Yo Ho! A Copyright Pirate’s Life In 2021
Since the passing of the original Copyright Act in 1790, developments in copyright law in the United States have been influenced by many civil disputes—lawsuits where one private party sues another. Our seminal copyright case law has, for the most part, come from such civil disputes, including cases heard by the Supreme Court of the United States. However, every now and then, someone plunders the copyright coffers so egregiously that it amounts to piracy or more generally, criminal copyright infringement.
An Introduction to Criminal Copyright Infringement
One might think that investigations into criminal copyright infringement occur when the potential monetary damages are high. Oracle sought a staggering eight billion dollars when they sued Google in 2010, alleging that Google had impermissibly copied some of Oracle’s software while designing the Android operating system. In their 1988 lawsuit, Apple sought five billion dollars (nearly ten billion dollars in today’s money) from Microsoft for allegedly copying elements of Apple’s Macintosh user interface. However, neither case saw any involvement from federal law enforcement. So, if potential infringement worth billions of dollars is not of interest to law enforcement, then what are they looking for?
The primary statute that criminalizes copyright infringement is found in § 506 of the Copyright Act. It states that criminal prosecution can be aimed at a party who willfully infringes a copyright, if the infringement:
- was for purposes of commercial advantage or private financial gain,
- resulted in the production of over one thousand dollars’ worth of illegal copies, or
- was of a work that was intended to be commercially distributed (like an unreleased motion picture).
The statute also criminalizes other acts, such as removing a copyright notice from a protected work, fraudulently displaying a copyright notice, and making false representations to the U.S. Copyright Office in an application for copyright registration. Penalties can range from fines of a couple thousands of dollars (that are paid to the government instead of the owners of the infringed copyrights) to prison sentences of not more than ten years in the most egregious cases.
Criminal prosecutions of copyright infringement, as illustrated below, often involve schemes where a person or a group of people intentionally infringed thousands and millions of copyright-protected works and operated a large-scale piracy ring in order to massively profit from them. A party may also find themselves walking the plank if they create technology or devices that are primarily intended to enable copyright infringement. According to the Federal Bureau of Investigation, “theft is theft, and if you’re going to willfully steal another party’s intellectual property, the FBI stands ready to step in and shut you down.”
Some pirates might live and operate in the shadowy and murky lagoons of the internet, often hiding behind different aliases. But some pirates operate in full view on the open seas, as seen in possibly the most public criminal copyright case of 2021 brought by the FBI against “OMI In a Hellcat.”
Bill Omar Carrasquillo (aka “OMI in a Hellcat”)
In September of 2021, the FBI arrested the popular YouTube content creator, Bill Omar Carrasquillo (known to his followers as “OMI in a Hellcat”), alleging that he and two associates had engaged in a multi-year copyright piracy scheme that netted the trio over $30 million.
According to the FBI, Carrasquillo and his associates fraudulently obtained cable television accounts, stole television shows and movies from these cable services, and resold them to their own subscribers by offering live TV, on-demand shows and movies, and pay-per-view events. Carrasquillo allegedly used profits generated from these piracy activities to purchase homes and dozens of high-end vehicles, all of which he regularly displayed in his videos. His channel currently has over eight hundred thousand subscribers. Carrasquillo has denied these allegations multiple times in videos that are available on his YouTube channel.
This case has been particularly interesting due to the publicity surrounding it. Multiple news articles about Carrasquillo’s arrest recount his rags to riches story—he used to sell drugs on a Philly street corner before his rise to the flashy, luxury-filled lifestyle he is notorious for. The YouTuber himself talked about his change in fortunes, displaying his riches in videos on his YouTube channel including his multimillion-dollar collection of sportscars. He also mentioned having set aside over nine hundred thousand dollars towards taxes and other liabilities, although it is unclear whether these liabilities arose from his piracy activity and whether they were all from the same year.
Carrasquillo’s case is interesting because he documents his thoughts and feelings on being investigated by the FBI and the Internal Revenue Service. In one video, he states, after alluding to his past run-ins with the law that, “I never thought that there would be a day where I’d be in trouble with the law again.” He goes on in the same video to explain that he expected all of the copyright owners of the pirated content to come to him with cease-and-desist letters before the FBI investigation. Unfortunately, Carrasquillo doesn’t realize, that a cease-and-desist letter is not mandatory for a criminal copyright infringement case—especially when we’re talking about a multimillion-dollar pirate site where hundreds to thousands of copyright owners’ rights are being infringed.
