Disney Enterprises, Inc. et al v. Hotfile Corp. et al

Filing 54

SCHEDULING REPORT - Rule 26(f) by Columbia Pictures Industries, Inc., Disney Enterprises, Inc., Hotfile Corp., Anton Titov, Twentieth Century Fox Film Corporation, Universal City Studios Productions LLLP, Warner Bros. Entertainment Inc. (Stetson, Karen)

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF FLORIDA
MIAMI DIVISION
CASE NO.: 11-20427-CIV-JORDAN

DISNEY ENTERPRISES, INC.,
TWENTIETH CENTURY FOX FILM CORPORATION,
UNIVERSAL CITY STUDIOS PRODUCTIONS LLLP,
COLUMBIA PICTURES INDUSTRIES, INC., and
WARNER BROS. ENTERTAINMENT INC.,
Plaintiffs,
vs.
HOTFILE CORP., ANTON TITOV, and
DOES 1-10.
Defendants.
JOINT SCHEDULING CONFERENCE REPORT
Pursuant to Fed. R. Civ. P. 26(f) and Local Rule 16.1, the parties hereby submit their
Joint Scheduling Report. Counsel for the parties met and conferred on April 1, 2011 as required
by Rule 26(f) and the Court’s March 4, 2011 order, and further conferred on April 13 and 15,
2011. This Report outlines the parties’ proposed discovery plan and the specific topics indicated
in Local Rule 16.1(b). The parties’ respective positions are separately stated where the parties
are in disagreement.
A.

Nature of Claims and Defenses.
Plaintiffs’ summary of their claims: This is an action for copyright infringement brought

by Disney Enterprises, Inc., Twentieth Century Fox Film Corp., Universal City Studios
Productions LLLP, Columbia Pictures Industries, Inc., and Warner Bros. Entertainment, Inc.
(“plaintiffs”) against Hotfile Corp., Anton Titov (“Defendants”), and Does 1-10. Plaintiffs have
alleged that defendants – through their operation of the website located at www.hotfile.com

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(“Hotfile”) – are engaged in the infringement of plaintiffs’ copyrighted motion picture and
television properties on a massive scale. Compl. ¶ 1. Defendants encourage their users to
upload infringing copies of plaintiffs’ popular entertainment content to Hotfile’s computer
servers and to promote those works for download by other users, including by providing
Hotfile’s users financial incentives to engage in such conduct. Id. ¶¶ 2-4. Defendants’ model for
generating revenue depends on their users uploading and promoting these infringing works. Id. ¶
3. Defendants are fully aware of the infringement to which they materially contribute. Id. ¶ 61.
Moreover, defendants obtain a financial benefit from infringement that they have the right and
ability to control, but do not stop. Id. ¶ 62.
As a result of this and other conduct alleged in plaintiffs’ complaint, defendants are liable
for copyright infringement. Defendants are liable for direct infringement of plaintiffs’
copyrighted works distributed via Hotfile. Compl. ¶¶ 46-57. Further, defendants are secondarily
liable for their users’ unlawful reproductions and distributions of plaintiffs’ works under three
separate bases for liability: (i) inducement of infringement, id. ¶ 60; (ii) contributory
infringement, id. ¶ 61; and (iii) vicarious infringement, id. ¶ 62. Defendant Titov is jointly and
severally liable for each act of infringement for which defendant Hotfile Corp. is liable because
he personally directed and participated in, and benefited from, Hotfile Corp.’s infringing conduct
as alleged herein, and has been the guiding spirit behind and central figure in Hotfile Corp.’s
infringing activities. Id. ¶ 63.
As relief, plaintiffs seek: (a) damages and defendants’ profits; (b) the maximum in
statutory damages ($150,000 per work), Compl. ¶ 67; (c) attorneys’ fees and costs, id. ¶ 68, and
(d) injunctive relief, id. ¶ 69.

