De Lorenzo v DPP (Cth)
[2017] VSCA 270
•25 September 2017
SUPREME COURT OF VICTORIA
COURT OF APPEAL
S APCR 2017 0130
| WILLIAM DE LORENZO | Applicant |
| v | |
| DIRECTOR OF PUBLIC PROSECUTIONS (CTH) | Respondent |
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| JUDGES: | OSBORN and COGHLAN JJA |
| WHERE HELD: | MELBOURNE |
| DATE OF HEARING: | 11 September 2017 |
| DATE OF JUDGMENT: | 25 September 2017 |
| MEDIUM NEUTRAL CITATION: | [2017] VSCA 270 |
| JUDGMENT APPEALED FROM: | DPP (Cth) v de Lorenzo (Unreported, County Court of Victoria, Judge Ryan, 12 April 2017) |
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CRIMINAL LAW – Appeal – Sentence – Making unauthorised decoder available online – Causing unauthorised access to encoded broadcasts by way of trade – Applicant effectively ran Melbourne card-sharing Pay TV piracy network – Sentenced to 15 months’ imprisonment to be released on recognisance release order for 18 months after serving 10 months’ imprisonment – Whether manifestly excessive – Parity – Whether manifest lack of appropriate relativity with interstate co-offender sentenced to 18 months’ imprisonment wholly suspended, released on a recognisance to be of good behaviour for 18 months on condition of $1,000 surety – Applicant convicted of two continuing offences cf. interstate co-offender convicted of one offence on a single agreed date – Further offending of interstate co-offender taken into account pursuant to s 16BA of the Crimes Act 1914 (Cth) – Appeal allowed – Sentence of imprisonment confirmed; order that applicant be released on a recognisance release order after 164 days being the total time served to date – Copyright Act 1968 (Cth) ss 135ASG, 135ASJ – Attorney-General’s Application Under Section 37 of the Crimes (Sentencing Procedure) Act 1991 No. 1 of 2002 (2002) 56 NSLWR 146 referred to.
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| APPEARANCES: | Counsel | Solicitors |
| For the Applicant | Mr D F Dann QC | Melinda Walker Criminal Law Solicitor |
| For the Crown | Mr D Porceddu | Ms A Pavleka, Solicitor for Public Prosecutions (Cth) |
OSBORN JA:
COGHLAN JA:
On 31 March 2017 the applicant (now aged 45), pleaded guilty to making an unauthorised decoder available online and causing unauthorised access to encoded broadcasts by way of trade in breach of the Copyright Act 1968 (Cth). Following a plea on 31 March 2017, the applicant was sentenced in the County Court of Victoria at Melbourne on 12 April 2017 as follows:
| Charge on Indictment | Offence | Maximum | Sentence | Cumulation |
| 1 | Making an unauthorised decoder available online [Copyright Act 1968 (Cth) s 135ASG] | 5 years’ imprisonment [Copyright Act 1968 (Cth) s 135ASG(2)] | 12 months’ imprisonment | Base |
| 2 | Causing unauthorised access to encoded broadcasts by way of trade [Copyright Act 1968 (Cth) s 135ASJ] | 5 years’ imprisonment [Copyright Act 1968 (Cth) s 135ASJ (4)] | 12 months’ imprisonment | To commence 3 months after the commencement of the sentence imposed on Charge 1 |
| Total Effective Sentence: | 15 months’ imprisonment with the Applicant to be released on a Recognisance Release Order for 18 months after serving 10 months’ imprisonment. | |||
| Non-Parole Period: | N/A | |||
| Pre-sentence Detention Declared: | Nil | |||
| 6AAA Statement: | 30 months’ imprisonment with the Applicant to be released on a Recognisance Release Order after serving 20 months’ imprisonment. | |||
| 16AC Crimes Act (Commonwealth Declaration) | 24 months’ imprisonment with the Applicant to be released on a Recognisance Release Order after serving 15 months’ imprisonment. | |||
A co-offender involved in related offending, Kamaran Mirkhail, pleaded guilty to one charge of causing unauthorised access to encoded broadcasts by way of trade and was sentenced in the County Court of Victoria at Melbourne on 17 May 2016 to a Community Correct Order (‘CCO’) for two years with one condition as to supervision.
A further co-offender involved in related offending, George Haraka, pleaded guilty to one charge of causing unauthorised access to encoded broadcasts by way of trade and one charge of making an unauthorised decoder available online and was sentenced in the County Court of Victoria at Melbourne on 17 May 2016 to a CCO for two years with one condition as to his supervision.
