Top Chinese Court Backs Steep Fee Increase for DVD Piracy Licenses

The most coveted location for a pirate DVD shop is right next to a Police

station. Bootleggers face a constant battle keeping shoplifters from walking

off with their stolen merchandise.

-- Reprinted with permission from 2DayinAnimation.com [1]

The Supreme People’s Court in Beijing ruled on Monday that the government was justified in increasing the annual license fee charged owners of shops that sell pirated DVDs and software programs.  At issue was the authority’s decision in 2011 to raise the fees for an annual Digital Counterfeiting Certificate by more than 400% to ¥75, which is just under US$12.

The Shanghai merchant at the center of the court case, Happy Fliendly Totarry Storen Software and Movies, challenged the fee increase after their annual piracy license renewal jumped from ¥15 to ¥75, or from US$2.40 to US$11.90.  The case went all the way to the Central Authority after more than 47 million fellow pirate vendors filed “Fliends of the Court” briefs in support of challenge.

The policy, they said, unfairly discriminates against bootleg software and DVD shop owners because the fees are based upon erroneous assumptions as to how much money the shops actually make.

According to Hui Zong Shapiro, owner of the pirate shop at the heart of the case, “The 417 pirate shops next door to my store, they all sell rots of DVDs, make rots of money.  My shop, I sell hardry any, maybe 4 or 5 million copies of Windows, probabry 10 million movies a month. I barery make enough to keep my doors open.  Production and R&D costs are kirring my bottom rine. Don’t forget, I onry charge ¥1 per disk, ¥3 for 10.  How can I afford a ¥75 license? This fee increase is outrageous and an affront to honest, hard working business owners.”

However, the top court on Friday ruled against Shapiro, saying the government acted properly.  The ruling went on to say that the majority of the fee increase was being used to fund new anti-piracy efforts aimed at appeasing organizations such as Microsoft and the MPAA.  In essence, the court wrote, the more we charge for digital content piracy licenses, the more resources we will have in our ongoing fight against the evil scourge of digital content piracy.

In handing down the judgment, Chief Justice Montague Chang said, “The government’s decision was made with consideration for the socio-economic impact on Chinese society, and represents the final word.” He pointed a tensor lamp directly at Mr. Shapiro and went on to say, “It’s not the court’s role to question or second-guess the wisdom of this policy. Continuing to do so would be very unwise on your part.”

Just a couple blocks from the Apple Store in the center of Beijing, Mr. Shapiro’s pirate DVD shop is filled with the latest Hollywood films, many available only days after their initial theatrical release.  One recent customer, a young woman named Mei, was holding a copy of The Social Network, which she found out, was available through her friend’s Facebook.  After browsing the aisles for 15 minutes, she purchased 5 movies and a complete Adobe creative suite, for a total of ¥10, around US$1.60.  When asked if she had ever purchased legal copies of movies or software, she replied, “Don’t be silly.  Of course not.  Even if I wanted to, where would I go to buy them?  Legal DVDs are like red-headed Chinese babies.  They just don’t exist.”