Lockblog.com

Revision3 Denial of Service attack by MediaDefender brings Questions of Legitimacy and Accountability 

MediaDefender is becoming more of a mediaoffender. It is interesting that a company linked to the RIAA and MPAA would be behind one of the most vicious attacks on one of the most promising new media enterprises. Media Defender has previously reported problems with money flow.

This brings into question the legitimacy of MediaDefender as an incorporated entity. Is MediaDefender merely a taxicab incorporation for the old media business?

What is a taxicab incorporation? Back in the early days of cab drivers in New York City (1918-1929) a company called Checkered Cabs dominated the landscape. By around 1929 competition, manufacturing, and risk liability incentives increased the drivers to as many as 30,000 among many different companies and killed Cherkered Cab’s dominance. The liability aspect is the most critical aspect to consider. The larger cab companies discovered that if they incorporated each individual cab car as an incorporated entity, liability to the larger corporation was reduced because seizure of assets would entitle a victim to only the property of the individual driver and the specified cab. In 1937 Mayor Fiorello H. La Guardia signed the Haas Act, which introduced official taxi licenses and the medallion system that remains in place today. This act eliminated the taxicab incorporation tactics and increased accountability for cab companies to take proper care of their vehicles.

Similarly taxicab incorporations are used today in different industries. The MPAA and RIAA are shielded cab corporations for media companies like Sony, Time-Warner, and Viacom. However, the old media companies are taking it a step further by possibly adopting a failing company like MediaDefender to create new and vicious attacks on thriving new media companies. MediaDefender shields the RIAA and MPAA, who have assets with an incorporated entity without assets. The RIAA and MPAA lose nothing by empowering a “rogue” upstart company like MediaDefender to take vicious actions against their competitors.

Revision3 Chief Executive Jim Louderback is much more upset than he appears in this video from CNET.

What Louderback realizes is that MediaDefender has no assets to win in a lawsuit and probably would not be able to pay for the costs of his company’s downtime. If a suit is filed MediaDefender will simply declare bankruptcy and the RIAA and MPAA will move on to their next cab company to sponsor. Revision3 would win nothing and only lose in paying for their own legal costs.

What the media companies should recognize is that cab companies can work the other direction as well. It is only a matter of time before every home ISP subscriber incorporates their own cab company to pay their bills. Then if the someone should sue…the media company can end up owning a shell company with no assets…If you are going to go to war it is only a matter of time before the enemy escalate’s their tactics to match your own. The MPAA and RIAA is truly headed down a very ugly path. This could lead to an all out media war. Look for companies like Piratebay, Revision3 and even individual consumers to strike back in a way that at least equals the viciousness of these actions. It will get ugly…