On 4 August 2017, after an initial 12 day trial had miscarried, a further co-offender involved in related offending, Haidar Al Baghdadi, entered into a plea bargain and pleaded guilty to one charge of causing unauthorised access to encoded broadcasts by way of trade. He was sentenced in the District Court of New South Wales to 18 months’ imprisonment which was wholly suspended and released on a recognisance to be of good behaviour for 18 months on condition that he enter into a surety in the sum of $1,000.
Grounds of appeal
The applicant seeks leave to appeal on the following grounds:
1. The learned sentencing judge erred in his application of the parity principle, by imposing a sentence upon the applicant that was unjustifiably and manifestly disparate from the sentences imposed on the co-offenders (Mirkhail and Haraka).
2. The sentence imposed on the applicant is manifestly excessive.
3. The sentence imposed on Haidar Al Baghdadi gives rise to a justifiable sense of grievance, in that there is a manifest lack of appropriate relativity as between that sentence and the sentence imposed upon the applicant.
We would refuse leave to appeal on grounds 1 and 2 but would grant leave on proposed ground 3, and allow the appeal.
We would reduce the time the applicant is required to serve before being released on a recognisance release order to 164 days, being time served. We take this course because of the manifest disparity in the relative severity of the sentences imposed upon the applicant and Haidar Al Baghdadi.
The principle of parity requires that there be proportionality between the sentences of offenders involved in related offending giving rise to relative equivalence. The classic statement of the principle is that of Dawson and Gaudron JJ in Postiglione v The Queen.[1] In that case, the place of different offenders in the hierarchy of the group responsible for the offending on the one hand and differences personal to the offenders on the other, justified differentials in the sentences imposed.
The parity principle upon which the argument in this Court was mainly based is an aspect of equal justice. Equal justice requires that like should be treated alike but that, if there are relevant differences, due allowance should be made for them.[2] In the case of co-offenders, different sentences may reflect different degrees of culpability or their different circumstances. If so, the notion of equal justice is not violated. On some occasions, different sentences may indicate that one or other of them is infected with error.[3] Ordinarily, correction of the error will result in there being a due proportion between the sentences and there will then be equal justice. However, the parity principle, as identified and expounded in Lowe v The Queen,[4] recognises that equal justice requires that, as between co-offenders, there should not be a marked disparity which gives rise to ‘a justifiable sense of grievance’.[5] If there is, the sentence in issue should be reduced, notwithstanding that it is otherwise appropriate and within the permissible range of sentencing options.
Discrepancy or disparity is not simply a question of the imposition of different sentences for the same offence. Rather, it is a question of due proportion between those sentences, that being a matter to be determined having regard to the different circumstances of the co-offenders in question and their different degrees of criminality. The different circumstances involved in this case, namely, the fact that Savvas was the principal organiser in both conspiracies and that Postiglione rendered significant assistance to police and prosecuting authorities, clearly require that Postiglione receive a markedly lesser sentence than that imposed on Savvas.[6]
[1](1997) 189 CLR 295.
[2]See Lowe v The Queen (1984) 154 CLR 606, 610–11 (Mason J).
[3]Lowe v The Queen (1984) 154 CLR 606, 617–18 (Brennan J).
[4](1984) 154 CLR 606.
[5]Lowe v The Queen (1984) 154 CLR 606, esp 610 (Gibbs CJ); 613 (Mason J); and 623 (Dawson J).
[6]Postiglione v The Queen (1997) 189 CLR 295, 301–2 (citations in original). See also Green v The Queen (2011) 244 CLR 462, 474–5 [31].
Background
Pay TV signal in Australia is transmitted by the broadcaster in the form of an encoded broadcast. A satellite, cable, or terrestrial connection enables the encoded broadcast to be delivered to a client’s household and received by a set-top box, in which an authorised smart card issued by the broadcaster has been inserted. The encoded broadcast contains the necessary data, known as a decryption key, or a control word, that permits the encoded broadcast to be descrambled. The authorised smart card contains embedded features that enable the control word to be recovered from the data delivered in the encoded broadcast.
In order to access unauthorised subscription television services, clients of Pay TV pirates must have a satellite dish installed at their household and a set-top box connected to the satellite feed. A common means of enabling a set-top box to descramble the encoded broadcast without the insertion of an authorised smart card, is for the client to use a set-top box on which the necessary card-sharing software has been installed, and connect to a card-sharing network provided by the Pay TV pirates via the internet.
Through a card-sharing network, one legitimate smart card can be used to obtain the encoded broadcast control word, which is then distributed to multiple unsubscribed set-top boxes via the internet, allowing the clients of the Pay TV pirates to access the descrambled broadcast. It was not alleged that the applicant ever possessed the Foxtel smartcard(s) from which the card-sharing network was operating.