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Though defendants make unsubstantiated allegations in their statement below that they
indicate “may” be the basis for a counterclaim, defendants have not in fact filed counterclaims,
and therefore plaintiffs are not in a position to respond.
Hotfile’s statement of defenses:
Hotfile is an online file storage and sharing service. Using Hotfile’s website, open source
software developers can store and share lengthy program files with online communities.
Bloggers can share video footage. Companies can share voluminous files. Most threateningly to
studios, independent musicians, photographers and film-makers can promote their albums,
images and movies directly to fans and the public without relying upon studios for distribution or
promotion. Tens of millions of files have been uploaded to Hotfile.com.
Hotfile’s “Terms of Service” and “Intellectual Property and Rights Policy” published on
its website explicitly prohibit copyright infringement. Moreover, Hotfile terminates users that
repeatedly violate its anti-infringement policies. Hotfile also uses sophisticated MD5/SHAl
digital fingerprinting technology to detect and block copyrighted works from appearing on its
website. It even permits qualifying copyright holders – including Plaintiff Warner Bros. – to
have the unfettered ability to unilaterally take down any file on Hotfile’s service without any
oversight from Hotfile whatsoever. Hotfile competes with the services provided by Google®
Docs, Windows® Live SkyDrive, RapidShare®, DepositFiles®, MegaUpload®, and MediaFire® –
none of whom are defendants here.
Under the Digital Millennium Copyright Act (“DMCA”), online service providers such
as Hotfile are entitled to “safe harbor” protection from claims of copyright infringement, both
direct and indirect. 17 U.S.C. § 512. In enacting the DMCA, Congress was concerned that:
[W]ithout clarification of their liability, service providers may
hesitate to make the necessary investment in the expansion of the
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speed and capacity of the Internet…In short, by limiting the
liability of service providers, the DMCA ensures that the efficiency
of the Internet will continue to improve and that the variety and
quality of services on the Internet will continue to expand.
Viacom Int. Inc. v. YouTube, Inc., 718 F. Supp. 2d 514, 519-524 (S.D.N.Y. 2010)
(discussing legislative history). Congress recognized that it “will not serve anyone’s interest if
the Internet’s backbone and infrastructure are sued out of existence for involvement in
purportedly aiding copyright infringement.” Nimmer on Copyright § 12B.01[C][1].
Hotfile is an internet service provider protected by the DMCA. Because Hotfile has
complied with the DMCA safe harbor requirements, Plaintiffs cannot prevail on the copyright
claims. Hotfile is entitled to judgment as a matter of law as to all of Plaintiffs’ claims.
Although Hotfile is still investigating the issue, it appears that an account used on behalf
of at least one the Plaintiffs has badly misused the DMCA takedown procedure causing
thousands of files to be deleted based on a false assertion that the Plaintiff is the legally
authorized representative of the copyright holder with respect to the files in question. This may
be the basis for a counterclaim for which Hotfile would be entitled to damages.
B.

Discovery Plan
1. Rule 26(a) Disclosures.
The parties do not believe that any change should be made in the form or requirement for

disclosures under Rule 26(a). The parties propose that the due date for Rule 26(a) disclosures be
extended by ten days, such that disclosures should be served by April 25, 2011. Plaintiffs
requested and Hotfile agreed to this 10-day extension provided that Plaintiffs would not later
argue that the resulting 10-day delay is a reason for denial of a Section 1404(a) motion to
transfer this action to the Central District of California, a motion Hotfile may make if the great
majority of potential witnesses listed in Plaintiffs’ initial disclosure are located in the Los

