Director of Public Prosecutions v Ly

[2014] VCC 1514

IN THE COUNTY COURT OF VICTORIA Revised
Not Restricted
Suitable for Publication

AT MELBOURNE
CRIMINAL JURISDICTION

CR-14-00981

DIRECTOR OF PUBLIC PROSECUTIONS

v

PHONG QUAC LY

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JUDGE:	HIS HONOUR JUDGE MAIDMENT
WHERE HELD:	Melbourne
DATE OF HEARING:	13 August 2014
DATE OF SENTENCE:	13 August 2014
CASE MAY BE CITED AS:	DPP v Ly
MEDIUM NEUTRAL CITATION:	[2014] VCC 1514

REASONS FOR SENTENCE
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Subject:
Catchwords:
Legislation Cited:
Cases Cited:
Sentence:

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APPEARANCES:	Counsel	Solicitors
For the Director of Public Prosecutions	Ms F. Thompson

For the Accused Mr J. Dickinson QC

HIS HONOUR:

Stephen Duong, sworn as Interpreter.

1Phong Quach Ly, you have pleaded guilty to an indictment charging with two offences, one of possession with the intention of infringing copies of subject matter, namely movie DVDs, in which copyrights existed, contrary to sub.s 132(AJ)(1) of the Copyright Act 1968 (1968) (Commonwealth) and Charge 2, exposure of goods, namely movie DVDs and computer games for sale without the permission of the registered owner of trademarks that were applied to the goods, contrary to sub-s.1481 of the Trademarks Act (1995) (Commonwealth).  The charges are rolled up representative charges.  Charge 1 encompasses multiple copies of 30 film DVDs in which copyrights subsisted.  Charge 2 encompasses multiple copies of ten film DVDs and five computer games to which registered trademarks had been applied without the permission of the trademark owner.

2The offences are serious ones and carry maximum terms of imprisonment of five years or a fine of 550 penalty units, making a total of $93,500 or both, that is in relation to each of those offences.  You have also admitted three prior court appearances and convictions, and the first on 13 December 2007 involving charges of making a threat to kill and causing injury intentionally for which you were placed on a community-based order for a period of six months.  Those offences as I understand it arose out of domestic difficulties with your first wife from whom you are now divorced.  Your second court appearances was at the Dandenong Magistrates' Court on 23 September 2009 on various charges involving breaches of the Copyright and trademark legislation.  You were sentenced to an aggregate term of imprisonment of three months and were released forthwith on entering into recognizance to be of good behaviour for 12 months and on a charge of dealing with property suspected of being the proceeds of crime, you were ordered to pay a fine of $600.  I am told by your counsel that those offences arose out of circumstances where you were conducting the business of selling items that infringed the legislation to which I have referred from your home.

3The third offence, or the third court appearance involved your appearance at the Dandenong Magistrates' Court on 30 August 2011 on charges of selling and infringing copyright copy of work or other subject matter, possessing and infringing copy of work or other subject matter with intent to sell and possessing a device intended to be used for making and infringing copy of work or other subject matter and for those offences you were ordered to pay an aggregate fine of $8,000 on all charges.

4The prosecution provided me with two folders of materials.  Under Tab 3 of Volume 1 was a prosecution opening and that was read to the court on the previous occasion and I do not propose to read it again.  It sets out a summary of the evidence upon which the prosecution rely and the circumstances in which the offences came to light.  In essence, the offences arose in connection with the operation by you of a business operating from premises in Heatherton Road, Springvale South where you operated the business of a company called Kuok Phuong DVD World Pty Ltd.  As a result it seems of information received, the Australian Federal Police executed search warrants at those business premises of DVD World and also at a shop at 100 Lightwood Road, Noble Park which was apparently occupied by you, and also your home at 63 Manton Road in Clayton.  When the warrants were executed on the DVD World shop, thousands of predominantly Asian DVDs were displayed on tables and shelves for sale.  There were two catalogues of English language DVDs that appeared to be designed to avoid detection by anti-piracy investigators and law enforcement agencies.  From those premises, a total of 55,000 counterfeit DVDs were seized by police.  There were also 216 counterfeit Nintendo Wii game disks.  There were two computer towers, seven DVD burner towers, five printers and an external hard-drive that were located in the backroom of the shop and other computer towers found in the front office and five portable hard-drives were found in the desk cupboard. Also located under the desk towards the rear of the shop. was a book of handwritten dates and dollar amounts.  It is alleged by the prosecution and referred to in the opening as a record of takings from the shop.  The document shows on that analysis that between 30 January 2012 and 31 December 2012, the amounts recorded as takings totalled $226,500 and between 1 January and 5 November of 2013, the amounts totalled $206,023.  It is not admitted, as I understand it, that those are indeed books of account of the business conducted at those premises.  The prosecution of course rely on the fact that the last entry was 5 November 2013 and the execution of the search warrant took place on 7 November 2013 in support of their contention that it does indeed show the accounts of the business.