A card-sharing network can be managed and run from one of more locations through the use of web interfaces. A card-sharing proxy server (CSP) is a computer server that acts as an intermediary point between the card-sharing client decoder and the card-sharing server. The applicant was using a CSP to run a card-sharing Pay TV piracy network. The server was being hosted by a cloud computing company named Ninefold Pty Ltd.
On 1 November 2013, in the course of an investigation into Sydney man Haidar Al Baghdadi, who was alleged to have operated a card-sharing Pay TV piracy network in Sydney, a mobile phone belonging to Al Baghdadi was seized and analysed. The phone showed communications between the applicant and Al Baghdadi between 11 August 2012 and 1 November 2013 in relation to, inter alia, Foxtel channels not working, the operation of the server, and customer complaints about the quality of broadcasts.
On 5 February 2015, AFP members executed a search warrant at the applicant’s residence. During the search, a number of set-top boxes, card reading devices, smart cards and smart card readers were seized.
The applicant was arrested on 5 February 2015 and bailed.
A contested committal was listed on 18 May 2016. The matter resolved prior to any witness being called.
On 7 October 2016, the applicant gave a full and frank record of interview to investigating police describing criminal conduct both by himself and his co-accused.
On 22 December 2016, the applicant signed a written statement for the prosecution relating to Al Baghdadi which relevantly included the following:
8.Between 2008 and 2015, I was involved In a card sharing network together with George HARAKA (George) and Kamaran MIRKHAIL (Kamaran) that at its highest point serviced approximately 1000 customers. My customers were all based in Victoria, with the majority in the Melbourne Metropolitan area. Cards used in this system were initially original non modified smart cards. Later to my knowledge, software and a form of decryption was required to enable them to work in a similar fashion. The cards were shared from a network run by Haidar AL BAGHDADI (Haidar) and Danny O’CONNOR (Danny) in Sydney.
9.From approximately 2008, I had been importing some set top boxes, mainly DreamBox branded boxes from overseas which I sold on eBay for $120 to $130. People bought these boxes to use at home as the boxes had additional features to a normal set top box. They could take the smart card from the original Foxtel set top box and put it in the DreamBox. However these boxes stopped working for Foxtel cards.
10.To operate my network I had a computer that I used to configure the set top boxes. Danny and Haidar provided me with an IP address that I needed to use to access the network. To do so I set up a dns account that ‘pointed’ to the IP address provided by Danny and Haidar. I downloaded firmware from the internet which was installed onto the set top box. The firmware was configured to go to the IP address provided by Danny and Haidar to let them get access to the network. Through the network, I was able to provide access to channels broadcast by Foxtel (including Fox sports and Fox footy), UBI, MySat (Arabic based channels). The channels we were able to give our customers access to weren’t pre-recorded, we were accessing the live Foxtel broadcast and were able to watch Foxtel like a legitimate Foxtel customer.
11.Initially, I connected new customers myself. A customer would contact me on the phone, or would be referred by an existing customer. I would get a new set top box, usually a DreamBox branded box that I imported from China. I’d connect the set top box to the computer at my home and configure it with the firmware so that it would provide access to the channels requested by a particular customer.
12.After that, I would go to the customer’s house, provide a set top box and arrange for an installation of a satellite dish. The satellite dish was directed at the Optus C1 satellite, as this is the satellite that broadcasts the Foxtel channels. I would then connect the satellite dish to the set top box and an Internet connection. The customer would then be able to view the channels that I had agreed to provide. I learnt to do most of this by talking to people on internet forums or on the phone.
13.I would enter new customer’s details on a spreadsheet that had a customer name, what they were subscribed to and an expiry date. I charged $120 to $170 for the new set top box and a yearly subscription fee of $150 to $250 depending on whether the package included Foxtel, Italian etc. Due to the unstable performance of the server many customers would refuse to pay.
14.After a while, due to work commitments I wasn’t able to maintain the system and manage all customers so I had Kamaran do some installations. George came on board around this time as well as he was wanting access to a service for his own customers. At no time was George doing any installations for myself. Both George and Kamaran were also running their own clients on this system. George and Kamaran were also arrested and charged when I was. The agreement was that these two gentlemen would purchase set-top boxes from me for $120 and then I charged $100 – $150 per year for anyone they connected. I’m not exactly sure what they charged the customer for the service or the installation. These installers weren’t very reliable though and they often owed me money.
15.After the installers had finished, I’d add these customers to a spreadsheet with the same details as my customers. In total, the most customers combined between all installers was approximately 1000.
Danny O’CONNOR
16.In about 2008, I met Danny O’CONNOR. I was introduced to Danny through a friend, Paul. Initially I just spoke to Danny on the phone. The current phone number I have for Danny is [redacted]. I’m not sure if that is a new number or the one Danny had at that time.
17.At this time, I was using telephone number [redacted].