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Angeles area with few or none residing in Florida. Plaintiffs intend to oppose such a motion,
including on the basis of Defendants’ delay (except for the ten days resulting from the agreed
extension) in bringing such a motion.
2. Subjects on Which Discovery May be Needed.
Plaintiffs believe that discovery will be required on the following issues, among others:
(1) downloads of plaintiffs’ copyrighted works via Hotfile; (2) defendants’ knowledge of and
intent to foster copyright infringement, including by operation of their Affiliate programs and
defendants’ role in soliciting content to be uploaded to Hotfile; (3) the means and extent of
copyright infringement occurring via Hotfile; (4) defendants’ removal of and failure to remove
infringing content from their system in response to notices from copyright owners or otherwise;
(5) technological measures defendants took, did not take, considered taking, or could have taken
to limit infringement on Hotfile; (6) defendants’ revenues and profit from their infringing
activities; (7) the extent to which copyright infringement acts as a draw to attract users to Hotfile
or to which defendants otherwise receive a financial benefit attributable to infringement; (8)
defendants’ right and ability to control infringement, including by blocking files or terminating
users; (9) defendants’ compliance with the provisions of the Digital Millennium Copyright Act,
including maintenance and implementation of a repeat infringer policy; (10) the identities and
involvement of other individuals, investors, or entities involved in the creation or operation of
Hotfile, or working in concert with defendants to facilitate infringement.
Defendants believe that discovery will be required on the following issues, among others:
(1) Plaintiffs’ alleged ownership of copyrights relating to the works in suit; (2) Plaintiffs’ (and
their agents’) takedown notices sent to Hotfile, and the bases for those notices; (3) Plaintiffs’ use
of Special Rightsholder Accounts such as those available to Plaintiffs at Hotfile; (4) the DMCA

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safe harbors; (5) Internet business models, including those business models employed by Hotfile
and its competitors, including webhosting and cloud computing, and their substantial noninfringing uses; (6) mechanisms for controlling and limiting copyright infringement on the
Internet, such as digital fingerprinting and password protection; (7) Plaintiffs’ and their affiliates’
voluntary posting of their works on the Internet; (8) copyright infringement policies utilized by
Plaintiffs’ and their affiliates; (9) evidence refuting the alleged direct and indirect copyright
infringement; and (10) the alleged harm to Plaintiffs of posting works on the Internet.
3. Case Management Track and Limitations on Discovery.
The parties believe that this case should proceed on the standard track pursuant to Local
Rule 16.1(a)(2)(B). Plaintiffs propose a discovery cut-off of October 17, 2011. Defendants
propose a discovery cut-off of January 16, 2012. The time periods suggested by both plaintiffs
and defendants are within the range of days provided for discovery in standard track cases.
The parties have agreed that the number of depositions that each side is permitted to take
should be enlarged to 12, exclusive of depositions of expert witnesses. The parties otherwise do
not believe that any changes should be made in the limitations on discovery imposed under the
Federal Rules of Civil Procedure or the Local Rules of this Court.
Plaintiffs’ proposal to stage discovery regarding individual copyrighted works.
a. Plaintiffs’ Statement
Plaintiffs propose that discovery regarding individual copyrighted works proceed in two
phases, in order to simplify or potentially eliminate the need for discovery on all copyrighted
works at issue in the case. Plaintiffs have alleged that defendants are liable for infringement of
the works listed in Exhibit A to the complaint, and plaintiffs expect that discovery from
defendants will show that defendants are liable for infringement of likely thousands of additional

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works that have been downloaded by Hotfile users. Those works will be at issue in the case
regardless of how discovery is conducted. But while plaintiffs intend to seek damages for
infringement for a large number of works, the parties do not need to complete discovery
regarding all of those works in order to resolve summary judgment motions on the issue of
defendants’ liability. Any affirmative defenses as to individual works will not be a key issue in
the liability determination.
Plaintiffs therefore propose that the Court permit summary judgment motions on liability
to be filed and resolved based on a representative sample of 100-150 works that plaintiffs allege
to have been infringed. Discovery regarding that sample of works would be permitted during the
discovery period prior to filing of summary judgment motions, but discovery on additional works
would be deferred until the Court has ruled on summary judgment. Following the Court’s
liability determination, the parties would meet and confer within 5 days of the Court’s decision
to determine whether any additional discovery related to the remaining works alleged to be
infringed is necessary prior to trial. Any such pre-trial discovery on the remaining works would
proceed during a second phase of discovery limited to that single topic.
This type of procedure has been adopted in other online infringement cases and is likely
to greatly streamline discovery and a potential trial on damages. For example, if plaintiffs
prevail on liability on the subset of works infringed, plaintiffs expect that the second stage of
discovery and/or the issues remaining for damages trial could be greatly limited by stipulation of
the parties. Further, there is no prejudice to defendants for the discovery to be staged in this
manner. Plaintiffs will still identify the works on which they intend to seek damages during the
first phase of discovery, and defendants will be able to seek relevant discovery on the subset of

