A new project known as the "Peer-to-Peer Legal Defense Fund" was launched today by a group calling themselvers Downhill Battle. Co-founder Nicholas Reville explains:
We think the major label lawsuits are just intimidation followed by extortion: the record companies scare people with a suit for hundreds of thousands of dollars and then offer a settlement for 4 or 5 thousand. The cost of fighting is so high that even if you think you're innocent, it's cheaper to settle. (…)
The Defense Fund actually runs on a peer-to-peer model: rather than collecting the donations centrally and then later distributing them, we use PayPal accounts so that donations go directly to people that have been sued and have signed up on our system. Our open-source software tracks donations and presents the person with the least donations so far to receive the next
contribution– money gets spread out evenly over time, without a middleman. We think it's a cool system and a good political response.
We hope it will give some people the ability to fight and will help alleviate some of the financial damage to the families that have to settle, people are seriously talking about taking out second mortgages or not being able to afford college tuition. From a political standpoint, if we can take away the damage, then the lawsuit scare strategy doesn't work as well.