As most of you know, Hustler and Vivid recently signed a licence agreement with Acacia. After spending a large sum of money fighting this lawsuit, they settled for one simple reason, because it was the right business decision. It was the right decision for them and for their affiliates.

Hustler and Vivid have built their companies into what they are today by making a series of good business decisions over a long period of time. Some of these decisions have allowed others (including most of you) to greatly profit from the adult industry. There is a time and place to fight and it would be wise to have more faith in companies who have proven themselves over the course of time, rather than make uninformed decisions based on very limited information.

Hustler and Vivid share one common goal. That goal is to be a stable force in this very unstable industry and to provide affiliates with a "safe haven" for their traffic. Safe from attacks by Acacia or anyone else who might want to harm their businesses.

As part of their settlement agreements, all FlyntDigital and VividCash affiliates are indemnified from paying Acacia fees for traffic they send to these programs. This was a condition that was not given up easily and that Hustler and Vivid spent a lot of time and money negotiating for. Therefore, if Acacia decides to go after affiliates for "contributing" to the infringement of their patents, Hustler and Vivid affiliates will already be protected.

In addition, Hustler and Vivid are simply absorbing the additional fees they have to pay Acacia and will not pass on any of these fees in the form of lower payouts, etc. Therefore, the "attack" by Acacia will have no financial impact on Hustler and Vivid affiliates. That was their goal and it has been accomplished.

Having said that, the settlement by Hustler and Vivid by no means validates Acacia's patents. That can only be done in a court of law. Hustler and Vivid respect and support the decisions of the groups who have decided to fight Acacia. We hope they achieve their end goals, whatever they might be. We have achieved ours in our own way, which we ultimately believe will best serve our affiliates and business partners.

A few months ago, when other programs tried to lower payouts because of new Visa/MasterCard regulations, what did Hustler do? They raised payouts, which caused most of their competitors to back peddle and keep their payouts the same. That single decision on the part of Hustler, put hundreds of thousands of extra dollars back in the pockets of affiliates. Why? Because Hustler made the right business decision for them and for their affiliates, which caused their competitors to remain competitive. Who was the big winner from Hustler's decision to raise payouts? Affiliates were......many of which were not even our affiliates.

In these uncertain times, Hustler and Vivid are companies that affiliates can depend on over the long term. This industry is under attack from every angle and it's going to get a lot worse before it gets better. Who do you think will survive and who will be able to make their affiliate payouts, regardless of what comes their way?

My money is on Hustler and Vivid....

Hey Ken, can you post your contract with Acacia so all your affiliates are aware what type of 'protection' is being offered by being a Hustler / Vivid affiliate? I'm sure there are some loopholes set by Acacia and you really should identify those. You wouldn't want an affiliate assuming they are covered from sending traffic to Hustler / Vivid and then still be sued by Acacia. That could get very costly for Hustler / Vivd themselves (law suits from your affiliate against you because you claimed indemnification and it was false because of loophole a, b, or c)

That is a good move on your part and assuming you have a good agreement I'll be one VERY happy camper ;)

MarcDE,
I know you good for your money and therefore I offer you a friendly bet...

I bet you $1,000,000 US thta you'll never see those contracts posted on the boards....the parties will claim "confidentiality clauses".

Give me the number of your escrow agent and I'll wire up the funds if you accept the bet...

Good point Marc.


Seems like an "unfair business practice " for Acacia to allow Hustler and Vivid to be out there implying "Hey we settled now be an affiliate and you'll be safe too!"

Ken, I hope your attorneys looked closely at your new license. A lot closer than you did the original lawsuit.

You might find that Acacia put some "loopholes" in there that you hadn't bargained for.


I recall Ron was pretty surprised when Acacia started using CE's name in their press releases.

Marc....GFYers put another mil to the bet
http://www.gofuckyourself.com/showthread.p...067#post2487067

we goinna make your escrow agent rich!
;-)))

Serge - a mill is too rich fro my blood ;) Plus I don't like the odds hehe

c'mon!
I'll give you 7.25% loan!
;-)))

..but I can't dispute you on odds
;-))))

Ken,
I have a problem with your post...
this is NOT GFY, and you know it!

You can NOT insult Oprano's intelligence,
this is a BIG no-no!

