In two separate court cases that underscore the federal government’s resolve to capture and prosecute those who illegally distribute copyright-protected digital materials online, students Jeffrey Lerman, 20, of the University of Maryland and Parvin Dhaliwal, 18, of the University of Arizona have pleaded guilty to charges of copyright violation.

Lerman was part of a global computer piracy ring that allegedly shuttled millions of dollars in computer games, movies, and software around the world through a coded system of web sites and chat rooms, the Associated Press (AP) reported March 8.

Lerman and two other men pleaded guilty in U.S. District court to federal copyright charges, reportedly becoming the first people convicted in what the U.S. Justice Department said was the largest-ever investigation into software piracy.

Their arrests came after FBI agents in New Haven spent more than a year looking into the underground “Warez” community on the internet.

“It’s a competition of different groups racing to release pirated software over the internet,” said Seth Kleinberg, a 26-year-old Los Angeles man who, with a high-school education and a home computer, reportedly cracked the computer industry’s toughest copyright protections.

Kleinberg, who lives with his father, faces between five and six years in prison when he is sentenced in July. He pleaded guilty along with Lerman, who is from Long Island, and Albert Bryndza, 32, of New York.

The investigation, dubbed “Operation Higher Education,” spanned across the United States and about a dozen foreign countries, prosecutors said.

Federal investigators have increasingly targeted computer pirates. In December, Jathan Desir, 26, of Iowa City, Iowa, was the first American convicted as part of “Operation Fastlink,” an investigation that spanned across 27 states and 11 foreign countries: Belgium, Denmark, France, Germany, Hungary, Israel, the Netherlands, Singapore, Sweden, Spain, and Great Britain. (See “FBI hits schools, colleges.”)

“Operation Higher Education” appears to have built on that case. In November, Kenneth Doroshow, senior counsel in the U.S. Justice Department’s computer crime division, described the probe to Korean officials and business leaders, saying it involved investigators in 12 nations.

The FBI recently built a state-of-the-art computer crimes facility in the New Haven field office to handle internet investigations. “Operation Higher Education” originated from this New Haven office, AP reported.

In a separate but possibly related case, University of Arizona student Dhaliwal is believed to be the first person in the country to be convicted of a crime under state laws for illegally downloading music and movies from the internet, prosecutors and activists say.

Dhaliwal pleaded guilty to possession of counterfeit marks, or unauthorized copies of intellectual property.

Under an agreement with prosecutors, Dhaliwal was sentenced last month to a three-month deferred jail sentence, three years of probation, 200 hours of community service, and a $5,400 fine. The judge in the case also ordered him to take a copyright class and to avoid file-sharing computer programs.

“Generally copyright is exclusively a federal matter,” said Jason Schultz, an attorney with the Electronic Frontier Foundation, a technology civil liberties group. “Up until this point, you just haven’t seen states involved at all.”

Federal investigators referred the case to the Maricopa County, Ariz., Attorney’s Office for prosecution because Dhaliwal was a minor when he committed the crime, said Krystal Garza, a spokeswoman for the office.

“His age was a big factor,” she said. “If it went into federal court, it’s a minimum of three months in jail up front.”

Although Dhaliwal wasn’t charged until he was 18, he was 17 when he committed the crime. Prosecutors charged him as an adult but kept it in state court to allow for a deferred sentence. Garza also said Dhaliwal had no prior criminal record.

The charge is a low-level felony but may be dropped to a misdemeanor once he completes probation, she said.

A call to Dhaliwal’s attorney, James Martin, was not returned.

A man who identified himself as Dhaliwal’s father, but refused to give his name, returned a message left March 7 at Dhaliwal’s parents’ home. He said his son had made a mistake, and was trying to put the case behind him. The man declined to comment further.

Brad Buckles, executive vice president for anti-piracy at the Recording Industry Association of America, estimated internet piracy has cost the industry up to $300 million a year in CD sales alone.

The FBI reportedly found illegal copies of music and movies on Dhaliwal’s computer, including films that, at the time of the theft, were available only in theaters. They included Eternal Sunshine of the Spotless Mind, Matrix Revolutions, The Cat In The Hat, and Mona Lisa Smile.

A federal task force that monitors the internet caught on to the student and got a warrant, Garza said, adding that Dhaliwal was copying and selling the pirated material.

At press time, it was unclear whether Dhaliwal was identified in the same operation that captured Lerman and the others.

Links:

Federal Bureau of Investigation
http://www.fbi.gov

Maricopa County Attorney’s Office
http://www.maricopacountyattorney.org

Electronic Frontier Foundation
http://www.eff.org

Recording Industry Association of America
http://www.riaa.com