BILL ANALYSIS Ó
AB 1241
Page 1
Date of Hearing: April 28, 2015
Counsel: Sandra Uribe
ASSEMBLY COMMITTEE ON PUBLIC SAFETY
Bill Quirk, Chair
AB
1241 (Calderon) - As Amended March 26, 2015
SUMMARY: Imposes a mandatory minimum fine of not less than
$1,000 for a second or subsequent conviction for the crime of
music or video piracy.
EXISTING LAW:
1)Provides that a person is guilty of the failure to disclose
the origin of a recording or audiovisual work (piracy) if, for
commercial advantage or private financial gain, he or she
knowingly advertises or offers for sale or resale, or sells or
resells, or causes the rental, sale or resale, or rents, or
manufactures, or possesses for these purposes, any recording
or audiovisual work, the outside cover, box, jacket, or label
of which does not clearly and conspicuously disclose the
actual true name and address of the manufacturer thereof and
the name of the actual author, artist, performer, producer,
programmer, or group thereon. (Pen. Code, § 653w, subd.
(a)(1).)
2)Provides that if the offense involves at least 100 articles of
audio recordings or audiovisual works, or the commercial
equivalent thereof, then the punishment is imprisonment in a
county jail not to exceed one year, by imprisonment pursuant
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to criminal justice realignment for two, three, or five years,
by a fine not to exceed $500,000, or by both that fine and
imprisonment. (Pen. Code, § 653w, subd. (b)(1).)
3)Punishes any other first-time violation of the crime by
imprisonment in a county jail not to exceed one year, by a
fine of not more than $50,000, or by both that fine and
imprisonment. (Pen. Code, § 653w, subd. (b)(2).)
4)Punishes a second or subsequent conviction by imprisonment in
a county jail not to exceed one year, or by imprisonment
pursuant to criminal justice realignment, by a fine not more
than $200,000, or by both that fine and imprisonment. (Pen.
Code, § 653w, subd. (b)(3).)
5)Defines "recording" as any "tangible medium upon which
information or sounds are recorded or otherwise stored,
including, but not limited to, any phonograph record, disc,
tape, audio cassette, wire, film, memory card, flash drive,
hard drive, data storage device, or other medium on which
information or sounds are recorded or otherwise stored, but
does not include sounds accompanying a motion picture or other
audiovisual work." (Pen. Code, § 653w, subd. (a)(2).)
6)Defines "audiovisual works" as the "physical embodiment of
works that consist of related images that are intrinsically
intended to be shown using machines or devices, such as
projectors, viewers, or electronic equipment, together with
accompanying sounds, if any, regardless of the nature of the
material objects, such as films, tapes, discs, memory cards,
flash drives, data storage devices, or other devices, on which
the works are embodied." (Pen. Code, § 653w, subd. (a)(3).)
7)Requires, in addition to any other penalty or fine, the court
to order a person who has been convicted of a music or video
piracy to make restitution to an owner or lawful producer, or
trade association acting on behalf of the owner or lawful
producer, of a phonograph record, disc, wire, tape, film, or
other device or article from which sounds or visual images are
derived that suffered economic loss resulting from the
violation. (Pen. Code, § 1202.4, subd. (r)(1).)
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8)Requires the restitution order be based on the aggregate
wholesale value of lawfully manufactured and authorized
devices or articles, and to also include reasonable costs
incurred as a result of the investigation undertaken by the
owner, lawful producer, or trade association acting on behalf
of the owner. (Pen. Code, § 1202.4, subd. (r)(1).)
FISCAL EFFECT: Unknown
COMMENTS:
1)Author's Statement: According to the author, "AB 1241
continues the practice of fine-tuning state laws to address
the impact of piracy upon very important industry sections to
California. This just clarifies that a minimum fine will be
established for those committing a second offense in this
criminal area."
2)Underground Economy: The "underground economy" refers to
those individuals and businesses that deal in cash and/or use
other schemes to conceal their activities, identities, and
true tax liabilities from government licensing, regulatory,
and taxing agencies. The activities that occur in the
underground economy include the sale or transfer of illegal
goods, such as pirated music or movies, counterfeit
pharmaceutical drugs, vitamins, wine, clothing, accessories,
weapons, tax evasion or fraud, and untaxed tobacco products or
alcohol. The underground economy hurts legitimate businesses,
creates an enormous tax gap and hurts all California due to
the loss of revenue. The Board of Equalization estimates that
the State of California losses about $8.5 billion dollars
annually in tax revenue due to the underground economy.
(< http://www.boe.ca.gov/info/underground_economy.htm >.) This
revenue is needed to fund critical programs such as education,
public safety, infrastructure and social services.
3)Practical Considerations: Setting the penalty, or range of
penalties, for a crime is an inherently legislative function.
The Legislature does have the power to require a minimum term
or other specific sentence. (Keeler v. Superior Court (1970)
2 Cal.3d 619, 631.) Sentencing, however, is solely a judicial
power. (People v. Tenorio (1970) 3 Cal.3d 89, 90-93; People
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v. Superior Court (Fellman) (1976) 59 Cal.App.3d 270, 275.)
