## Facts

- David LaMacchia, an MIT student, used MIT’s network to access the Internet and created an electronic bulletin board system under pseudonyms and encrypted addresses.
- He encouraged users to upload copyrighted software and games to the bulletin board and moved uploaded files to a second encrypted location for downloading by other users with a password.
- The government alleged the system enabled large-scale unauthorized copying and distribution of copyrighted software internationally, causing losses exceeding $1 million to copyright holders.
- The indictment did not allege that LaMacchia sought or received commercial advantage, private financial gain, or other personal benefit from the distribution activity.

## Issues

1. Whether conduct consisting of large-scale, noncommercial unauthorized copying and distribution of copyrighted software can be prosecuted as a conspiracy to commit wire fraud under 18 U.S.C. § 1343.
2. Whether using the wire fraud statute in this setting would improperly bypass Congress’s limits on criminal copyright liability under 17 U.S.C. § 506 (as then framed around commercial advantage or private financial gain).

## Decision

- The court granted the motion to dismiss the indictment.
- The court held the alleged scheme did not state an offense under the wire fraud statute because it was not a scheme to obtain “money or property” from the alleged victims.
- The court declined to treat § 1343 as a general tool to criminalize noncommercial copyright infringement beyond the boundaries Congress set in the Copyright Act’s criminal provisions.

## Legal Principles

- Wire fraud under 18 U.S.C. § 1343 requires a scheme to defraud aimed at obtaining money or property, not merely conduct that causes economic loss to a victim.
- Copyright infringement is governed by a detailed statutory framework; criminal liability for infringement exists only to the extent Congress has authorized it.
- Courts should not permit general criminal statutes to expand criminal copyright enforcement in a manner that would circumvent Congress’s specific choices regarding the scope of criminal infringement.
- Where an indictment alleges unauthorized distribution of copyrighted works without alleging the defendant’s pursuit or receipt of money, property, or financial gain, § 1343 is not satisfied.

## Conclusion

The court dismissed the wire-fraud conspiracy charge because the alleged noncommercial copying and distribution of copyrighted software, without any alleged pursuit or receipt of money or property by the defendant, did not constitute wire fraud and could not be used to extend criminal copyright liability beyond the limits set by Congress.


United States v. LaMacchia, 871 F. Supp. 535 (D. Mass. 1994)