18.Danny and I would talk/text on the phone about many things including developments with software to enable DreamBoxes to work with many different features and addons.
19.After knowing Danny for a while, Danny and I agreed to start working together, providing card sharing services and IPTV. Initially, I paid Danny $50 for every customer I connected, or one of my installers connected.
Haidar AL BAGHDADI
20.In about 2008 or 2009, I’m not sure of the exact dates, Danny asked me to come to Sydney, to meet Haidar AL BAGHDADI, who Danny had just started working with. I’m not sure if this was the start of 2 Day Technology or just prior to them starting that company.
21.I flew up to Sydney where Danny picked me up at the Airport. Danny was driving a White Nissan Pulsar. After he had picked me up, Danny drove me to a house which had a detached garage. They had set up computers. It was someone else’s house, not Danny’s or Haidar’s.
22.Danny, Haidar and I spent about half a day or just a bit more at this house. There was another guy there too but I don’t remember his name. It was at this time when I had a conversation with Haidar, during which he told me about the card sharing and the types of services Haidar would be offering, including Foxtel, UBI and MySat. At the end of the day, Haidar took me back to the airport.
23.I’m not sure if it was this time or another time, but we all agreed that we would start working together. Haidar and Danny were going to ‘host’ for me, they set up everything as they already had the cards and the servers. I know at this stage I was still mainly dealing with Danny not Haidar. I think this was because Danny was trying to hide some money from Haidar. I think at this time I was still sending Danny about $50 per connection.
24.Eventually though I started to deal with Haidar. I would say that Danny had the technical knowledge of the system and Haidar was the owner who made most of the money.
25.Initially it wasn’t a very big thing, but Haidar decided he wanted to expand and asked if I could look after everything in Melbourne. All of my customers in Melbourne ran through Haidar’s network. The agreement was I would provide $50 to Haidar per customer connected.
26.I used to deposit money into Danny’s home loan account or sometimes instead of paying for each customer, Haidar would ask me to pay for something that needed to be fixed on the system. I don’t have records of these payments. I cannot remember specific dates but towards the end of 2012–2013 there was a requirement for a scanner to be built and I was asked to pay for this instead of paying for each customer. The scanner was required for the protection of the cards from getting disabled by the providers. Both Danny and Haidar explained to me why this was required and Danny had arranged to build this unit.
27.We continued to operate the network like this for a number of years. If there was ever any issues with service or anything like that I would ring or text message Haidar or Danny. Sometimes I even used Viber. I would talk to Danny and Haidar most days at this time.
28.I became aware of other persons who were involved in the network in Sydney, but I didn’t have anything to do with them at that time.
29.I went to Haidar’s shop in Sydney on one occasion. It was a single storey shop in a row with other shops. I don’t know Sydney that well so I’m not really sure where it was. From talking to Danny and Haidar, I knew that they moved to another shop after I visited the first shop. I think the new shop was two storey.
30.In about 2012 or 2013, Foxtel changed their system and a lot of the cards that used to work on the server wouldn’t work anymore. I know that they used to look for cards from out in the rural areas, because the cards were an older style and they didn’t need to be cracked to be used on the server.
31.To resolve this, contact was made with a team of guys in Egypt (Samir and Ibrahim) who were able to ‘crack’ or decrypt the cards. Haidar asked me if I could pay USD4500.00 for one of the cards to get decrypted. Haidar told me he was going to pay the rest. I never really saw the cards.
32.I remember that Haidar asked me to send this money to his bank account and he text messaged me the details to my phone. He told me to use the word antenna as a reference, because I remember that he had said to me not to make any reference to Foxtel. In the end I sent the USD4500 through Western Union to a gentleman in Egypt by the name of Ibrahim or Samir and not to Haidar’s bank account. The details were provided to me by Haidar who was dealing with him directly. I no longer have any records of this payment.
33.Just prior to when Haidar and Danny were charged or arrested, Haidar asked me if I knew someone who lived in the Austar area. I had a friend, Steve and his wife Tara who did and they had access to Foxtel, or Austar as it was. Haidar asked me to get 4 cards or 4 systems set up which I did. Originally Haidar told me it was for some sort of app but I knew what it was all about by then. Danny asked me to send them to the shop and I did, through Australian Air Express and I think I addressed them to Danny.
34.I don’t think they worked though because they were a version 6 card. These cards didn’t work on the card sharing system, only the earlier version cards do. According to papers that were provided to me by my previous solicitor (Simon Moodie), they were found when the Police searched Haidar’s shop.
35.From time to time customers would contact me if they were having trouble connecting to the network. If I had trouble I would try and contact Haidar on the phone either by calling or text messaging, and sometimes both. I can’t remember the number now, but I think the phone number ended in 331. I don’t have the number saved in this new phone.
