Kara Sears
Copyright infringement is a serious matter that can result in legal consequences, including jail time. While it is often handled as a civil issue, with companies sending cease-and-desist letters or filing civil lawsuits for monetary damages, criminal prosecution is also a possibility under certain circumstances. The main statute, 17 U.S.C. § 506, outlines that criminal infringement occurs when it is committed willfully for commercial advantage or private financial gain, involving the reproduction or distribution of copyrighted works valued at over $1,000 within a 180-day period, or distributing a work intended for commercial distribution without permission. Criminal penalties can include prison sentences and substantial fines, with enhanced penalties for repeat offenders. Additionally, the Digital Millennium Copyright Act (DMCA) imposes sanctions on those attempting to circumvent copyright controls, such as encryption or digital rights management. The federal government carefully considers the seriousness of the offense and the likelihood of a successful prosecution when deciding on criminal charges.
| Characteristics | Values |
|---|---|
| Criminal copyright infringement | Criminal offence under the Digital Millennium Copyright Act (DMCA) |
| Criminal prosecution factors | Seriousness of the offence, likelihood of successful prosecution, number of copies, and their worth |
| Criminal penalties | Prison time, large fines, or both |
| First offence | Fined up to $500,000, imprisoned for up to 5 years, or both |
| Subsequent offences | Fined up to $1,000,000, imprisoned for up to 10 years, or both |
| Second or later offences | Maximum of 10 years in prison, up to $250,000 in fines, or both |
| Misdemeanours | Imprisoned for up to 1 year, fined a maximum of $100,000 |
| Copyright infringement | Often handled as a civil matter, companies send cease-and-desist letters, followed by civil lawsuits seeking monetary damages |
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What You'll Learn
Criminal copyright infringement
To prove criminal copyright infringement, the government must provide evidence of four things. Firstly, that the author had a valid copyright. Secondly, that the defendant used, copied, or distributed the material without the author's permission. Thirdly, that this was done intentionally. And finally, that it was done for personal financial gain or business advantage.
The penalties for criminal copyright infringement can be severe. Felony charges can be filed when 10 copies of a copyrighted work are reproduced or distributed with a retail value of more than $2,000 to $2,500. Misdemeanour charges can be filed with just one copy and a retail value of $1,000. Fines can range from $250,000 to $1,000,000, and prison sentences can be up to 10 years for a felony conviction, 5 years if the offence involves 10 copies or a value greater than $2,500, and up to 1 year for a misdemeanour.
It is important to note that charges for criminal copyright infringement must be made within three years of the crime, and permission from the author to use or distribute the material is a defence against such charges. Additionally, small amounts of permissible copying, such as photocopies, are not considered criminal copyright infringement.
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Civil lawsuits
While copyright infringement is usually addressed through civil lawsuits, criminal penalties can sometimes be imposed. Civil lawsuits are a common way to address copyright infringement, and they can have significant financial consequences.
In a civil lawsuit, the plaintiff must prove copyright ownership and that the defendant copied or otherwise violated their rights in the original work. This proof of copying can be demonstrated through circumstantial evidence, such as showing that the defendant had access to the original work and that there are substantial similarities between the two works in terms of format, appearance, sound, or sequence.
The penalties in a copyright civil lawsuit differ from most other types of civil suits. In personal injury, breach of contract, patent, or trademark infringement cases, plaintiffs can typically only recover financial compensation for the actual harm suffered. However, in copyright civil lawsuits, there are no such limitations, and the penalties can be excessive. Copyright holders can seek "statutory damages" in an infringement lawsuit, which can result in significant financial awards. For example, if the court finds that the infringement was ""willful," it can increase the statutory damages award to up to $150,000. On the other hand, if the infringer did not have reason to believe their use was infringing, the court can reduce the damages to a minimum of $200.
Additionally, copyright owners can recover actual damages, including lost market value at the time of infringement, and the infringer's profits. The copyright owner must prove the infringer's gross revenue, while the infringer must demonstrate deductible expenses and elements of profit not attributed to the copyrighted work. If the work was registered with the Copyright Office promptly, the owner can also recover statutory damages and attorney's fees without proving actual damages.
The massive civil penalties in copyright cases have been criticized as being out of line with other countries and detrimental to innovation. There have been calls for rational and predictable civil damages to allow entrepreneurs and investors to assess and manage their risks effectively.
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Factors influencing prosecution
While copyright infringement is often handled as a civil matter, it can also lead to criminal prosecution under certain circumstances. The main federal statute on this subject, 17 U.S.C. § 506, states that a person commits a crime if they "willfully" infringe on a copyright for commercial advantage or private financial gain. This includes reproducing at least $1,000 worth of copyrighted works (based on retail value) within a 180-day period or distributing a copyrighted work online that is intended for commercial distribution without permission.
