VeePN hit for copyright and trademark infringement; Funds flow cut off

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(Updated July 20) On July 1, a complaint was filed in US District Court against Panama-based VeePN Corporation and “Does 1-100” by a group of independent studios including 42 Ventures, Voltage Holdings, American Cinema and others, “for committing and concealing movie piracy,” and promoting its services via Reddit, LinkedIn and Twitter.

It also stated that VeePN “blatantly promotes” its service using trademarks registered to one of the plaintiffs, 42 Ventures, which constitutes trademark infringement.

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The back story

Some of the plaintiffs in this current suit had brought legal action against a VPN provider called VPN.HT, and the operators of Popcorn Time, a notorious piracy app for distributing the Popcorn Time app and promoting the VPN “for ‘safely’ using Popcorn Time.”  VPN.HT terminated its partnership with Popcorn Time’s operators after being notified of that earlier suit, and agreed to log its end users’ activities.

Popcorn Time’s operators moved to a new domain and “left a message for Plaintiffs … expressing their intention to continue engaging in piracy.”  Three months later, VeePN began to promote itself as “Popcorn Time VPN,” including on a known piracy Web site called YTS.

The plaintiff group suing for copyright infringement (under 17 USC §§ 106 and 501, and under the Digital Millennium Copyright Act 17 U.S.C. § 1202) and are asking the court to ban VeePN from continued copyright infringement and DMCA violations.  It also calls on the Court to award damages for copyright infringement equal to the defendant’s profits, or alternatively, for statutory damages that can range to $150,000 per copyright, plus maximum statutory damages of $25,000 for each DMCA violation.

42 Ventures’ asserts trademark claim

In addition, 42 Ventures is suing for infringement of federally registered trademarks that are currently registered to 42 Ventures: Popcorn Time, YTS and RAR.BG – alleging that “VeePN is liable for trademark infringement, false descriptions and contributory trademark infringement.”  The complaint is asking the Court to prohibit VeePN from further infringing 42’s trademarks and to pay an additional $6 Million in statutory damages.

Funds cut off

On July 14, the Court issued a temporary restraining order (TRO) to freeze all funds associated with VeePN, for PayPal, PaymentWall and AliPay freeze all accounts that are associated with VeePN through which revenues to VeePN flow, and enjoin them from transferring any funds to VeePN.  The same order also demands that VeePN stop using the Popcorn Time name immediately.

The TRO also called for the defendants to post a bond of up to $25,000, and called for a preliminary injunction hearing on July 28 2022.

It was filed with the US District Court of the Eastern District of Virginia, Alexandria Division, because (nonparty) DataCamp operates at least thirty or more servers in Ashburn, Virginia, and the defendants contracted with DataCamp for hosting and network service including IP addresses from those servers.  Also, VeePN’s domain is registered with a subsidiary of Neustar Inc, in Sterling Virginia.  Both of those cities are under the jurisdiction of this District.

DataCamp not cited

The complaint also identified DataCamp as a carrier of VeePN, as well as an enabler of other infringing services, although DataCamp was classified as a “non-party” in this lawsuit.

The suit claimed that other DataCamp subscribers also “stream, distribute and reproduce unlicensed copies of … Plaintiff’s motion pictures, and yet DataCamp itself is not a defendant in that lawsuit.  DataCamp is, by coincidence, target of a $32 million February 2022 lawsuit by DISH Network, for providing transport services for eleven piracy operations which in turn are illegally distributing about 40 channels that are licensed to DISH.  DataCamp operates data centers in multiple US states and promotes its services widely.

Why it matters

VPNs attract two audiences: pirates who want to conceal their identities, and consumers who want to minimize their risk of theft and other criminal conduct; both by avoiding exposure of their IP addresses.  One pirate cited in the VeePN suit hacked into an individual’s email address to steal $12,000.

It seems ironic that a company (42 Ventures) would register names that are associated with piracy as trademarks, but in fact, 42 “streams in-depth movie reviews and debates concerning pop culture and movies from the Web site under those trademarks thorugh an agreement with the creator of a popular YouTube channel.

Piracy Monitor is surprised that DataCamp, and not just VeePN, isn’t being targeted. – and DataCamp is mentioned no less than 46 times in the VeePN complaint.  But that is literally another matter.

Furthermore, some of the plaintiffs’ content is being distributed over multiple pirate services transported by DataCamp.  It will be interesting to learn why the plaintiffs in this VeePN suit didn’t target DataCamp, and perhaps it’s a matter of the other shoe not yet dropping.

In addition to using DataCamp’s services, VeePN also uses Amazon Technologies, Namecheap, Cogent Communications, Cloudflare and Namecheap for domain hosting and/or nameserver services.

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