BILL NUMBER: AB 819	AMENDED
	BILL TEXT

	AMENDED IN ASSEMBLY  JUNE 1, 2009
	AMENDED IN ASSEMBLY  MAY 6, 2009
	AMENDED IN ASSEMBLY  APRIL 15, 2009

INTRODUCED BY   Assembly Member Charles Calderon
   (Coauthors: Assembly Members Lieu, Portantino, and Smyth)

                        FEBRUARY 26, 2009

   An act to amend Sections 13848 and 13848.6 of, and to add Chapter
5.8 (commencing with Section 13849) to Title 6 of Part 4 of, the
Penal Code, relating to intellectual property piracy,  making
an appropriation therefor,  and declaring the urgency
thereof, to take effect immediately.



	LEGISLATIVE COUNSEL'S DIGEST


   AB 819, as amended, Charles Calderon. Intellectual property
piracy.
   Existing law establishes various crime prevention and prosecution
programs.
   This bill would establish the Intellectual Property Piracy
Prevention and Prosecution Program to fund grants for local law
enforcement and district attorneys for purposes of preventing and
prosecuting intellectual property piracy, as specified.
   The bill would establish the Intellectual Property Piracy
Prevention and Prosecution Fund  , which would be
continuously appropriated and which would be funded by private and
state sources, including an annual appropriation from the General
Fund to bring the balance in the fund to $50 million  . This
bill would become operative only if  AB 711 of the 2009-10
Regular Session is enacted   an appropriation is made
for its operation  . The bill would make other technical,
conforming changes.
   This bill would declare that it is to take effect immediately as
an urgency statute.
   Vote: 2/3. Appropriation:  yes   no  .
Fiscal committee: yes. State-mandated local program: no.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