If you posted this shit on GFY and 12 Clicks gave his seal of approval,
I wouldn't say a word, but...
this is OPRANO for Larr...err..Christ sake!

i bet you a million dollars you wouldn't pay up if he won

I'm disappointed in all of you! You are allowing an aggressive piece of shit like Acacia to back you into a corner, and turn the screws.

What you should be doing is joining together and fighting Acacia to the end. Are we supposed to respect Hustler, Vivid, and CE for selling out? A good business decision????? Who says so! B)

Taking the easy and safe way out may be good for politicians and gutless wonders, but how can major porn companies do it with a straight face.

spanno,
only insolvent person like you would make a bet like you did...what a pity...or was it intended to be pithy?
;-)))

MarcDe can give 50% from the bet to Ken and have him release a copy. I bet the consequences by doing it will cost him less than $500k :)

Soul,
I know Marc since Marc had milk on his lips, and Marc ALWAYS was HONARABLE man...
he wouldn't do it.

Plus...in order to release the contract, Ken would need a JOINT approval of LF and Vivid and you know how long those negotiations last....
;-)))

haha true. I proposed my greek way to increase the odds



Last edited by Soul_Rebel at Oct 6 2003, 03:08 PM

that's why I bet WASPs and not Greeks!
;-)))

I have some major questions about this deal, and others with the big guys.

I am very troubled with the way things are going. I have been in touch with my attorneys. I hope to speak with Ken tommorow.

Until then, for once, I am going to keep my big mouth shut.

Shona Tova!

Ken - with immense respect for your business acumen and obviously the names Hustler and Vivid speak volumes

a few questions

How much information can you share about the "protection" to affiliates?

Do you have a strategy for the future with regards to more copyright infringement litigation?
(Hopefully your legal team included in the agreement that under no circumstances at any time for any reason will Hustler and Vivid be libel for any licenses and or fees to Acacia or any of it subsidiaries)

What would stop another company from buying, say patents on Flash technology and then entering into copyright infringement litigation against Hustler and Vivid because you have Flash technology on sites?


I sincerely hope your legal team worked the best possible agreement and took into consideration that Acacia is buying more patents and this may be a viable business model which others may try in the very near future

btw hasn't Brian Shuster of Xpics patented the pop up console?

Nick,
do you know the patents Gary Kremen has ?

few interesting ones are internet related and you know Gary's modus operandi
;-))

you ALL fucked!
;l-))

No webmasters = no sponsors = no boards = More time for museums.

I'll be left mailing ONLY you with details of Sotheby's sales ;-))

We are all fucked ;-))



Last edited by Nickatilynx at Oct 6 2003, 04:13 PM

Nick,
I'll do my best to have MORE TIME!
;-)))

I'll let Ken work, work, work, accumulate, accumulate, accumulate and...die at peak of his career and earning height from unforseen causes
;-))

Museums RULE!
;-)))

..and the time for Ken';s yearly prayer
;-))

We MUST remeber him every Yom Kippur!
;-)))

I still read these threads shaking my head ...

the whole concept of patenting something and not making any claims until the industry is too poor & disconnected to fight it - and the companies that are supporting this, what are you thinking?!!? Your own pockets might be protected for a few minutes but ... surely that's not the end of it?!?

Ken, did you REALLY just say that being an affiliate of hustler or vivid will protect webmasters from legal action?!?! All of my paysite exits will immediately be sent to hustler & vivid programs & I expect full protection!!! :P

MikeAI: Be sure to give us a shout as well. Call Spike at 949-716-8080.

For what it is worth... what did Hustler and Vivid spend to figure this out and with who?

Paul Cambria might be the shizznat when it comes to first amendment issues... but a patent attorney he most certainly is not.

Can we see the bills?

This is what bugs me about these ACACIA settlements, not the settlements themselves, it's that those who settle brag about how they are helping all of us.

Look, if I were in the position of an igallery, CE or vivid/hustler, I would probably settle too...hell, probably much cheaper to settle than fight. They're doing it to protect their business, but does ANYONE really think this was done for the betterment of the industry or out of the goodness of their hearts?

Goodness of their wallets yes, but better for the webmasters who send them traffic on a daily basis? nope.

Not that I have any traffic to send to either of these companies anyways....but I'm just troubled by these settlements....especially when they are presented as "in the best interests of the industry and our affiliates"

Oh well, I'm glad I'm basically out of the industry anyways except the new pill proggie and some other adult-related stuff that's not porn.....