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works in the first phase, and then seek relevant discovery on the remaining works in the second
phase (if necessary).
b. Hotfile’s Statement
Plaintiffs cannot have it both ways—either they are limiting this case to the works the
selected and specifically identified in the attachment to the Complaint or they are now also
asserting that “thousands” of additional works are also infringed and at issue in this case.
Plaintiffs’ proposal limiting discovery issues relating to Hotfile’s alleged liability to only
Plaintiffs’ handpicked assortment of copyrighted works, but allow Plaintiffs to add unlimited
(e.g. “thousands”) of more works after an adjudication of liability is unacceptable for several
reasons. First Plaintiffs’ “sample of 100-150 works” were of course carefully chosen and to
maximize Plaintiffs’ chances of success and would not be representative of the other works they
chose not to select. Second, it would improperly relieve Plaintiffs of the burden of proving all
the facts necessary to obtain the relief they demand with respect to such later-added works, while
depriving Hotfile of the opportunity to challenge Plaintiffs’ assertion of the rights in those
works. The proposal would also bind Hotfile to the full extent of its potential liability, leaving
until after adjudication of liability any identification of an undetermined number of “additional
works” for which liability would apparently be presumed.
This is an unfair and one-sided procedure that would threaten to deprive Defendants of
fundamental due process. Plaintiffs can either proceed with this case 1) on the selected works
they elected to include in the Complaint or 2) on “thousands” of unidentified works. But they
cannot be allowed do both simultaneously. Plaintiffs suggest that their proposed structure has
been used in other cases. The only case Defendants have located addressing this issue, however,
declined Plaintiffs’ proposed approach. See UMG Recordings, Inc. v. Escape Media Group, Inc.,

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No. 100152/10 (N.Y. App. Div. June 9, 2010) (copy attached as Attachment 1) (denying
Plaintiff’s request to restrict discovery to a representative sample identified by Plaintiff as doing
so would prejudice Defendants’ ability to assert specific affirmative defenses with respect to
individual works).
Defendants’ proposal for early summary judgment motion on DMCA safe harbor.
a. Hotfile's Statement
The most efficient way to resolve this case is an early adjudication of Hotfile’s
qualification for “safe harbor” protection under the DMCA. If the safe harbor applies, the case
will be over. See Viacom Int. Inc. v. YouTube, Inc., 718 F. Supp. 2d 514, 519-524 (S.D.N.Y.
2010); and Perfect 10 v. CCBill, 488 F.3d 1102, 1109 (9th Cir. 2007) (finding safe harbor issue
sufficient to resolve case on early adjudication). If it does not, the case may resolve itself
quickly via settlement. If there is any remaining issue in dispute, the litigation can proceed
focused on those triable issue(s).
Defendants propose that each party bring any motion for summary judgment limited to
the DMCA issue on or before June 15, 2011. Discovery would then be conducted as necessary
on the issues raised by the motion(s), and this pivotal issue should be fully briefed and ready for
decision sometime in the fall. The Court’s ruling on that motion is likely to be case dispositive.
In the event that neither party obtains summary judgment, each party may later file a motion for
summary judgment on any other ground(s) at the close of discovery. This procedure was used
successfully by the district court in CCBill (Nov. 17, 2003 Order, copy attached) (“pending
disposition of the DMCA issues . . . Defendants should be spared the burden and expense of
responding to demands that are not focused upon the potential application of the
DMCA”)(Attachment 2, pp.2-3). It is also similar to the streamlined procedure this Court

