Dunn Lampton, United States Attorney for the Southern District of Mississippi, and Michael A. Holt, Agent-in-Charge, Office of Investigations, U.S. Immigration and Customs Enforcement (ICE), announce the conviction of Thomas Irving Davis Jr., a co-conspirator of Randolph Hobson Guthrie III. Davis will be sentenced on January 22, 2008 in U.S. District Court in Gulfport. This conviction concludes a lengthy investigation which was the first joint Intellectual Property Rights (IPR) investigation by ICE agents and Chinese authorities, and the very first joint Sino-American undercover investigation.
Davis admitted his role in a wide ranging conspiracy which involved the commission of various offenses against the United States, including infringing on copyrights for purposes of commercial advantage and private financial gain, trafficking in goods and using counterfeit marks on and in connection with such goods, and fraudulently and knowingly importing unauthorized reproductions of U.S. copyrighted motion pictures stored on digital versatile discs into the United States contrary to law.
The investigation began in Mississippi when undercover ICE agents purchased counterfeit DVDs, and has already led to the conviction in China of a global distributor of counterfeit products, with significant contributions having been made by Chinese authorities and ICE agents.
"As the first joint counterfeiting investigation by ICE and Chinese authorities, this landmark case has already served as a roadmap for future Intellectual Property Rights investigations," said Michael A. Holt, Special Agent-in-Charge, Office of Investigations for ICE in New Orleans.
U.S. Attorney Dunn Lampton said, "What began with counterfeit DVDs being sold at a Harrison County Flea Market resulted in not only the first joint Intellectual Property Rights investigation between the U.S. and China; but, also the first full undercover law enforcement investigation between the U.S. and Peoples Republic of China. This investigation and prosecution demonstrates what cooperation between law enforcement agencies in the United States and China can achieve in order to counter the enormous adverse economic consequences to the United States of intellectual property drain in China and around the globe."
The indictment in this case was the product of a joint effort between ICE agents and Chinese law enforcement called "Operation Spring." Launched in September, 2003 by the ICE Resident Agent-in-Charge office in Gulfport, Mississippi, the investigation grew to include the ICE Attaché in Beijing, China, the ICE Special Agent-in-Charge office in Houston, the National Intellectual Property Rights Center, and the Internal Revenue Service, Office of Investigations.
In April 2004, agents assigned to the ICE Attaché in Beijing reached out to Chinese authorities and began sharing information on the investigation. The Economic Crime Investigation Department of the Chinese MPS assigned the Shanghai Public Security bureau to work with ICE on the case. After months of joint investigation with ICE, Chinese authorities were able to develop sufficient evidence against Randolph Hobson Guthrie III to make an arrest.
On July 1, 2004, officers from the Economic Crime Investigation Department of the Chinese MPS and the Shanghai Public Security Bureau carried out enforcement actions in China that resulted in the arrest of six individuals, including two U.S. citizens, one being Guthrie. Guthrie had lived in Shanghai for nearly ten years and also listed addresses in New York, Miami Beach and Palm Beach, Florida
In addition, the enforcement actions in China led to the seizure of more than 210,000 counterfeit motion picture DVDs and approximately $67,000 in U.S. currency as well as 222,000 in Chinese Renminibi (RNB) currency. Chinese authorities also located and destroyed three warehouses that were being used to store counterfeit motion picture DVDs for distribution around the globe, including the United States.
According to facts presented at Thomas Davis's guilty plea hearing, he participated in the conspiracy by establishing or assisting in the establishment of various accounts on web-based services such as WorldPay and Ebay to facilitate the sale of pirated DVDs. Davis additionally traveled within the state of Florida delivering pirated DVDs and accepting payments from customers. During the conspiracy, Davis collected more than $50,000 in payments for the pirated DVDs operating out of an office located at 240 Worth Avenue, Palm Beach, Florida.
"We applaud the U.S. Attorney for the Southern District of Mississippi, U.S. Immigration and Customs Enforcement and the Chinese authorities for their diligent and sustained efforts over the last three years to break-up this far-reaching conspiracy," said Dan Glickman, Chairman and CEO of the Motion Picture Association of America. "This conviction is a significant milestone in the film industry's global efforts to fight film theft and is a model of interagency and international cooperation to stem the tide of rampant copyright infringement around the globe."
U.S. Attorney Lampton expressed his appreciation to Assistant U.S. Attorney Jay Golden, ICE Resident Agent-in-Charge Steve Thomas, who has since become the ICE attache in Beijing, Case Agent Alan Prejean, and ICE undercover agents for their dedicated efforts. He also thanked officials of the U.S. Department of State and ICE Intellectual Property National Program Coordinator Nancy Sherman of the National Intellectual Property Rights Center in Washington, D.C.
Lampton stressed that the protection of intellectual property rights is of vital concern to our nation and that success in this area will not be achieved without further coordinated investigations of this kind.