Overview of U.S. Criminal Prosecutions & Turning Customs Violations into
Cases
Daniel AckermanRegional Intellectual Property Law Enforcement CoordinatorU.S. Department of Justice U.S. Consulate General, São Paulo Brazil
Federal Overview
• Background & Priorities• Statutes & Practice Tips–Intent –Impact of Technology• Legal concepts (i.e., venue)• International Collaboration
• Health and Safety Risk (e.g., drugs, batteries)• Used by the military or law enforcement• Entertainment Industry Piracy (Films/Games)• Apparel & Luxury Goods– Target has prior seizures after C&D letter– Target has prior convictions for similar conduct– Target is a gang member or has long CH– Other aggravating factors exist
Criminal Enforcement
Criminal Copyright Infringement(Reproduction/Distribution)
5 year max (10 year max if a second offense)1. Valid Copyright2. D infringed on copyrighted work by reproduction or distribution3. D acted willfully (i.e., aware he broke law)4. Reproduced and/or distributed ≥ 10 copies of one or more works w/total retail value of ≥ $2500 in ≤ 180 days; AND5. D did so for purpose of commercial advantage or private financial gain
Reproduction and Distribution• Making a copy or sharing a copy– Also aiding and abetting, conspiracy
• Uploading, downloading, P2P, BitTorrent, cyberlockers
• Streaming– Complete copy of work made to memory of device
but only over time and hidden and hard to access– May only be public performance, which is
misdemeanor if committed for purpose of commercial advantage or private financial gain
Willfulness
• Intention to violate a known legal duty, i.e., intention to break the law
• Best method of proof:– UC operation—get recorded admission from
target admitting that he or she is making and/or selling infringing goods or afraid to get caught• Gives you evidence or willfulness as well as
reproduction and/or distribution– Admissions (e.g., interview, emails)
Willfulness
• Discussion of law enforcement or efforts to evade detection– Response to UC inquiries showing concern about
enforcement, being caught, and so on• Other admissions and efforts to obtain illegal
content
Willfulness
• Notice– Examples• Cease and Desist Letters• CBP detention/seizure notices
– Letters should be as specific as possible, referencing statutes and registration materials
– Should be personally delivered to target, with receipt documented, if possible• Try to obtain any responses received to letters or
notices
Willfulness
• Prior lawsuits, prosecution, or knowledge of others engaging in counterfeiting– Search for subject on PACER– Subpoena right holder for documents in any civil
cases including any statements of D, confidential settlements, and the like
Commercial Advantage or Private Financial Gain
• Prove that D sought a profit, financial or otherwise
• “Financial gain” includes receipt or expectation of receipt or anything of value, including the receipt of other copyrighted works– E.g., warez site where members trade files
• Generally, easy to prove where D is running business selling infringing works
Criminal Felony Sentences
• No Commercial Purpose: Up to 3 years & $250k fine (6 years / fine if second offense)
• With Commercial Purpose: Up to 5 years & $250k fine (10 years / fine if second offense)
• BUT Sentencing driven by US Sentencing Guidelines
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Camcording (18 USC 2319B)
• Knowingly (not willfully)
• Without authorization of copyright holder
• Use or attempt to use AV recording device
• To transmit or copy a copyrighted AV work
• From a motion picture exhibition facility
• 3 year prison max (6 years if a second offense)
• $250,000 or twice the gross gain/loss
Bootlegging (18 USC 2319A)
• Fix, transmit, or distribute sound or images of a live musical performance
• Knowingly
• Without authorization of performer
• For commercial advantage or financial gain
• 5 year prison max (10 years if second offense)
• $250,000 or twice the gross gain/loss
Digital Millennium Copyright Act
• Circumventing Access Controls• Trafficking in Access Control Circumvention Tools• Trafficking in Copy Control Circumvention Tools• Falsifying, Altering, or Removing Copyright
Management Information• 5 year prison max (10 years if a second offense)• $500,000 or twice the gross gain/loss (1 million if
second)• But see Safe Harbor Provisions
Criminal Trademark Infringement 18
U.S.C. § 2320
1. Genuine trademark registered with USPTO and in use
• different from civil
2. Defendant intentionally trafficked in goods/services
• also includes labels, stickers, packaging, etc.
