As I wrote a month ago, a Judge denied the RIAA's request to dismiss the Elektra v. Santangelo case without prejudice. Yesterday, papers were filed which not only discontinued the case, but named the defendant as the prevailing party - possibly putting the RIAA on the hook for legal fees.
This is a situation which the RIAA has been trying to avoid since the inception of its crusade against its customers. Because the persecution relies largely on evidence found after bringing the lawsuit, there is little to ensure that a case will be won by the RIAA if it is brought to court.
In the past several months the RIAA has made efforts to streamline the process from easy to extortion by giving middle-class students and families a 3-5 thousand dollar pre-litigation settlement option (they even take discover!) allowing them to avoid paying tens of thousands of dollars in legal fees in the event that the case goes to court.
The problem with the manner by which the RIAA brings lawsuits clearly evident in the Elektra v. Santangelo case. When the RIAA brings cases with which it has no real accompanying evidence, it risks losing the case and being forced to pay the defendant's legal fees. These fees can be from tens to hundreds of thousands of dollars, and if the RIAA is forced to pay them, the cost can wipe out the gains from thirty or forty pre-litigation settlements.
If dismissals with prejudice keep occurring, these lawsuits could become very expensive for the RIAA - hopefully prohibitively expensive.
(via the Recording Industry vs. the People Blog)