  SECTION 1.  Section 13848 of the Penal Code is amended to read:
   13848.  (a) It is the intent of the Legislature in enacting this
chapter to provide local law enforcement and district attorneys with
the tools necessary to successfully interdict the promulgation of
high technology crime. According to the federal Law Enforcement
Training Center, it is expected that states will see a tremendous
growth in high technology crimes over the next few years as computers
become more available and computer users more skilled in utilizing
technology to commit these faceless crimes. High technology crimes
are those crimes in which technology is used as an instrument in
committing, or assisting in the commission of, a crime, or which is
the target of a criminal act.
   (b) Funds provided under this program are intended to ensure that
law enforcement is equipped with the necessary personnel and
equipment to successfully combat high technology crime which
includes, but is not limited to, the following offenses:
   (1) White-collar crime, such as check, automated teller machine,
and credit card fraud, committed by means of electronic or
computer-related media.
   (2) Unlawful access, destruction of or unauthorized entry into and
use of private, corporate, or government computers and networks,
including wireless and wireline communications networks and law
enforcement dispatch systems, and the theft, interception,
manipulation, destruction, or unauthorized disclosure of data stored
within those computers and networks.
   (3) Money laundering accomplished with the aid of computer
networks or electronic banking transfers.
   (4) Theft and resale of telephone calling codes, theft of
telecommunications service, theft of wireless communication service,
and theft of cable television services by manipulation of the
equipment used to receive those services.
   (5) Theft and resale of computer components and other high
technology products produced by the high technology industry.
   (6) Remarking and counterfeiting of computer hardware and
software.
   (7) Theft of trade secrets.
   (c) This program is also intended to provide support to law
enforcement agencies by providing technical assistance to those
agencies with respect to the seizure and analysis of computer systems
used to commit high technology crimes or store evidence relating to
those crimes.
  SEC. 2.  Section 13848.6 of the Penal Code is amended to read:
   13848.6.  (a) The High Technology Crime Advisory Committee is
hereby established for the purpose of formulating a comprehensive
written strategy for addressing high technology crime throughout the
state, with the exception of crimes that occur on state property or
are committed against state employees, and to advise the California
Emergency Management Agency on the appropriate disbursement of funds
to regional task forces.
   (b) This strategy shall be designed to be implemented through
regional task forces. In formulating that strategy, the committee
shall identify various priorities for law enforcement attention,
including the following goals:
   (1) To apprehend and prosecute criminal organizations, networks,
and groups of individuals engaged in the following activities:
   (A) Theft of computer components and other high technology
products.
   (B) Violations of Penal Code Sections 211, 350, 351a, 459, 496,
537e, 593d, 593e, 653h, 653s, and 635w.
   (C) Theft of telecommunications services and other violations of
Penal Code Sections 502.7 and 502.8.
   (D) Counterfeiting of negotiable instruments and other valuable
items through the use of computer technology.
   (2) To apprehend and prosecute individuals and groups engaged in
the unlawful access, destruction, or unauthorized entry into and use
of private, corporate, or government computers and networks,
including wireless and wire line communications networks and law
enforcement dispatch systems, and the theft, interception,
manipulation, destruction, and unauthorized disclosure of data stored
within those computers.
   (3) To apprehend and prosecute individuals and groups engaged in
the theft of trade secrets.
   (4) To investigate and prosecute high technology crime cases
requiring coordination and cooperation between regional task forces
and local, state, federal, and international law enforcement
agencies.
   (c) The Secretary of California Emergency Management shall appoint
the following members to the committee:
   (1) A designee of the California District Attorneys Association.
   (2) A designee of the California State Sheriffs Association.
   (3) A designee of the California Police Chiefs Association.
   (4) A designee of the Attorney General.
   (5) A designee of the California Highway Patrol.
   (6) A designee of the High Technology Crime Investigation
Association.
   (7) A designee of the California Emergency Management Agency.
   (8) A designee of the American Electronic Association to represent
California computer system manufacturers.
   (9) A designee of the American Electronic Association to represent
California computer software producers.
   (10) A designee of CTIA - The Wireless Association.
   (11) A representative of the California Internet industry.
   (12) A designee of the Semiconductor Equipment and Materials
International.
   (13) A designee of the California Cable & Telecommunications
Association.
   (14) A designee of the Motion Picture Association of America.
   (15) A designee of the California Communications Associations
(CalCom).
   (16) A representative of the California banking industry.
   (17) A representative of the Office of Information Security and
Privacy Protection.
   (18) A representative of the Department of Finance.
   (19) A representative of the State Chief Information Officer.
   (20) A representative of the Recording Industry of America.
   (21) A representative of the Consumers Union.
   (d) The Secretary of California Emergency Management shall
designate the Chair of the High Technology Crime Advisory Committee
from the appointed members.
