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Solers, Inc. v. Doe

August 13, 2009


Appeal from the Superior Court of the District of Columbia (CAB3779-05) (Hon. Anna Blackburne-Rigsby, Motions Judge) (Hon. Jennifer M. Anderson, Motions Judge).

The opinion of the court was delivered by: Fisher, Associate Judge

Argued June 19, 2008

Before REID, GLICKMAN, and FISHER, Associate Judges.

In this unusual case, the defendant has not yet been identified. Appellant Solers, Inc. filed a complaint against John Doe, alleging defamation and tortious interference with "prospective advantageous business opportunities." Seeking to learn the identity of John Doe so that it could proceed with service of process, Solers next served a subpoena upon appellee, the Software & Information Industry Association ("SIIA"). In response, SIIA filed a motion to quash the subpoena. The trial court granted that motion and later dismissed Solers' lawsuit for failure to state a claim. Concluding that both rulings were made in error, we vacate the trial court's orders and remand for further proceedings consistent with this opinion.

I. Factual Background

Appellant Solers, Inc. "is a for-profit Virginia corporation with its principal place of business in Arlington, Virginia. [Its] work principally consists of developing software and other technology for agencies within the Department of Defense." Solers is a privately held company, owned by its employees. Appellee SIIA describes itself as "the principal trade association for the software and digital content industry" and explains that "[o]ne of [its] chief missions is to protect the intellectual property of member companies by fighting the software piracy that threatens to undermine the entire industry." While Solers' work is primarily in the same industry that SIIA seeks to protect, Solers is not a member of SIIA.

In order "[t]o fulfill its mission, SIIA [has] established an Anti-Piracy Division and developed anti-piracy programs involving both education and enforcement." "SIIA's enforcement program enables sources with knowledge of software piracy to report anonymously to SIIA via telephone or the Internet about companies [committing piracy] . . . ." To encourage reporting, "SIIA allows individuals to submit information . . . on a confidential basis." Through this program, John Doe, an "individual," reported that Solers was engaged in illegal activity. Accusations of copyright infringement followed, and Solers sued Doe but has not been able to learn his or her identity.*fn1

A. SIIA's Accusation of Copyright Infringement

SIIA acknowledges that, "[i]n March 2005, [it] received a communication via the Internet from [Doe] who alleged that Solers was using unlicensed software." Soon thereafter, on April 29, 2005, SIIA's attorney wrote to the President of Solers, accusing Solers of "copyright infringement." The letter stated that SIIA "has evidence that Solers, Inc. is engaged in the unlawful copying and use of software published by the software publishers listed in [the attached exhibit] in violation of the Copyright Act, Title 17 U.S.C. § 501, et seq." The letter announced that "[SIIA is] prepared to seek remedies available under the Copyright Act," but explained that SIIA "prefer[s] to work with companies to reach a resolution that is quick, fair and out of the public spotlight . . . [through] a three part process [that leads to] an easy and quick settlement . . . ."

SIIA's letter demanded that Solers complete an internal audit of its software programs, instructed Solers on how to complete the audit, and requested that Solers deliver the results to SIIA. According to SIIA's letter, once the audit was completed, the parties would negotiate a settlement and SIIA would release Solers "from all claims and causes of action for copyright infringement." The letter warned, however, that "if Solers [] is unwilling to promptly conduct an audit and the other activities mentioned [in the letter], [Solers] should be aware that SIIA will not hesitate to initiate litigation against Solers [] for copyright infringement." The letter did not provide any information about the alleged "evidence" of Solers' "copyright infringement," or any details regarding the source of this "evidence."

According to Solers, "[b]etween May 2 and May 13, 2005, representatives of SIIA and Solers communicated regarding [SIIA's] allegations of software piracy by Solers. Through these communications, Solers informed SIIA that it had reviewed its computer systems and confirmed that Solers had violated no party's copyright." Solers further asserts that "[a]s a result of the communications between Solers and SIIA between May 2 and May 13, Solers satisfied SIIA that [Doe's] allegations were false. On Friday, May 13, 2005, counsel for SIIA confirmed to [Solers' attorney] that SIIA had 'closed its file' on Solers." (SIIA states that it decided not to pursue a claim against Solers in order to protect the identity of John Doe, not because it concluded that his allegations were false.)

B. The Identity of John Doe

John Doe used the "website reporting form" that is part of SIIA's "Corporate Anti-Piracy program" to provide information about Solers. Sources, like Doe, "who report piracy by corporate software end-users to SIIA[,] may become eligible for financial payment under [this program.]" Source reports "are received by two SIIA employees who . . . forward [them] to [the program's legal counsel] for [] review" and a determination as to whether SIIA should "pursue the report further."

SIIA asserts that it has kept Doe's identity and the information that Doe provided about Solers confidential. SIIA has a "long standing policy of keeping the identity of [its] sources anonymous (unless required by law to disclose the identity)[, and] . . . maintain[ing] as confidential the information provided by its sources[.]" Thus, when Solers asked SIIA to voluntarily disclose Doe's identity in May 2005, SIIA refused to do so. The only information SIIA has disclosed is that Doe is an "individual" who "does not work or reside in the District of Columbia" and "did not choose to participate in SIIA's Reward Program and therefore was never asked to, and did not sign, the Terms and Conditions of the Corporate Anti-Piracy Report Program."

II. Procedural History

On May 18, 2005, Solers filed a complaint against Doe which alleged one count of defamation and one count of tortious interference with "prospective advantageous business opportunities[,]" and requested injunctive relief, compensatory damages, and punitive damages. The following day Solers issued a subpoena to SIIA, seeking production of all documents related to the identity of Doe, Doe's initial report and his ensuing correspondence with SIIA, and "[a]ll documents . . . believed to be 'evidence'" of Solers' alleged copyright infringement. SIIA, which is not a party to the underlying suit, lodged objections to the subpoena on June 9, 2005, and, in response, Solers immediately moved to enforce the subpoena. SIIA then filed a motion to quash.

On December 16, 2005, Judge Blackburne-Rigsby heard arguments from Solers and SIIA on these two motions. Counsel for SIIA informed us at oral argument that SIIA notified John Doe of the lawsuit and the subpoena. However, Doe did not participate in this hearing, either in person or through counsel, and only SIIA made arguments in support of Doe's interests.

Solers argued that "where a plaintiff comes to court and accuses [a] defendant of illegal conduct, [the defendant] can't hide behind the First Amendment . . . to remain anonymous." Solers conceded that some anonymous speech on "public affairs" is protected, but it argued that such protection is not appropriate here because "[t]his was a private e-mail from Doe to a private organization accusing [Solers] of fundamentally improper conduct in the industry in which it operates." SIIA, on the other hand, argued that the "anonymous speaker" on the internet has First Amendment rights and that a plaintiff must "do more than file a lawsuit" in order to unmask him. Acknowledging that it was raising novel issues in the District of Columbia,*fn2 SIIA presented case law from other jurisdictions.

At a status hearing on April 28, 2006, the court heard additional argument from Solers.*fn3 Expressing concern that "there's been no financial or economic harm demonstrated in the pleadings[,]" the court asked Solers to address this issue, explaining that "I get to this question about . . . harm . . . [because] one of the test[s] that I should apply in determining whether or not to compel [SIIA] to release [Doe's identity] is whether or not your claim will withstand a motion to dismiss." In response, Solers argued that "the harm is actual," "the harm is reputational," and "when we get into discovery with John Doe we'll find out what other harm has been caused, and that may very well be economic." The court then questioned Solers about the "other efforts [it has] taken ...

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