36.When I would call Haidar on the phone, most of the time Haidar would answer, but sometimes Danny would answer it too.
37.Included in my Brief of Evidence (pages 73–93) was a copy of text messages between [redacted] and [redacted].
38.I have seen this spreadsheet and can say that these are messages I sent to Haidar when I had trouble or for some other reason. When I refer to channels like Fox Footy it must have been because customers were complaining to me that they couldn’t see that channel. I received messages back which I assumed were from Haidar, but they could have been from Danny also. Like I said before, when I rang Haidar’s phone, sometimes Danny answered. Haidar answered it most of the time though.
39.I continued to work with Danny and Haidar until towards the end of 2013, the time when they were arrested or charged.[7]
[7]Statement by William de Lorenzo to the AFP dated 7 October 2016 in the matter of R v Haidar Al Baghdadi, [8]–[39].
On 18 January 2017, the applicant signed a written undertaking to co-operate with investigating police pursuant to s 16AC of the Crimes Act 1916 (Cth) and, in particular, to provide evidence against Al Baghdadi.
On the plea hearing relating to the applicant a letter of assistance signed by Detective Sergeant Paul Everingham of the Australian Federal Police was provided to the Court. The letter referred to smart card sharing piracy in both New South Wales and Victoria.
The AFP commenced investigation of this matter in February 2013 after receiving a referral from the Foxtel Fraud Department. The investigation, known as Operation Telfair, identified four persons of interest in a smart card sharing piracy network operating in New South Wales.
Operation Telfair identified Haidar AL BAGHDADI (AL BAGHDADI) as one of the principal facilitators of the smart card sharing piracy network in New South Wales. AL BAGHDADI has been charged with making an unauthorised decoder available online, contrary to section 135ASG(1) of the Copyright Act 1968 (Cth); making decoder available online for subscription broadcast, contrary to section 135ASH(1) of the Copyright Act 1968 (Cth); and causing unauthorised access to an encoded broadcast, contrary to section 135ASJ(1) of the Copyright Act 1968 (Cth). AL BAGHDADI was due to stand trial on 20 March 2017. Following a late plea he is scheduled to appear for sentencing on 4 August 2017.
The AFP began a second investigation known as Operation Albumen in February 2014 into a smart card sharing piracy network operating in Victoria. Operation Albumen identified DE LORENZO as the principal facilitator for the smart card sharing piracy network. The investigation further identified George HARAKA (HARAKA) and Kamaran MIRKHAIL (MIRKHAIL) as associates of DE LORENZO. HARAKA and MIRKHAIL were responsible for the sale and installation of set top boxes and maintenance of the smart card sharing piracy network. Both HARAKA and MIRKHAIL provided signed statements in which they identified DE LORENZO as the principal facilitator.[8]
[8]AFP Letter of Assistance dated 23 March 2017, 1.
The letter confirmed that the applicant provided information of significant value concerning Al Baghdadi:
On 23 July 2016, the informant had a conversation with DE LORENZO during which he considered making a statement in the matter of AL BAGHDADI. DE LORENZO agreed to make a statement which was signed on 22 December 2016 and agreed to give evidence against AL BAGHDADI in his upcoming trial. In that statement he detailed evidence of the following significant matters:
•In 2008 or 2009, DE LORENZO agreed to join AL BAGHDADI’S network and start hosting his own clients in Melbourne and Victoria;
•AL BAGHDADI ran the network which included smart card and servers;
•AL BAGHDADI provided DE LORENZO with an IP address to access the network;
•Whenever DE LORENZO had a problem with the network he would contact AL BAGHDADI via SMS, or messaging applications such as Viber or WhatsApp;
•AL BAGHDADI owned and paid for the operation in New South Wales;
•AL BAGHDADI used to send smart cards overseas to have them decrypted so they could be used in his network;
•DE LORENZO transferred USD4500 to AL BAGHDADI to assist with the cost of having cards decrypted overseas;
•DE LORENZO was able to provide AL BAGHDADI with four Austar cards at his request. These were obtained from a friend of DE LORENZO’S and mailed to AL BAGHDADI in Sydney.[9]
[9]AFP letter of assistance dated 23 March 2017, 2.
The sentencing judge’s reasons
In the course of his sentence, the sentencing judge referred to the purpose of the provisions of the Copyright Act 1968 (Cth) pursuant to which the applicant was charged[10] and quoted from the Second Reading Speech introducing the Copyright Amendment Act 2006 (Cth) of the then Attorney-General relating to the introduction of the relevant provisions of the Act. After referring to the new opportunities for the dissemination of information created by the internet and digital technology, the Attorney-General said:
We want laws in place which mean copyright pirates are penalised for flouting the law. And we want to make sure that ordinary consumers are not infringing the law through everyday use of copyright products they have legitimately purchased.
