Piracy in the Entertainment Industry & Legal Penalties
Technology has made it easier for people around the world to enjoy music, films, or TV shows, but it also creates a risk of violating intellectual property rights. One type of copyright infringement is popularly known as piracy. This involves duplicating and distributing copyrighted materials without permission from the copyright holder. While it is widespread and tacitly accepted in some circles, piracy can lead to civil liability and criminal penalties under federal law. Perhaps the most familiar form of piracy is online piracy, which involves illegally uploading or downloading a copyrighted sound or video recording, as well as some uses of streaming systems.
However, piracy also exists in more tangible forms offline. Illegal bootleg recordings involve unauthorized recordings of concerts, movies shown in theaters, or television or radio broadcasts. Other forms of infringement include counterfeit recordings, which reproduce a recording without permission, while duplicating the packaging that comes with the original recording, such as trademarks and labels. In other cases, people make "pirate recordings," which are similar to counterfeit recordings, except that they do not duplicate the packaging that comes with the original recording. Pirate recordings often involve compilations of multiple recordings and sometimes multiple entertainers.
Impact of Piracy on the Entertainment Industry
People often take music or film copyrights and the concept of "piracy" lightly, but it is not a victimless crime. The entertainment industry loses billions of dollars each year due to copyright infringement, putting jobs and careers at risk. Meanwhile, musicians and other entertainers suffer from piracy due to the loss of royalties. Sometimes pirated copies are perceived as the real thing, moreover, which can harm the reputation of an entertainer if the pirated version has a noticeably inferior quality. Businesses that legally sell copyrighted works also lose money because they cannot offer these legitimate versions for a price comparable to the price of pirated versions. Finally, the costs of piracy ultimately are transferred to consumers, since the losses caused by copyright infringement force the entertainment industry to increase the price of access to copyrighted works.
Three trade associations in the entertainment industry hold primary responsibility for fighting piracy. These are the Recording Industry Association of America, the Motion Picture Association of America, and the Entertainment Software Association. The member companies of these trade associations produce about 90 percent of US music, film, and television recordings, as well as computer games and video games. The RIAA, MPAA, and ESA work aggressively with law enforcement to hold violators accountable.
Penalties for Piracy
Federal law bars any copyright infringement that was perpetrated for commercial advantage or private financial gain. It also prohibits the reproduction or distribution (tangible or electronic) of one or more copyrighted works with a total retail value over $1,000 during a 180-day period. Finally, federal law bans distributing a work that is being prepared for commercial distribution by making it available on a public computer network, while knowing that the work was meant for commercial distribution.
Maximum penalties for misdemeanor copyright infringement are one year in prison and a $100,000 fine. Maximum penalties for felony copyright infringement generally are:
- Commercial advantage or private financial gain: five years in prison and a $250,000 fine
- Reproduction or distribution (retail value over $1,000 during a 180-day period): three years in prison and a $250,000 fine
- Distribution on a public computer network: three years in prison (for ordinary distribution) or five years in prison (for commercial advantage or financial gain) and a $250,000 fine
Copyright infringement also may lead to a civil lawsuit, even if the infringement was not for profit. Damages in these cases can consist of actual damages, lost profits, or statutory damages. Statutory damages are capped at $150,000 for each copyright that was infringed.
