614 F.2d 1133 (7th Cir. 1980), 79-1301, United States v. Heilman

Docket Nº:79-1301.
Citation:614 F.2d 1133
Party Name:133 UNITED STATES of America, Plaintiff-Appellee, v. David L. HEILMAN, Defendant-Appellant.
Case Date:February 08, 1980
Court:United States Courts of Appeals, Court of Appeals for the Seventh Circuit

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614 F.2d 1133 (7th Cir. 1980)


UNITED STATES of America, Plaintiff-Appellee,


David L. HEILMAN, Defendant-Appellant.

No. 79-1301.

United States Court of Appeals, Seventh Circuit

February 8, 1980

Argued Nov. 28, 1979.

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Bruce F. Ehlke, Madison, Wis., for defendant-appellant.

Thomas P. Sullivan, U. S. Atty., Barry R. Elden, Asst. U. S. Atty., Chicago, Ill., for plaintiff-appellee.

Before CUMMINGS, Circuit Judge, WISDOM, Senior Circuit Judge, [*] and CUDAHY, Circuit Judge.

CUMMINGS, Circuit Judge.

This appeal challenges the validity of the first criminal prosecution for "record piracy" under Section 104 of the Copyright Act (17 U.S.C. § 104). The indictment also contained numerous mail fraud counts (18 U.S.C. § 1341). After a bench trial, defendant was found guilty of 18 of the 26 counts of the copyright offenses; the remaining counts of the indictment were dismissed. Defendant was sentenced to six months' imprisonment and fined $500 on each count, the prison terms to run concurrently and the fines to be accumulated. From the judgment of conviction, the defendant appeals. We affirm.

I. Factual Background

The facts of this case, set forth in affidavits of defendant and stipulations of the Government and the defendant, are not in dispute. Defendant was the president of E-C Tape Service, Inc. until April 1976. E-C Tape was engaged in the business of producing and marketing anthologies of recorded music at Lake Villa, Illinois, and Brookfield, Wisconsin. To make these records and tapes, the defendant used only copyrighted music that was recorded or "fixed" by others prior to February 15, 1972. Records fixed after that date are not involved in this case. The defendant duplicated commercially available records (usually 45 r. p. m.'s), organized them into anthologies, and sold them by mail order. Two out of sixteen of the holders of copyrights in the duplicated compositions accepted the defendant's tender of a two cent "compulsory license fee" mandated by 17 U.S.C. § 1(e). 1

In October 1971, Congress amended the copyright law, effective February 15, 1972,

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and created a copyright interest in sound recordings. 17 U.S.C. § 1(f). 2 Congress also promulgated criminal sanctions for unauthorized duplication of copyrighted sound recordings fixed after February 15, 1972. 3

The United States Department of Justice took the position that record duplicators who copied recordings made prior to February 15, 1972, would not violate the copyright laws so long as they paid the compulsory license fee. "Copyright Protection of Sound Recordings" (App. 103-104). On January 20, 1975, however, the Department of Justice changed its position and publicly announced a prospective policy to prosecute criminally for copyright infringement those persons who duplicated records fixed prior to February 15, 1972, regardless of payment of the licensing fee. 4 Subsequently, on September 3, 1976, Congress once again amended the scope of 17 U.S.C. § 1(e) to provide that the compulsory license provided for copyrighted musical works would not be available to persons making unauthorized duplications of sound recordings. Section 115(a) of Pub.L. 94-553 (effective October 19, 1976), 90 Stat. 2561 discussed in 5 U.S.Code Cong. and Admin.News (94th Cong. 2d Sess. 1976) 5722-5724.

After the Department of Justice announced its prospective policy change, Heilman

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(the defendant herein) filed a suit in the United States District Court for the Eastern District of Wisconsin for declaratory judgment that his record duplication business did not violate the Copyright Act. He also sought an injunction against any criminal prosecution of him under that Act. On April 28, 1975, Judge Reynolds denied a motion for a temporary restraining order or preliminary injunction. On July 14, 1977, he entered summary judgment against defendant. Heilman v. Levi, 391 F.Supp. 1106 (E.D.Wis.1975). This Court affirmed. Heilman v. Bell, 583 F.2d 373 (7th Cir. 1978), certiorari denied, 440 U.S. 959, 99 S.Ct. 1499, 59 L.Ed.2d 771.

On March 31, 1977, almost two years after the entry of Judge Reynolds' ruling on the preliminary injunction, this criminal indictment was filed in Illinois alleging that defendant between April 29, 1975, and January 7, 1976, had duplicated and sold certain recordings that had been fixed prior to February 15, 1972, such as "Mack the Knife," without authorization from the copyright owners. The indictment also alleged that mail frauds were committed in connection with the defendant's sales of these records and tapes. The evidence at trial consisted of the Government's stipulation with exhibits, the defendant's stipulation with exhibits, and the testimony of two defense witnesses (Jan. 30, 1979, Tr.). The two witnesses, both counsel who had been consulted by defendant regarding the legality of his record duplication business, testified that they had advised the defendant in 1975 and 1976 that his activities would not violate the criminal provision of the Copyright Act so long as he continued to tender the compulsory license fee and to give notice to the copyright owner (Jan. 30, 1979, Tr. 3-9, 23-26).

Defendant raises these issues on appeal: (1) Are the provisions of the Copyright Act which authorize criminal sanction unconstitutionally vague? (2) Did the defendant willfully infringe copyrights when he was duplicating records but was also complying with the compulsory license provisions of the Copyright Act? and (3) Did the district judge deny defendant equal protection of the laws when he refused to hold a hearing on whether this was an impermissibly selective prosecution?


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