These important reforms include new exceptions to make our copyright law more sensible and defensible. The bill also introduces new offences and enforcement measures to ensure that those who seek to undermine the legitimate rights of copyright owners can be brought to account. These balanced and practical reforms will ensure the effectiveness of our copyright laws in the dynamic environment that we face.[11]
[10]DPP (Cth) v de Lorenzo (Unreported, County Court of Victoria, Judge Ryan, 12 April 2017) [7] (‘Reasons’).
[11]Ibid.
The judge went on to set out the history of the prosecutions of the applicant and his co-offenders. He dwelt in some detail on the position of Al Baghdadi and the fact of the applicant’s undertaking to co-operate with respect to Al Baghdadi’s prosecution.[12] Al Baghdadi had not at that point been sentenced.
[12]Ibid [17]–[18].
The judge summarised matters personal to the applicant as follows:
Mr de Lorenzo, you are forty-four years of age. Your parents, who are both deceased, migrated to Australia from Italy in or about 1956. You have one sibling, an older sister. You reside in South Morang with your second wife, Na, who is aged forty-one and who works part-time for Qantas as ground crew.
You met your first wife when you were twenty years of age, and four years later you married. There is one child of that union, a daughter, now aged thirteen. You were divorced in 2011. You have access to your daughter every second weekend, and you are in regular telephone contact with her.
You were educated to Year 10 standard at Northcote High School. Thereafter you attended Preston TAFE and completed a one-year certificate course in electronics. You then completed the advanced electrical certificate course at the RMIT. You have always worked. Initially you used your electrical training; however, at twenty-one years of age in 1993 you commenced to work for Qantas. You remained there until 2010, being promoted from time to time and eventually becoming the airline services coordinator. After leaving Qantas you worked for Foxtel Services. However, you returned to work at Qantas in 2011, and by the time you took a retrenchment package in February 2015, you were the workforce planning manager.
Whilst employed at Qantas from April to December 2014 you used your inheritance from your mother’s estate to open and operate a cafe. It failed, and you lost your inheritance. During this time, you effectively worked two jobs.
After your arrest, you trained as a traffic controller and work permanent part-time, predominantly night shifts, four to five nights per week on average, for the Traffic Diversion Group. You earn approximately $1,100 per week.
As well, you run two businesses: one developing an alarm/camera system in China to import and sell in Australia. You also develop safety plans for businesses. I was told that you also export baby formula powder to China.
Your health is problematic, in that you are an insulin-dependent diabetic and accordingly, you are at risk of complications, as a result of that disease. In the period since your arrest, you were hospitalised for some 45 days, as a result of surgery to remove an abscess.
You are in significant debt, and have some $41,000 owing on credit cards, and you have a mortgage of $436,000 on your family home that is valued between $550,000 and $600,000.[13]
[13]Ibid [19]–[26].
The judge then referred to the sentences imposed on Mirkhail and Haraka and addressed the question of parity with respect to these sentences. The judge concluded that because of the applicant’s higher role in the network involved in card-sharing piracy, the applicant deserved a heavier penalty.[14]
[14]Ibid [28].
The judge assessed the gravity of the applicant’s offending as follows:
In my opinion, your level of criminality is high and far higher than your co-offenders. You effectively ran in Melbourne the scheme operated in Sydney by Mr Al Baghdadi. Your client base was in the order of 1,000 persons. The illegal business that you ran earned you substantial amounts of money. It was conceded on your behalf that your motive for operating this illegal enterprise was profit. The enterprise operated for a lengthy period of time. Your enterprise adversely affected the property rights of Foxtel Cable Pty Ltd and Selectra Pty Ltd. The offences that you pleaded guilty to, in my view, would be hard to detect and prosecute. The provisions that create the instant offences were enacted by Parliament to protect private and corporate citizens’ property rights. Each offence is punishable by five years’ imprisonment, and this reflects Parliament’s view of the seriousness of these offences. General deterrence must play an important role in the exercise of my sentencing discretion.[15]
[15]Ibid [33].
We are not persuaded that the proposed ground of appeal relating to parity with the sentences imposed on Mirkhail and Haraka are arguable. The sentencing judge was entitled to take the view which he did as to the more significant role which the applicant played in the offending.
Nor do we accept that the sentence imposed by the sentencing judge was manifestly excessive. The offending involved multiple deliberate breaches of the Copyright Act 1968 (Cth) provisions.
On the other hand, the disparity between the sentences imposed upon the applicant and Al Baghdadi is very troubling.
The respondent submits that, although the offending of the applicant and Al Baghdadi was related, the applicant was convicted of two continuing offences whilst Al Baghdadi was convicted of offending on a single agreed date.
