It's not fun, but all things considered, John Steele is OK with being a villain. 

In recent months, Steele's Chicago law firm has filed almost 100 federal lawsuits seeking to identify thousands of "John Does" who downloaded pornographic videos in violation of their producers' copyright. Federal court records indicate that none of Steele's cases — in fact, no case of this type ever — has ended with a verdict at trial.

Sometimes, the cases run into roadblocks from skeptical judges over jurisdiction or whether the defendants have been appropriately identified. Others end in settlements for a few thousand dollars from defendants who are relieved that they get to remain anonymous. 

Internet privacy advocates and technology writers call Steele a "copyright troll" and accuse his firm of scouring the Internet to track down computers that download pornographic videos, then forcing Internet service providers to identify the computer owners so it can shame those people into writing settlement checks. 

The incentive to settle is to keep from being named forever in court records as a porno fiend, which "seems to me like it's a good way to make an easy buck," said Julie Samuels, a staff attorney for the Electronic Frontier Foundation, nonprofit advocate for what it calls "freedoms in the networked world."

"These plaintiffs are out to get a quick settlement," she said, because they know defendants — even those who have been wrongly identified — are eager to remain anonymous.

If you look at it as a matter of law, a lot of that is right, said Steele, who's fine with being called names as long as it doesn't cross the line into accusations of malfeasance.

Yes, Steele's firm goes looking for pornographic videos being accessed without permission — the firm developed its own tracking software "to make sure it's done right," he said. 

Yes, the goal is to bring in money for pornographers — a letter from Steele's firm explicitly urges defendants to seize the "opportunity to avoid litigation by working out a settlement with us." One of the letters, a copy of which Steele verified, suggests writing a $2,900 check to the firm at its Chicago address.

• Read the Steele Hansmeier settlement letter (.PDF)

And yes, one of the goals is to "scare people," he said — not primarily into writing checks, but to stop them from "stealing our clients' content."

That's not a bad thing, Steele said, because piracy today is so easy that "the industry's really on its knees right now." 

(The economics of the pornography business are notoriously hard to nail down, but the industry commonly claims that illegal downloads have wiped out as much as 90 percent of producers' income since the advent of videocassettes made porn easy to watch in the privacy of the home.)

Lots of people may think his firm's methods are unfair, but adult entertainment companies are legal businesses with valid claims, and "we believe it's completely ethical and important to recover more money than the cost of the litigation," Steele said.

And as for his critics, he accepted that "you can't control what people say." 

"If we were doing anything unethical, after 95 cases I can assure you I wouldn't have a law license," he said.

• Read a representative recent suit (.PDF)

Studios have strong piracy case
Steele's opponents agree with him when he says that most of the anonymous defendants probably did break the law and that adult entertainment producers have a right to protect their interests in court. 

Even as he criticized the methods of lawyers like Steele, Adam E. Urbanczyk, an attorney with Saper Law of Chicago — which defends John Does sued by adult studios — stressed that "it's almost incomprehensible the amount of material that's getting ripped off." 

And Samuels, of the Electronic Frontier Foundation, said it's "absolutely not the position of EFF that the industry should not be able to sue."

The distaste is with how the suits are filed. And this is where things get pretty technical.

The shorthand description of what plaintiffs' firms like Steele Hansmeier do is scour P2P networks to identify IP addresses that are downloading copyrighted material. 

In non-tech, that translates to looking for videos that are being distributed across decentralized peer-to-peer (hence, P2P) file-sharing networks called "torrent sites." Then, using geotracking technology (like the GPS in your car or on your smartphone), investigators harvest the numeric Internet protocol addresses of the computers that are retrieving and sharing them. 

That requires sophisticated programming, because the computers linked into the torrent "swarm" go on and offline from second to second — and when they're plugged in, their IP addresses can also change second by second. 

Similar cases have sought the addresses of computers that retrieve videos from upload pirated video to so-called tube sites, which are underground YouTube-like operations that stream X-rated videos without permission.

In both instances, the lawsuits are meant to attach real people to the IP addresses. A dozen to a couple of hundred of them are then lumped together in a single lawsuit; this month alone, Steele Hansmeier has filed at least seven such suits seeking the identities of almost 700 John Does in California and Illinois, federal dockets show. 

Urbanczyk likened that strategy to "throwing your lure out there" to see what you might catch.

"I wouldn't say bringing these cases is a scam because the claims are absolutely valid," Urbanczyk said. But "the whole situation reeks" because there are better remedies for copyright infringement, he said.

Targeting the pirates, not their customers
When mainstream music and movie studios pursued copyright suits against individual users a few years ago, the public backlash was severe. Only a handful of such cases are still being pursued, most notably involving downloads of the Academy Award-winning movie "The Hurt Locker." 