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recently adopted in Quito Enterprises, LLC v. Netflix, Inc. et. al. (No. 08-CV-23543-JORDAN).
The CCBill court spelled out the limits of discovery related to the safe harbor issues, and
Plaintiffs’ contention that all liability issues must “overlap” is overstated. The safe harbor issue
does not require a work-by-work examination of liability and would thus save the parties (and
the Court) from significant and unnecessary litigation burden.
Plaintiffs’ reliance on the misdeeds of other litigants is beside the point. In particular, the
Fung case is factually dissimilar as it was a peer to peer file sharing case against an unabashed
infringer. The Viacom case therefore is more persuasive. The Viacom court therefore believed
the Fung case had “little application” to the facts presented. See Viacom , 718 F. Supp. 2d at 25
(“Fung was an admitted copyright thief whose DMCA defense under § 512(d) was denied on
undisputed evidence of “ ‘purposeful, culpable expression and conduct’ aimed at promoting
infringing uses of the websites” (citing the same page--2009 WL 6355911, at *15—relied up by
Plaintiffs here.) Hofile’s hosting service is more closely analogous to Google’s YouTube
service that the peer file sharing at issue in Fung. In contrast, Hotfile has designed its service to
comply strictly with the DMCA and is confident that it will qualify for Safe Harbor protection.
If the Court would prefer, Hotfile will promptly file a motion demonstrating why a staged or
phased approach—with the first phase limited to the DMCA safe harbor issues ending with a
summary judgment ruling—will be the most effective way to handle this litigation.
b. Plaintiffs’ Statement
Defendants’ proposal to permit defendants to file a separate summary judgment motion
on their DMCA defense, in addition to a summary judgment motion on liability, should be
rejected. Defendants’ further proposal to limit discovery to what defendants believe to be
relevant DMCA issues is entirely baseless, and should be rejected apart from whether the Court

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permits additional summary judgment briefing. While defendants are entitled to move for
summary judgment on an affirmative defense, there is no basis to permit them to move on it
separately and then have yet another chance to move for summary judgment on liability.
Plaintiffs do not intend to separately move for summary judgment on defendants’ defense, and
they would be unduly burdened by the need to respond to another dispositive motion while
discovery is ongoing. Further, plaintiffs are presumptively entitled to seek discovery on their
affirmative claims, and defendants provide no basis to artificially constrict plaintiffs’ discovery
merely because they are asserting an affirmative defense. It is not unusual for defendants to
assert that an affirmative defense, if proven, would resolve the case, but that alone is not
sufficient to restrict discovery to that defense.
Permitting defendants to file a separate summary judgment motion on their DMCA
defense prior to the close of discovery would also be pointless, as that motion simply cannot be
resolved without fully developed factual record, at the close of fact discovery on plaintiffs’
claims. Issues related to defendants’ liability and any DMCA safe harbor are inextricably
intertwined. Defendants must show that they meet a number of requirements to obtain the
statutory safe harbor of the DMCA, not merely that they removed content in response to
takedown notices. For example, defendants cannot be eligible for the safe harbor if they failed to
remove or disable access to material where they had “actual knowledge that the material or an
activity using the material on the system or network is infringing,” or were “aware of facts or
circumstances from which infringing activity is apparent,” 17 U.S.C. 512(c)(1)(A), if they
“receive[d] a financial benefit directly attributable to the infringing activity” where they had “the
right and ability to control such activity,” 17 U.S.C. 512(c)(1)(B), or if they failed to reasonably
implement a policy to terminate users who are repeat infringers pursuant to 17 U.S.C.

