Federal Criminal Infringement of a Copyright Law - 17 U.S. Code § 506
There is a fine line between inspiration and copyright violation. As with other intellectual property crimes, copyright infringements are typically handled at the civil level.
Those who violate copyright law are often sued by the copyright holder, with no immediate threat of criminal consequences. However, this is not always the case.
In some circumstances, federal prosecutors may pursue copyright infringements as a criminal matter under 17 U.S. Code § 506(a), which is penalized under18 U.S.C. § 2319.
So, when does a copyright violation rise to criminal copyright infringement? Federal prosecutors use several statutes to charge people with this common white-collar crime. They frequently combine charges of criminal copyright infringement with more common criminal charges, such as wire fraud, mail fraud, money laundering, or RICO.
The United States Congress has the authority to: “promote the progress of science and useful arts, by securing for authors and inventors the exclusive rights to their writings and discoveries.” Thus, Congress passed numerous federal laws primarily designed to protect intellectual property.
Copyright law grants copyright holders exclusive right to reproduction of their work, public distribution, public performance of literary, dramatic, musical, sound recordings, choreographic, audiovisual works, and a public display of works.
Federal laws also provide remedies for the infringement of these exclusive rights. Readers should note that the vast majority of infringement cases are civil issues, but there are situations where criminal copyright laws could be used.
If you are under investigation for criminal copyright infringement, this article from our federal criminal defense lawyers will help set your expectations in the event you are charged.
Reviewing the Law - 18 U.S. Code § 2319 and 17 U.S. Code § 506
Federal prosecutors use two statutes simultaneously to establish criminal charges for copyright infringement, and it's valuable to understand both sections as you and your attorney build your case.
17 U.S. Code § 506 defines the type of infringements that constitute criminal proceedings:
- Infringements committed with the intent to gain a commercial or personal financial advantage,
- If the retail value of copyrighted reproductions is greater than $1,000,
- If a work intended for commercial distribution is intentionally made available to the public while the copyright owner still has a reasonable expectation of distributing the work.
What is considered a work intended for commercial distribution? According to the statute, a “work” could be:
- Computer programs,
- Motion pictures,
- Sound recordings,
- Other audiovisual work.
It's important to note that infringements of these works can be applied to tangible and digital reproductions. This includes electronic music, film piracy, and camcording (using a recording device in a movie theater).
18 U.S. Code § 2319 outlines the scope and range of penalties if an individual commits a copyright offense as defined in 17 U.S.C. § 506. Generally, these are scaled based on the amount gained from the infringement or the number of reproductions distributed. A maximum prison sentence of 5 years, plus fines, assuming:
- There have been at least ten copies produced in 180 days, and
- The retail value of the copies exceeds $2,500.
Imprisonment of up to 10 years, plus hefty fines, assuming:
- The same production and value stipulations stated in (a), and
- It is the offender's second (or subsequent) violation.
If the amount gained is less than $2,500:
- Maximum of 1-year imprisonment
- Possible fines up to $25,000
What Factors Determine a Felony Vs. Misdemeanor?
For a felony copyright infringement, the Government has to prove the defendant willfully infringed upon valid copyright using unlawful reproduction or distribution.
It's a criminal violation to reproduce or distribute ten or more copies of a copyrighted work with a value exceeding $2,500.
Further, it's a felony offense to distribute copies for commercial distribution, make such copies publicly accessible, and act when you know or should have known the work is being prepared for commercial distribution.
A misdemeanor charge typically involves when the defendant acted with the purpose of a commercial, financial gain or if they reproduced or distributed the works that exceeded a value of $1,000 within 180 days.
Misdemeanor charges are frequently brought in cases involving the unlawful use of digital audio transmission and infringement of performance rights.
So, in review, if prosecutors decide to pursue a criminal copyright infringement case, whether it is considered a misdemeanor or a felony comes down to the amount of money gained from copyright reproduction.
- If the retail value exceeds $2,500, the case may be charged as a felony,
- An offense with profits of at least $1,000 but under $2,500 is considered a misdemeanor,
- If the violation results in a financial gain of under $1,000, it is unlikely that federal criminal charges will be filed under 18 U.S.C. § 2319.
What Charges Are Related to 17 U.S.C. § 506(a)?
Criminal copyright infringement is often charged alongside federal fraud and financial statutes, including:
- 18 U.S.C. § 1341 - Mail fraud,
- 18 U.S.C. § 1343 - Wire fraud,
- 18 U.S.C. § 2320 - Trafficking in counterfeit goods or services,
- 18 U.S.C. § 2323 - Forfeiture, destruction, and restitution,
- 18 U.S.C. § 1030 - Computer fraud and abuse,
- 18 U.S.C. § 535 - Smuggling goods into the United States,
- 18 U.S.C. § 1832 - Theft of trade secrets,
- 18 U.S.C. § 2318 — Trafficking in counterfeit labels, documentation, or packaging.
What Are the Defenses for Criminal Copyright Infringement?
Laws protecting intellectual property are complex and often misunderstood. In criminal cases, federal prosecutors must establish that the defendant knowingly violated federal copyright statutes.
This can be hard to prove because unintentional violations are widespread, especially if the offender is under the impression that the material was not copyrighted or was allowed to be replicated.
Fair use is one of the most effective defenses against copyright infringement charges. The exception permits a person (or legal entity) to use or recreate a copyrighted work without compensating the copyright holder. However, it is not all-encompassing. As set forward in 17 U.S.C. § 107, the types of uses that qualify for a fair use exception are:
- News reporting,
- Criticism, including parody,
- Teaching or learning,
Fair use is judged on a case-by-case basis, and a lawyer may be best suited to determine its validity as a defense in your specific situation.
What if the government violated your Constitutional rights in investigating or obtaining evidence? The seized evidence could be suppressed after filing and arguing a successful defense motion.
The top-rated federal criminal lawyers at Eisner Gorin LLP are in Los Angeles, California. We provide legal representation across the United States for all types of federal crimes. You can reach us for a case review via phone or contact form.