This whole post is a pearl!!

People should read it again!

Marc,

As Serge pointed out and you know very well, we can't post our contract. However, you do bring up a good point and we would be happy to clarify.

Acacia has agreed to indemnify our affiliates ONLY for traffic they are sending to us. So they would not have a blanket indemnification. They would ONLY be indemnified for the portion of business they are sending to Hustler and Vivid. Basically, this protects them from possible "contributing to infringement". Will Acacia go after affiliates for "contributing"? Who knows. We just thought it would be nice to bundle that in our deal so our affiliates didn't have to deal with this issue should it ever arise.

In no way are we saying that affiliates who are not sending to Hustler and Vivid are going to have problems, nor do we want our settlement to scare anyone. It shouldn't. It was simply the right choice for Hustler and Vivid. It might not be the right choice for everyone.

Marc,

As Serge pointed out and you know very well, we can't post our contract. However, you do bring up a good point and we would be happy to clarify.

Acacia has agreed to indemnify our affiliates ONLY for traffic they are sending to us. So they would not have a blanket indemnification. They would ONLY be indemnified for the portion of business they are sending to Hustler and Vivid. Basically, this protects them from possible "contributing to infringement". Will Acacia go after affiliates for "contributing"? Who knows. We just thought it would be nice to bundle that in our deal so our affiliates didn't have to deal with this issue should it ever arise.

In no way are we saying that affiliates who are not sending to Hustler and Vivid are going to have problems, nor do we want our settlement to scare anyone. It shouldn't. It was simply the right choice for Hustler and Vivid. It might not be the right choice for everyone.




[/b][/quote]


Ken,

If Acacia said from day1 that they weren't going to "double dip" on license fees (i.e. tag the sponsor program and the affiliate member of that program) how is it "nice to bundle that in our deal so our affiliates didn't have to deal with this issue should it ever arise"?

This whole post is a pearl!!

People should read it again![/b][/quote]


MikeAI,

I disagree. Sykkboy said several things that are simply not true.

1. We never claimed that our settling would help the industry as a whole. I honestly doubt it won't effect it one way or the other. There are much larger threats to the industry than Acacia.

2. We never claimed this was done out of the goodness of our hearts

3. We did say over and over that this was the best choice for Hustler and Vivid, which is true. Part of running a successful business is making sound business decisions. They made the decision that they thought was best for their respective businesses.

4. It remains to be seen whether it will be better for our webmasters, but it certainly is not worse. They can rest assured that they will not be financially harmed by this issue with regard to the business they do with us. Hustler and Vivid have simply ensured that they will be able to continue paying webmasters a heafty comission now and into future.

I understand his point.....but in this case, if you look at the statements made, nothing he said is all that accurate.

Excuse me sir...I speak jive allow me to "whiten" up that release...

Yo Yo ...can you hear me player?
We likes you sending dat traffic o' yurs ta our programms...soswes taken some o' dat mon-ay u hep us'ns urn n gives it ups to da playas at Acadia.

Iz dun it fer ur on gud. Weez jest tryn to hep at Hustler 'n Vivid...[dont fergit Cashquest too!] Sos eye dint thinks u'd mine if'n sum o'dat mon-ay gut spent covern' hour asses...jess in case this soot mite takes long.

Continues to sends ur traffics to us. In da near futa weez spends it on uther thangs 4 ur on gud.

UR Fiends
@ Hustler 'n Vivid [don't fer git Cashquest too!]

CJ,

Just be sure to remember that you will be protected for only the biz you do with Hustler/Vivid.

The video content in your actual paysites would be subject to Acacia's license demands.

Also, good point re: the next wave of patent claims- rumors of Wlaters, Piccionelli, FM, Shuster, Gary Kremen all possibly doing similar things

MikeAI,

I disagree. Sykkboy said several things that are simply not true.

1. We never claimed that our settling would help the industry as a whole. I honestly doubt it won't effect it one way or the other. There are much larger threats to the industry than Acacia.

2. We never claimed this was done out of the goodness of our hearts

3. We did say over and over that this was the best choice for Hustler and Vivid, which is true. Part of running a successful business is making sound business decisions. They made the decision that they thought was best for their respective businesses.

4. It remains to be seen whether it will be better for our webmasters, but it certainly is not worse. They can rest assured that they will not be financially harmed by this issue with regard to the business they do with us. Hustler and Vivid have simply ensured that they will be able to continue paying webmasters a heafty comission now and into future.