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512(i)(1)(A). None of these issues can be resolved absent a developed factual record, and
discovery into these topics will plainly overlap with plaintiffs’ discovery on their affirmative
claims. See, e.g., Columbia Pictures Indus., Inc. v. Fung, No. 06-5578 SVW (JCx), 2009 WL
6355911, at *15-*18 (C.D. Cal. Dec. 21, 2009). Indeed, the DMCA defense cannot be resolved
without the plaintiffs’ obtaining discovery showing that defendants are liable. See id. at *18
(“[I]nducement liability and the [DMCA] safe harbors are inherently contradictory. . . .
Defendants are liable for inducement. There is no safe harbor for such conduct.”). Thus, even if
defendants filed an early motion for summary judgment based on the DMCA, it would be
necessarily denied, or its resolution would be postponed, under Fed. R. Civ. P. 54(d).
Defendants’ citation to other orders that have staged discovery on defenses is inapposite,
as defendants make no attempt to analogize the circumstances in those cases to that here. Quito
was a patent infringement case, and CCBill involved claims against a payment processor and
connectivity provider, not a service paying users to upload infringing works and offering them
for download. Indeed, defendants’ attempt to distinguish the Fung case merely shows why full
discovery is necessary in this kind of case, as it is premised on a finding that defendants are not
liable for infringement, the issue that must be resolved on summary judgment on liability.
Indeed, even the Viacom court (on which defendants rely) did not stage discovery on DMCA
issues. Defendants must show far more than their intent to assert an affirmative defense in order
to narrow discovery to that defense.
If the Court is inclined to entertain such a request, plaintiffs submit that a request for
multiple summary judgment motions or to restrict discovery should be made by separate motion
to which plaintiffs may fully respond.

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4. Evidence Preservation.
The parties have exchanged correspondence and conferred extensively about evidence
preservation issues. Plaintiffs’ motion for a preservation order remains pending before the
Magistrate Judge.

5. Proposed Time Limits.
The parties propose the following deadlines:
Deadline
Deadline for serving disclosures
under Fed. R. Civ. P. 26(a)(1)
Deadline for joining parties and
amending pleadings
Deadline for exchanging
privilege logs
Deadline for expert disclosures
under Fed. R. Civ. 26(a)(2) and
Local Rule 16.1(k)
Deadline for rebuttal expert
reports
Discovery cut-off
Dispositive motion deadline
Final pretrial conference
Trial date

Plaintiffs’
Proposal
April 25, 2011

Defendants’
Proposal
April 25, 2011

August 1, 2011

June 15, 2011

June 15, 2011

June 15, 2011

September 9,
2011

September 9,
2011

September 23,
2011
October 17,
2011
November 30,
2011
On or after May
7, 2012
On or after May
21, 2012

November 11,
2011
January 16, 2012
January 30, 2012
On or after May
7, 2012
On or after May
21, 2012

a. Plaintiffs’ Statement
Plaintiffs believe that their proposed time limits provide a sufficient time for discovery to
be completed, as the parties have already served and are moving forward on responding to
discovery requests. Plaintiffs believe that the time for joining parties and amending pleadings
should not be unnecessarily constricted, as defendants have proposed, given that plaintiffs will
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need to ascertain the identities and involvement of additional parties that may be added to this
action in place of the Doe Defendants, through the course of discovery that plaintiffs must obtain
from the defendants. Regarding expert rebuttals, plaintiffs believe that their proposal provides
sufficient time for rebuttal and plaintiffs have never stated that they anticipate designating a
particularly large number of experts.
b. Hotfile’s Statement
It is not reasonable to impose such arbitrarily short time periods on Defendants for
discovery, especially when Plaintiff wants to present a moving target, with the ability to freely
add to and change its allegations until near the end of discovery.
For the reasons explained above, an early targeted motion on the application of the
DMCA safe harbor provision will help focus discovery and make it realistic for the parties to
stay within the outer range of the standard track, with a discovery cut off on January 16, 2012
and a dispositive motion cut off of January 30, 2012. Defendants have also proposed more time
for disclosure of Rebuttal experts (until November 30, 2011) as Plaintiffs have indicated they
intend to designate a large number of experts.
6. Likelihood of Settlement
The parties intend to explore the possibilities for promptly settling the case and have
scheduled an initial settlement meeting for April 29, 2011. The parties do not believe that the
schedule should be modified at this time based on settlement discussions.
7. Additional Parties and Amended Pleadings.
a. Plaintiffs’ Statement
Plaintiffs believe additional parties may be added to this action in place of the Doe
Defendants. Those may include other individuals or entities involved in the operation of Hotfile