3. Counterfeit mark was:
a) identical to or substantially indistinguishable from genuine mark
b) used on or in connection with defendant’s goods/services; andc) likely to cause confusion, to cause mistake, or to deceive
4. Defendant knew mark was counterfeit
• “Gray Market” or “Overrun Goods” always potential defenses
Knowledge
• Knowledge is the key for felony prosecution• How will you prove defendant knew (not just
suspected) the drugs were counterfeit?– Price alone NOT enough– Knowledge of prescription requirement alone is
likely not enough– Defense: widespread counterfeiting in Asia– Strive for direct and circumstantial evidence
Proving Knowledge
• Recorded calls/meets• Emails (w/ suppliers and/or customers)• Use of false identities• Labels or packaging separate• Request changes to look of drug or packaging• Ask about safety or chemical composition
Proving Knowledge (Ctd)• Site offers medications at a price significantly lower than
local pharmacies• Site offers “generic” product or medications not marked
by the manufacturer• Site offers higher or different product doses than the
manufacturer• Site uses email to direct visitors to its website; legitimate
manufacturers will never send emails unless specifically requested
• Site does not list a street address or contact information
Smuggling (18 U.S.C. § 545)
1. Defendant knowingly imported or brought merchandise into the United States;
2. Defendant’s importation or bringing was contrary to law; and
3. Defendant knew the importation or bringing of the merchandise was contrary to law.
4. 20 year maximum sentence and $250k fine.
Misdemeanor Food & Drug Offenses 21 U.S.C. § 331
• 21 U.S.C. § 331(a): introduction of misbranded drugs
• 21 U.S.C. § 331(i)(3): sale/holding for sale of counterfeit drugs
• STRICT LIABILITY: don’t have to prove knowledge of counterfeit
• Felony for 2nd offense OR intent to mislead
Case Development & Management
• Identifying viable cases• Jurisdiction/Venue• Software & Open Source Tools• Undercover buys • Product Authentication• Trace the $$• Preservation requests & search warrants
Preservation• Helps to ensure availability of data at time legal
process served. Absent preservation, U.S.ISPs/hosting services not obligated to retain data, and often erase it, once no longer needed for business.
• U.S. authorities can request ISPs/hosting services topreserve data for a foreign country for 90 days (canbe extended once for 90 more days).
• Foreign authorities may be able to preserve by contacting ISP/hosting service directly and may beable to obtain preservation for a longer period of time, but this is at the provider’s discretion.
•
Preservation (ctd)• MLA request not required to preserve data.
• Request to preserve should include description of:– the account identifier– the offense– the data to be preserved– the data’s relationship to the offense, and– state that MLA request for disclosure of the data is being
pursued.
• In subsequent MLA request for the data, include– date of preservation request, and– tracking number
• Remember to renew preservation before it expires and keep seeking timely extensions until records received.
Preservation (Ctd)
• Most ISPs/hosting services preserve records for maximum of 180 days.• Imperative that OIA receive MLA request as quickly as possible. 30 days or sooner after preservation is best. Requests received shortly before the 180 day period ends are likely too late.• Risk destruction of records - often automated process.
Preservation (Ctd)
• Working Directly with ISP or Hosting Service– Foreign law enforcement request directly to ISP or
hosting service in the U.S.– Foreign law enforcement request to a local
affiliate in foreign country of U.S. based ISP or hosting service.