5In the course of the interview which was conducted with police subsequently you asserted that you took between $2000 and $3000 a week from the business of which approximately 50 percent was profit.  I am not able to find beyond reasonable doubt that the documents were the books of account of the business.  However, it is clear that the business was being conducted on commercial lines with a view to making substantial profits. 

6The premises at Lightwood Road, Noble Park was partially stocked with DVDs and police seized approximately 4000 counterfeit DVDs.  At your home during the execution of the search warrant police seized more than 2300 counterfeit DVDs and a number of DVD burners packed in boxes.  The vast majority of the 61,000 discs in round figures that were seized were movie DVDs and included computer games and music recordings. 

7A small number of the discs found at the Lightwood Road shop were found to be genuine.  Industry representatives were called in to examine a selected sample of DVDs selected at random and the schedules that are attached to the two charges reflect the results of that selection.  In relation to Charge 1 the total number of DVDs is I think a little over 1000 or something of that order.  In relation to Charge 2 the total number reflected in the schedule is about 170 I think. 

8The computer equipment and other items were examined forensically.  The computer towers contained multiple applications for burning, copying and editing CDs, DVDs and Blu-ray discs.  Two of the towers contained software used for downloading Torrents as well as Torrent files relating to videos.  The six hard disc drives contained 2018 video files and movies, cartoons, et cetera. 

9You were interviewed by police on 7 November 2013 and amongst other admissions you admitted that you had copied some DVD movies using the copying machines at the DVD World shop.  You had also obtained DVDs from other sources.  You also admitted downloading films using Torrent and that you stored them on hard drives and burned them to DVDs and sold them.  You claimed that you sold between 20 and 50 DVDs a day but did not keep a record.  You admitted that you knew that what you were doing was wrong.

10You claimed that you had told your partner, Rosie Tran, that what you were doing was not the right way to continue and that if "a cop come in one more time" that you would get into trouble again and you did not know what would happen to you.  You told her apparently, according to what you said to police, that you wanted to close the shop, that is as I understand it the shop at Heatherton Road, Springvale South, at the end of December and start a new shop selling other things.

11The prosecution also provided me with written submissions on sentence in which they set out legal principles relating to the laying of representative charges.  During the course of the plea your counsel was concerned to stress the limited way in which I could use those principles in this case.  But as I understand it, it was common ground in the end that the principles as set out in the section of the Crown submissions, mainly paragraphs 2, 3 and 4 were correctly stated.  In essence the representative nature of the charges is to be taken into account in the sense that the other materials may be looked at to give a more complete picture and a full circumstantial context in which the offences themselves are to be assessed.  I am bound only to sentence you for the offences to which you have pleaded guilty but I may take into account that they occurred in a wider context and that they are not to be seen as isolated. 

12The prosecution document draws my attention to a number of other principles including the Second Reading Speech in support of the legislation under which these ventures arise.  Relevantly, the Second Reading Speech in support of the original legislation reads:

"In addition to the loss suffered by the copyright owner, piracy activities causes harm to the community by undermining the work of creators and innovators.  There is also lost tax revenue when copyright material is traded in an underground market.  Further, it is often not in the consumer's interests to obtain pirate copies.  A pirate is unlikely to be willing to comply with the normal commercial rules concerning warranties and so on."

13The present offences in their present form were introduced in 2006 in recognition that technological advances had made it increasingly easier to infringe copyright on a large scale.  The new regime of offences was stated in the Second Reading Speech to be "aimed at copyright pirates who profit at the expense of our creators."  I add also that such offending conduct undercuts legitimate businesses selling legitimate DVDs, games and so on and undermines their liability and their capacity to trade legitimately in the subject matter of copyright and trademark. 