Whilst this is so, the charge against Al Baghdadi was understood to be a representative charge and a statement tendered to the Court placed the offending in the context of Al Baghdadi’s overall responsibility for the piracy network. It concluded with the following passage:
On execution of the Search Warrant approximately 9300 connections to the illegal card-sharing network were identified. The Crown cannot prove beyond reasonable doubt what proportion of these connections the accused was aware of or benefiting financially from. Some of these connections were being utilized by a card-sharing network in Victoria. There is also evidence to suggest that the co-offender Danny O’Connor was profiting from some connections without this offender’s knowledge. However, banking records indicate that the financial benefit to the accused was significant.[16]
[16]R v Haidar Majid Salam Al Baghdadi Statement of Facts dated 29 October 2015 [30].
Further, as the District Court judge stated, he took into account two further offences pursuant to s 16BA of the Crimes Act 1914 (Cth):
Haidar Al Baghdadi stands to be sentenced in relation to one offence, I do not propose to read it out but it is an offence contrary to s 135ASJ(1) of the Copyright Act 1968 (Commonwealth). In addition, when sentencing in relation to that matter he asks me to take into account one further matter which is on a s 16EA (scil 16BA) Form being two further offences contrary to the Copyright Act and I shall do so. In doing so I shall apply the principles applicable to that process which in more recent times have tended to coincide with those identified for that process under the State legislation, to the effect in other words, that unless there are exceptional circumstances the sentence that will be imposed for the offence will be greater than it otherwise would have been unless there are exceptional circumstances, and there are no exceptional circumstances which is consistent with what the Court of Criminal Appeal said in Abass.[17]
[17]R v Haidar Majid Salam Al Baghdadi (Unreported, District Court of New South Wales Criminal Jurisdiction, Judge Toner SC, 4 August 2017) 1 citing Abass Osman v R [2006] NSWCCA 196.
In Putland v The Queen, Gummow and Heydon JJ stated:
Section 16BA provides a procedure whereby in certain circumstances in passing sentence for convictions the court may take into account offences in respect of which guilt is admitted but there has been no trial.[18]
[18][2004] HCA 8 [56].
In Attorney-General’s Application Under Section 37 of the Crimes (Sentencing Procedure) Act 1991 No. 1 of 2002, Spigelman CJ, with whom Wood CJ at Common Law, Grove, Sully and James JJ agreed, identified two public benefits flowing from this approach:
First, the opportunity for an offender to emerge from the sentence for the primary offence with a clean slate promotes the objective of rehabilitation.
Secondly, there is a utilitarian value in the admission of guilt which may save resources for law enforcement agencies, particularly where investigations are continuing.[19]
[19](2002) 56 NSLWR 146, 161 [63]–[64] (citations omitted) (‘Attorney-General’s Application’).
New South Wales authority has held that the general principles which have been applied in taking into account State offences other than the offence charged, should be applied to Commonwealth offences.[20] This was also accepted as the correct approach by this Court in DPP (Cth) v K M D.[21]
[20]See, eg, R v Nguyen; R v Pham (2010) 205 A Crim R 106, 128 [72] where Johnson J (Macfarlan JA and Hulme J agreeing) stated ‘ insofar as each Respondent asked the sentencing Judge to take into account on sentence offences under s 16BA Crimes Act 1914 (Cth), it is necessary for a sentencing court to comply with the general principles applicable to the State regime for taking offences into account in accordance with Re Attorney General’s Application (No 1 of 2002) (NSW) (2002) 56 NSWLR 146 ’. See also R v Poynder (2007) 171 A Crim R 544, 550 [28] (James J, Rothman and Harrison JJ agreeing); R v Lamella [2014] NSWCCA 122 [48] (Price J, Garling and Bellew JJ agreeing); R v Dennison [2011] NSWCCA 114 [49]–[52] (Schmidt J, McCallum J and Whealy JA agreeing).
[21][2015] VSCA 255 [82]–[88] (Maxwell P, Weinberg and Beach JJA).
The general principles which are relevant were summarised by Spigelman CJ in Attorney General’s Application:
The position, in my opinion, is that, although a court is sentencing for a particular offence, it takes into account the matters for which guilt has been admitted, with a view to increasing the penalty that would otherwise be appropriate for the particular offence. The Court does so by giving greater weight to two elements which are always material in the sentencing process. The first is the need for personal deterrence, which the commission of the other offences will frequently indicate, ought to be given greater weight by reason of the course of conduct in which the accused has engaged. The second is the community’s entitlement to extract retribution for serious offences which there are offences for which no punishment has in fact been imposed. These elements are entitled to greater weight than they may otherwise be given when sentencing for the primary offence. There are matters which limit the extent to which this is so. The express provision in s 33(3) referring to the maximum penalty for the primary offence is one. The principle of totality is another.
