Hotfile Fights Back-Says Movie Studio Abused Its Anti-Piracy Tool

Earlier this year, the MPAA kicked off the entertainment industry’s battle against “cyberlockers” by suing Hotfile, a company it painted as a particularly egregious offender. But Hotfile is hardly rolling over in the face of this legal attack; recently filed court documents show the shape of the company’s defense strategy.

Hotfile has filed papers indicating that part of its defense will be a counter-claim that one of the plaintiffs-Warner Bros. (NYSE: TWX) Entertainment-used an antipiracy tool on Hotfile’s website to take down material it didn’t even own. In a footnote on page 6 of a recently filed document, Hotfile claims that Warner “used an antipiracy tool provided by Hotfile at Warner’s request to improperly remove material for which Warner did not own a copyright, and that Warner removed some material without ever verifying the contents of what it was deleting.”

MPAA lawyers haven’t yet responded to that claim, which was first reported by the TorrentFreak blog.

Presently, the parties are disputing the scheduling of how to handle the lawsuit. Hotfile wants to an early argument on a summary judgment motion that it’s protected by the “safe harbor” of the Digital Millennium Copyright Act. That’s the same law that has allowed YouTube (NSDQ: GOOG) to win its legal battle with Viacom (NYSE: VIA). (In that case, the judge found that even though users do sometimes upload copyrighted material to YouTube, the company takes it down promptly.) The studios “want delay,” write Hotfile lawyers. “The longer they can put off allowing the Court to consider the merits of the DMCA Safe Harbor issue, the more costly the defense of this case for the much smaller Hotfile.”

But the movie studios say the DMCA safe harbor issue can’t be decided without significant amounts of evidence-gathering through the discovery process. “Early summary judgment motions on defendants’ DMCA defense would only result in wasteful and duplicative discovery and motions practice,” write MPAA lawyers.

If discovery actually proceeds, it would finish up by the end of this year, and if a trial was necessary it could be scheduled as early as the middle of 2012.