Channels to Request Preservation• Through U.S. government points of contact:• • 24/7 network: U.S. DOJ, Computer Crime and
Intellectual Property Section (CCIPS):• +1-202-514-1026 (business hours);• +1-202-532-5235 (non-public number for after
business hours);• +1-202-514-6113 (fax);• +1-202-514-5000 (DOJ Command Center - non-public
number).• • U.S. Embassy law enforcement liaison officers• (e.g., FBI, HSI, DEA Attachés)
Contacting ISP’s Directly
• If the ISP/hosting service is not a major service (e.g., Yahoo), be cautious.• CCIPS or OIA can help you determine whether contacting the ISP/hosting service directly may result in suspect being alerted.
US Legal Requirements to ObtainStored Electronic Evidence: Basics
• • Generally, foreign requests must meet same requirements that U.S. authorities must follow to obtain electronic evidence in U.S. cases.
• • Generally, the more invasive to privacy, the greater the legal burden (whether in U.S. or foreign case) to secure records.
• – For example, obtaining email account subscriber information vs. obtaining content of email communications.
•
• U.S. legal requirements vary according to type of stored electronic evidence/information• There are three types of stored electronic evidence/information
– Subscriber information– Transactional information– Content
•
Subscriber Information• What is it?
• Information that describes who a person is (for example, the name and address of the subscriber), and includes basic information about the person’s use of an online service (ISP) on a specific date and time (for example, times of logging into the account, how long the subscriber has used that specific service, etc.)•
Subscriber Information
• What is the legal standard?
• Lowest Legal Standard Under U.S. law: To obtain subscriber information, must establish that evidence sought is relevant and related to the criminal investigation.
Transactional Information
What is it?
• Includes records identifying with whom a subscriber communicated, what websites a subscriber visited, and similar information about a user’s online activity
Transactional Information• What is the legal standard?• • Intermediate Legal Standard: higher than
mere relevance; to obtain most transactional information, must provide specific facts detailing how the records or other information sought are relevant and material to a criminal investigation
• – U.S. law requires prosecutors to provide the court with a factual summary of the investigation and how the records requested will advance that investigation
Obtaining Subscriber and TransactionalInformation
• Directly from U.S. ISP/hosting service• ISP/hosting service may directly provide non-content
data (in particular, subscriber data) to foreign law enforcement on voluntary basis, but not required to do so.
• ISPs/hosting services operate under different organizational, legal and policy structures, and practices may change over time, so ISPs/hosting services, and any foreign affiliates, should be consulted directly on this point.
• ISP/hosting service may require foreign authorities to make an MLA request for this information.
Obtaining Subscriber andTransactional Information
• Through an MLA Request• • MLA request necessary if U.S. ISP/hosting service will not
voluntarily disclose to foreign law enforcement authorities.• • MLA request requires detailed description of the information
sought, and detailed description of the facts sufficient to meet the applicable legal standard for the information sought.
• • When MLA request executed, notice to subscriber need not be given, but must seek confidentiality in MLA request and specify compelling reason notice not be given. For example, if foreign law enforcement is still trying to identify a perpetrator, this is usually sufficient. On the other hand, if sole suspect knows he is under investigation or has already been charged, must identify another compelling reason.
Content• What is it?
• • Information sent in an email from the sender to the recipient, which could include written messages, embedded photographs or images, and attached files
• – Content of emails (including the subject line) or websites
• – Social Networking: messages, “friend” requests
Content
• What is the legal standard?
• • Highest Legal Standard: you must provide information in the formal request that satisfies two legal standards:(1) “probable cause,” and (2) that the facts supporting the request are current.
Content: Probable Cause Required• What is Probable Cause?• Requirement in U.S. Constitution to protect
against unreasonable searches and seizures.• Necessary to have (1) information that is
reasonably trustworthy, to (2) warrant a person of reasonable caution in the belief that an offense has been committed by a particular person and that a specific location contains evidence of a crime.
• Requirement for search warrant to issue.
Content: Facts Must Be Current
• At least some facts described in request need to be relatively recent, or indicate likelihood that evidence will still be located in place to be searched.
