Prenda: the gift that keeps on giving. Late last week there was some movement in the ongoing fight directly involving Alan Cooper and Prenda. If you don't recall, Alan Cooper claimed that Steele put Cooper's name and signature on various documents, such as those suggesting that he was the person behind shell companies AF Holdings and Ingenuity 13 (two of the shell companies that Judge Otis Wright found were actually controlled by Prenda's principles, including John Steele, Paul Hansmeier and Paul Duffy). Prenda tried to handwave this issue away, but also refused to answer any basic questions about it. In response, Cooper sued both Steele and Prenda (remember this, it'll come up again).

In response, Prenda as a company, and Paul Duffy and John Steele as individuals, all sued Cooper (and his lawyer and anonymous internet commenters) for defamation in state courts in Illinois and Florida. Steele dropped the Florida suit (we believe due to a pretty big procedurial screwup), and the two cases in Illinois were removed to federal court. About this time, Steele called Cooper and left voicemails that are clearly bullying/intimidation attempts. It is, of course, a big legal no-no to directly contact someone (rather than their lawyer) who is suing you while litigation is ongoing, but Steele tried to get around this in the voicemail by claiming the call was not about Cooper's lawsuit against Steele (where Cooper was represented), but Steele's lawsuit against Cooper. Since he was also suing Cooper's lawyer, he knew that the same lawyer was unlikely to be able to defend Cooper in the same case, and in fact some filings in the case suggest that this point was made to his lawyer.

Cooper and his lawyer, Paul Godfread, then filed counterclaims in the two remaining defamation cases (one from Prenda and one from Paul Duffy who supposedly runs Prenda). Then Paul Hansmeier (named as one of the Prenda principles by Judge Wright), now representing Paul Duffy and Prenda, argued that the defamation case should never have been removed to federal court from state court, because his own law firm in Minnesota was added as a plaintiff in an amended complaint and you can't get "diversity" needed to remove from state to federal court if two opposing parties are in the same state. As we noted at the time, it seemed like adding Hansmeier's Alpha Law firm was a complete sham, because nothing in the amended complaint involved any defamatory statements towards Alpha Law firm.


Phew. So that catches you up to last week. A few interesting things then took place last week. First, on Monday, in the original case that Cooper had filed against Prenda and John Steele in Minnesota, Godfread asked the court for a default judgment because Prenda/John Steele had never replied. Note that Steels has been insisting that Cooper's claims are bogus and that this would all come out in court. If that were true, you'd think that he would have bothered to respond to the damn lawsuit. Also ironic: Steele claimed he would go after Cooper for default. Godfread also points out that Steele and Prenda clearly knew about the case because of the lawsuits they had filed in response. So, they ask the court for a default ruling... and ask for the $4,641,000 that they estimate Steele and Prenda made via lawsuits using Alan Cooper's name.

That very same day, Prenda and Steele finally filed a response. The response is basically "we deny everything possible." Of course Minnesota Law (MN R. Civ. P. 12.01) requires an answer within 20 days after service, and we're way, way outside of that.

Leaving that particular case aside for the moment, and jumping back to the Defamation case that Duffy and Prenda had filed back against Cooper and Godfread (where they amusingly and ridiculously claim that lawsuit over identity fraud was "completely unrelated"), Cooper and Godfread have hit back at Prenda's weak attempt to move it back to state court. They're both represented by Erin Russell and Jason Sweet - two lawyers who have been fighting the good fight against Prenda for a while now. When Hansmeier first filed that attempt, we noted that Prenda's history of being less than forthcoming in its filing made me wonder if it was being somewhat misleading with that filing - and I would reserve judgment until the inevitable reply was filed. And, yes, it suggests less than full honesty from Hansmeier.

First, it makes a strong case (as I had suggested) that Hansmeier's firm, Alpha Law Firm, was added for no other reason than to try to keep the case in state court and out of federal court. But, even more importantly, it points out that Prenda apparently mislead the court in getting the amended complaint filed. That's because to amend the complaint, Prenda would first need to ask the court for leave to amend, which it did not. Even worse, the lawyer representing Prenda, Kevin Hoerner, apparently convinced the court clerk that there was no need to take that important step because (he claimed) the defendants (Cooper and Godfread) had not yet been served. Except (1) they had and (2) Prenda knew they had because John Steele called Godfread hours after they had been served (and days before this "amended" complaint was filed) and left the following voicemail:

"Mr. Godfrey. This is John Steele calling. I understand that you just got served. So, I do need to know if you are going to be representing Mr. Cooper in this suit as well. Obviously there is a conflict of interest that I can see but obviously I'm going to have to defer that decision about whether you are going to represent your co-defendant to you. Uhm and I leave the question as to the other suits that are coming your way in the next few days, I'll just wait until you actually get served before I bringing those up, but at least on this issue, this suit, I do need to know if I may contact Mr. Cooper directly or if I will be working through you. All right. Thank you."

That's the call I mentioned earlier in which Steele was making sure that Godfread wouldn't represent Cooper in this particular case, which Steele seems to think made it okay for him to reach out directly to Cooper. So, Prenda knew that the defendants had been served, and told the court they had not in order to file an amended complaint, where the amendment appears to be solely to add a sham plaintiff in the same state as Cooper and Godfread to block them from removing it to federal court. Oh, and did we mention that Hansmeier's filing to move the case back to state court was filed well past the deadline to make such a filing?

As I said, Prenda is the gift that just keeps giving.


In another filing, Russell and Sweet, representing Cooper and Godfread, also hit back at Prenda's attempt to dismiss their counterclaims. Here, the most interesting part is more evidence being filed that Steele pretended to be Cooper. In particular, they file a document from GoDaddy, showing what is clearly John Steele (it's using his email) registering various domains while claiming to be Alan Cooper. Just last week Steele demanded to see evidence that he faked Cooper's name. Well, there it is. That same document also shows that the domain was originally filed with Prenda's address in Chicago, but then was moved to what appears to be John Steele's sister's house in Phoenix. Oh, and also customer service records that show that John controlled the account.

And, just for good measure, there are a couple more filings showing that John Steele (and sometimes Paul Hansmeier) bought the various domain names used by Prenda Law (despite claiming that they had nothing to do with the firm) and that Steele continued to control that account (he called for customer service a few times) for quite some time, again contrary to Steele's public statements.

I fully expect to see Steele continue to tapdance around this, and maybe give a few more interviews to the press where he doesn't really answer the questions, but it would seem that reality has an unfortunate habit of eventually coming out. Given all of this, it would look like Cooper has a pretty strong change of winning his initial lawsuit against Prenda and Steele (though I doubt the $4 million is going to show up) and Prenda and Paul Duffy's nuisance defamation lawsuit in response is probably in trouble as well.

Oh, one more fun tidbit in the filings. I'd mentioned above the absolutely ridiculous statement in the lawsuits against Cooper and Godfread, that Cooper's lawsuit against Prenda was a totally "unrelated matter." Yet, the filing notes that not all of Prenda's lawyers were told not to admit the connection. They point out that in the infamous case in Georgia, where Prenda's local counsel Jacque Nazaire has tried to get the court to ignore Judge Wright's finding of fact because California recognizes gay marriage, Nazaire also flat out admits that the cases are connected. Sweet and Russell suggest: "Apparently, Atty. Nazaire did not receive Plaintiff's memo to lie to the Court on this issue." Ouch.