News Lawyer

The Counterfeit Mafia of Kim Il Jong

[Originally Written April 9, 2009, but still applicable today]

A friend recently asked me why counterfeiting is evil. I explained that counterfeiters were often criminals with far-flung enterprises who would not think twice about dealing narcotics, exploiting child labor and committing many other crimes. He agreed with a wan smile and hint of an eye roll. I was not reaching him.

Some of this attitude presumably comes from a distrust of legitimate businesses. An attitude of moral equivalency towards all business – legitimate and illegitimate – has taken hold. Recent financial news understandably feeds such dark outlooks.

Nonetheless, counterfeiters are worse. Unlike much of the business community now under scrutiny, counterfeiters have a specific intent to steal and deceive. Their cheap fakes trade on the goodwill and efforts of legitimate businesses, costing profits (and ultimately jobs) from lost sales. In this world economy, lost jobs and tax revenue are not easily replaced. And while most counterfeiters are not guilty of enslaving an entire people under a tyrannical regime, there is one counterfeiter who is.

North Korean Dear Leader Kim Jong-il may be the world’s worst counterfeiter. While he sips on Hennessey XO and rattles nuclear sabers, North Korea’s civilian population suffers the horrors of a murderous police state, foraging the land for weeds to eat and toiling to produce fakes that help fuel Kim’s regime.

Using extreme brutality to repress internal dissent and its arsenal to scare off external threats, North Korea functions like a very well-armed mafia family with Kim as its Don. North Korea uses the wages of its sins to fund and fuel its million man army, perpetuating Kim’s cycle of ruthless rule. An anonymous State Department source estimated that North Korea’s illicit activities bring in $1 billion a year, an astonishing figure considering that North Korea only generates a total of $1.7 billion a year in legitimate exports.

Like many criminal enterprises, North Korea has a well-diversified portfolio of illicit activities. North Korea smuggles heroin to Australia, nuclear technology to Syria and Iran, and counterfeit Viagra to America. It was this last activity that drew the attention of American law enforcement. The FBI staged a counterfeit Mafia wedding in a sting operation and invited several known North Korean counterfeiters whom they subsequently arrested. One North Korean suspect carried a briefcase full of counterfeit Viagra as a wedding present.

Meanwhile, North Korea continues to pelt the Pacific with dud missile technology. So the North Korean mafia has not yet figured out how to put nuke to missile, but that day is coming. And when it comes, enforcement of international law against North Korea will be virtually impossible without risking a nuclear war.

The international community is at a loss in finding long-lasting solutions for dealing with the petulant Kim Il-Jong. Consumers, however, can change the world for the better with their buying decisions. By consciously seeking to buy real products, consumers not only help ensure the quality of their purchases, but they also sap a key source of funds for North Korea and other criminals and thugs.

And remember, if you are buying counterfeit Viagra, the rocket you fuel may not be your own.

It had to happen sooner or later, but the ease of content distribution has impacted the pornography industry.

Pornographic movies are presumably easy to produce and write, so the porno industry is now being hit from both ends – battling a growing army of free content providers while simultaneously fending off the standard piracy threat so pervasive with other forms of online content.  Presumably, consumers of smut will want to pay for “quality” branding as a means of wading through unappealing amateur content.  If porn actors are like rock stars, the branding could include live appearances or, more likely, increased emphasis on endorsements for the stars.  In this case (as is the case in music labels and newspapers), it is the middle-man in the content production chain who faces the most pressure from internet market forces.

(Hat Tip: Drudge)

YouTube is working to perfect technology to allow for automatic filtering of copyrighted clips on its website.  Interesting allegation mentioned in the article that YouTube purposefully turned a blind eye to copyright infringement in order to build its audience and enhance its acquisition price.  That strategy may have worked.  Google paid $1.76 billion to acquire YouTube 11 months ago.