14Section 16A of the Crimes Act requires me to look at a number of different matters in determining an appropriate sentence. Section 16A(1) requires me to impose a sentence that is of a severity appropriate to all the circumstances of the offence. Section 16A(2) requires me to take into account a number of matters concerning the nature and circumstances of the offence to the extent that they are relevant.

15That section does not refer to general deterrence but it is well-established on authority that general deterrence is an important feature of sentencing in Commonwealth offences just as it is in relation to State offences.  The prosecution drew my attention to a passage from the judgment of Von Doussa JA in the case of Hamm v Middleton [1999] FCA 777 at paragraph 18 where Von Doussa JA said:

"There is also the question of general deterrence.  It is important in these types of offences which are not always easy to detect and that have the potential to interfere with important rights in the community that the penalty fixed be sufficient to deter others that might be minded to engage in similar conduct."

16The representative charges do reflect a significant number of infringing discs as set out in the schedules to the charges and I am bound to take into account that those offences must be seen in the context of a wider commercial enterprise.  I think I have already indicated the nature of that commercial enterprise and the scale of it that is revealed by the evidence in the case as set out in the Crown opening.  The Crown submits that this was a substantial commercial business and I am satisfied beyond reasonable doubt that it was.  I take into account that these offences were part of a course of conduct in running that business.

17I am also bound to take into account the extent to which you have shown contrition.  Your counsel submitted that there were a number of indicia of remorse including your early plea of guilty and your cooperation with the police in answering questions in the interview and I indicated to him that I thought that those matters were consistent with remorse but I do not see any evidence of it and note that he did not choose to call any evidence of remorse, either from you or from anybody else.  I do not see any evidence from which I can find on the balance of probabilities that you are genuinely remorseful.  I do not regard the answers you gave in your interview with police as entirely frank.  I think the reality of the situation is that you endeavoured to downplay your culpability in the course of your interview and I certainly do not accept that it demonstrates that you are genuinely remorseful.  I have to balance what is sought to be relied upon as evidence of remorse against the fact that this is your third offence of its kind within a relatively short period of time.

18I note that in the course of endeavouring to explain your conduct to the forensic psychologist, Mr Ball, whose report was provided to me by your counsel, that is, the report dated 25 July this year, you endeavoured to explain the prior offences of this kind in the context of your own naiveté around copyright and trademark laws in Australia and needing to support yourself.  I find that very hard to accept, particularly in relation to the 2011 offending.  By then of course you must have been well aware of the nature of the Commonwealth legislation surrounding offences of this kind.  The sentences imposed on the offending in 2009 do not suggest that the court accepted any proposition that you were simply committing those offences in the context of naiveté.  In my opinion, the evidence leads to the conclusion that these were offences that you committed with your eyes open, that is, the present offences, that you knew exactly what you were doing.  You had failed to heed the warning that should have arisen from your previous court appearances.  This was deliberate, flagrant, calculated offending motivated by the prospect of substantial profits.  There is no evidence before me of any financial pressure of a kind which might explain your running the risk of getting caught for the third time for offences which you must have realised when you were committing them were serious offences which carried terms of imprisonment.  I am driven to the conclusion that you were driven by greed, not need. 

19It is true that you have pleaded guilty and indicated your plea of guilty at an early stage and you are entitled to substantial credit for that. I am also bound to take into account the need to deter you from committing further offences and I regard it as a significant sentencing consideration in this case for all the reasons I have just indicated, in particular your prior criminal convictions. Although you apparently indicated in your interview that you wished to close the business and go on to some other type of business, in December of 2013 the new shop, the Lightwood Road Noble Park shop, was clearly being set up to sell substantial numbers of DVDs as well as other items and had something in the order of 4000 counterfeit DVDs within the shop already. It is necessary for me to ensure pursuant to s.16A(2) that you are punished adequately for your offences. I am bound of course to take into account your character, age, means, physical and mental condition and I am greatly assisted in that regard by the report of Mr Ball to which I have already referred which sets out conveniently a number of details which were also spoken to by your counsel in the course of the plea about your background.

