The Ninth wants a criminal defendant to pay a huge software company’s
(And it’s a good thing). United States v. Anderson, 2013 WL
6670793 (9th Cir. Dec. 19, 2013), decision available here.
Players: Decision by Judge Callahan, joined by Judge Fernandez and Chief
DJ Vance. Hard-fought appeal by ND CJA attorney John Jordan.
Facts: Anderson sold (unauthorized) copies
of Adobe software online. Id. at *1. Activation
codes were hand-written on the disk in permanent marker. Id. He sold about $70,000 worth of the software, was discovered by
Adobe, and was ultimately prosecuted for criminal copyright infringement. Id. at *2. At trial, Anderson explained
that he thought these disks were legal backup copies. Id. The parties disputed a “willful infringement of copyright” jury
instruction, and the jury later sent a note questioning the meaning of “willful.”
Id. at *4-*5. Anderson was convicted
and the district court imposed $247,144 in restitution. Id. at *3.
Issue(s): “[ ]Anderson . . . appeals his conviction for
criminal copyright infringement . . . .. Anderson contends that the district
court erred: (1) by giving an incorrect jury instruction on willfulness; (2) by
allowing the government to introduce evidence of uncharged acts of
infringement; and (3) in calculating restitution.” Id. at *1.
the willfulness standard for criminal copyright cases as recently clarified in
. . . Liu, 731 F.3d 982 (9th Cir.2 013),
we conclude that the jury instruction was flawed but did not rise to the level
of plain error. We also find that the evidence of uncharged acts was properly
admitted as intrinsic to the charged conduct, and accordingly, we affirm
Anderson’s conviction. Nonetheless, consistent with . . . Fair, 699 F.3d 508 (D.C. Cir. 2012), and . . . Chalupnik, 514 F.3d 748 (8th Cir. 2008), we conclude that the
district court erred in failing to award restitution reflecting the victim's actual
loss, which consisted of the victim’s lost profits on sales of authentic copies
that would have taken place if not for Anderson’s conduct.” Id.
Of Note: The district court erroneously calculated restitution by
multiplying the number of copies of Adobe disks sold, by the retail value of
the disks. Id. at *10. The Ninth embraces
out-of-circuit authority for copyright restitution cases and reverses.
Restitution for criminal copyright should focus on the victim’s loss, not the defendant’s
gain – and “in most cases, that will consist of the copyright owner’s lost
profits on sales that would have taken place if not for the infringing conduct.”
Id. at *12. Anderson is a useful, rigorous application of restitution – a “back
of the envelope approach simply will not do.” Id. “Speculation and rough justice are not permitted.” Id. at *13. Turn to Anderson to put
some bite in restitution fights.
Use: In addition to a good restitution
holding, the Court in Anderson also
offers helpful language on the mens rea
requirement for criminal copyright infringement. Id. at *7. The government in Anderson
inexplicably used an old instruction that allowed for conviction if Anderson
knew his acts “may” infringe upon copyrights. Id. “May” won’t cut it: the word is “vague” and rendered “the first
sentence of the instruction incorrect to the extent that it suggests that
Anderson could be convicted without knowing that he was violating Adobe’s
rights.” Id. at *7. Because this was
plain error review, this erroneous instruction didn’t earn a reversal – but the
good mens rea language is still
useful for copyright cases.
|Executive Committee, A.O. US Courts (new Chair Judge Traxler, not pictured)|
Further Reading: The Hon. Sarah S. Vance, Chief Judge
of the E.D. La., sat on the Anderson
panel. Chief Judge Vance is one of the eight members of the Executive Committee
of the Administrative Office of the United States Courts (CJ Vance is to the far left, in
front, in red). See article here.
The significance? It is the Executive Committee who ultimately determines the funding of
the Defender Service account – a subject of much interest to those committed to the defense of indigent clients in federal court. See, e.g., E.C. Letter re: CJA Rate Cut, here.
Image of the (2012) Executive Committee from http://www.uscourts.gov/FederalCourts/UnderstandingtheFederalCourts/AdministrativeOffice/DirectorAnnualReport/annual-report-2012/support-for-the-judges-and-court-staff.aspx
Labels: Callahan, Copyright, Mens Rea, Restitution, Willfulness