On Forbes.com, some more bad news for journalists and those who aspire to the profession. The relevant quotes:

Another endangered species: journalists. Despite the proliferation of media outlets, newspapers, where the bulk of U.S. reporters work, will cut costs and jobs as the Internet replaces print. While current events will always need to be covered (we hope), the number of reporting positions is expected to grow by just 5% in the coming decade, the Labor Department says. Most jobs will be in small (read: low-paying) markets.

And broadcast journalists aren’t immune to this trend, either:

Radio announcers will have a tough time, too. Station consolidation, advances in technology and a barren landscape for new radio stations will contribute to a 5% reduction in employment for announcers by the middle of the next decade.

The writing is on the wall at Columbia Journalism School, where, according to one professor, even senior print faculty are stressing the need for all students to learn web skills. Ironically, some print students are more resistant to this emphasis than the professors, apparently fearing the technological learning curve or perhaps clinging to obsolete romanticisms of the profession.

The internet has changed the journalism economic model, with bloggers supplying content that journalists had previously charged for in print publication. At work here is the tragedy of the commons – bloggers and citizen journalists typically use news unearthed by professional journalists without compensation, republishing and repackaging the original news items with opinion. Each republishing and repackaging of the original reported content reduces the demand for the actual original form of the content – much like the case in the music industry and file-shared songs. With most news organizations losing money, the issue is whether an economic model can be developed to encourage reporting despite the lack of financial incentives to report. For even if intellectual property law developed in a way in which reported facts are protected by copyright, journalists would then only stand with musicians, trying to establish the fame necessary to generate ancillary income from (reporting) gigs that generate so little revenue of its own. By emphasizing New Media, Columbia Journalism School is trying to give its students the skills necessary to be one-man bands – to report and produce content in a variety of mediums for distribution over the internet. Each journalist would then be a hybrid – a reporter/publisher/producer/writer/techie – to varying degrees. To bring the analogy one step further, Columbia Journalism School is one step closer to making the logical yet startling concession – that traditional newspapers will wither like record companies, increasingly irrelevant distributors of content in the online world.

(Hat Tip: Instapundit).

Interesting quotes compiled by 10 Zen Monkeys. Good job.

There is an interesting parallel to law here. Commercial attorneys and those whose coin of the realm were intellectual property licenses and other commercial papers are getting killed by the internet, where their hard work gets posted and pasted by a multitude of companies who would prefer to pilfer something on the cheap rather than pay an attorney to draft the language. It doesn’t even matter that such language might be inapplicable or worse. And it doesn’t matter that using such language could get the thief in trouble for practicing law without a license – the pilfering continues unabated.

Regarding writing more specifically, it seems now that writing is merely the platform for something more lucrative – a means to an end, rather than an end in and of itself. Writers write books but earn better money speaking (or even more lucratively, consulting). Musicians make little from albums but earn great amounts of box office booty. Published lawyers become the safe pick for a multitude of high-paying gigs, whether public speaking, consulting, or straight practice of law.

In short, we’re entering a brave new world where intellectual property laws are routinely broken by common citizens. There is no stopping it. There are no easy answers, except by finding indirect ways to make money off of our writings.

In a case that no doubt sent shudders up the spines of file sharers, the Recording Industry Association of America (RIAA) secured a $220,000 judgment against a single mother for downloading and sharing copyrighted music online.

Jammie Thomas, 30, was ordered to pay $9,250 for each of the 24 songs that the recording industry focused on in the evidence. Thomas is alleged to have shared 1,702 songs.

The culture of sharing music and other files online is so firmly entrenched that the defendant may have felt that she could go forward, notwithstanding the evidence and law arrayed against her. Also, an industry official was cited as saying how surprised he was at the length of jury deliberations. While this comment may indicate any number of things, it is not unreasonable to think that the jurors wrestled with a law they found abhorrent.

Much like during the era of Prohibition, this is an area and time where there is a chasm between the law and what people believe the law should be. While the music industry has initiated 26,000 suits against alleged copyright violators, these actions constitute but a minute percentage of the total number of people involved in illegal file sharing. These suits are incredibly expensive, and with music sales plummeting, it may be time for the recording industry to find another business model.