   (e) The advisory committee shall not be required to meet more than
12 times per year. The advisory committee may create subcommittees
of its own membership, and each subcommittee shall meet as often as
the subcommittee members find necessary. It is the intent of the
Legislature that all advisory committee members shall actively
participate in all advisory committee deliberations required by this
chapter.
   Any member who, without advance notice to the Secretary of
California Emergency Management and without designating an
alternative representative, misses three scheduled meetings in any
calendar year for any reason other than severe temporary illness or
injury (as determined by the secretary) shall automatically be
removed from the advisory committee. If a member wishes to send an
alternative representative in his or her place, advance written
notification of this substitution shall be presented to the executive
director. This notification shall be required for each meeting the
appointed member elects not to attend.
   Members of the advisory committee shall receive no compensation
for their services, but shall be reimbursed for travel and per diem
expenses incurred as a result of attending meetings sponsored by the
California Emergency Management Agency.
   (f) The Secretary of California Emergency Management, in
consultation with the High Technology Crime Advisory Committee, shall
develop specific guidelines and administrative procedures for the
selection of projects to be funded by the High Technology Theft
Apprehension and Prosecution Program, which guidelines shall include
the following selection criteria:
   (1) Each regional task force that seeks funds shall submit a
written application to the committee setting forth in detail the
proposed use of the funds.
   (2) In order to qualify for the receipt of funds, each proposed
regional task force submitting an application shall provide written
evidence that the agency meets either of the following conditions:
   (A) The regional task force devoted to the investigation and
prosecution of high technology-related crimes is comprised of local
law enforcement and prosecutors, and has been in existence for at
least one year prior to the application date.
   (B) At least one member of the task force has at least three years
of experience in investigating or prosecuting cases of suspected
high technology crime.
   (3) Each regional task force shall be identified by a name that is
appropriate to the area that it serves. In order to qualify for
funds, a regional task force shall be comprised of local law
enforcement and prosecutors from at least two counties. At the time
of funding, the proposed task force shall also have at least one
investigator assigned to it from a state law enforcement agency. Each
task force shall be directed by a local steering committee composed
of representatives of participating agencies and members of the local
high technology industry.
   (4) The California High Technology Crimes Task Force shall be
comprised of each regional task force developed pursuant to this
subdivision.
   (5) Additional criteria that shall be considered by the advisory
committee in awarding grant funds shall include, but not be limited
to, the following:
   (A) The number of high technology crime cases filed in the prior
year.
   (B) The number of high technology crime cases investigated in the
prior year.
   (C) The number of victims involved in the cases filed.
   (D) The total aggregate monetary loss suffered by the victims,
including individuals, associations, institutions, or corporations,
as a result of the high technology crime cases filed, and those under
active investigation by that task force.
   (6) Each regional task force that has been awarded funds
authorized under the High Technology Theft Apprehension and
Prosecution Program during the previous grant-funding cycle, upon
reapplication for funds to the committee in each successive year,
shall be required to submit a detailed accounting of funds received
and expended in the prior year in addition to any information
required by this section. The accounting shall include all of the
following information:
   (A) The amount of funds received and expended.
   (B) The use to which those funds were put, including payment of
salaries and expenses, purchase of equipment and supplies, and other
expenditures by type.
   (C) The number of filed complaints, investigations, arrests, and
convictions that resulted from the expenditure of the funds.
   (g) The committee shall annually review the effectiveness of the
California High Technology Crimes Task Force in deterring,
investigating, and prosecuting high technology crimes and provide its
findings in a report to the Legislature and the Governor. This
report shall be based on information provided by the regional task
forces in an annual report to the committee which shall detail the
following:
   (1) Facts based upon, but not limited to, the following:
   (A) The number of high technology crime cases filed in the prior
year.
   (B) The number of high technology crime cases investigated in the
prior year.
   (C) The number of victims involved in the cases filed.
   (D) The number of convictions obtained in the prior year.
   (E) The total aggregate monetary loss suffered by the victims,
including individuals, associations, institutions, corporations, and
other relevant public entities, according to the number of cases
filed, investigations, prosecutions, and convictions obtained.
   (2) An accounting of funds received and expended in the prior
year, which shall include all of the following:
   (A) The amount of funds received and expended.
   (B) The uses to which those funds were put, including payment of
salaries and expenses, purchase of supplies, and other expenditures
of funds.
   (C) Any other relevant information requested.
  SEC. 3.  Chapter 5.8 (commencing with Section 13849) is added to
Title 6 of Part 4 of the Penal Code, to read:
      CHAPTER 5.8.  INTELLECTUAL PROPERTY PIRACY PREVENTION AND
PROSECUTION ACT OF 2009


