Read the full story as covered by Paul Alan Levy, Public Citizen.
I wrote about this case after we first told the Court why Watch Tower could not prevail on an infringement action, or on a motion for leave to identify our client for the purpose of pursuing an infringement action, because it had already lost its DMCA section 512(h) subpoena action based on a holding of fair use, and it had allowed that ruling to become final by not pursuing an appeal.
At our suggestion, the Court asked the parties to agree on a briefing schedule for the planned motion to quash, but that proved not to be possible because Watch Tower made clear that it was going to try to pursue discovery having nothing to do with its copyright claims. Rather, Watch Tower told us that it planned to use the infringement action to pursue the question of how McFree had obtained the previously unpublished videos. The Watch Tower headquarters is a leaky sieve and it wants to identify the leakers. Beyond that, there may have been a massive hack of Watch Tower’s computer systems several years ago. Watch Tower made clear that it was planning to seek discovery on those issues as part of its opposition to the planned motion to quash. It demanded a briefing schedule that would have allowed it to postpone explaining how it could obtain McFree’s identifying information despite the res judicata defense until it had had the opportunity to pursue discovery. At the same time, it told us that it was willing to drop its lawsuit with prejudice so long as McFree was willing to agree that he would never use any of Watch Tower’s materials before Watch Tower’s own publication of those materials without Watch Tower’s consent.
Of course, under the Supreme Court’s decision in Bartnicki v. Vopper, McFree has every right to use leaked unpublished materials, even if obtained from people violating a confidentiality contract, and even unpublished materials obtained by illegal hacking, so long as McFree had no involvement in the hacking. And although the possible hack of Watch Tower’s computer might well have been actionable under the Computer Fraud and Abuse Act, the statute of limitations on that cause of action expired years ago. So it became apparent that Watch Tower was trying to leverage a barred copyright claim, and the threat of identifying McFree, to obtain relief and or discovery on a different subject entirely – a possible abuse of process. McFree rejected this proposed settlement outright, and we warned Watch Tower that if it persisted in the litigation, we might file a document blocking it from a voluntary dismissal without prejudice, thus locking it into litigation that it was sure to lose.