The U.S. Department of Justice (DoJ) bagged its first-ever criminal
convictions for peer-to-peer (P2P) copyright theft Tuesday when two men
arrested in last summer’s
Operation Digital Gridlock
pleaded guilty.
William R. Towbridge, 50, of Johnson City, N.Y., and Michael Chicoine, 47,
of San Antonio each pleaded guilty to one count of conspiracy to commit
felony criminal copyright infringement. The maximum penalties for a
first-time offender are five years in prison, a fine of $250,000 and
restitution to the victims.
In addition, Towbridge and Chicoine will be required to destroy all
infringing copies and all equipment used to make the infringing copies.
Sentencing is scheduled for April 29.
The operation targeted the illegal file sharing of copyrighted materials
over five P2P networks that belonged to a group known as the Underground
Network. According to the DoJ, the networks required users to share a
minimum of 1GB to 100GB of computer files with other users on the
network.
“Like the defendants who pleaded guilty today, those who steal the work of
others over the Internet stand to face serious consequences,” Kenneth L.
Wainstein, the U.S. attorney for the District of Columbia, said in a
statement.
According to court documents, Towbridge and Chicoine owned, maintained and
moderated two Direct Connect hubs offering computer software, games, music
and movies worth millions. The networks required their users to share
computer files with other network users, all of whom could download each
others’ shared files.
During the investigation, first announced by Attorney General John Ashcroft
in August, government agents downloaded more than 70 copyrighted works worth
approximately $20,000 from Towbridge’s hub and 35 works from Chicoine’s site
valued at nearly $5,000.
According to an FBI affidavit in support of the search warrants, the
Underground Network Web site is hosted on a server located in San Antonio.
The hubs on the network are located both in the United States and abroad. The
affidavit claims the network has 55 staff positions including hub
operators and moderators and network administrators.
Users access the site by downloading Direct Connect software and then
connecting to the Underground Network. There is no fee to join the network
and members are provided with access to a list of hub sites on the network.
The DoJ stressed that NeoModus, which develops the Direct Connect P2P
software, is not a target of the investigation.
During the August press conference, Ashcroft
said search
warrants were executed in Texas, New York and Wisconsin in raids on five
residences and an Internet service provider. During the raids, federal
agents seized computers, software and computer-related equipment.
Ashcroft
said the raids “disrupted an extensive peer-to-peer network suspected of
enabling users to traffic illegally in music, films, software and published
works.”
“As today’s pleas demonstrate, those who steal copyrighted material will be
caught, even when they use the tools of technology to commit their crimes,”
Ashcroft said in a statement issued late Tuesday afternoon. “The Department
of Justice is committed to pursuing and bringing to justice those who commit
intellectual property theft.”
The FBI, the Office of the U.S. Attorney for the District of Columbia and
the Justice Department’s Computer Crime and Intellectual Property Section,
is conducting the ongoing investigation. The DoJ says theft through the
illegal reproduction and distribution of movies, software, games and music
is estimated to annually cost U.S. industries $19 billion worldwide.