But pornography is different, because "we're an industry that people may think is morally questionable, that we may deserve it," said Dominic Ford, a gay adult video performer who operates Porn Guardian, a company that tracks copyrighted material and helps producers pursue video pirates.

Porn Guardian LLC

Services like Porn Guardian, run by adult video performer Dominic Ford, try to attack piracy fro the supply end — the pirates.

Many use Ford's Porn Guardian service, a version of which he offers free to smaller producers. The service helps producers safeguard their material by digitally watermarking it on the front end, gathering evidence of illegal downloading in real time and packaging that evidence for attorneys to file takedown notices against download sites under the Digital Millennium Copyright Act of 1996.

A driving force behind pirate-focused campaigns is a studio called Pink Visual of Van Nuys, Calif., whose president, Allison Vivas, has convened two industry gatherings bringing together producers, performers, distributors and intellectual property experts. Their goal is to develop a "collaborative anti-piracy stratregy" across the industry, said Jessica Pena, the company's corporate counsel.

"This isn't just about lawsuits," said Quentin Boyer, a spokesman for the company.

Boyer said Pink Visual was also putting the final touches on a new way to deliver copyrighted video online called PV Locker, which is designed to prevent piracy at the source. Now in beta, it allows subscribers to pay for whatever they want on demand, but it's available only inside the site. If it works the way Pink Visual intends, pirates can't download the video in the first place.

That's the real key to stopping losses, said Ford, who — using an analogy commonly repeated in interviews with executives of several companies — said cleaning up files on the Internet after they've already been downloaded is "just playing Whack-a-Mole."

"It's not about the 300 people who were illegally downloading it," Ford said, especially because "there's been some bad publicity when lawyers are going after these John Does (who) end up being a 70-year-old grandmother who didn't know the kids next door were feeding off their Wi-Fi."

• Bizarre pornography raid underscores Wi-Fi privacy risks

Could 'false positives' help teach a lesson?
Steele acknowledges the "false positives" — industry shorthand for otherwise innocent but technologically naive defendants who don't protect their home networks, leaving them open for anyone to use. Their defense is usually that they had no idea someone else — their teenage son or the college kid next door, for example — was downloading porn over their networks.

Experts disagree whether that's a valid defense, and anyway, it's "a huge P.R. problem," Steele said.

Another P.R. problem is the public perception that lawyers like Steele invade individuals' privacy by sneaking into their computers for a look around. That's not true, Steele said — that really "would be an invasion of privacy." 

Instead, Steele Hansmeier's software joins the torrent swarm and monitors traffic to and from ISPs to users' Internet routers, he said. 

"There are no entrapment issues because ... we're sitting right outside," much like investigators who legally go through trash bins on the sidewalk, he said. If someone else is piggybacking on your network, the solution is simple: Password-protect it. The hope, he said, is that eventually "people are no longer going to leave their wireless networks open." 

Until that happens, Steele said, he really has no choice but to go after home users because pursuing pirates is unlikely to be effective in the long run. 

"Why do we sue the end user? Because there's no one else in the piracy chain," he said. The nature of torrent sites — most of which are hosted outside the United States anyway — means "there's absolutely no company we can go after."

"We can't go after middlemen because there aren't any middlemen," he said.

'Piracy starts at a very known place' 
Pink Visual, with its "content protection retreats," and Dominic Ford, with his nearly 300 Porn Guardian clients, suggest that Steele may be skipping a step: working with them to choke the torrent sites' supply. 

"Piracy starts at a very known place: my website," Ford said. "Someone is starting at our website and downloading that content. Those hundreds of copies are all exact duplicates of one file that was downloaded from one site."

The idea is that by targeting that initial downloader, you should be able to intercept the video before it even makes it to a torrent site. Ford's company says 98 percent of the takedown notices it generates are successful.

Often, those downloaders aren't really pirates, he said; they're just people who've been confused by the dominant culture of the Web.

Such people aren't criminals, he said; they just don't make the connection between product and producer.

• Technolog: 70 percent find piracy socially acceptable, says poll

"There's a common perception in America and perhaps the world that porn companies are all huge and unbelievably wealthy, that because we make movies and the mainstream (movie industry) makes movies, we're as big as they are," he said.

Most porn studios are "mom-and-pop operations like mine, or pop-and-pop, if you will," he said. "They're not these juggernaut companies where a little bit of piracy is not going to affect them."

That's the core conflict, said Urbanczyk, the Chicago lawyer who represents defendants in John Doe cases.  

It may be true that "information wants to be free," he said. "But entertainment does not want to be free."

