File hosting and sharing service, Hotfile was sued earlier this year by a consortium of copyright holders including Warner Bros, Disney, and Fox. The MPAA recently scored a victory when it was ruled that Hotfile has to divulge user details. Now Hotfile is firing back, accusing Warner of abusing the anti-piracy takedown tool built into the service.
Back in 2009, Warner approached Hotfile about making it easier to have infringing material removed from the service. Hotfile complied and developed the Special Rightsholders Account (SRA). This system allowed rights-holders to manually remove content that they owned the copyrights to. Hotfile now alleges that Warner committed fraud and abuse by removing thousands of files they did not hold the rights to.
In the counter-suit, Hotfile points to numerous free and open source files deleted by the Warner SRA. It appears that instead of investigating a file, Warner used an automated search algorithm to remove anything that might be theirs. Hotfile is seeking damages from lost revenue and disruption of its business. If anything, these accusations should remind us that a takedown system with checks and balances is the best solution we have.