DVD pirates come under legal siege

Motion Picture Association of America has established an investigation arm in NZ

Despite a surge in the use, and sale of, counterfeit DVDs in New Zealand, one could get the impression the New Zealand Police and copyright owners have taken a relaxed approach to dealing with the problem.

This year, however, with the first successful DVD pirate prosecution and the establishment of the New Zealand Federation Against Copyright Theft, DVD pirates have officially been served notice. DVD pirates in New Zealand should take notice and watch carefully to see what punishment is meted out to the individuals caught dealing with pirated copies of local film Sione’s Wedding.

The one that got away

In November 2004, Zheng Wang was arrested outside the Otahuhu markets, after being found in possession of ten pirated DVDs and nearly $500 cash. The police charged Wang with making or using a forged document under the Crimes Act 1961. In the District Court, Wang faced a hard-line judge who issued a sentence of 15 months imprisonment.

Wang successfully appealed this decision in the Auckland High Court in March 2005. The High Court held that Wang had not committed an offence because the DVDs were obvious and amateur copies of films not yet released in New Zealand and there was no evidence that Wang had intended to deceive the public about the nature of the merchandise.

The police then attempted to substitute the Crimes Act charge with a charge under the Copyright Act but were unsuccessful because of the significant differences between the two offences.

The relevant Copyright Act offence, of making or dealing with infringing copies of copyright works, has existed since 1994. If convicted under this act, the maximum penalty is a fine of up to $150,000 plus a potential maximum of five years in prison.

With such severe consequences, this legislation is clearly designed to act as a deterrent against copyright infringement such as making and selling counterfeit DVDs.

Going after the big fish

Since the Wang case, the Police appear to have caught on to the benefits of prosecution under the Copyright Act. On 13 February 2006, Benjamin Samu was successfully prosecuted for DVD piracy, after being caught selling pirated DVDs at the Otahuhu markets in October 2005. Samu was sentenced to serve 300 hours community work and to pay $1,000 in reparation.

Samu is certainly not the only person guilty of selling unauthorised copies of DVDs in New Zealand. In fact, the Motion Picture Association of America is so concerned about this problem that it has recently established an investigation arm in New Zealand, the New Zealand Federation Against Copyright Theft. Perhaps this is not surprising given that video piracy cost the Motion Picture Association of America an estimated $5 billion in 2005.

At present, the federation is intent on prosecuting commercial video pirates rather than the average Kiwi who copies DVDs for private use.

However, DVD piracy is a growing problem in New Zealand, where an estimated one of every ten DVDs is a pirate copy.

The federation is not content with simply catching Samu in the act. In fact, he appears to be a small fish in a big pond, being one of at least five men operating a DVD piracy ring in Auckland.

The alleged leader faces up to 38 charges under the Copyright Act and will appear in court later this year. Like Samu, he faces penalties of up to five years in prison and fines of up to $150,000.

Sione’s Wedding — who will be on the hook?

This month, the local film industry has been hit hard with the wide release of pirated copies of the popular film Sione’s Wedding.

A bootlegged copy of an unfinished version of the film has been spreading like wildfire across South Auckland, and producers estimate the illegal recording has cost distributors about $500,000.

Private investigators and the federation have been called in to investigate and it is understood that the main culprit has been identified. It is not yet known whether charges will be laid but, undoubtedly, the pirate will come to regret the decision to make and distribute illegal copies of a local film.

Piracy beyond New Zealand

The establishment of the federation is not an initiative exclusive to New Zealand, although in some countries this process is undertaken by government bodies. In April 2005, the Malaysian Government through its Ministry of Domestic Trade and Consumer Affairs, established an enforcement division with a special unit dedicated to deal with the export of pirated CDs, VCDs and DVDs. The establishment of this unit signals the Malaysian Government’s desire to overcome the image Malaysia has as being a haven for piracy.

Because the Malaysian enforcement unit is a government initiative it has significant resources that the New Zealand federation does not have, including a staff of over 1,500.

In 2005, the enforcement division closed down seven factories manufacturing pirated discs, conducted over 35,000 raids and seized approximately 4.7 million pirated discs, worth over NZ$40 million.

Although the level of piracy in New Zealand is unlikely to reach that in Malaysia, it will be interesting to monitor the progress made by the federation and the New Zealand Police over the coming months and to see what level of punishment is meted out by the Courts, particularly in relation to the Sione’s Wedding release.

Foggo and Stafford are solicitors with Simpson Grierson. They specialise in intellectual property and technology.

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