By Rich Gardella and Jamie Forzato, NBC News

Amid growing calls for more government regulation of the Internet, the United States is conducting what it calls "a sustained law enforcement initiative aimed at counterfeiting and piracy" – an effort that already has resulted in arrests and the seizure of 125 websites.

Ask anybody who uses a computer if they've ever downloaded or streamed media content for free on the Internet, and the answer most likely will be yes. The U.S. government and the American media industry say as much as a quarter of this kind of media traffic violates U.S. copyright law, and both are getting serious in their attempts to turn off the spigot.

But detractors of the crackdown say that the government shouldn’t side with industry and attempt to restrict what flows across the Internet.

(A similar debate unfolded this week at the G8 summit in Paris, with French President Nicolas Sarkozy arguing that governments need to impose more rules of the road on the Internet, and tech leaders like Google’s Eric Schmidt and Facebook’s Mark Zuckerberg warning that could stymie innovation and squelch free expression.)

The most recent skirmish in the escalating conflict occurred this week, when the U.S. Immigration and Customs Enforcement agency (ICE) announced that its Homeland Security Investigations unit had seized the domain names of five websites that it said were being used to sell counterfeit goods or illegally distribute copyrighted materials, including media content.

"American business is threatened by those who produce counterfeit trademarked goods and pirate copyrighted materials," ICE Director John Morton said Wednesday in a press release announcing the seizures. "From counterfeit pharmaceuticals and electronics to pirated movies, music, and software, IP thieves undermine the U.S. economy and jeopardize public safety. Our efforts through this operation successfully disrupt the ability of criminals to purvey counterfeit goods and copyrighted materials illegally over the Internet."

The crackdown – dubbed “Operation In Our Sites" – is being spearheaded by ICE’s National Intellectual Property Rights Coordination Center, working in coordination with U.S. attorneys' offices across the country. The initiative has so far seized the domain names of 125 websites since it began last year, ICE says, effectively shutting them down.

Of the seized website domains, approximately 25 – including two of the five announced this week – were hosting or linking to copyrighted media content illegally, the government says. (The rest have been selling counterfeit goods, everything from shoes and clothing and accessories to DVDs of movies and TV shows to pharmaceutical products.)

Free downloading or "streaming" media content from Internet websites – including movies, TV shows, sports events and music – is a big and rapidly growing business. While an exact number is difficult to pin down, available data and estimates show that millions of streamings and downloads occur daily. 

A lot of that traffic is legal – downloading or streaming a full episode of a current television program from an authorized and sponsored service, such as a network's website, for example.

But the U.S. government and the American media industry claim a significant amount of it is illegal. A lot of the media content streamed and downloaded is copyrighted – owned by the person or entity that created it – and a lot of the services providing access to the material don't have permission from the copyright holder to do so.

The government and the media industry say U.S. copyright law (specifically, 18 USC 2319), states that distributing such content without permission from the copyright holder is a crime – copyright infringement.  They generally use a simpler name: theft – of intellectual property, or "IP theft" for short.

It’s been more than a decade since the online music-sharing service Napster made headlines for distributing copyrighted content without permission.  At the service's peak, millions of Napster users traded and downloaded millions of data files containing copyrighted music, free of charge. The music industry, through some of its largest companies, sued over copyright infringements and lost revenue. After losing in federal court, Napster shut itself down in 2001. (Its name and now-legal music service lives on as a part of the electronics retailer Best Buy.)  Despite Napster’s legal troubles, online services providing unauthorized access to copyrighted media content have continued to ply the Internet, though not on such a large scale.

Study: Nearly a quarter of streams, downloads illegal
The media industry seeks to quantify IP theft as a problem.  

It commissioned a study that found that almost one-quarter of all that streaming and downloading is illegal.  In a January report, the Internet intelligence and research company Envisional of Cambridge, England, found that "across all areas of the global internet, 23.76 percent of traffic was estimated to be infringing" on copyrighted material.  

(The report, "An Estimate of Infringing Use of the Internet," was commissioned by NBCUniversal Media LLC, part owner of msnbc.com. The media industry's powerful lobby, the Motion Picture Association of America, supports its conclusions. Microsoft, another parent company of msnbc.com, also is a leading advocate of stricter enforcement of digital copyright protections.)  

The industry claims that all that copyright-infringing media traffic translates not only to lost revenue, but also to lost jobs and wages for media industry workers.

The Motion Picture Association of America claims illegal streaming and downloading cost American workers 375,000 jobs and $16 billion in earnings every year.

A public service announcement, originally produced for the City of New York to help protect its film and television business, with support from NBCUniversal, makes that point bluntly.

Comedian Tom Papa appears on a New York City sidewalk as a vendor hawking illegally downloaded "free movies." As passers-by express interest, Papa gestures to a woman standing beside him carrying audio equipment, who looks a bit forlorn. 