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as well as operators of third-party websites that have partnered with defendants to facilitate
infringement via Hotfile. Plaintiffs will seek to identify these potential defendants through
discovery, as information regarding those entities is uniquely in possession of defendants.
Plaintiffs anticipate amending the pleadings to add those defendants, but do not otherwise
anticipate amending the pleadings at this time.
b. Hotfile’s Statement
Plaintiffs wish to be able to freely add parties and amend their complaint up until August
but insist on a discovery cut off just two and a half months later. As noted above, Plaintiffs also
insist on the one-sided ability to inject thousands of additional works in to the case at any time.
Their complaint reveals that they have been investigating and planning this action for “well over
a year”. Compl. ¶ 37. Plaintiff should identify all parties to the action no later than June 15,
2011 more than four months after it filed this action.
Hotfile is willing to commit to the June 15 date to determine whether to assert
counterclaims. In the days immediately before if filed this litigation, Plaintiffs – invoking
Hotfile’s tools and procedures for copyright owners to unilaterally delete files suspected to be
copyright infringement – caused Hotfile to take down thousands of files for which Plaintiffs
supposedly owned the applicable copyrights. However, it appears that a substantial portion of
these files were not likely to be owned by any Plaintiff (e.g., software and pornography).
Accordingly, if necessary, Hotfile expects to file counterclaims against some or all of the
Plaintiffs (and perhaps the third parties) for material misrepresentations in takedown notices
pursuant to the DMCA. 17 U.S.C. § 512(f).

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8. Proposals for the Formulation and Simplification of Issues.
The parties agree that discovery requests served by one side on the opposing side will be
equally applicable to all parties on the other side, unless otherwise specified by the serving
party.
The parties disagree on the full scope of information that may be redacted in response to
discovery requests. The parties do agree that, for database records that are redacted, redactions
will be done in a way that preserves the ability to identify the geographic location of the user
(such as by providing city and state information or sufficient unredacted IP address information),
and that allows for a unique individual user’s activities to be identified even when examining
different sets of data.
a. Plaintiffs’ Statement
Plaintiffs believe that defendants have no basis to unilaterally redact information
personally identifying particular Hotfile users. In particular, Hotfile possesses information that
will identify individuals to which it has made substantial payments for uploading and promoting
content that is copyrighted. Those individuals are effectively functioning as Hotfile’s business
partners, and defendants have identified no privacy interest that would provide a basis to redact
information identifying such individuals, citing the case indicated below for the first time in this
report. Plaintiffs have proposed a protocol whereby defendants could produce certain data in
partially redacted form, but that would still allow plaintiffs to identify a limited subset of the top
500 users and/or website operators who have received the greatest amounts of payments from
defendants. The parties would then meet and confer regarding any additional information to be
produced in unredacted form. Defendants have refused to agree to this protocol.

