing a case or a particular copyright holder. Malibu Media, LLC and their implosion with Keith Lipscomb (who ran each of their thousands of lawsuits filed across the US) was one such example, but not for the reasons you might consider.

This summer, I sat back and watched what was once one of the biggest copyright trolls and their scheme implode as the relationship between the attorney hired to represent their cases across the US (Keith Lipscomb) and Malibu Media, LLC crumbled. Regardless of the screams of autonomy each local counsel hired by Lipscomb claimed in the courts, it was still plain and obvious to me that Lipscomb was running each of the thousands of lawsuits filed against single “John Doe” defendants (not only because the filings were identical, and the court documents allegedly filed by different attorneys had the same spelling errors in each filing, but because every settlement payment — regardless of which local counsel was allegedly in charge of the lawsuit — went to Lipscomb’s Florida office).

Recognizing that there is ‘no honor among thieves‘, I laughed when I learned that Malibu Media sued Lipscomb for not paying them the settlement monies him and his attorneys extorted from hundreds if not thousands of John Doe Defendants across the US, and… he appears to have kept the settlement monies for himself.

However, the reason I stayed quiet was because I knew of something going on internally at Copyright Enforcement Group (CEG-TEK), and I saw a possible reality where Keith Lipscomb got into negotiations with CEG-TEK, and he got them to agree to send DMCA letters to thousands of accused downloaders through their ISPs, but instead of asking for a $300 settlement for one copyrighted title allegedly downloaded, he would list each-and-every title from his X-Art.com siterips.

Instead of CEG-TEK sending a notice for each title allegedly downloaded, Keith would have them send one notice for the siterip [when accessed by clicking a link on a bittorrent website, and that bittorrent file wold contain possibly 100+ titles to be downloaded]. However, when that unsuspecting user logged into CEG-TEK’s copyrightsettlements.com website using the username and password provided in the DMCA notice, each-and-every title in the X-Art Malibu Media siterip would have appeared. Thus, a $300 per accused downloader settlement could have easily turned into a $30,000+ per accused downloader settlement ($300/title x 100+ titles in the siterip). This could have even been exacerbated if Lipscomb asked for higher per-title settlement amounts, as his attorneys are accustomed to negotiate with other attorneys in the $750-$500/title range.

In my opinion, a Lipscomb-Siegel/CEG-TEK marriage would have been a nightmare, and because at the time CEG-TEK was changing their business model and shifting how they send out letters and to whom (remember the Girls Gone Wild fiasco?), the timing was right for Lipscomb to reach out to them, and I was concerned that they would have accepted his plan.

[In passing, I want to note that CEG-TEK had a shake-up as well over the summer. They were changing their business model from sending DMCA notices and soliciting small $300 settlements for copyright infringement claims for just a few titles to sending notices only to “more egregious downloaders” which in turn would increase the per-person settlement amount paid to CEG-TEK on behalf of their clients. They also appear to have been changing their client base by transitioning away from little porn companies to more well-known copyright trolls (e.g., Millennium Films, LHF Productions, etc.) — copyright holders who threatened to sue downloaders (and in at least one circumstance did sue at least one client of mine in federal court.) The point is that they were changing their image from being a company who’s clients didn’t sue to a company who’s clients do sue. Lipscomb fit their former profile of bringing pornography copyright holders to the table, and he matched their new profile because he brings a strong proclivity to sue defendants who ignored the notices. Thus in a possible reality, I saw Lipscomb meeting with CEG-TEK, and I did everything I could behind the scenes to avert this reality.]

Now we are roughly six-months later, and I am happy to share that the marriage between Lipscomb and CEG-TEK never took place, and CEG-TEK is no longer in a place where they would accept Keith Lipscomb or the $10K/client+ settlement amounts he would have brought to the table.

For this reason, I am sharing the story of this nightmare which — even though the ‘stars aligned’ — never happened (and thankfully, will never happen).

…there is new news for Lipscomb’s former Malibu Media, LLC client. I will post about that next.

[2017 UPDATE: This is bad news.  In my article, I wrote about how former Guardaley kingpin Lipscomb might have corrupted CEG-TEK.  Since the April 2016 breakup of the Lipscomb/Guardaley relationship, new Guardaley kingpin Carl Crowell has created a new entity called RIGHTS ENFORCEMENT which has reverse-engineered CEG-TEK’s proprietary DMCA copyright infringement notice system.  Many of you have visited this link thinking that RIGHTS ENFORCEMENT was somehow related to CEG-TEK (at first, I thought so too), but really it is an ‘evil twin’ competitor.  In sum, apparently my concerns about CEG-TEK’s DMCA notice system getting corrupted may actually have happened, but I got the entity wrong.  It wasn’t CEG-TEK’s system that was corrupted, it was Crowell’s reverse-engineered ‘evil twin’ copy of CEG-TEK which we now see in RIGHTS ENFORCEMENT.]


CONTACT FORM: If you have a question or comment about what I have written, and you want to keep it *for my eyes only*, please feel free to use the form below. The information you post will be e-mailed to me, and I will be happy to respond.

NOTE: No attorney client relationship is established by sending this form, and while the attorney-client privilege (which keeps everything that you share confidential and private) attaches immediately when you contact me, I do not become your attorney until we sign a contract together.  That being said, please do not state anything “incriminating” about your case when using this form, or more practically, in any e-mail.