Criminal Copyright Infringement
Gasaway, Laura, Information Outlook
Most copyright litigation is civil in nature--a court finds that a defendant has infringed and orders the defendant to pay either statutory damages or actual damages and profits. There are also criminal copyright penalties, and Congress has shown recent interest in increasing these penalties. Criminal copyright infringement laws exist to punish infringers who misappropriate copyrighted works that an "author" invested time, creativity, energy, and money to create but lacks the means to protect from such infringement.
Misdemeanors are less serious crimes, and criminal misdemeanor penalties have been a part of the copyright law since 1897. Traditionally available only if the infringement was willful and done for profit, the misdemeanors involved unlawful performances and representation of copyrighted dramatic and musical compositions. So the reproduction and distribution of copies of copyrighted works, even when undertaken for profit, was not a crime. In the 1909 Copyright Act, criminal copyright infringement was expanded to cover all types of works and all types of activities. It continued to be a misdemeanor offense with both willfulness and a financial motive required; the penalties included fines and imprisonment.
The 1976 Act revamped the criminal provisions by changing the "for profit" requirement to infringement conducted "willfully and for purposes of commercial advantage or private financial gain." This phrasing lowered the standard from requiring that the defendant profit from the infringement to merely an intent to profit or gain from the activity. The Act retained the one-year federal prison term but increased the fine from $1,000 to as much as $10,000 generally, and to $50,000 if the work infringed was a sound recording or motion picture.
In 1982 the criminal infringement provisions were amended to make certain types of first-time infringement punishable as felonies (more serous crimes), although most criminal infringements remained at the misdemeanor level in the statute. The types of activities that were classified as felonies depended on the number of copies made or sold within a 180-day period. Increased penalties of up to five years' imprisonment and $250,000 in fines were available only if the infringement involved reproduction or distribution of motion pictures, audiovisual works, or sound recordings. Repeat offenders were subject to the maximum fines regardless of the number of copies or types of works involved. All other offenses continued to be misdemeanors, with maximum fines of $25,000 and one year imprisonment.
The most recent amendment to criminal copyright infringement was the No Electronic Theft Act of 1997 (Net Act), which made it a felony to reproduce or distribute copies of copyrighted works electronically regardless of whether the defendant had a profit motive. Thus, it changed the 100-year standard regarding profit motive but retained the element of willfulness. The ease of infringement on the Internet was the primary reason for criminalizing noncommercial infringement, as well as recognition of other motivations a nonprofit defendant might have, such as anti-copyright or anti-corporate sentiment, or trying to make a name in the Internet world and wanting to be a cyber-renegade. So, the infringement must either (1) be for purposes of commercial advantage or private financial gain or (2) involve the reproduction or distribution of one or more copies of a work or works within a 180-day period with a total retail value of $1,000. Commercial infringers are subject to higher penalties, however. A commercially motivated infringer can receive up to a five-year federal prison term and $250,000 in fines; a noncommercial willful infringer is subject to up to a one-year prison term and $100,000 in fines. …