MINNEAPOLIS - As U.S. Attorney for Minnesota and a veteran prosecutor, Andy Luger sometimes tells people he's seen it all when it comes to greed, fraud and criminal behavior.

But the case he shared with reporters Friday, Luger says, may be the icing on the cake.

Luger announced that an 18-count indictment has been filed against two attorneys and U of M grads involving fraud, money laundering and supporting perjury. The indictment details how authorities say Paul Hansmeier and John Steele used courts across the country to extort money from individuals who had downloaded porn videos, threatening to sue them for $150,000 and publicly identify them as users of porn.

But the U.S. Attorney's office maintains the lawsuits were simply an empty threat to get the victims to pay a $3,000 settlement fee -- and it reportedly worked. Luger says the men extorted more than $6 million over a period of several years.

Victims were sent a threatening letter telling them they were facing a $150,000 lawsuit and being publicly named as a downloader of porn unless they paid a $3,000 "settlement" fee. 

“Everything about their practice of law was fraudulent," Luger alleged. "And they will now see justice."

Investigators say the scheme started in 2011, when Hansmeier and Steele convinced producers of porn movies to let them file copyright lawsuits against people who pirated those porn movies for personal use. They maintain the lawyers knew of special websites that existed for the sole purpose of allowing people to illegally trade copyrighted porn, and would upload, or have others upload porn films to those websites.

Once people took the bait and downloaded films, Hansmeier and Steele brought copyright infringement lawsuits in both state and federal courts all over the country against so-called John Does who downloaded the movies. They captured internet addresses of the porn downloaders, which allowed them to subpoena courts and obtain the names of those who controlled or used the internet addresses.

The indictment says Hansmeier and Steele then engaged in aggressive tactics to extort money from their victims. While never intending to take them to court, the two would send a menacing letter threatening a $150,000 lawsuit and public identification as a user of pornography. The good news? A small payment of $3,000 could make the entire matter go away.

“And it worked. It worked to the tune of millions of dollars," said Luger. "Person after person, victim after victim who was extorted to make this payment in order to make this go away. Victims readily paid the extortion payment rather than face public humiliation and what they thought would be an expensive lawsuit -- a lawsuit the defendants, despite what they said in this letter, never intended to pursue."

Federal authorities say the two took matters even further, deciding to cut the porn producers out of the scheme. Hansmeier and Steele allegedly began attending adult film industry conventions, hiring actresses to film their own porn productions. The lawyers would then use their own films as bait to trap illegal downloaders so more extortion operations could be launched.

The scheme, Luger says, began falling apart in 2013 when courts began catching on to what they were doing due to the massive amount of discovery filings to learn the identities of John Doe victims. Judges began dismissing lawsuits, sanctions were handed down and Hansmeier and Steele were referred for discipline. Hansmeier is currently barred from practicing law in Minnesota.

The road ahead appears far worse than that. Two men whose profession depends on ethical conduct and upholding the principles of law could be headed for federal prison.

“I’m often tempted to say that I’ve seen it all," Luger said. "And then something like this comes along.”