Thursday, March 17, 2005

D.A. BROWN: FOUR CHARGED IN DVD AND CD PIRACY SCHEME; THOUSANDS OF COUNTERFEIT DVDS AND CDS AND SOPHISTICATED MANUFACTURING EQUIPMENT SEIZED AT ELMHURST, QUEENS HOUSE USED AS ILLEGAL DUPLICATING MILL; CONTRABAND HAS OVER $500,000 STREET VALUE

Queens District Attorney Richard A. Brown today announced the seizure of thousands of counterfeit DVDS and CDS from a basement of a private house in a residential Elmhurst, Queens neighborhood that was being used as an underground DVD and CD duplicating factory. Four defendants have been charged.

District Attorney Brown said, “A counterfeiting mill with a high-volume duplicating capacity like this factory is capable each year of fleecing the motion picture association and the recording industry of millions of dollars in revenues, cheating companies and artists out of substantial sums in lost royalties and ripping off honest consumers who are forced to pay higher prices for their listening entertainment. In addition, it deprives the City and State of much needed tax revenues. My office will continue to work with the Police Department and recording industry to close down these illegal operations and vigorously prosecute those involved.”

District Attorney Brown identified the defendants as (1) Wen Miao Zhang (male), 36, and (2) Xiaofei Huang (female), 29, both of 41-59 55 Street in Elmhurst, Queens and (3) Wei Jian Hu (male) 38, and (4) Xiao Zhen Qu (female) 38, both of 40-85 Denman Street, Elmhurst. The defendants have been charged with Trademark Counterfeiting in the First Degree, Criminal Possession of Forgery Devices and Failure to Disclose the Origin of a Recording in the First Degree and face up to 15 years in prison if convicted.

The District Attorney said that according to the criminal charges New York City Police Department detectives assigned to the Intelligence Division yesterday executed a court-authorized search warrant on the alleged factory at 87-03 55 Avenue in Elmhurst, Queens.

District Attorney Brown said that the search warrant was prepared by his Economic Crimes Bureau and was the result of confidential information obtained in an on-going investigation that began last summer.

According to the District Attorney, detectives conducted a search in the residence’s basement and recovered 11 computer towers with a total of 99 burners, 35,050 counterfeit DVD movies of rent theatrical releases such as “Hostage,” “Robot,” “Be Cool,” “Pacifier,” and others, 7,400 counterfeit CDs of rap artists such as 50 Cent, 5,900 counterfeit DVD music videos, 4,800 DVDR blanks, 4,000 DVD/CD blank cases, 15 DVD-ROM drives, a flat screen television, 2 DVD players, 1 personal computer with a key board and monitor, and a box containing stamps of movie titles and labeling equipment. The equipment was capable of producing as many as over 800 DVDs and CDs an hour and it is believed was churning out over 140,000 counterfeit DVDs and CDs each week.

According to District Attorney Brown, counterfeit DVDs and CDs turn up all over the City -- they are sold in neighborhood retail stores, in flea markets and by street-corner vendors. The DVDs are usually sold for between $5 and $10 each -- the legitimate product usually runs around $19. The motion picture industry estimates that it loses in excess of $3 billion annually in potential worldwide revenue due to the manufacture and distribution of bogus DVDs. The CDs are usually sold for $4 or $5 each -- the legitimate product usually runs between $15 and $18. The recording industry estimates that it loses some $400 million each year as a result of the manufacture and distribution of bogus CD’s and audio cassettes.

The four defendants are being held pending arraignment in Queens County Criminal Court.

The investigation was conducted by Intelligence Division Sergeant Eugene Miniero and Detective Xhezat Kraja under the supervision of Lieutenant Mark Magrone, and Captain Frank Darsillo and the overall supervision of Chief Michael Tiffany and Deputy Commissioner David Cohen. The OCID Trademarking counterfeiting team also assisted under the leadership of Detective William Sanborn. Investigations were also conducted by Investigator John Segovia from The Motion Pictures Association of America under the supervision of Staff Supervisor Peter English and the overall supervision of William Shannon, Deputy Director of US Operations, along with the assistance of Investigator William Macioch of the Recording Industry Association.

District Attorney Brown commended the New York City Police Department’s Intelligence Division and expressed his appreciation for the cooperation and support from the Motion Picture Association of America, and the Recording Industry Association of America, both located in Yonkers, New York.

The case is being prosecuted by Assistant District Attorney Allison Wright of the District Attorney’s Economic Crimes Bureau under the supervision of Assistant District Attorneys Gregory Pavlides, Bureau Chief, and Diane M. Peress, Deputy Bureau Chief, and the overall supervision of Executive District Attorney for Investigations Peter A. Crusco and Deputy Executive Assistant District Attorney for Investigations Linda M. Cantoni.

It should be noted that criminal charges are merely an accusation and that defendants are presumed innocent until proven guilty.