I understand his point.....but in this case, if you look at the statements made, nothing he said is all that accurate.[/b][/quote]


Ken, I had a 20 paragraph response and break down of you posts. I thought twice about posting it. I would like to talk to you tomorow on the phone. ( I did cut and paste the post and sent it to myself in e-mail :D )

And some people say old dogs can't learn new tricks....

HomeGrownMof,

I'm not sure what Acacia said they would and wouldn't do verbally. But I do know that this clause was not in our original agreement and it took quite a bit of back and fourth to have it inserted in a way that our attorneys were comfortable with.

Serge,

Let's see....1/3rd of the posts on this thread are from you....most of them about nothing relevant.

You're right, this is NOT GFY! It's painfully obvious ;)

Ken... kindly allow me to retort...

1. That is not correct. I was told that if Hustler/Vivid/Wicked settled that it would be to the benefit of all.

2. Your press release regarding the favor you did your affiliates and the money you spent to do it suggests otherwise.

3. Sound choices and successful business? That must be what finally led Hustler and Vivid to pay you to run their internet show rather than keep doing it themselves... (I have been around long enough to remember Tony Tang and what do you think Vivid paid on that auction site launch?)

4. I am glad you are ok with it. Can I please send all the other patent carpetbaggers to your door?

You know, I really don't remember you ever being part of the discussions about what to do at all before so it is nice to see you so involved now.

Sykkboy expressed an opinion and for you to say that is false is inappropriate, imo. Especially in light of what I know and the questions that I raise.

Nick,
do you know the patents Gary Kremen has ?

few interesting ones are internet related and you know Gary's modus operandi
;-))

you ALL fucked!
;l-))[/b][/quote]


I think Serge actually did make 1 salient comment- see above.

This is a new business model for some people- patent licensing. And not just newbies like Berman. Seasoned web vets.

Will Hustler /Vivid just keep brushing off the last "We're settling!" press release ?

Ken you are one of the brightest around- when are you going to take the reins from Cambria.

For what it's worth :o

ex·tort ( P ) Pronunciation Key (k-stôrt)
tr.v. ex·tort·ed, ex·tort·ing, ex·torts
To obtain from another by coercion or intimidation.

http://dictionary.reference.com/search?q=extort


again please bear in mind that Acacia could just be the beginning and companies could find themselves facing these situations repeatedly

"We are going to be at $200 million a year without writing a single line of code"

Who said this?

1. An inventor

2. A Gangster

3. An Attorney named Rob Berman, Acacia

Ken... kindly allow me to retort...

1. That is not correct. I was told that if Hustler/Vivid/Wicked settled that it would be to the benefit of all.

2. Your press release regarding the favor you did your affiliates and the money you spent to do it suggests otherwise.

3. Sound choices and successful business? That must be what finally led Hustler and Vivid to pay you to run their internet show rather than keep doing it themselves... (I have been around long enough to remember Tony Tang and what do you think Vivid paid on that auction site launch?)

4. I am glad you are ok with it. Can I please send all the other patent carpetbaggers to your door?

You know, I really don't remember you ever being part of the discussions about what to do at all before so it is nice to see you so involved now.

Sykkboy expressed an opinion and for you to say that is false is inappropriate, imo. Especially in light of what I know and the questions that I raise.[/b][/quote]

Far-L,

1. I believe Sykk Boy was commenting on my posts, not on what you were told. I was responding ONLY about my posts and what I stated. If you were told something other than that by someone else, I can not respond to that.

2. I stated facts in the press release. We believe we acted in favor of our affiliates over the long term.

3. Actually, you are exactly correct. It just goes to show you that they are more concerned with doing what is best for their business, rather than feeding their own egos. Lesser companies would have kept trying to do things themselves, instead of focusing on their core businesses. Given that we are talking about Steve H and Larry Flynt, it's amazing that you're even questioning their long term ability to make good decisions for their companies. When you have accomplished half as much maybe someone will take you seriously.

4. It doesn't matter if I'm ok with it or not on a personal level. This is business. I try and check my ego at the door. It helps keep priorities in order. I know you are upset, but there is no reason to make it personal. It's just business.

BTW - Do you still make money from your HomeGrown partnership with Cyberotica? Just curious?