Opinion ID: 1385481
Heading Depth: 2
Heading Rank: 1

Heading: Is BMG a Victim?

Text: In Hughey v. United States, 495 U.S. 411, 110 S.Ct. 1979, 109 L.Ed.2d 408 (1990), the Supreme Court held that the Victim and Witness Protection Act of 1982 (VWPA) [2] was intended to compensate victims only for losses caused by the conduct underlying the offense of conviction. 495 U.S. at 416, 110 S.Ct. 1979. Therefore, restitution may be awarded only to victims of the offense of conviction, and a victim may not be compensated for conduct unrelated to the offense of conviction, even if that unrelated conduct was the subject of criminal charges dropped by the government in exchange for the defendant's guilty plea. Id. at 420-21, 110 S.Ct. 1979. Congress responded by adding a definition of victim that retained the core limiting principle of Hughey but clarified its application to certain offenses and to plea agreements. See 18 U.S.C. § 3663(a)(2)-(3) (Supp. III 1991). When Congress enacted the MVRA in 1996, it included a definition of victim that again incorporated the core principle of Hughey: (2) For the purposes of this section, the term victim means a person directly and proximately harmed as a result of the commission of an offense for which restitution may be ordered including, in the case of an offense that involves as an element a scheme, conspiracy, or pattern of criminal activity, any person directly harmed by the defendant's criminal conduct in the course of the scheme, conspiracy, or pattern. . . . (3) The court shall also order, if agreed to by the parties in a plea agreement, restitution to persons other than the victim of the offense, 18 U.S.C. § 3663A(a)(2)-(3). Consistent with Hughey, the Senate Judiciary Committee Report explained that, unless a plea agreement provides otherwise, the mandatory restitution provisions apply only in those instances where a named, identifiable victim suffers a physical injury or pecuniary loss directly and proximately caused by the course of conduct under the count or counts for which the offender is convicted. S. REP. No. 104-179, at 19 (1996), reprinted in 1996-4 U.S.C.C.A.N. 924, 932. Congress also amended the VWPA so that the two statutes would contain identical definitions of the term victim and substantively identical plea agreement provisions, See 18 U.S.C. § 3663(a)(2)-(3); United States v. Ramirez, 196 F.3d 895, 899-900 (8th Cir. 1999). Chalupnik argues that the government failed to prove that BMG was a victim for purposes of the MVRA because it presented no evidence that BMG, a retail mail-order seller of CDs and. DVDs, had an interest in the infringed copyrights sufficient to make BMG a victim of his copyright infringement offense. This is a novel and intriguing contention. We agree with a number of its underlying premises. First, restitution is essentially a civil remedy created by Congress and incorporated into criminal proceedings for reasons of economy and practicality. United States v. Carruth, 418 F.3d 900, 904 (8th Cir.2005). Therefore, restitution, at least in theory, tracks the recovery to which the victim would have been entitled in a civil suit against the criminal. United States v. Behrman, 235 F.3d 1049, 1052 (7th Cir.2000) (quotation omitted). Second, copyright law generally limits standing to seek a civil remedy for copyright infringement to the owner of the copyright or to a person who holds an exclusive license to one of the owner's exclusive rights in the copyrighted work See 17 U.S.C. §§ 106, 501(b); 3 Nimmer on Copyright § 12.02[B] (2007). This may be an unsettled issue of copyright law. See the conflicting opinions in Silvers v. Sony Pictures Entm't, Inc., 402 F.3d 881 (9th Cir.2005) (en banc). But it appears that BMG could not bring a civil action against Chalupnik for copyright infringement unless it was the exclusive licensee of the copyright owners, and the government does not argue to the contrary. Third, the government offered no evidence that BMG was an owner or exclusive licensee of any of the infringed copyrights, and there is good reason to believe that BMG has not been granted exclusive licenses. See 3 Nimmer § 12.02[B] at 12-57 to 12-58. Though we agree with Chalupnik's underlying premises, we agree with the government that BMG was a victim under the MVRA as a matter of law. The issue posed by Chalupnik is whether, to be a victim for purposes of the MVRA, a person must have standing to bring a civil action for the injury the criminal statute is, intended to remedyhere, copyright infringementor whether MVRA victims include persons who have other injuries proximately caused by, in the words of Hughey, the conduct underlying the offense of conviction. 495 U.S. at 416, 110 S.Ct. 1979. The MVRA does not use the term, conduct underlying the offense of conviction. Instead, it defines a victim as a person proximately harmed as a result of the commission of the offense. 18 U.S.C. § 3663A(a)(2). But the word commission reflects an intent to include the defendant's total conduct in committing the offense, an intent confirmed by the Senate Judiciary Committee Report, which paraphrased Hughey in referring to the course of conduct under the count or counts for which the offender is convicted. S.REP. No. 104-179, at 19. For this reason, we conclude that the relevant analogy is not whether' BMG could sue Chalupnik for copyright infringement. Rather, the relevant analogy is whether BMG would have a civil cause of action against Chalupnik for his conduct in committing the copyright infringement offense of conviction. As the district court noted at sentencing, the answer to that question is clearly yes, because Chalupnik's offense conduct included stealing or converting BMG property from BMG's bailee, USPS. [3] That qualifies BMG as an MVRA victim, just as the bank customer who suffered lost wages as a result of witnessing an attempted bank robbery was an MVRA victim in Moore v. United States, 178 F.3d 994, 1001 (8th Cir.1999). The bank customer could not have sued the defendant for attempting to rob the bank, but the customer was an MVRA victim because he suffered pecuniary damage as a result of the defendant's commission of the offense. Accord United States n Donaby, 349 F.3d 1046, 1054 (7th Cir. 2003) (owner of police car damaged during bank robber's getaway was MVRA victim).