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Relativity Hit With Second 'Catfish' Lawsuit as Legal Fight Becomes More Bizarre (Exclusive)

Ryan Kavanaugh's company is blaming a top Hollywood lawyer for spawning a quickly developing legal campaign over music used in the film.

Catfish
Rogue

Relativity Media, currently defending a fascinating copyright lawsuit against its 2010 documentary Catfish, has been sued a second time over the film. And we've learned that the Ryan Kavanaugh company may be prepared to launch a counterattack against the lawyer representing one of the plaintiffs.

First, some background on this extraordinary case.

In January, Spin Move Records sued the makers of Catfish because the controversial film allegedly used a copyrighted song from singer-songwriter Amy Kuney without permission.

The film purports to be a documentary about an incredible hoax, but many have pointed to circumstantial evidence that the filmmakers had staged some of the scenes and were thus playing a hoax on the audience. In the legal context, the difference between a real documentary and a faux documentary could mean the difference between "fair use" of the song and copyright infringement. The filmmakers maintain that Catfish is 100% authentic, opening up questions about the nature of creative license in the documentary filmmaking genre at large.

For more details about the allegations, check out our prior article.

Now, according to Catfish distributor Relativity, the film has an unrecouped balance of more than $8.5 million and will not likely ever become profitable. Further, the company points out that because the copyright on the song was registered late, Spin Move can only seek actual damages -- the value of a reasonable licensing fee for the song -- which it believes would amount to no more than $35,000.

So why is a copyright lawsuit being pursued for such a modest reward?

According to Relativity's lawyer, Jeff Sanders, it's because Spin Move's lawyer Neville Johnson has a legal strategy to extract a lot more than actual damages in this dispute. One might say it's an alleged two-part plan.

First, in federal court papers, Sanders points out a provision of federal copyright law that allows successful parties to recover attorney costs. In other words, even if Spin Move's potential pay-out is modest, Johnson can potentially win compensation from Relativity for his billable hours.

Second, a lawsuit has been filed this week in the UK against Catfish by the copyright holder of a song that also appeared in the film. According to Sanders, Johnson reached out to other songwriters and allegedly interfered with the producer's ability to close a licensing deal. He says that Johnson is trying to make the legal defense so burdensome and expensive that Relativity will be forced to pay a high settlement amount to put it to bed.

Johnson calls the allegation "absolutely false," that the UK plaintiff contacted him, and that any disputes in the UK over a movie that allegedly cleared no rights before its release will be potentially dangerous for Relativity as there's no "fair use" doctrine there.

Back to the issue of attorney costs.

In a highly unusual move, Sanders is demanding access to Spin Move's attorney engagement contract(s) with Johnson, including the fee arrangement.

"As the fee application is clearly the tail wagging the dog, discovery of Plaintiff‟s fee arrangement is highly relevant, as the potential fee application is the greatest amount of value in dispute in this case," writes Sanders in an ex-parte application to the court on Tuesday.

Not surprisingly, Johnson is vigorously fighting the demand. He takes exception to the untimely and procedurally defective way it was made, and says it is premature to produce such documents before any motion for fees has been made. In his opposition, Johnson says such information it "is protected by the attorney-client privilege and is entirely irrelevant to this copyright action."

Johnson tells THR that he is "befuddled by the motion."

Contacted for explanation, Sanders says the information is being requested in advance of challenging any award of legal fees to Johnson. "If you challenge a fee award with evidence, you better get it in discovery," he says.

Meanwhile, Relativity may be on the verge of filing its own lawsuit against Johnson's firm. Sanders points our attention to the firm's reposting of THR's original lawsuit story on its website. The article there is adorned by a copy of the Catfish poster image, which Sanders says represents an infringement of copyrighted material.

Johnson responds that this allegation is too ridiculous to merit a response, asking, "Haven't they heard of fair use as a defense?"

E-mail: eriqgardner@yahoo.com

Twitter: @eriqgardner