United States v. Liu

Summarized by:

  • Court: 9th Circuit Court of Appeals Archives
  • Area(s) of Law: Copyright
  • Date Filed: 10-01-2013
  • Case #: 10-10613
  • Judge(s)/Court Below: Circuit Judge Nguyen for the Court; Circuit Judges Noonan and Fisher
  • Full Text Opinion

Under 17 U.S.C. § 506(a), “willfully” requires the Plaintiff to prove that the Defendant knew he was acting illegally, not just that he knew he was making copies, and under 18 U.S.C. § 2318(a)(1), “knowingly” trafficking counterfeit labels “requires knowledge that the labels were counterfeit.”

Julius Liu is the founder and CEO of a DVD-manufacturing company called Super DVD. The government began to suspect Super DVD’s replication operations and executed a search warrant to raid the operation. The evidence obtained included a compilation of rap tracks, compilations of Latin music tracks, counterfeit copies of anti-virus software, and copies of the film Crouching Tiger, Hidden Dragon. Liu did not have authorization from the copyright holders to replicate any of these works. Liu was charged with three counts of criminal copyright infringement and a fourth count alleged that Liu trafficked in the counterfeit labels on the software. Liu argued that he requires his customers to sign a release indicating that they have obtained the authorization to replicate, and he maintained that he was not involved in replicating works. A jury convicted Liu on all four counts. On appeal, the Ninth Circuit found that the district court erred by giving a jury instruction that merged the concepts of “knowing” and “willful” without conveying the culpable state of mind that the term “willfully” is designed to invoke. The panel went on to hold that as used in 17 U.S.C.§ 506(a), “willfully” is a “voluntary, intentional violation of a known legal duty.” Consequently, the district court erred by providing jury instructions defining willfulness in a way in which the jury did not need to find that Liu knew his actions were unlawful in order to convict him. The panel found that this error was not harmless. The panel also held that in this case, “knowingly” under 18 U.S.C. § 2318(a)(1) meant that “Liu knew the labels were counterfeit.” The district court also erred on its knowledge jury instruction, and this error was not harmless. VACATED and REMANDED.

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