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Name: People v. Kelly
Case #: E049337
Court: CA Court of Appeal
District 4 DCA
Division: 2
Opinion Date: 10/12/2010

The Recording Industry Association of America was not a direct victim of a piracy crime and therefore, could not receive restitution. Appellants were each convicted of one charge involving counterfeit compact music discs. The Recording Industry Association of America, a non-profit trade association that investigates the illegal production and distribution of sound recordings for the recording industry, sough restitution from defendants. The court ordered restitution to be paid to the RIAA and appellants appealed that order. The Court of Appeal reversed the order. RIAA is not a direct victim because it was not the object of appellants’ crimes and it cannot claim lost profits or other losses caused by those crimes. Only those people or entities whose product was pirated by appellants have suffered losses. And while Penal Code section 1202.4 was amended in 2009 to add subdivision (j), specifically permitting trade associations acting on behalf of an owner or lawful producer to recover restitution, the statute cannot be applied to appellants because their crimes were committed prior to the effective date. Moreover, even if the statute could be applied retroactively, the record in this case does not establish that RIAA was acting on behalf of the artist or producers. With one exception, the compact discs and their owners or producers were not identified in the record.