I did not intend these observations to be exhaustive of the elements upon which the fact of other offences may impinge… The important point is that the focus throughout must be on sentencing for the primary offence.
The manner and degree to which the Form 1 offences can impinge upon elements relevant to sentencing for the principal offence will depend on a range of other factors pertinent to those elements and the weight to be given to them in the overall sentencing task. For that reason it will rarely be appropriate for a sentencing judge to attempt to quantify the effect on the sentence of taking into account Form 1 offences.[22]
[22](2002) 56 NSWLR 146, 159 [42]–[44].
For present purposes the short point is that although Al Baghdadi was sentenced on only one charge, two other related offences were taken into account as informing the seriousness of the primary offence.
We accept the applicant’s submission that the evidence available at the time of sentence of both offenders demonstrated that Al Baghdadi’s involvement in card-sharing piracy was of at least equivalent significance to that of the applicant in the overall networking organisation with which the applicant became involved.
Detective Sergeant Everingham described both the applicant and Al Baghdadi as ‘principal facilitators’ of the piracy networks with which they were involved.
The sentencing judge in the present case expressly found that the applicant ‘effectively ran the Melbourne franchise of an illegal scheme’[23] and that the applicant ‘effectively ran in Melbourne the scheme operated in Sydney by Mr Al Baghdadi’.[24] The statements of facts tendered by the prosecution on both sentencing hearings make plain and set out in considerable detail the ways in which Al Baghdadi’s role can be characterised as at least equivalent to that of the applicant.
[23]Reasons [28].
[24]Ibid [33].
Furthermore, whilst both offenders could call in aid general good character apart from the conduct associated with the offending, the applicant had a series of factors bearing on his sentence which were not available to Al Baghdadi to which we will specifically refer. Conversely, the respondent did not submit that factors personal to Al Baghdadi justified the differential in sentences.[25] The District Court judge found that imprisonment would not result in exceptional hardship to Al Baghdadi’s family but, on the other hand, recognised that his post-traumatic stress disorder and fluctuating depression should be taken into account in accordance with the principles stated in Muldrock v The Queen.[26]
[25]We note for completeness that Al Baghdadi was a 33 year old married man with good prospects of rehabilitation. He had come to Australia in 2002 as a refugee from Iran and suffered from post-traumatic stress disorder and recurrent depression.
[26](2011) 244 CLR 120.
On the other hand, there were a series of significant matters apart from the applicant’s plea of guilty which could be urged on his behalf. Senior counsel for the applicant highlighted the following matters:
(a) the applicant made an early plea whereas Al Baghdadi did not plead until effectively the penultimate moment (as the District Court judge described it);
(b) the utilitarian value of the applicant’s plea was significantly greater than that of Al Baghdadi as it avoided the cost of a committal and trial, whereas significant costs were incurred with respect to these matters in relation to Al Baghdadi;
(c) the applicant co-operated with investigating police and provided evidence of significant value against his co-accused, whereas Al Baghdadi did not;
(d) whereas there was evidence of a network involving some 1,560 customers in the applicant’s case, the equivalent figure in Al Baghdadi’s case was 9,300 customers;
(e) the delay between plea and sentence in the applicant’s case was not due to any fault on his part, whereas the delay in Al Baghdadi’s case was directly due to his late plea.
In our view, the most significant of these matters was the applicant’s co-operation with investigators. Of itself, this warranted a materially reduced penalty than would otherwise have been appropriate. The detection of this type of offending is exceptionally difficult as the sentencing judge himself recognised in this case.
When the circumstances of the two cases are considered as a whole, then despite the differences between them, and in particular the matter relied upon by the respondent, namely the fact that Al Baghdadi was charged with offending on a single day, the applicant has an entirely justifiable grievance that he has been dealt with disproportionately severely when compared with Al Baghdadi.
The relativity which has eventuated between the sentences imposed on the two offenders is manifestly unreasonable.[27]
[27]Anthony v The Queen [2016] VSCA 22 [12]; Khoa v The Queen [2015] VSCA 80 [42]–[45].
Insofar as the scope of the offending for which the applicant falls to be sentenced is greater than that embraced by the charge to which Al Baghdadi pleaded, the five months which the applicant has served to date is sufficient and appropriate to recognise that difference. Likewise, that differential embraces any reduction in the need for retribution and denunciation that might be said to flow from Al Baghdadi’s mental state.
In the circumstances, we would grant leave to appeal on ground 3 and allow the appeal.
We would confirm the sentences imposed by the sentencing judge save that we would order that the applicant be released on a recognisance release order after 164 days being the total time served to date.
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