20You are now 34 years of age.  You are the second of four siblings with an older brother and a younger sister and brother.  Your early years are I think fairly characterised as being poverty-stricken as a consequence of being brought up in post-war Vietnam under the Communist regime.  Your father apparently had been a member of the South Vietnamese Regular Army and suffered a number of wounds in the course of combat and apparently also suffered psychological symptoms relating to his war service.  You described him as being a sick man who would always argue and fight with your mother.  It seems that when you were aged 8 an aunt of yours took you away from Vietnam by boat and you spent some years, at least three as I understand it, in a refugee camp in the Philippines before travelling to Australia.  As I understand it, you arrived when you were 14 years of age, you were placed in Year 8 and continued through to Year 10.  You had little, if any, English when you arrived and not surprisingly would have struggled with the school curriculum due to your language difficulties and it seems that you still suffered to a significant extent with difficulties with the English language.  After you left school you went to full time work on a farm and you had since been variously employed as a farmhand or factory hand or as a bus driver. 

21You have had two significant intimate relationships.  You were married previously, had two children by that marriage who are now aged 9 and 11 years respectively and, as I have already indicated, you are now estranged from both your ex-wife and your two natural children, although it seems that you continue to pay child support. More recently you have established a relationship with Ms Rosie Tran who is in court and it seems has a head for business and is a capable woman.  She has two children by a previous relationship, now aged 7 and 14 respectively. It seems that the relationship you have with her is settled and will provide you with a good deal of support and comfort in the future.  Her presence in court suggests that she is fully supportive of you.

22The report of Mr Ball indicates that he could find no evidence of any mental illness or personality disorder or mood disorder or other significant clinical syndromes and no evidence of any substance abuse disorder, alcohol or drug abuse.  He found, although he was unable to provide any formal testing results due to the language difficulties, that you were a person of normal intelligence.  There does not seem to be any reason to be found in anything you said to Mr Ball or any of his findings to excuse this offending conduct or essentially to mitigate it.  You claimed that your earlier offending conduct, your prior offences were really borne out of a need to make ends meet in providing child support for your children and to pay your rent.  I am not in a position to say yea or nay whether that is true but there is certainly no evidence before me of any financial distress or pressure that would justify this offending conduct. 

23I was invited to look at some other decisions of courts in relation to offences of this kind in order to discern if I can a current sentencing practice.  The cases to which I am referred by the prosecution have to be viewed with considerable care because every case has to be determined on the same facts and circumstances and it is really difficult to discern from the information with which I was provided sufficient to draw any close comparisons in terms of appropriate sentencing standards and I only use those as very loose guides in pointing me to what seems to me to be an appropriate sentence in this case.

24It is difficult for me to say that your prospects of rehabilitation are good, having regard to your record.  However, I am moderately optimistic that your relationship with Ms Tran may keep you out of trouble in the future.  I suspect that she is a capable person who will enable you to run a successful business, legitimate business, in the future.  I hope that view is correct. 

25There seems to be no other good reason why you should not stay out of trouble in the future and whilst I think individual deterrence is a significant sentencing feature of this case I am hopeful that you will in the future heed the warning that this third court appearance for offences of this kind will deliver. 

26Doing my best to balance all of the sentencing considerations that I am required by statute to consider and also the facts relating to this particular case, I am now ready to impose sentence upon you.  Would you please stand?

27I think it is necessary to impose a sentence of immediate imprisonment in order to satisfy all the sentencing considerations and in particular to send a clear message that offending conduct of this kind is not to be tolerated and will result at least ultimately in appropriate cases in immediate custodial sentences. 

28On Charge 1 I convict you and sentence you imprisonment for a period of 12 months.  On Charge 2 I convict you and sentence you to imprisonment for a period of eight months.  Both sentences are to commence today which means the total effective sentence is imprisonment for a period of 12 months.  I order that you be released on your own recognizance of $1500 to be of good behaviour for after serving eight months of that sentence.  But for your plea of guilty I would have sentenced you to a total effective sentence of 17 months' imprisonment with a Recognizance Release Order allowing your release after having served 12 months. 

29I make the disposal order in relation to the property listed on the schedule of the draft that I have received from the prosecution.  Do you have a copy or an order for me to sign?

30MS THOMPSON:  Yes, I do, Your Honour.  I can hand up multiple copies so that there's one for each of the parties and one for the court file.

31HIS HONOUR:  Yes and do you have a Recognisance Release Order?

32MS THOMPSON:  I haven't, I was relying on your associate to prepare that.

33HIS HONOUR:  Were you?  He was relying on you I think. 

34MS THOMPSON:  I can certainly prepare one of those in a relatively short time if I go back to the office.  I apologise for not having that.

35HIS HONOUR:  Between you, would you prepare one?

36MS THOMPSON:  We'll attend to that, yes.

37HIS HONOUR:  And once that is done then I will come back and deal with it formally.