• Courts will reject request if information presented is old or “stale.”
• Generally speaking, facts more than 120 – 180 days old, in context of electronic evidence, are more likely to be considered too old.
What does this all mean?• • To obtain content, including of email messages,
search warrant must be obtained from U.S. court.• • The standard applied to obtain the warrant is
essentially the same standard applied to obtain a warrant to search someone’s home.
• • Highest legal standard applied because of invasive nature of the request upon a person’s privacy.
• • Foreign authorities must submit MLA request to obtain the warrant.
•
MLA Request for Search Warrant• To justify issuance of a search warrant, MLA
request cannot simply state that a person is involved in criminal activity and evidence of that crime is in a certain place or email account. This is a conclusion, the factual basis of which has not been provided.
• Instead, the MLA request must include a detailed description of the sources of evidence that enabled the foreign authority to arrive at these conclusions.
MLA Request for Search Warrant
• • The MLA request must precisely describe facts gathered by investigators demonstrating that it is probable that the email account contains evidence of a crime. The description of facts must include the sources of the facts, and enough information about them to enable the U.S. judge to assess their reliability. The facts must be recent enough that the judge can conclude that it is probable that the evidence is still in the account.
Real-Time Interceptions• Real-time interception of communications means the
gathering of information while the communication is still occurring. Different than stored communications.
• Real-time interception of content data is available only if there is jurisdiction for U.S. investigators to commence a
• U.S. investigation and obtain an order for electronic eavesdropping (often known as a “wiretap” or “T3“). They can often share the evidence gathered.
• Real-time interception of non-content data (connection data) is available even in a purely foreign crime and can be obtained at a lower standard of proof. It can be useful to locate a fugitive.
Emergencies
• ISPs permitted to voluntarily disclosure content and non-content information to government entities in certain emergency situations.
• Only applicable where there is imminent danger of death or serious physical injury requiring disclosure without delay. (For example, when necessary to identify source of credible impending bomb threat or rescue kidnap victim.)
• If ISP agrees to voluntarily disclose, obviates need for MLA request by foreign authority.
Constitutional Considerations
• U.S. Constitution protects freedom of expression whether in written, spoken or other form.
• For example, “hate” speech is generally protected by the Constitution, even though objectionable, unless the expression includes calls for immediate violent action.
• Please consult DOJ/OIA on these matters before submitting MLA request, as such MLA requests may not be actionable under U.S. law.
•
Hypothetical # 1• The court ordered search of a house owned by suspect
X, one of the targets of an ongoing narcotics investigation, resulted in the seizure of several kilos of cocaine, $450,000 in cash, several automatic weapons, and a laptop computer. A forensic examination of the computer revealed several stored email messages discussing cocaine transactions sent from the email account [email protected]. Five messages had been sent within the one month period prior to the search. The content of messages referred to other communications relating to drug trafficking. No other messages involving other email accounts were retrieved.
Hypothetical # 2• Janet Smith has a friend - Betty Jones, who lives overseas, and they
keep in touch by Facebook. On 1 Jan 2015, Janet received a proposal from Betty via Facebook private message. In the message, Betty asked Janet to buy telephone calling cards and send Janet the PIN numbers. After the PIN numbers were received, Betty promised to transfer funds to Janet’s bank account, including 20% premium. Janet bought the calling cards and sent PIN numbers, but never received any funds.
• The police determine Janet bought $16,000 in calling cards and, from 15 Jan 2015, to 15 Feb 2015, sent seven private messages to Betty’s Facebook account (Betty.Jones12) containing the PIN numbers.
• Betty claims she never made the business proposal or received the PIN numbers. All funds were drained from the calling cards.
Questions?
DANIEL ACKERMANIPLEC, Latin America & the Caribbean11-3250-5633; [email protected]@state.gov
RODRIGO DIASLegal Adviser11-3250-5632; [email protected]@gmail.com
