Specifically, Hunt slammed Righthaven for failing to disclose that its contract with Las Vegas Review-Journal parent Stephens Media called for the companies to split lawsuit proceeds 50-50. Hunt also ordered Righthaven to obtain a transcript of the sanctions hearing, held on Thursday, and make it available to judges and defendants in the company's other 100-some pending cases in the state.
Considering that the Nevada state bar is believed to be investigating Righthaven, that ruling could spell very bad news. But even beyond any possible state bar actions, Hunt's ruling could well have an impact on how other judges view Righthaven's lawsuits. While a $5,000 fine probably isn't a huge amount for Righthaven to absorb, a judge's findings that the company misled the court could prove very damaging.
Judges presiding over contested copyright lawsuits have tremendous discretion over matters ranging from whether to grant adjournments to what sort of evidence to consider on whether to award the winner attorneys' fees. While the copyright statute says that judges can order the losing party to pay the winner's legal fees, judges need not do so.
Additionally, financial damages for copyright infringement can be as little as $750.
Even if Righthaven was to win every lawsuit it filed, but only to the tune of $750, the company probably wouldn't be able to stay in business long. Filing the case alone costs more than $300, and Righthaven also has operating expenses, salaries to pay and the like.
When Recording Industry Association of America sued individual file-sharers, the organization lost more money than it collected. At this point, Righthaven could well end up in the same boat.