"These are illegally downloaded movies," Papa says, "and because of that people like her are losing their jobs."

"Whether you get it off the streets or off the Internet,” Papa concludes, now facing the camera, "digital piracy and product counterfeiting are not victimless crimes." 

The federal government has adopted that message, releasing the public service announcement to the public through its own media office, and linking it to some of now-shuttered websites whose domains it has seized.

A warning to surfers
Visitors to these websites are redirected first to a government warning banner bearing the seals of the Department of Justice, the National Intellectual Property Rights Coordination Center and Homeland Security Investigations. The banner states that the government has seized the domain name, that it is illegal to reproduce or distribute copyrighted material without authorization and that willful offenders risk prosecution for criminal felony violation copyright law. If convicted, the banner warns, even first-time offenders "will face up to five years in federal prison," plus "restitution, forfeiture and fine."  

William Ross, the unit chief for investigations at the National Intellectual Property Rights Center, said Operation In Our Sites is about enforcing copyright law and protecting the U.S. economy from intellectual property theft, which the government considers a national threat.

"We try to protect the economic interests of U.S. industries and manufacturers," Ross said. "We're protecting them from other people taking their ideas and selling them."

In some cases, the government has arrested and charged website operators. In February, it arrested and charged a Texas man who had streamed copyrighted sports events on one seized site, channelsurfing.net, claiming he'd collected $90,000 in online advertising revenue.

Most of the seized websites appear to be strictly online operations, and their operators were difficult to contact.  But NBC News found one willing to talk: Waleed Gadelkareem, an Egyptian businessman.

The U.S. government seized his domain – torrent-finder.com, which was based in the U.S. – in November. He says his site was getting 100,000 hits a day and generating revenue from online advertising. 

But Gadelkareem claims he wasn't doing anything wrong. He said his site was a just a search engine that linked to other sites with such content, just like other big search engines do.

"It's a dirty game they are playing. and it's totally unfair," said Gadelkareem, interviewed via Skype from his home office in Alexandria, Egypt. "I don't try to sell anything. I'm a search engine. I don't have any database of any copyrighted materials."

Ross said he could not discuss Gadelkareem's case, an ongoing investigation. But he said every website the government acted against was violating American copyright law. 

After the government seized his U.S.-based domain, which was run from a server in Texas, Gadelkareem changed its name slightly, to torrent-finder.info, and moved it to a server based in Sweden.  He continues to operate it from Egypt.

Ross said the U.S. is working with foreign governments to shut down sites if they move out of the U.S. "We keep going after them,” Ross said, “no matter how many times they come back up."

Proposed legislation in Congress would give the U.S. government the power to shut down copyright-infringing websites in other countries – even if they mainly link to copyright-protected material without permission.

Businessman says he was wrongly shut down
Waleed Gadelkareem sees big business behind the government’s efforts.

"The USA government is trying to shut it down," Gadelkareem said, "for the sake of a group of rich businessmen.  That's what I think. That's (what) everybody thinks."

His American lawyer, David Snead, who represents and advises online service providers who distribute content on copyright issues, agrees.

"The government is doing industry's bidding here," Snead said. "I think that it is wrong for prosecutorial resources to be used on behalf of any one industry."

There is vigorous debate in the various precincts of the Internet about whether the government's crackdown and seizures are appropriate. 

The media and entertainment industry – including NBCUniversal – has long advocated more government enforcement of intellectual property violations.

Ross said the motivation for the government's efforts to crack down on unauthorized distribution of media content is simply to enforce copyright law and to protect the U.S. economy and jobs.

He says the media industry itself takes down far more websites hosting illegal copyrighted content than the government does, using its own mechanisms.

"They have a lot more resources, a lot more manpower to do those type things than we have within the government,” Ross said. “So what we're doing is a very small percentage."

As the government and industry crack down on supply, what will happen to demand – the computer users who aren't distributing unauthorized media content but are consuming it, who initiate all those unauthorized downloads and streams?

NBC News recently discussed these issues with six college students at the University of Maryland. 

"I think it's common, especially among college students,” said one, “because it seems anonymous and it seems like something you can get away with."

All six students we talked to at the University of Maryland/College Park agreed that hosting or providing access to copyrighted content without the permission of the copyright holder was illegal. 

They made a distinction between illegal and wrong, however, with only one saying it was wrong.

"If it violates the law," the student said, "then, yeah, I think it should be enforced."

But while five of the six thought that consuming copyrighted media content without the permission of the copyright holder was illegal, none thought that was wrong.

"I just don't think that it's wrong enough for me to stop doing something that's so easy and so available to me," said another, expressing the view of the majority.  "I just don't feel it's wrong."