   13849.  (a) This act shall be known and may be cited as the
Intellectual Property Piracy Prevention and Prosecution Act of 2009.
   (b) The Legislature finds and declares the following:
   (1) According to a 2007 study by the Institute for Policy
Innovation, intellectual property piracy, meaning the theft of
movies, music, software, and video games, costs the United States
economy fifty-eight billion dollars ($58,000,000,000) each year.
   (2) The problem of intellectual property piracy continues to grow
worse. A 2005 Gallup study found that 5 percent of Americans had
purchased, copied, or downloaded counterfeit music in the preceding
year. By 2007, this number had jumped to 9 percent. The percentage of
respondents that admitted buying a pirated movie rose from 3 percent
in 2005, to 6 percent in 2007. At the same time, once robust DVD
sales have flattened over the past few years, while CD shipments to
retailers have plummeted.
   (3) The effect of intellectual property piracy on California and
its citizens is particularly dire. Intellectual property piracy
adversely affects the California economy, eliminates jobs, and
damages industry. According to the Business Software Alliance, in
2003, software piracy alone cost the California economy more than
13,000 jobs, over eight hundred two million dollars ($802,000,000) in
wages and salaries, over one billion dollars ($1,000,000,000) in
retail sales of business software applications, and roughly two
hundred thirty-nine million dollars ($239,000,000) in total tax
losses.
   (4) This act will send a strong signal that California is
committed to protecting the intellectual property created by
California's innovation and entertainment industries.
   (5) By creating a technical advisory committee, California will be
able to draw upon the expertise and insight of those on the front
lines of the antipiracy effort.
   (6) Grants awarded pursuant to this act will be used to foster
innovation and to provide local law enforcement and prosecutors the
tools they need to effectively fight intellectual property piracy.
   (7) Finally, by safeguarding the legitimate sale of intellectual
property, California will increase its tax base, and stimulate the
economy.
   (c) Funds provided under this program are intended to ensure that
law enforcement and prosecutors are equipped with the necessary
personnel and equipment to combat successfully intellectual property
piracy, which includes piracy of movies, music, software, and video
games.
   13849.1.  (a) There is hereby established in the Department of
Justice, a program of financial assistance for law enforcement and
district attorneys' offices, designated the Intellectual Property
Piracy Prevention and Prosecution Program. Upon appropriation by the
Legislature, all funds appropriated to the Department of Justice for
the purposes of this chapter shall be administered and disbursed by
the Attorney General in consultation with the Intellectual Property
Piracy Prevention and Prosecution Advisory Committee as established
in Section  13849.3 and shall, to the extent feasible, be
coordinated with funds derived pursuant to Section 13849.3 and
private grants or private donations that are made available for these
purposes.   13849.2. 
   (b) All funds designated for use for purposes of this chapter
shall be deposited in the Intellectual Property Piracy Prevention and
Prosecution Fund, which is hereby established. The fund shall be
under the direction and control of the office of the Attorney
General.  Notwithstanding Section 13340 of the Government
Code, moneys in the fund are hereby continuously appropriated for the
purposes specified in this chapter. The fund may also accept private
donations. 
   (c) The advisory committee shall review grant applications and, on
a majority vote of the membership, submit those applications to the
Attorney General for formal approval.
   (d) The advisory committee shall monitor and audit the use of
grant funds.
   (e) Grant money shall be used exclusively to combat intellectual
property piracy within the state. Grants shall be made on an annual
basis, and may not be used to pay existing staff, absent
extraordinary circumstances and approval by the Attorney General.
Grant recipients may receive funding for no more than three years
without submitting another grant application. Grants shall only be
made to applicants with an existing budget dedicated to fighting
intellectual property piracy.
   (f) In order to receive a grant, prospective recipients shall
agree in writing to the following terms, as conditions of receiving a
grant:
   (1) The recipient is authorized to accept grant funds under all
applicable state and local laws.
   (2) The recipient will vigilantly safeguard grant funds and ensure
that use of the grant funds fully comports with the purposes
specified in the application for the grant funds, as approved or
modified by the advisory committee.
   (3) Grant funds shall be used to augment, but shall not be used to
supplant, a grant recipient's budget.
   (4) If the grant funds are used for the purpose of investigation,
litigation, or prosecution, any remedy, settlement, judgment, or
restitution award shall provide for full reimbursement to the
Intellectual Property Piracy Protection and Prosecution Fund of all
grant funds used for that investigation, litigation, or prosecution.
   (5)  The recipient shall notify the advisory committee in writing
of litigation or prosecution results, including any settlement,
