December 14, 11

NEWS / CD and DVD Counterfeiter and Supplier Both Sentenced in Atlanta to Prison

WASHINGTON – Two individuals were sentenced this week in Atlanta for their involvement in a counterfeit DVD and CD ring, announced Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division and U.S. Attorney Sally Quillian Yates for the Northern District of Georgia.

Charles Ndhlovu, 34, was sentenced on Dec. 12, 2011, by U.S. District Judge William S. Duffey Jr. to 51 months in prison and Scott Ahn, 42, was sentenced yesterday by Judge Duffey to 19 months in prison. Ndhlovu and Ahn also were ordered to serve three years of supervised release following their prison terms. Ahn was ordered to pay $25,000 in restitution to the Recording Industry Association of America and $15,000 in restitution to the Motion Picture Association of America.

Ahn pleaded guilty on Jan. 14, 2010, to one count of conspiracy to commit criminal copyright infringement, to traffic in counterfeit goods and to traffic in counterfeit labels. Ndhlovu was convicted by a federal jury on July 28, 2011, of one count of trafficking in counterfeit labels and two counts of criminal copyright infringement.

“These sentences send an important message that criminal counterfeiting will not be tolerated,” said Assistant Attorney General Breuer. “The sale of counterfeit goods and the theft of intellectual property harm businesses, consumers and artists alike. We will continue to investigate and prosecute individuals who seek to profit illegally by stealing the works of others, including those who knowingly support the criminal activity.”

“These defendants mass-produced hundreds of thousands of counterfeit music CDs and DVD movies in a pirating operation that appeared to be the largest of its kind in the southeastern United States,” said U.S. Attorney Yates. “Their victims included consumers, who were not getting genuine products, as well as the thousands of Americans who earn their livelihoods from the legitimate creation of their art.”

“The wholesale theft of intellectual property and copyrighted material as was seen in this case simply cannot be tolerated,” said Brian D. Lamkin, Special Agent in Charge, FBI Atlanta Field Office. “The FBI is well positioned to investigate such criminal enterprises which attempt to profit off of the creativity and hard work of others and will continue to work with its various law enforcement partners to bring such individuals to justice.”

“The theft of intellectual property undermines our economy and deprives our creative artists of the full value of their work,” said Brock D. Nicholson, special agent in charge of U.S. Immigration and Customs Enforcement (ICE) Homeland Security Investigations (HSI) for Georgia and the Carolinas. “Protecting legitimate business interests is a priority for HSI and our law enforcement partners. We are dedicated to protecting the jobs, the income and the tax revenue that disappear when criminals and criminal organizations traffic in stolen content for their own profit.”

According to evidence at trial, Ndhlovu reproduced thousands of infringing copies of copyrighted CDs and DVDs, purchased corresponding counterfeit labels and packaging, and assembled the final product that he ultimately sold. Evidence at trial also showed that Ndhlovu reproduced thousands of CDs and DVDs per week for distribution. Ahn assisted in supplying Ndhlovu with blank DVDs and CDs knowing that Ndhlovu and others intended to reproduce infringing copies of copyrighted music and movies onto such digital media.

The sentenced defendants were among 13 charged by a federal grand jury on May 19, 2009, in an indictment alleging various copyright, trademark and counterfeit goods offenses. Five other defendants were sentenced earlier this year. One was placed on probation for a year; the other four were sentenced to prison terms ranging from two to five years. The court found that Ahn conspired with co-defendants and others to reproduce and distribute hundreds of thousands of copyright infringing music CDs and movie DVDs which, if legitimate, would have been worth more than $3.7 million.

The case was prosecuted by Assistant U.S. Attorney Brian Pearce in the Northern District of Georgia and Senior Counsel John H. Zacharia of the Computer Crime and Intellectual Property Section in the Justice Department’s Criminal Division. The case was investigated by special agents of the FBI and the ICE-HSI, together with officers of the Atlanta Police Department Organized Crime Unit; Fulton County, Ga., Sheriff’s Office; College Park, Ga., Police Department; and East Point, Ga., Police Department. Assistance was provided by the Recording Industry Association of America and the Motion Picture Association of America.

This case is part of efforts being undertaken by the Department of Justice Task Force on Intellectual Property (IP Task Force) to stop the theft of intellectual property. Attorney General Eric Holder created the IP Task Force to combat the growing number of domestic and international intellectual property crimes, protect the health and safety of American consumers, and safeguard the nation’s economic security against those who seek to profit illegally from American creativity, innovation and hard work. The IP Task Force seeks to strengthen intellectual property rights protection through heightened criminal and civil enforcement, greater coordination among federal, state and local law enforcement partners, and increased focus on international enforcement efforts, including reinforcing relationships with key foreign partners and U.S. industry leaders. To learn more about the IP Task Force, go to www.justice.gov/dag/iptaskforce.

http://www.justice.gov/opa/pr/2011/December/11-crm-1638.html

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