CEDAR RAPIDS, Iowa — A federal judge today set aside Private Media Group's motion for a $11.3 million default judgment against two of the largest porn tube sites, EmpFlix.com and TnAFlix.com.
U.S. Judge Mark Bennett ruled that while the websites' operator, Youngtek Solutions Ltd., failed to timely respond to Private's complaint, it was not intentional because the company was served in Cyprus and none of its management is located there.
Bennett further decided that Youngtek has various potential meritorious defenses to Private's claims, including that it lacks personal jurisdiction in Iowa, where the suit was filed, and that it maintains a DMCA agent for service of takedown notices for possible infringing material.
Private, in its original suit filed in February, claims YoungTek illegally streamed 75 of its videos on EmpFlix.com, which attracts 1.5 million surfers a day, and TnAflix.com, which attracts 3 million daily.
It further said that YoungTek generates "annual revenue estimated in tens of millions of dollars."
The suit also names John Does, as well as 100 John Doe companies, presumably YoungTek's business partners or advertisers. It seeks $150,000 for each alleged infringement, as well as an injunction among other forms of relief.
Private's attorney, Chad Belville, also is seeking to have EmpFlix.com and TnAFlix.com's domain names awarded to the Barcelona-based adult entertainment giant.
"The amount at stake is large, but the defendant is a commercial venture that operates one of the busiest online commercial properties in the world," Private said in an earlier motion for default judgment. "Only a large award will serve to deter these arrogant defendants from future illegal action."
But Bennett on Tuesday decided that Private's default motion should be upheld, saying that Private "does not argue that it would be prejudiced in any concrete way by setting aside the default entry."
Private spokesman Jason Tucker told XBIZ that the litigation against Youngtek will continue at U.S. District Court at Cedar Rapids, Iowa.
"Getting a default judgment is never easy," he said. "Since they never answered the complaint in the first place I believe we had to file this motion as a matter of procedure.
"Bottom line is that Youngtek is now taking this case seriously so it can move forward on the merits.
"As I have said before, it is my opinion that they should be looking to settle as the road they are on only postpones the inevitable for so long."
Officials from Youngtek did not immediately respond to XBIZ on the ruling.