judgment, or other resolution, within 30 days.
   (6) The recipient shall notify the advisory committee in writing
of the status of all outstanding investigations, litigation, or
prosecutions funded in whole or in part by the grant six months after
the funds are disbursed, and every 12 months thereafter until all
disbursed funds have been expended and reported on.
   (7) The recipient shall fully cooperate with the advisory
committee and its agents in providing all information and documents
concerning the use of grant funds.
   (8) Except as otherwise expressly agreed by the advisory
committee, within 60 days after the conclusion of the investigation,
litigation, or prosecution, training, or other activity for which the
disbursement was awarded, the recipient shall return all unused
funds to the advisory committee by check made payable to the
Intellectual Property Piracy Prevention and Prosecution Fund.
   (9) If grant funds are used for the production of any materials,
the recipient shall permit the Attorney General's office and the
advisory committee to use and distribute those materials without
restriction, for their intended purposes.
   (10) The advisory committee is authorized to audit, review, and
inspect the recipient's activities, books, documents, papers, and
records during the project and thereafter for three years following
the final allocation of funds.
   13849.2.  (a) The Intellectual Property Piracy Prevention and
Prosecution Advisory Committee is hereby established for the purpose
of formulating a comprehensive written strategy for addressing
intellectual property piracy prevention and prosecution throughout
the state, and to advise the Attorney General on the appropriate
disbursement of funds to local law enforcement agencies and district
attorneys' offices.
   (b) In formulating that strategy, the committee shall identify
various priorities for law enforcement attention regarding the
following:
   (1) The apprehension and prosecution of criminal organizations,
networks, and groups of individuals engaged in the theft of,
counterfeiting of, or unauthorized distribution, sale, or
reproduction of, the following types of intellectual property:
   (A) Movies.
   (B) Music.
   (C) Computer software.
   (D) Video games.
   (2) The investigation and prosecution of violations of criminal
and civil provisions of law, including, but not limited to, Sections
653h, 653s, and 653w.
   (3) The advising of local law enforcement and district attorneys
regarding current aspects of intellectual property piracy, in order
to respond quickly to the most serious threats of piracy.
   (c) The advisory committee, which shall meet at least four times
per year, shall consist of 10 members, of whom six shall be appointed
by the Governor, two by the Speaker of the Assembly, and two by the
Senate Committee on Rules. Members shall be paid a one hundred dollar
($100) per diem for each meeting, as well as all necessary travel
expenses. The advisory committee shall be composed of the following
members:
   (1) At least two representatives of the general public.
   (2) At least one representative with demonstrable knowledge of the
movie industry.
   (3) At least one representative with demonstrable knowledge of the
music industry.
   (4) At least one representative with demonstrable knowledge of the
computer software industry.
   (5) At least one representative with demonstrable knowledge of the
video gaming industry.
   (6) At least one representative with experience in law
enforcement, specifically relating to intellectual property piracy
offenses.
   (7) At least one representative with experience prosecuting
intellectual property piracy offenses at the local, state, or federal
level.
   (d) In deciding which grant applications to fund, the advisory
committee shall consider the following factors:
   (1) The purpose for which the funds are sought.
   (2) The proposal's specificity, including whether the proposal
identifies anticipated costs, along with materials and personnel to
be used.
   (3) The anticipated public benefit.
   (4) The ability of the advisory committee to audit the use of the
funds.
   (5) The number, amount, and use of previous grants awarded to the
prospective recipient, if any.
   (e) Members of the advisory committee shall be entitled to the
same immunity from liability that is provided to public employees.

   13849.3.  On July 1, 2010, and every July 1 thereafter, the
Legislature hereby appropriates from the General Fund to the
Intellectual Property Piracy Prevention and Prosecution Fund a sum
sufficient to bring the balance in the Intellectual Property Piracy
Prevention and Prosecution Fund to fifty million dollars
($50,000,000). In no event shall an annual appropriation from the
General Fund be made if the fund has a balance of fifty million
dollars ($50,000,000) or more. 
  SEC. 4.  This act shall become operative only if  upon
enactment of Assembly Bill 711 of the 2009-10 Regular Session is
enacted.   an appropriation is provided for its
operation. 
  SEC. 5.  This act is an urgency statute necessary for the immediate
preservation of the public peace, health, or safety within the
meaning of Article IV of the Constitution and shall go into immediate
effect. The facts constituting the necessity are:
   In order to ensure public peace against the accelerating problem
of intellectual property piracy, it is necessary for this act to take
effect immediately.