SHANGHAI, China – Two American men were sentenced Tuesday to prison terms of up to 2½ years for selling pirated DVDs on Internet sites like eBay in a rare success for joint U.S.-China efforts to enforce intellectual property laws.
The two Americans and two Chinese co-defendants were accused of using the Internet to sell more than 180,000 counterfeit DVDs to buyers in 25 countries, including about 20,000 discs to U.S. buyers. Prosecutors said they seized 119,000 pirated DVDs in raids last summer on a warehouse and the Shanghai apartment of American Randolph Hobson Guthrie (search).
Investigators said the case saw unprecedented cooperation between Chinese and U.S. law enforcement. The U.S. and other nations have been pressing China to crack down on rampant copyright violations.
The sentences marked the culmination of a three-year investigation by U.S. customs, Chinese police and industry group Motion Picture Association of America (search).
"This landmark case will serve as a roadmap for future intellectual property rights investigations," Michael Garcia, the U.S. Homeland Security official responsible for customs investigation, said.
Garcia said U.S. Customs began tracking Guthrie after undercover agents linked him to pirated discs being sold at a Mississippi flea market
Shanghai's No. 2 District Court ordered the 38-year-old Guthrie to 2½ years in prison and fined him $60,500. Abram Cody Thrush (search), convicted as an accessory, was sentenced to one year in prison and fined $1,200. Both Americans were ordered deported after serving their sentences.
The men have the right to appeal, but there was no immediate word on whether they would.
"There really isn't too much of a basis for appeal," Guthrie's lawyer, Zhai Jian, told reporters. "I think it was a pretty fair judgment."
Zhai said the conviction was the first he knew of involving a foreigner selling pirated DVDs.
Guthrie was "really more upset about the deportation order," Zhai said. "He's lived here for 10 years. He bought a home here. He really feels for Shanghai."
Guthrie made no audible comments as he and the other defendants stood during the hour-long hearing. U.S. Consulate officials attended the court session but did not comment.
One Chinese co-defendant was found guilty of aiding the operation and sentenced to one year in prison. The other was also convicted but was released.
Guthrie, of New York City, earned $159,000 between October 2002 and November 2003 selling the discs, Xue said. Thrush, of Portland, Ore., provided technical assistance and earned $1,450, Xue said.
Chinese state media pointed to the case as an example of how foreigners are involved in purchases of pirated products. Despite sporadic arrests, counterfeit books, DVDs and music are easily available on almost every city street. Shanghai's outdoor Xiangyang market (search) is filled almost daily with foreign tourists buying up knock-off watches, sportswear and handbags.
However, Patrick Powers, Beijing director of the U.S.-China Business Council, said the high profile given to the Guthrie case could indicate a new determination to prosecute major piracy cases.
"Prosecution of a foreigner for intellectual property rights violations should help authorities persuade local law enforcement to be more proactive," Powers said.
Along with DVDs seized from Guthrie, evidence in the case involved shipping invoices and bank transfer receipts, some of which were provided by U.S. law enforcement, Xue said.