The federal government carefully considers the seriousness of the offense and the likelihood of a successful prosecution when deciding whether to pursue criminal charges. The seriousness of the offense is determined by the number of copies made and their total worth. Prosecutors are particularly attentive to infringers who continue to violate copyrights even after being successfully sued civilly. The success of a criminal prosecution hinges on the ability to address any evidentiary or legal issues that may arise.
The penalties for criminal copyright infringement can be severe, including both prison time and substantial fines. For a first offense, an individual can be fined up to $500,000, imprisoned for up to five years, or face a combination of both. Repeat offenders face even harsher consequences, with fines of up to $1,000,000, imprisonment for up to 10 years, or a combination thereof.
It is important to note that the definition of "retail value" in this context is not entirely clear, and courts have employed various methods to reach equitable results. Prior to the sentencing phase, prosecutors are advised to consult with the Computer Crime and Intellectual Property Section of the Criminal Division to ensure a comprehensive understanding of the case.
In addition to criminal copyright infringement charges, individuals may also face additional counts such as wire fraud, conspiracy to commit wire fraud, and conspiracy to commit money laundering. The federal government treats the willful theft of intellectual property with the same gravity as any other crime involving monetary assets or possessions.
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Digital Millennium Copyright Act (DMCA)
The Digital Millennium Copyright Act (DMCA) is a United States copyright law enacted in 1998 to enforce two 1996 World Intellectual Property Organization (WIPO) treaties. It amends Title 17 of the United States Code to extend copyright protection while limiting the liability of online service providers for copyright infringement committed by their users.
The DMCA's primary innovation is exempting Internet service providers and other intermediaries from direct and indirect liability. This exemption was later adopted by the European Union in the Electronic Commerce Directive 2000. The DMCA also establishes protections for online service providers if their users engage in copyright infringement, such as the notice-and-takedown system, which allows copyright owners to request that infringing material be removed.
Additionally, the DMCA makes it unlawful to provide false copyright management information (CMI) or remove/alter this information in certain circumstances. CMI includes the title, name of the author, copyright owner, and terms for using the work. It also prohibits circumventing technological protection measures (TPMs) used by copyright owners to control access to their works, such as bypassing password systems.
The DMCA has been invoked in several legal cases. For example, in 2009, the DVD Copy Control Association won a lawsuit against RealNetworks for violating copyright law by selling software that allowed users to copy DVDs and store them on a hard drive. In another case, Lenz v. Universal Music, the court ruled that copyright holders must consider "fair use" before sending a takedown notice, and Universal was found liable under the DMCA's bad faith notice and takedown provision.
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Penalties for criminal copyright infringement
Copyright infringement is the act of exercising, without permission or legal authority, one or more of the exclusive rights granted to the copyright owner under Section 106 of the Copyright Act (Title 17 of the United States Code). Copyright owners have exclusive rights of reproduction, adaptation, publication, performance, and display. Infringement includes the reproduction or distribution of a copyrighted work in the following ways: downloading, uploading, sharing, or posting parts of a copyrighted work without authority, or using copyrighted content on a peer-to-peer network. Willful copyright infringement can result in criminal penalties, including imprisonment of up to five years and fines of up to $250,000 per offence.
The penalties for criminal copyright infringement are set forth in 18 U.S.C. § 2319. A defendant convicted for the first time of violating 17 U.S.C. § 506(a) by the unauthorized reproduction or distribution, during any 180-day period, of at least 10 copies or phonorecords, or one or more copyrighted works, with a retail value of more than $2,500, can be imprisoned for up to five years and fined up to $250,000, or both. Defendants who have previously been convicted of criminal copyright infringement may be sentenced to a maximum of 10 years' imprisonment, a $250,000 fine, or both.
The term "infringing items" means the items that violate the copyright or trademark laws, not the legitimate items that are infringed upon. It is not entirely clear, however, what is meant by "retail value" in this context, and courts have relied upon a number of methods to achieve equitable results. Congress has increased these penalties substantially in recent years and broadened the scope of behaviors to which they can apply.
Copyright infringement can also result in civil judgments. Anyone found liable for civil copyright infringement can be ordered to pay damages, with fines ranging from $750 to $30,000 per work infringed. For "willful" infringement, a court may award up to $150,000 per work infringed. A court can also assess costs and attorneys' fees.
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Frequently asked questions
Yes, breaking copyright law can result in jail time, but it is often handled as a civil matter first.
Copyright infringement occurs when someone "willfully" reproduce or distribute copyrighted material for commercial gain or financial profit.
Copyright infringement can include reproducing and selling copyrighted works, distributing copyrighted content online, or circumventing access controls to copy and distribute content.
Penalties for copyright infringement can include fines, imprisonment, or both. Fines can reach up to $500,000 for a first offense and $1,000,000 for subsequent offenses. Imprisonment can be up to five years for a first offense and ten years for subsequent offenses.
Prosecutors consider the seriousness of the offense, the likelihood of a successful prosecution, the number of copies, and the total retail value of the infringing items. They pay special attention to repeat offenders who continue to infringe despite civil lawsuits.
