June 12, 2013
At first blush, it was a relatively modest business. Initially, it was thought that from February 2004 to April 2008, Naveed Sheikh made over $265,000 selling copies over 100 software programs, such as :
- Microsoft Money 2006 Small Business,
- Adobe After Effects Pro 7.0,
- Veritas NetBackUp Pro 5.1,
- Solid Works Office 2000 Premium,
- Quicken Premier Home and Business 2006, and
- Apple iLife 2006.
The wonderful thing about Sheikh's entrepreneurial approach was that he was selling millions of dollars worth of popular software titles through his Internet website for a fraction of their usual sticker price. Although Sheikh's computer server which hosted his website was based in Scranton, PA, he used remote computers in Bel Air, MD and multiple Internet domains, including ezencode.com, lazer-toners.com, and coark.net. Very impressive but for the fact that according to federal prosecutors, Sheikh accomplished this bargain sale by infringing the copyrights of the programs.
Take The Money And Run
During the fall of 2010, the government engaged in plea negotiations with Sheikh. In November 2010, shortly before the deadline for Sheikh to reach an agreement with the government or be charged, Sheikh left the United States for Pakistan and became a fugitive.
According to a January 13, 2011, Indictment by a federal grand jury in District of Maryland, Sheikh, 30, Baltimore, MD, illegally reproduced and distributed copyrighted software programs, which he sold via DVD-Rs and CD-Rs containing the infringed software and crack codes allowing buyers to modify software in order to remove disable security protections. Oh, so that's how he managed to keep the prices so low.
If convicted, Sheikh faced a maximum sentence of five years in prison. Prosecutors were seeking a $265,000 forfeiture and property derived from or traceable to the proceeds of the criminal scheme.
It's My Carry-On
On January 31, 2012, Sheikh was arrested at Dulles Airport as he was attempting to enter the U.S. When arrested, Sheikh was carrying electronic media containing evidence that he and his co-conspirators were responsible for the sales of infringing software.
On June 28, 2012, Sheikh was named in a Superseding Indictment for conspiring to and illegally reproducing and distributing over 1,000 copyrighted commercial software programs, with a total value of over $4 million. Oops, that little sojourn to Pakistan gave the Feds enough time to really jack things up: The 100 infringed titles mushroomed over 1,000 and the roughly quarter of a million theft had exploded into over $4 million. More to the point,the one-count Indictment had ominously multiplied into a Superseding Indictment charging one count of conspiracy, three counts of copyright infringement, and seeking forfeiture of $4 million. The expanded charges now alleged Sheikh's recruitment and compensation of co-conspirators and his direction of their actions. Some of the individuals who worked for Sheikh were located overseas and could assist with overnight projects. Sheikh and other conspirators posed as other individuals when corresponding with customers by e-mail.
Would You Believe?
In meetings with federal prosecutors and agents during the course of the investigation, Sheikh made numerous false statements in order to obstruct the investigation. If you can get away with that, it's one thing; but if you get caught lying to the feds, oh boy, that's not calculated to win you a lot of brownie points during settlement negotiations or when you're standing before a sentencing judge.
It seems that Sheikh claimed that he had rented computer space to another individual whom Sheikh believed was selling computer training programs. Apparently Sheikh asserted that it was in 2008 when he first learned that this other individual had infringed software. The Feds may have been skeptical but to dissuade their disbelief, Sheikh apparently claimed to have recorded phone conversations with this individual.
Okay, so, that could help - giving up the goods on another possible defendant in an effort to get some consideration from your prosecutors.
Through his attorney, Sheikh provided what he had characterized as the recordings. Not so fast. Turns out that Sheikh fabricated the taped conversations. All of which explains why we're now talking about obstruction of justice.
On November 19, 2012, Sheikh pled guilty and will be required to forfeit $4 million. Sheikh faces a maximum sentence of five years in prison and a $250,000 fine for the conspiracy and for each count of copyright infringement.
On June 6, 2013, Sheikh, 32, was sentenced in federal court in the District of Maryland for conspiring to and infringing copyrights by illegally reproducing and distributing over 1,000 copyrighted commercial software programs. He was sentenced to 87 months in prison, followed by three years of supervised release; and ordered to forfeit $4 million, the total value of the infringed software programs.
Bill Singer's Comment
Where should I begin? Not only does this idiot come back to the USA and gets arrested at Dulles Airport with incriminating evidence, but he also tries to sandbag the Feds with bogus recordings? Wow.