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Corbin Fisher Blasts Oron's 2nd Cash Request; More Plaintiffs Lining Up

Corbin Fisher Blasts Oron's 2nd Cash Request; More Plaintiffs Lining Up
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Jun 29, 2012 4:15 PM PDT    Text size: 

LAS VEGAS — Corbin Fisher counsel today blasted Oron's attempt to gain court approval to disburse more than $355,000 for additional business expenses, noting that "something is amiss."

Operators of the file-locker site made a second emergency request for funds after the court earlier this week allowed $100,000 to be withdrawn from its PayPal account.

Oron told the court that server hosting company LeaseWeb is requesting about $75,000 by Sunday to keep on operating, as well as another $280,000 by July 9.

But Corbin Fisher attorneys, armed with declarations from numerous adult antipiracy experts and industry professionals, said the amount of money Oron seeks from its frozen bank accounts is "exorbitant" and that the site may be working with others to make money off stolen adult content.

"The evidence put forth by [Oron] shows that these expenses fall far outside of the norm for the industry. Something is amiss," Corbin Fisher's motion to oppose the disbursement of funds. "Either Oron is fabricating this newfound need for hundreds of thousands of dollars or LeaseWeb is conspiring with Oron."

Corbin Fisher offered an array of possibilities that might be at play, including possible undocumented payments to LeaseWeb, which attorneys characterized as the "Internet’s premier hosting service for high-volume copyright infringement."

"Logic suggests that LeaseWeb is either colluding with Oron to assist Oron in removing hundreds of thousands of dollars from this court’s jurisdiction; extorting Oron; or Oron is not being entirely forthcoming with the court," Corbin Fisher counsel said.

Corbin Fisher attorneys in today's filing to oppose the disbursement of $355,000 in Oron funds noted that it is "likely only the tip of a massive iceberg for Oron."

"Multiple other potential plaintiffs have already identified Oron as their primary source of copyright infringement and intend to join this action as plaintiffs before the motion for preliminary injunction is filed,"  Corbin Fisher counsel said.

Industry attorney Marc Randazza, who is leading Corbin Fisher's case against Oron, did not respond to an XBIZ query over the names of the companies contemplating litigation.    

Gay adult company Corbin Fisher last week sued operators of Oron.com for $34.8 million in damages, alleging they had knowledge of and induced the trading of pirated porn on its site.  

PayPal, AlertPay and CCBill were ordered to freeze Oron accounts; VeriSign also was ordered to freeze the Oron.com domain name from any transfers.  

Earlier this week, U.S. District Judge Gloria Navarro agreed with Corbin Fisher attorneys that Oron didn't provide any itemization or accounting for the court to consider and allowed it to withdraw only $100,000 to keep the site afloat and pay off lawyers.  

Today's motion to oppose Oron's latest request for more cash included testimony from Corbin Fisher's Brian Dunlap, Takedown Piracy's Nate Glass, Porn Guardian's  Peter Phinney, SSC Group's Adam Silverman, Yellow Fiber Networks' Zachary Thompson, Battleship Stance's Jason Tucker and online investigator Erika Dillon.  

Thompson, who runs the Yellow Fiber Networks hosting service, said that he is skeptical of Oron's server pricing even without knowing the number of servers that are dedicated to the site's use.

"[B]ased on the massive size discrepancy between Oron and its largest competitor, I do not believe its hosting costs genuinely run anywhere close to $75,000 per month," Thompson said in a declaration.

Thompson also said he was skeptical about the second LeaseWeb payment slated for July 9.

"I have never seen a billing practice where a customer would have to pay one bill at the end of the month, and then another bill for regularly occurring charges only eight days later," he said.

Tucker, whose Battleship Stance firm has represented a laundry list of adult entertainment companies including Private Media Group, Kink and Zero Tolerance, said the structure of the LeaseWeb payments brings suspicion to mind.

"In my experience in the online adult entertainment business, I have not encountered a hosting company that would not extend credit to cover hosting expenses upon request for a limited time, and especially under circumstances such as litigation," Tucker said.

"Any party who has a relationship, such as the one Oron maintains with LeaseWeb, not unlike the relationships I have with my hosting company, would be more than understanding in waiting a few weeks or months for funds if needed. Anything to the contrary seems questionable."

Erika Dillon, an online investigator for Corbin Fisher, said in her declaration that LeaseWeb has been implicated in numerous episodes involving piracy and served as hosts of MegaUpload and Diwana, two services that are now shut down.

"Since 2007, LeaseWeb has been acknowledged online and by anti-piracy law enforcement agencies as the target of several investigations," Dillon said. "They have frequently found themselves in the midst of legal actions because of the websites that they provide services to.

"It is common knowledge online that LeaseWeb works to ignore DMCA notices or at the very least, minimize their impact."

***

UPDATE (Friday, 5:30 p.m. PDT): A federal judge didn't buy Oron's explanation for needing $355,000 in additional funding to keep on operating and has denied its request.

In her order, U.S. District Judge Gloria Navarro said Oron "did not provide any explanation or evidence to demonstrate that the money was already used to pay other costs or expenses."

She said that $100,000 in funds earlier withdrawn should have covered Oron's bill with LeaseWeb.

"Furthermore, any future requests must be accompanied by a full accounting of defendants accounts and presented with appropriate documentation and any future requests for additional funds shall state the amount requested in U.S. dollars," she said.

Oron attorneys earlier today stated their request for $355,000 in additional funding in euros, which Corbin Fisher noted in a footnote in its opposition.

"In Oron’s prior motion, it converted the funds it requested from euros to American dollars," Corbin Fisher said in the footnote. "Presumably, it did not do so in the instant motion in the hope that the court would not notice that it was requesting almost the exact same amount."

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