Copyright Piracy in Other Cases
Carrasquillo’s arrest, while the talk of the town, was not the only time that individuals or corporations were criminally investigated or prosecuted for copyright infringement this year. In November, Gary Bowser, a Canadian national, admitted to participating in an enterprise that developed and sold technology that enabled gamers to play pirated copies of video games on their consoles. Bowser and his associates at Team Xecuter, the enterprise, tried to mask the devices as “modding” devices, which are used by gaming enthusiasts to add their own modifications to games. However, Bowser later admitted that the primary purpose was to enable players to play pirated games. Bowser could be fined up to $750,000 (separate from the $4.5 million he agreed to pay Nintendo directly).
In another case, a Minnesota individual was arrested for hacking into the Major League Baseball (MLB) computer systems, accessing copyrighted content (from leagues such as the National Basketball Association, National Football League, National Hockey League, and MLB) stored on the systems, and streaming the content for his own profit. The individual, Joshua Streit, also attempted to extort the MLB, threatening to expose the MLB systems’ vulnerabilities unless the league paid him $150,000. If found guilty, Streit could be sentenced to over 20 years in prison.
A Long Island information technology company and three of its employees found themselves charged with criminal copyright infringement after the three employees installed pirated copies of certain software programs on their clients’ computer systems. Constructure Technologies, LLC provides IT services to other businesses by installing, managing and servicing technology products for them. On many occasions, clients requested the installation of certain software programs on their systems. Instead of licensing these programs on the client’s behalf, the three employees would install pirated copies of the programs using “cracking” programs or “key generators” and bill the clients the full cost of the licensed program. The company agreed to pay a fine of $60,000 and the three individuals each face up to a year in prison and a fine.
Traits of a Classic Copyright Piracy Case
While the facts in each of these cases are very different, we can see certain patterns which brought each of these cases onto law enforcement radars.
- Each case involved an intentional scheme of copyright infringement designed for profit.
Carrasquillo and Streit both illegally obtained copyrighted content and sold it to their own subscribers. The Nintendo case and the Constructure case also involved schemes where illegal or infringing products were sold at a large scale for profit. As Assistant Attorney General Kenneth A. Polite Jr. of the Justice Department’s Criminal Division said about the Carrasquillo indictment, the Department takes “schemes for profit that infringe upon copyrights” seriously.
- Criminal prosecution often follows attempts to circumvent technology that is used to prevent piracy and infringement.
Bowser and his colleagues developed and sold technology that was designed to enable the playing of pirated video games on gaming consoles. Playing pirated games would not have otherwise been possible because most modern gaming consoles are equipped to differentiate between pirated copies and originals.
In a similar vein, Streit hacked into the MLB computer systems, identifying weaknesses in the MLB’s security protocols and thereby circumventing them. The Constructure employees also used software applications that enabled them to circumvent the technological protections on software and run pirated copies on their clients’ computers.
- The cases discussed here resulted in either large-scale profits to the infringers and/or large-scale losses to the victims of the infringement.
Carrasquillo was alleged to have earned over $30 million. Streit’s illegal streams of sports content obtained from major American sports leagues’ systems resulted in losses of approximately $3 million to one of the victim leagues. Bowser’s involvement with Team Xecuter, while only earning him around $320,000 over seven years, caused between $65 million and $150 million in losses to the victims (according to this plea document).
- Some cases involve schemes that are so blatant or egregious that they draw unwanted attention to themselves.
Carrasquillo talked about his streaming service and his riches multiple times on his YouTube channel. He regularly posted videos showing off his home, luxury cars, and new purchases. Coupled with that, he openly talked about his streaming service in his videos. While he always maintained that his business was legitimate, the flashy content was likely to have raised more than a few eyebrows once he was under investigation.
Streit, on the other hand, didn’t attempt to hide his illegal operations. After hacking into the MLB systems, he directly reached out to the MLB and demanded payment in exchange for not exposing the weaknesses in the MLB systems. There was even a Reddit page dedicated to Streit’s illegal streaming service, where Streit made his email address available to users. A publicly-accessible website managed by Streit also displayed one of his alias names, “Josh Brody,” and it was an email address associated with this website that was used by Streit to extort the MLB.
Though the copyright pirate’s life might look tempting with the glimmer of a promising doubloon or two, the reality is that these large-scale infringements result not only in serious penalties for pirates but also in hurting the creators and distributors of such valuable content. As mentioned earlier, the federal government is ready to step in when people willfully steal copyrighted works and profit off them. But what these cases show is that if a person or a group of people willfully aids in widespread commercial-scale copyright infringement, they may find themselves walking the plank.