Movie Studio Wants $869,000 From FileServe to Compensate Piracy Losses

[Ernesto]

In recent years several file-hosting services have been taken to court in the US, including Megaupload, Hotfile and RapidShare.

While these cases differ in nature, all companies have been accused of facilitating piracy through their services.

Last year FileServe joined the growing list when the makers of the independent movie American Cowslip filed a lawsuit at a federal court in California. The movie producers accused FileServe of a wide variety of copyright related offenses, including selling pirated goods through subscriptions.

“FileServe is aware that its websites are being used as a vehicle to illegally copy and distribute large amounts of infringing materials. Because it charges membership fees for immediate access to the copyrighted materials stored on its servers, it is a distributor and seller of pirated materials,” the complaint read.

The Virgin Islands-based file-hosting service has thus far failed to respond to the allegations, which prompted the movie studio to file for a default judgment. This motion, submitted to the court a few days ago, asks for $869,500 in piracy-related damages.

In a declaration in support of the motion, American Cowslip producer Tony Hewett gives an example of the massive infringement that allegedly occurred on FileServe’s services. The producer lists statistics from a now defunct linking website, fileserv.com, which shows nearly 20,000 downloads.

“The accounting shows 19,928 downloads of American Cowslip. Cowslip Film Partners LLC did not authorize any of those downloads,” American Cowslip producer Tony Hewett writes.

What the producer fails to mention and perhaps isn’t aware of, is that these numbers are usually fabricated.

Based on revenues of comparable movies the producer also ran a statistical forecast model which predicts that American Cowslip should have generated more than a million in revenues in North America, as opposed to the $68,000 that it actually made.

According to the movie studio this revenue gap can be largely attributed to piracy so it wants FileServe to pay the difference. This arrangement appears to ignore potential losses ‘generated’ by all other piracy sources.

“Based upon our forecast of a minimum $1,250,000 for North America, and discounting that by 25% on the chance that the film would never be well-received by the public, it is my opinion that Cowslip Film Partners should have receive [sic] not less than $937,500 from North American distribution,” Hewett notes.

“Because receipts from North America were only $68,000, I attribute damages of $869,500 to the FileServe piracy,” he adds.

The judge now has to decide whether this amount will be awarded. Since FileServe isn’t defending itself the file-hosting service is bound to lose. But even when that happens it’s still unsure whether the movie studio will ever see a penny.

For FileServe this is not the fist time it has been targeted in the US. Last year Paramount Pictures’ vice president for worldwide content protection identified the file-hosting service as one of the prime candidates to be shuttered next as part of any future U.S. Government action.

Cowslip Film Partners previously sued Megashares in a similar lawsuit. The case was settled last year but the terms were not disclosed.

Source: TorrentFreak, for the latest info on copyright, file-sharing and VPN services

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