When does a copyright violation rise to the level of criminal copyright infringement? We address this issue below. Federal prosecutors have a number of statutory tools available to combat this common white-collar crime. In using those tools, prosecutors often combine charges of criminal copyright infringement with more common white-collar criminal charges, such as wire fraud, mail fraud, money laundering, or RICO.
Congress has the constitutional power “to promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries.”[1] Relying on this grant of authority, Congress has passed a variety of laws intended to protect intellectual property.[2] This article will discuss the rights that these statutes are intended to protect, as well as provide a brief overview of criminal copyright infringement.
Copyright Law: Protecting Inventors’ Rights
Copyright law grants copyright holders several exclusive rights, including: reproduction of the work; preparation of derivative works based upon the original copyrighted work; public distribution; public performance of literary, musical, dramatic, choreographic, and mixed audiovisual works; public display of works; and performance of sound recordings by means of digital auto transmission.[3] This body of law also provides remedies for the infringement of these exclusive rights. While most infringement cases are civil in nature, criminal copyright laws may come into play.[4]
Felony Versus Misdemeanor Copyright Infringement
With respect to criminal copyright infringement, two provisions are key. Section 506(a) criminalizes willful infringement while Section 2319 provides the penalties imposed for the willful infringement.
To establish a felony copyright infringement, the Government must show that a defendant willfully infringed upon a valid copyright through unlawful reproduction or distribution.[5] Specifically, it is a violation to reproduce or distribute ten or more copies of a copyrighted work having a total value of more than $2,500.[6] Additionally, it is a felony to distribute copies prepared for commercial distribution; to make such copies publicly accessible; and, to act when one knows or should know that the work is being prepared for commercial distribution.[7]
The Government must make a similar showing to establish a misdemeanor copyright infringement. However, a misdemeanor charge primarily involves two common scenarios. First, a misdemeanor charge is viable when a defendant acted with the purpose of commercial advantage or financial gain.[8] Second, a misdemeanor may apply if the individual reproduced or distributed one or more works with a total value of more than $1,000 within a 180-day period.[9] Often, misdemeanor charges also apply to cases involving the unlawful use of digital audio transmission and infringement on performance rights.[10]
Under Section 2319, a felony charge applies when a defendant infringes upon the rights of reproduction or distribution in the quantity and values provided by statute. Alternatively, misdemeanor penalties apply when the numerical and monetary thresholds are not met or if the defendant infringed on rights other than reproduction or distribution.
White Collar Defense Attorneys
Freeman Law represents companies, executives, and individuals in regulatory and white-collar government investigations and prosecutions. We employ a proactive approach to defend vigorously and strategically position our clients. White-collar matters often involve parallel regulatory and civil proceedings. Freeman Law can navigate the complexities and collateral consequences of multiple proceedings. And when it comes to the court of public opinion, we employ ethical and strategic tactics to manage publicity. Schedule a consultation or call (214) 984-3000 to discuss your allegations and investigations concerns.
[1] U.S. Const. art. 1, § 8, cl. 8.
[2] Office of Legal Educ. Exec. Off. Of U.S. Att’ys., Prosecuting Intellectual Property Crimes 10 (4th ed. 2013).
[3] 17 U.S.C. § 106(1)–(6).
[4] Office of Legal Educ., supra note 2, at 11.
[5] Id.at 16.
[6] 18 U.S.C. § 2319(b)(1).
[7] 17 U.S.C. § 506(a)(1).
[8] Office of Legal Educ., supra note 2, at 60 (citing 17 U.S.C. § 506(a)(1)(A), 18 U.S.C. § 2319(b)(3)).
[9] Id. (citing 17 U.S.C. § 506(a)(1)(B), 18 U.S.C. 2319(c)(3)).
[10] Id.
