Internet Copyright Infringement: An Emerging White-Collar Crime Internet

Criminal sanctions may be a better deterrent for the increasing online violations

Jonathan Bick, Bick is of counsel at Brach Eichler in Roseland. He is also an adjunct professor at Pace and Rutgers law schools, and the author of "101 Things You Need to Know About Internet Law" (Random House 2000).

Both white collar criminal prosecution and civil remedies thwart the unauthorized use of copyrighted material. Traditionally, injunctions and damages are more commonly used than criminal prosecution to frustrate infringements. However, the increasing use of the Internet for infringement activities makes criminal sanctions a better deterrent than traditional civil actions, thus Internet copyright infringement is emerging as a white-collar crime.

The Internet's own protocol and the software that allows Internet users to conduct searches to acquire new information also allow those users to readily reproduce some or all of their Internet search for their own uses. The reproduction normally occurs in the form of direct copying of an Internet site's content. Though the technology exists to prevent such copying and pasting, it is infrequently used by the content provider. This makes Internet copyright infringement easy to execute.

A "white-collar crime" is often thought to be an unlawful act committed by a person using resources that are available at the place of employment. Such an understanding clearly covers Internet copyright infringement, because Internet access is a common workplace resource and is habitually involved in infringing actions. Alternatively, "white-collar crime" may be an offense lacking physical violence and generally relying upon fraud or deceit. This understanding also results in Internet copyright infringement being considered in the same light as such white-collar crimes as Internet embezzlement or fraud.

Internet copyright infringement may result in significant damages due to lost sales, as evidenced in A&M Records v. Napster, 284 F.3d 1091 (9th Cir. 2001). Such great harm is also a common characteristic of white-collar crimes, amplifying the argument of those who contend that Internet copyright infringement is a white-collar crime. Similarly, proponents of Internet copyright infringement as a white-collar crime are bolstered by the fact that those who engage in such infringements normally engage in fraud or deceit, just as in the case of traditional white-collar crimes such as securities law violations, bribery, embezzlement, mail fraud, credit fraud, and other crimes associated with false claims to the government. Internet copyright infringers do so by knowingly copying content in contradiction to the terms of use agreements that are generally associated with the Internet site from which the copyrighted material is taken.

As the Internet matures and technology allows faster content transfer, infringers have found new methods of profiting from copyrighted content. Initially, infringers focused on printed content and photographs. Next, infringers added copyrighted music files and, most recently, copyrighted video content. These Internet infringement targets have multiplied copyright infringement on a huge scale.

The actors involved in promoting Internet copyright infringement have harvested an immediate commercial profit due to the fact that the Internet allows large-scale operation at nominal cost. Unlike traditional copyright infringers who must operate warehouses and factories where they undertake mass reproduction of copyrighted content in a systematic way, Internet copyright infringers are not burdened by such costly brick and mortar assets. Nor do Internet copyright infringers require blank recording media like tapes or CDs that have been purchased in large bulk quantities, duplicating machinery, or even the cost of traditional delivery systems.

While Internet copyright infringement is relatively new, criminal prosecution of copyright infringement is more than a hundred years older than the Internet. In particular, consider a reference in the 1909 Copyright Act to an 1897 Act of Congress declaring that persons who willfully and for profit shall infringe any copyright shall be deemed guilty of a misdemeanor.

Congressional intent with respect to the 1897 Act's criminalization of copyright infringement seems to connect the possibility of criminal prosecution with general deterrence. It was reasoned then, as it is today, that individuals commit intentional copyright infringement believing such infringement is easy to commit, and the likelihood of it being discovered is low. However, criminal prosecution then, as today, is usually believed to establish public expectations of right and wrong. By associating intentional infringement as a criminal act, those who consider infringement may be deterred by the fear of being branded a criminal.

While the 1897 Act limited criminal prosecution to unauthorized performances of plays and music, in 1909 the Copyright Act was changed so than any person who infringes a copyright willfully for purposes of commercial advantage or private financial gain, is subject to criminal prosecution. Such is still the law. 17 U.S.C. § 506(a)(1) (2000).

Additionally, Congress has made criminal copyright infringement a more serious offense and easier to prosecute. In particular, in 1982, Congress found certain infringements to be felonies. See Piracy and Counterfeiting Amendments Act of 1982, revised and found at 18 U.S.C. § 2319 (2000). Additionally, the No Electronic Theft (NET) Act of 1997—codified as amended at 17 U.S.C. § 506 (2000), 18 U.S.C. § 2319 (2000) and 28 U.S.C. § 994 (2000)—made criminal prosecution easier by lowering the threshold for proving criminal copyright infringement.

Civil Internet copyright infringement, like traditional copyright infringement, does not require intent. Thus, copyright infringement is always at least a civil action. Additionally, an Internet copyright infringer may also be charged with a federal crime in the event that the infringer willfully, either for purposes of commercial advantage, or private financial gain, reproduces or distributes (by any means, including electronically), one or more copyrighted works that have a total retail value of $1,000 or more within any 180-day period. See 17 USC §506(a).

Thus, the customary criminal requirement of some sort of mens rea is a statutory requirement. In particular, the defendant exhibits "willfulness" in regard to the infringement. As in the case of most interpretations of willfulness for criminal purposes, the act must be voluntary and an intentional violation of a known legal duty.

As evidenced by the Digital Millennium Copyright Act (DMCA), U.S. copyright law has increasingly relied on the criminalization of Internet copyright infringement to deter Internet copyright infringement. In particular, it criminalizes not only the act of infringement but also acts that profit from Internet copyright infringement, including the production and dissemination of technology, devices or services that allow the circumvention of measures that control access to copyrighted works. It also criminalizes the act of circumventing an access control, without the necessity of actual infringement of copyrighted content.

Notwithstanding existing criminal statutes and associated penalties, the infringement of copyrighted content flourishes. As public policy seeks to combat this trend, it is likely that governments will increasingly treat Internet copyright infringement as a white-collar crime. •