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b. Hotfile’s Statement.
Depriving third parties of the rights to privacy in the name of simplifying issues is not an
acceptable option. Hotfile users are entitled to privacy protection. See SaleHoo Group Lt. v.
ABC Co., 722 F. Supp. 2d 1210, 1213-14 (constitutional protections regarding internet
anonymity prevented party in intellectual property infringement action from unmasking internet
users in discovery). Plaintiffs’ proposal would arbitrarily strip 500 users of protection regardless
of their location and, most remarkably, regardless of applicable privacy law or constitutional law.
There is no basis to support the implicit assumption that any user who earns revenues from
Hotfile’s affiliate program must be engaged in copyright infringement. Plaintiffs have refused
to try and accommodate Hotfile users' lawful privacy rights, free speech rights, or other
constitutional guarantees. As noted, the parties have agreed that to the extent that Hotfile
maintains a unique ID for each user that may be used to track the user’s activity, that can be
provided where appropriate in discovery.
9. Admissions of Fact and Documents and Avoidance of Unnecessary Proof and
Cumulative Evidence.
In an effort to streamline production of content files on Hotfile, Plaintiffs intend to
initially request data regarding the downloads of content files, and then, at a later time, request a
subset of content files for production. Once the requested content files have been obtained, the
parties will meet and confer in order to establish procedures to reciprocally mitigate preservation
obligations of content files.
10. Suggestions on the Advisability of Referring Matters to a Magistrate Judge
The parties do not believe that any non-discovery matters should be referred to a
magistrate judge at this time.

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11. Preliminary Estimate of the Time Required for Trial
The parties believe that 7-9 days will suffice for a trial in this case.
12. Requested Date or Dates for Conferences Before Trial, a Final Pre-Trial
Conference, and Trial.
The parties believe that the case could be ready for final pretrial conference on or after
May 7, 2012 and ready for trial on or after May 21, 2012, subject to the convenience of the
Court.
13. Electronically Stored Information.
The parties have met and conferred regarding a plan to facilitate discovery of
electronically stored information, and are largely in agreement concerning its provisions. The
parties expect to submit a proposal to the Court in the next week.
14. Protective Order and Procedure for Asserting Claims of Privilege or Protection.
The parties have met and conferred regarding a proposed protective order governing use
and disclosure of confidential information, and expect to submit a proposal to the Court in the
next week.
By: s/ Karen L. Stetson
Karen L. Stetson
GRAY-ROBINSON, P.A.
Karen L. Stetson (FL Bar No. 742937)
1221 Brickell Avenue
Suite 1600
Miami, FL 33131
Phone: [phone]
Fax: [phone]
MOTION PICTURE ASSOCIATION
OF AMERICA, INC.
Karen R. Thorland (Pro Hac Vice)
15301 Ventura Blvd.
Building E
Sherman Oaks, CA 91403

26501\2581326.1

JENNER & BLOCK LLP
Steven B. Fabrizio (Pro Hac Vice)
Duane C. Pozza (Pro Hac Vice)
Luke C. Platzer (Pro Hac Vice)
1099 New York Ave., N.W.
Suite 900
Washington, DC 20001
18

Phone: [phone]
Fax: [phone]
Attorneys for Plaintiffs

By: s/______________
Janet T. Munn, Fla. Bar No. 501281
Rasco Klock
283 Catalonia Avenue, Suite 200
Coral Gables, Fl 33134
Telephone: [phone]
Telecopy: 305.476.7102
Email: [e-mail]
And
Roderick M. Thompson (admitted pro hac vice)
Andrew Leibnitz (admitted pro hac vice)
Deepak Gupta (admitted pro hac vice)
Janel Thamkul (admitted pro hac vice)
FARELLA BRAUN + MARTEL LLP
235 Montgomery St.
San Francisco, CA 94104
Telephone: [phone]
Telecopy: 415.954.4480

Attorneys for Defendants

26501\2581326.1

19

Attachment 1

FILED: NEW YORK COUNTY CLERK 06/09/2010
NYSCEF DOC. NO. 26

INDEX NO. 100152/2010
RECEIVED NYSCEF: 06/09/2010

Attachment 2

Case 2:02-cv-07624-AHM -SH Document 111

Filed 11/17/03 Page 1 of 3 Page ID #:102

Case 2:02-cv-07624-AHM -SH Document 111

Filed 11/17/03 Page 2 of 3 Page ID #:103

Case 2:02-cv-07624-AHM -SH Document 111

Filed 11/17/03 Page 3 of 3 Page ID #:104