38MS THOMPSON:  There was one thing, Your Honour, I didn’t hear and that was the period of good behaviour.

39HIS HONOUR:  It is really the period of the sentence, is it not?  12 months I think is what I had in mine.

40MS THOMPSON:  Yes.

41HIS HONOUR:  Yes. 

42MR DICKINSON:  Your Honour, that 12 months will not be after the 8 months, that will be as of today.

43HIS HONOUR:  No, that will be 12 months as of today so it will expire at the conclusion of the 12 month period of the sentence.  Very well, I have signed those orders.  I will leave the Bench for a few minutes whilst you either go back or ‑ ‑ ‑

44MS THOMPSON:  I'll arrange for that to be prepared, yes.

45HIS HONOUR:  ‑ ‑ ‑ prepare the order.  Mr Dickinson, would you, if you have not already done so, explain to your client what the Recognisance Release Order means and then I will formalise it in a moment.

46MR DICKINSON:  I'll do that, Your Honour.

47HIS HONOUR:  Yes, thank you.  I will stand down whilst the order is being prepared.

(Short adjournment.)

48HIS HONOUR:  Yes, thank you, Ms Thompson for that.

49MS THOMPSON:  Yes, I apologise for that misunderstanding.

50HIS HONOUR:  That is all right, I have signed the order and it is now necessary for your client to sign it if he is happy with the content of it, Mr Dickinson.

51MR DICKINSON:  I've explained it, Your Honour, he's prepared to sign it.

52HIS HONOUR:  Yes.  Do you want to go with Mr Travers to ensure that you are happy with it?

53MR DICKINSON:  Your Honour, he's prepared to sign it but I'm just wondering whether the term of the recognisance should be four months after the expiration of the 8 months because otherwise he's under a recognisance to be of good behaviour as of today and the order is that he be released upon his entering the recognisance.

54HIS HONOUR:  I must say it has a logic to it that I find appealing.  I can probably amend the order here and now, can I, to ‑ ‑ ‑ ?

55MR DICKINSON:  Because I don’t think Your Honour intends that it be under threat of being of good behaviour as of now.

56HIS HONOUR:  No, I do not want the order to go beyond the 12 months from today so I think that does seem to be more logical.  Ms Thompson.

57MS THOMPSON:  The only slight fly in the ointment as far as that is concerned is if there is some early reason; if Your Honour were to express the good behaviour period to be four months from his release ‑ ‑ ‑

58HIS HONOUR:  Yes but he'd be released on the recognizance, yes.

59MS THOMPSON:  Yes, but if he's released for some reason in less than eight months whether because of strike or admissions or something like that ‑ ‑ ‑

60HIS HONOUR:  We can say that the recognizance expires on 12 months from today, whatever that date is.  Does it include - would it be ‑ ‑ ‑ ?

61MS THOMPSON:  12 August 2015.

62HIS HONOUR:  12 August; the reconnaissance expires on that date.

63MR DICKINSON:  Your Honour, the chance of any remissions these days are remote and they're a matter of days if there are any.

64HIS HONOUR:  Nevertheless that would cover any concern about that, would it not, that he be released on that reconnaissance expiring on 12 August ‑ ‑ ‑ ?

65MR DICKINSON:  Yes, commencing on a date of release and expiring on ‑ ‑ ‑

66HIS HONOUR:  Yes, it would follow that it would be commencing because he'd be released on the recognizance, wouldn’t he? 

67MR DICKINSON:  Yes.

68HIS HONOUR:  So if he was released on the reconnaissance expiring on, that would cover it, would it not?

69MR DICKINSON:  Yes it would, Your Honour.

70HIS HONOUR:  Would you mind doing the alterations to the order to reflect that, perhaps in terms of pretty much what I have just said I think and I will countersign the alteration.  Comfortable with the terms of it now, Mr Dickinson?

71MR DICKINSON:  Yes, Your Honour, I am.

72MS THOMPSON:  Sorry, no, I haven't corrected that.  I didn’t change the 14 to 15, the way we've expressed it.

73HIS HONOUR:  Yes, very well.  I will alter it to 15 and initial both alterations.  Very well, just check that if you would, both of you.  Happy with that?

74MR DICKINSON:  I am, Your Honour.

75HIS HONOUR:  Yes, very well.  All right, that order is now in place, thank you.

76COUNSEL:  If Your Honour pleases. 

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