California law effectively directs judges to impose an
individualized sentence that fits the crime and the
defendant's background, attitude, and record. (Cal. Rules of
Court, rules 4.401-4.425.) This bill limits judicial
discretion and requires a minimum fine of $1,000 to be imposed
in each case in which a defendant has already suffered a prior
conviction for piracy, regardless of the facts.
Although a minimum fine of $1,000 for a second or subsequent
conviction may not be unreasonable, the sentencing judge
already has the discretion to impose this amount, and much
more. There is no evidence that this amount is not already
being imposed in these types of cases.
4)Existing Penalty Assessments: There are penalty assessments
and fees assessed on the base fine for a crime. Assuming a
defendant was fined $1,000 as the fine for a criminal offense,
the following penalty assessments would be imposed pursuant to
the Penal Code and the California Government Code:
Base Fine:
?? $ 1,000
Penal Code 1464 state penalty on fines:
1,000 ($10 for
every $10)
Penal Code 1465.7 state surcharge:
200 (20%
surcharge)
Penal Code 1465.8 court operation assessment:
40 ($40 fee per offense)
Government Code 70372 court construction penalty:
500 ($5 for every $10)
Government Code 70373 assessment:
30 ($30 for
felony or misdemeanor)
Government Code 76000 penalty:
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700 ($7 for every $10)
Government Code 76000.5 EMS penalty:
200 ($2 for every $10)
Government Code 76104.6 DNA fund penalty:
100 ($1 for every $10)
Government Code 76104.7 addt'l DNA fund penalty:
400 ($4 for every $10)
Total Fine with Assessments:
$4,170
It should be noted that this figure does not include victim
restitution, or the restitution fine, and that other fines and
fees, such as the jail booking fee, attorney fees, OR release
fees, probation department fees, may also be applicable.
5)Prioritization of Court-Ordered Debt: Current law under Penal
Code section 1203.1d prioritizes the order in which delinquent
court-ordered debt received is to be satisfied. The priorities
are 1) victim restitution, 2) state surcharge, 3) restitution
fines, penalty assessments, and other fines, with payments
made on a proportional basis to the total amount levied for
all of these items, and 4) state/county/city reimbursements,
and special revenue items.
The fine at issue in this bill has a fairly low priority in the
collection order, falling in the third category. Given that
victim restitution in these types of cases is to be on the
aggregate wholesale value of lawfully manufactured and
authorized devices or articles, and to also include reasonable
costs incurred as a result of the investigation undertaken by
the owner, lawful producer, or trade association acting on
behalf of the owner (Pen. Code, § 1202.4, subd. (r)(1)), it
could very well be the case that this fine is unlikely to be
collected.
A recent San Francisco Daily Journal article noted, "California
courts and counties collect nearly $2 billion in fines and
fees every year. Nevertheless, the state still has a more
than $10.2 billion balance of uncollected debt from prior
years, according to the most recent date from 2012." (See
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Jones & Sugarman, State Judges Bemoan Fee Collection Process,
San Francisco Daily Journal, (January 5, 2015).) "The annual
growth in delinquent debt partly reflects a supply of money
that doesn't exist to be collected." (Ibid.) In the same
article, the Presiding Judge of San Bernardino County was
quoted as saying "the whole concept is getting blood out of a
turnip." (Ibid.)
6)Related Legislation: AB 160 (Dababneh) would expand the list
of crimes that allow for forfeiture of assets and prosecution
of criminal profiteering to include, among other crimes,
illegal piracy of recordings or audiovisual works. AB 160 is
pending in the Assembly Committee on Revenue and Taxation.
7)Prior Legislation:
a) AB 2122 (Bocanegra), Chapter 857, Statutes of 2014,
provides that the "true name and address" audio recording
and audiovisual works piracy alternate felony-misdemeanor
shall apply where the defendant's conduct involved the
"commercial equivalent" of at least 100 articles of sound
recordings or audiovisual recordings.
b) SB 1479 (Pavley), Chapter 873, Statutes of 2012,
provides that in music or video piracy cases, restitution
shall include the value of pirated works that were seized
from the defendant, but not actually sold.
c) SB 830 (Wright), Chapter 480, Statutes of 2010, expanded
the definition of a "recording" for the purposes of
prosecution for failing to disclose the origin of a
recording when utilizing the recording for financial gain
to include memory cards, flash drives, hard-drives, or data
storage devices.
d) AB 819 (Calderon), Chapter 351, Statutes of 2010,
increased the fines for intellectual property piracy.
e) AB 2750 (Krekorian), Chapter 468, Statutes of 2008,
required a court to order persons convicted of specified
crimes relating to music piracy to pay restitution to not
only the owner or lawful producer, but also to a trade
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association acting on behalf of the owner or lawful
producer.
f) AB 64 (Cohn), Chapter 9, Statutes of 2006, made the
possession or sale of at least 100, rather than 1,000,
audio recordings punishable as an alternate
felony/misdemeanor.
REGISTERED SUPPORT / OPPOSITION:
Support
None
Opposition
None
Analysis Prepared
by: Sandy Uribe / PUB. S. / (916) 319-3744