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Porn, Google and the courts

Zada is no Hugh Hefner, but you may be hearing more about him as his Perfect 10 business jousts with Google.

Norm Zada is no Hugh Hefner.

But this adult content publisher has one thing Hefner does not. A major legal win against Internet giant Google.

Last week, Zada's Perfect 10 publication won a preliminary injunction against Google for alleged copyright infringement over its use of thumbnail photos of Perfect 10 models.

Champion of copyrights is the latest hat Zada's wearing--pulled from a closet with an assortment as wide-ranging as author, money manager, former university professor and mathematician.

Zada, who authored "Winning Poker Systems" for Prentice-Hall, also has geek blood running deep through his veins.

In addition to a stint at button-down IBM as a research staff member in the early 1970s, he wrote such papers as the "Theoretical efficiency of the Edmonds-Karp algorithm for computing maximal flows."

And then there's his dad, the renowned Lotfi Zadeh, who is considered by many in the technology industry to be the "father of fuzzy logic."

CNET News.com recently spoke to Zada, who formerly went by Norman Zadeh, about his life and his company's entanglement with Google, which these days are increasingly becoming one and the same.

Q: Perfect 10 has won a major round in its copyright fight against Google, which could ultimately affect the way people search for photos and other content online. But few people know the name Norm Zada like they do Hugh Hefner. Who is Norm Zada?
Zada: I was a research staff member for IBM in their main computer science department from 1972 to 1973. I also had teaching jobs at Stanford, Columbia, UCLA and UC Irvine (from 1975 to 1982) that were either in operations research, which is applied math for business, or in the business schools. So, I am basically a very applied mathematician.

After I stopped teaching at UCLA in 1982, I started running financial competitions called the U.S. Trading Championship and the U.S. Investing Championship. Later, I ran an investing competition called Money Manager Verified Ratings. Those contests were carried by Barrons and various other financial magazines and newspapers, and people started asking me who they should invest with and so forth.

I started referring them to various money managers and decided in 1991 to start managing money myself. I've been managing money ever since, with only one losing year, in 2003.

I gave back all my clients' money in 2003 and quit. But I resurrected my money management business in 2004 to make enough money to cover all the ongoing losses in Perfect 10. I've lost over $42 million in Perfect 10 since its inception in 1996. I am still a money manager and use my earnings in money management to finance Perfect 10.

How did you make the transition from university professor to publisher of adult content?
Zada: There are a lot of reasons. I've always been a lover of women, and I've always been very supportive of women. And I felt there was something wrong with what Playboy was doing. They were recommending implants to women that didn't need implants, and I just thought that implants are a very bad thing for women. Women's bodies are beautiful naturally, and they shouldn't feel they have to augment their bodies in order to be OK. So, I thought, let me start an all-natural magazine, which doesn't allow implants. I also thought I could make money doing it and thought it would be an interesting challenge. And I had a friend who had just been turned down by Playboy, and she was very distraught. And I said to myself, what can I do to make her feel better about herself? I said, I guess I'll have to start a magazine and put her in it. That wasn't the main reason, obviously, but it was one of the factors. I wanted something that would be more respectful of women. I thought I could make money doing it, and I wanted to help my friend.

If the ultimate conclusion from all of this is you can't assert secondary liability against people who are benefiting from intellectual property...then that will be the end of motion pictures, songs and Perfect 10.

And it's kind of cool when you publish a magazine. It's enabled me to interview some of the people that I would otherwise not have ever been able to interview. I've interviewed Dion DiMucci of Dion and the Belmonts, Felix Cavaliere of the Rascals. We've interviewed Morgan Freeman, Ray Charles, Sugar Ray Leonard, Robin Williams and Sidney Pollack. We've interviewed a tremendous number of wonderful people. We have a wonderful writing crew for Perfect 10, consisting of David Black, who is our editor in chief and former executive producer of "CSI: Miami." Most of the Perfect 10 writers are outstanding.

We have tried real hard to make a wonderful, wonderful publication, and we think we're entitled to benefit from the wonderful film that we've created that nobody else has. The problem is, everyone is infringing it, including large corporations, and benefiting from our hard work.

There have been a lot of people who have not been very sympathetic with Perfect 10, but I think that if they worked really hard to create a business and they had products they were proud of, they would go nuts if people were utilizing their products to make money at their expense. And that's what's happening right now.

And what is your prediction on how the courts will ultimately rule?
Zada: I'm pretty sure we'll win on the direct infringement issue. But the problem is that many of the direct infringers are in places like Russia and China, and there's no way to track them down. As far as indirect or secondary infringement is concerned, it's too easy for people to take advantage of our material without actually copying it themselves.

Remember, Grokster was a secondary liability case and there was a huge battle over Grokster which has not been completely resolved. If the ultimate conclusion from all of this is you can't assert secondary liability against people who are benefiting from intellectual property, if the only test is they have to copy it themselves, then that will be the end of motion pictures, songs and Perfect 10.

Has the recording industry or movie industry stepped up and offered you support on your copyrights battle, or do you feel like the actor Rodney Dangerfield and "can't get no respect" because of the content you provide?
Zada: Perfect 10 is not the perfect plaintiff in this case. It would have been much better if the motion pictures studios had sued instead of Perfect 10. Even though we have a very tasteful magazine, we are not viewed as respectfully as, obviously, the motion pictures studios.

The problem is that motion picture studios and the recording industry have been battling all their other battles like Grokster and all these other things.

I don't think they fully appreciate how critical this particular case is to their future. Napster was not a direct infringement case; it was a secondary infringement case, and they won Napster. But if we lose this case on secondary liability for linking, given the somewhat different facts and circumstances, then basically anybody, not just a search engine, can just link to sites that offer songs, link to sites that offer full-length movies and create a big, huge directory. Go to a site, click on a song; go to a site and click on a movie. It will be the end of motion pictures and songs.

Now that you have won a preliminary injunction in the case, do you think you'll get interest from the recording or movie industry to join you in the case?
Zada: We suspect one or more of them will join us in the appeal, but I don't know for sure. It's a political thing for them. I think it would be a mistake for them not to join the appeal, because the appeal would be much more sympathetically viewed by the 9th Circuit if we had major players in it besides Perfect 10. So, it's very important for us to get other major copyright holders to join in. I just don't know what the probabilities are.

Do you think Google did not act on your requests because you were not the recording industry or movie industry and, instead, a publisher of adult content?
Zada: Google may have felt that Perfect 10 was too small and no one would take us as being important.

But we did a very big win here. It is the first time I am aware of a federal judge that has said that somebody had a likelihood of success against Google for copyright infringement, and that opinion could have a dramatic impact.

And what happens if you lose in the 9th Circuit Court. Will you shut down Perfect 10?
Zada: If we do not prevail and are not able to protect our copyrighted material, I will probably stop the magazine and probably continue the Web site. We will basically give up. I put eight years of my life and millions and millions of dollars into this. People claim I'm this big litigious person. The last thing in the world I want to do is file a lawsuit.

We always try to settle lawsuits before we file them. Unfortunately, we were not able to settle this lawsuit before we filed it. We have tried to settle it later and have not been able to do so.

Lawsuits are terrible. The whole legal system is horribly backed up because there are not enough federal judges. This case could go on for years. How much energy do I have to spend the rest of my life, struggling over every detail, every piece of evidence, every deposition? I have better things to do. I hate litigation. I don't want to keep litigating, and whatever the 9th Circuit ultimately decides to do is what's going to determine whether Perfect 10 continues, or I just give up on it.