Troll lawyer uploads porn to Pirate Bay, extorts downloaders to settle ‘copyright’ claims

The lawyer deliberately released copyrighted material in order to coerce downloaders to settle -- or be publicly humiliated.

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If you use torrent software and search engines to download copyrighted content illegally, you may run the risk of being warned by ISPs or legal representatives that further infractions could lead to prosecution -- especially if you do so without the use of VPNs or IP masking.

However, it is not every day that you come across a case when an attorney deliberately uploads copyrighted, adult material for torrent users to download in order to extort them for money.

In an interesting case of legal professionals abusing their knowledge of the IP system to conduct fraud, an attorney in Florida has found himself behind bars after being involved in a "multi-million dollar fraud scheme," the US Department of Justice (DoJ) said on Tuesday

Between 2011 and 2014, John Steele, alongside co-defendant Paul Hansmeier -- another practicing lawyer -- concocted a scheme in which the pair would create what prosecutors called "sham entities" to obtain the copyrights to a range of pornographic movies. 

Steele and Hansmeier also filmed a number of adult movies themselves. 

With a selection of pornographic movies in their portfolio, the lawyers then deliberately uploaded them and made them available to torrent search websites. 

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After leechers hooked into the torrents and downloaded the pornographic material, Steele and Hansmeier would file copyright infringement lawsuits -- without mentioning their personal stake in the IP, of course -- which then gave them the right to subpoena Internet Service Providers (ISPs) for subscriber information connected to the downloading IP address. 

Empowered with this data, the lawyers then attempted to extort the downloaders with both letters and phone calls threatening vast financial penalties and "public embarrassment" if the pirates failed to pay a $3,000 "settlement" fee. 

According to Steele's plea agreement, court documents, and the indictment, in 2011 the duo created shell legal companies including Prenda Law in order to try and distance themselves and keep their own stake in the scheme under the radar. 

While Steele and Hansmeier had control over these companies, they recruited a fellow attorney based in Illinois to "pretend to own and control the law firm," prosecutors say. 

The DoJ estimates that the lawyers made roughly $3 million from their fraudulent copyright lawsuits alone. 

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A year later, the lawyers decided to also file false lawsuits claiming that PCs systems belonging to sham clients had been hacked. Fake "defendants" were sourced from those previously caught downloading pornography and they agreed to be 'sued' as hackers by Steele and Hansmeier as long as their settlement fees disappeared -- a scam designed, perhaps, to bolster the legitimacy and reputation of the legal companies. 

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The men were arrested in 2016 on charges of money laundering, fraud, and perjury.

Steele pleaded guilty in 2017 and has now been sentenced to five years in prison by the District of Minnesota court. The attorney will also have to adhere to two years of supervised release and must pay approximately $1.5 million.

While Steele cooperated with the authorities, Hansmeier originally fought the allegations and it was not until 2018 that he accepted a plea deal. He was sentenced to 14 years in prison and was also ordered to pay the same amount in restitution. 

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