Vol. 14, No. 5a, Pg. 32. When copying becomes criminal The stiff criminal penalties for copyright infringement.

• Author: By Tim F. Williams and Neil Batavia

South Carolina Lawyer

2003.

Vol. 14, No. 5a, Pg. 32.

When copying becomes criminal The stiff criminal penalties for copyright infringement

32When copying becomes criminal The stiff criminal penalties for copyright infringementBy Tim F. Williams and Neil BataviaJoe Associate was excited about his new purchase of Brief- While-You-Sleep for the low price of 5500. The software proved to be everything it claimed - while Joe slept through the afternoons in his office, Brief-While-You-Sleep cranked out convincing and persuasive briefs on nearly any legal issue encountered in Joe's practice. Once word spread within his firm, everyone wanted to use Joe's new software. Pleased with his near celebrity status, Joe was more than happy to provide copies to the other 10 associates in his firm. Joe was undeterred by the product label he read explaining that unauthorized production was illegal and would be prosecuted. Joe wondered: "What could possibly happen? Is some company going to sue me over $500 worth of software? No way!" Months later, Joe received a different answer from Sally Nolo, his newly hired defense attorney. Sally explained that the government had charged Joe with criminal copyright infringement for which Joe could receive up to five years in prison and a fine!

34 Introduction

Anti-piracy concerns are particularly relevant in today's economy as the world moves from the industrial age to the information age. The rapid growth of digital products and the Internet have facilitated global piracy on a previously unimaginable scale. Digital products can be reproduced with relative ease and broadband Internet connections allow data to be transmitted instantaneously with the click of a mouse.

As a result, copyright theft has grown significantly in the past several years and accounts for enormous economic losses for copyright owners. A recent report by the International Anti-Counterfeiting Coalition suggests that the combined U.S. copyright industries and derivative businesses account for more than $433 billion, or a staggering 5.68 percent of the U.S. Gross National Product, which is more than any other single manufacturing sector. The Business Software Alliance estimates that in 2001, 25 percent of all business software programs used by U.S. companies were pirated. The International Federation for the Phonographic Industry estimates that worldwide piracy of sound recordings, including compact disks, costs their industry over $4 billion a year. In addition, the Motion Picture Association of America and its international counterpart, the Motion Picture Association, estimate that the U.S. motion picture industry loses in excess of $3 billion annually in potential worldwide revenue due to piracy.

Thus, the computer software, sound recording and motion picture industries are particularly vulnerable to copyright violations. As the state of technology has developed, these industries have responded by pressuring Congress to enhance sanctions in the Copyright Act for criminal infringement. Despite such efforts, many counterfeiters remain unaware of the stiff criminal penal-ties for such activity under federal copyright statutes.

Brief history

of criminal copyright law

The intent of copyright law is to protect the creators of original and expressive works. The Constitution grants Congress the authority to enact the copyright law in an express grant of power "No promote the Progress of Science and the useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries." U.S. Const, art. I, § 8, cl. 8. Copyright law in the United States is codified in Title 17 of the U.S. Code. However, from the first Copyright Act of 1790 until 1897, criminal penalties were conspicuously absent from copyright law.

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