What a Tennessee Federal Judge’s Order Tells Every Strike 3 Defendant
A federal judge in Tennessee recently granted Strike 3 Holdings the subpoena it asked for. No surprise there. But, then used her order to explain, in writing, what Strike 3's litigation model actually is. Surprise.
The phrase she used was "documented pattern of using early-discovery subpoenas to coerce settlements before defendants can be identified." Judge Sheryl Lipman, Western District of Tennessee, April 24, 2026. She still granted the subpoena. But she attached conditions to it, and those conditions matter to anyone who has received a Strike 3 complaint or a notification letter from their internet provider.
Here is the background you need to understand why this is significant.
Strike 3 Holdings produces adult films. It is also, by a wide margin, the most active copyright plaintiff in federal court in the United States. In 2025, it filed more copyright cases than any other company in American history. The business model is not really about protecting films. If it were, we would not be on the third iteration of the model that has lasted decades without stopping BitTorrent downloads of porn (the infamous Prenda Law and Malibu Media being earlier iterations). Rather, It is about filing John Doe lawsuits against IP addresses identified by the company's (allegedly) own tracking software — a system called VXN Scan — and then using early discovery to find out who owns that IP address.
The timeline matters. Strike 3 files the complaint. The case is captioned against "John Doe." Strike 3 immediately asks the court for permission to subpoena your internet service provider. The ISP gets the subpoena, and in thirty days or so, hands over your name and address. You often do not know any of this is happening. By the time you find out, your information is already in Strike 3's hands.
Then Strike 3 calls.
The settlement offer is usually calibrated to your situation, your job, your professional licenses, your family. It is designed to be uncomfortable enough to motivate payment and reasonable enough that fighting it does not look worth the cost. If you pay, the case gets dismissed. If you do not, you get named in an amended complaint, usually in your home district.
Courts have allowed this process to continue for years, because taken in isolation, none of the individual steps are illegal. And so few people actively litigate the cases (something I do, when appropriate—and prevail). But what Judge Lipman's order does is put on paper what defense attorneys have argued for years: the pressure to settle is the product. The lawsuit is just the mechanism that generates it.
In response to that, the order does three concrete things. It allows the defendant to remain anonymous unless and until the court orders otherwise. It bars Strike 3 from initiating settlement discussions before serving the complaint, without first getting the court's permission. And it gives the defendant time, the service deadline was extended to June 22, 2026, to actually retain counsel and decide what to do before Strike 3 shows up with a demand.
Those protections are not available in every court. Other jurisdictions have their own practices, and the judge you draw matters enormously in a Strike 3 case. But the language from the Tennessee order travels. It is the kind of finding that ends up in motions to quash, in objections to early discovery, and in arguments that the subpoena process is being used for a purpose the court should not facilitate.
One other point worth making: an IP address is not a person. It identifies a connection — a router, a household, an apartment building with shared Wi-Fi. If four adults share a network, they share one IP address. VXN Scan identified that address, not the person who used it. Strike 3 files the complaint against the subscriber anyway, because the subscriber is the one whose name the ISP will hand over, and the subscriber is the one who will receive the settlement call.
Whether the subscriber is actually the infringer is a question Strike 3 would prefer to resolve in a private settlement rather than in court. Frankly, I find it hard to get Strike 3 to tell me, straight up, exactly who is the Defendant in this case. They do not want to say as it allows someone to defend.
If you have received a notification letter from your ISP about a Strike 3 subpoena, or if you have already been named in a complaint, you should talk to an attorney before responding to anything. The settlement window does not close tomorrow, and the decisions made in the first few weeks of a case shape everything that comes after.
Jonathan Phillips is an attorney at Phillips & Bathke, P.C. in Illinois. He represents defendants in BitTorrent copyright cases across the U.S. He can be reached HERE. Nothing here is legal advice, and reading this does not make him your attorney.