Summary: One accomplice in the Prenda Law porn copyright scheme has admitted guilt, placing the other accomplice in a tough spot to maintain innocence in the plot to extort money for victims.
John L. Steele admitted his role in a scheme to extort money from those that downloaded porn illegally. Steele and his partner Paul R. Hansmeier were indicted in December on several charges of fraud. Hansmeier and Steele are known for being copyright trolls but they took their scheme to another level, which ultimately got them in trouble.
Steele admitted his guilt as part of a plea bargain. The charges he pleaded to included conspiracy to commit mail fraud and wire fraud as well as conspiracy to commit money laundering.
In the scheme, the attorneys bought copyrights for pornography videos under the names of multiple shell companies. He stated that they would then upload the videos to internet piracy sites to wait until someone downloaded them. They even made videos themselves that they would upload.
After someone would illegally download the videos, Steele and Hansmeier would file fake copyright claims against the downloaded. The courts would then turnover personal information on the downloader so that legal lawsuits could be pursued. Steele and Hansmeier never intended to take anyone to court. They needed the personal information so they could contact the downloaders either by phone or mail. These threatening messages stated that the downloader could face $150,000 in fines or they could just pay $3,000 and the problem would go away. Most of the downloaders would rather avoid the legal fees and embarrassment of their actions so they paid the $3,000.
Eventually the courts noticed that something wasn’t right so judged barred them from suing multiple defendants under the same copyright lawsuit. Steele claims they took the route of claiming they had been hacked. This allowed them to entice their victims to testify against “co-conspirators” in exchange for waiving “settlement fees.”
In the end, Steele and Hansmeier ended up collecting over $6 million from fake settlements. With Steele admitting his guilt and naming his accomplice, Hansmeier will find it hard to maintain his innocence. Even if Hansmeier is successful at claiming Steele pulled off the scheme on his own, Hansmeier is under scrutiny and being investigated for another scheme that targeted people for minor violations of the American Disabilities Act.
Who do you think was the master mind behind the scheme? Steele or Hansmeier? Tell us in the comments below.
To learn more about the case, read these articles:
- Payback Time Nears for Victims of Prenda Law’s “Porno-Trolling Collective”
- Court Rules You Can’t Take Over $100,000 Out of Your Law Firm to Fake a Financial Crisis
- Prenda Law Lawyer Busted in Porn-Blackmail Scheme
Photo: latimes.com