United States v. William Silvius

Opinion

NOT RECOMMENDED FOR FULL-TEXT PUBLICATION File Name: 14a0260n.06

NO. 13-3810

UNITED STATES COURT OF APPEALS FOR THE SIXTH CIRCUIT FILED Apr 07, 2014 DEBORAH S. HUNT, Clerk UNITED STATES OF AMERICA, ) ) Plaintiff-Appellee, ) ON APPEAL FROM THE UNITED ) STATES DISTRICT COURT FOR v. ) THE NORTHERN DISTRICT OF ) OHIO WILLIAM B. SILVIUS, ) ) Defendant-Appellant. ) AMENDED OPINION

Before: COLE and ROGERS, Circuit Judges; and HOOD, District Judge.*

HOOD, District Judge. Defendant-Appellant appeals from the judgment of the district court

with respect to his conviction for selling modification chips and swap discs in violation of the

Digital Millenium Copyright Act (“DMCA”), 17 U.S.C. §§ 1201(a)(2)(A) and 1204(a). He entered

into a conditional guilty plea before the district court, preserving the right to appeal whether

§ 1201(a)(2)(A) is unconstitutionally vague and asks this Court to conclude that “[a] reasonable

person would not have adequate notice of the conduct that is prohibited under the DMCA[,] in this

case, that conduct being the selling of un-flashed [modification] chips” and swap discs. We decline

to reach that conclusion for the reasons set forth in this opinion and AFFIRM the judgment of the

district court.

* The Honorable Joseph M. Hood, United States District Judge for the Eastern District of Kentucky, sitting by designation. I.

On April 3, 2012, a federal grand jury in the Northern District of Ohio returned an indictment

charging that Silvius “knowingly and willfully manufactured, imported, offered to the public,

provided and otherwise trafficked in technology, products, services, devices, components and parts

thereof, which were primarily designed to circumvent technological measures designed to

effectively control access to a work copyrighted under Title 17 of the United States Code, for

purposes of commercial advantage or private financial gain, in violation of” 17 U.S.C. §§

1201(a)(2)(A) and 1204(a). [Indictment, PageID# 1.]

Defendant filed a Motion to Dismiss the Indictment, arguing among other things that

§ 1201(a)(2)(A) was unconstitutionally vague with respect to its application to the sale of

modification chips. The district court denied his motion, observing that it did not present “a purely

legal question” and “that vagueness challenges to statues which do not involve First Amendment

freedoms must be examined in light of the facts of the case at hand.” [Order, PageID## 88–89.]

Because there were “too many unresolved questions of fact at th[at] stage of the case to determine

whether Mr. Silvius ha[d] standing to challenge 17 U.S.C. § 1201 on vagueness grounds, . . . [the

court concluded that] [t]he proper course [wa]s to let a jury decide the questions of fact.” [Id.]

On March 29, 2013, Silvius pleaded guilty to violating § 1201(a)(2)(A), the trafficking

provision of the DMCA, which prohibits trafficking copyright control access circumvention tools,

pursuant to a written plea agreement with the government, reserving the right to appeal the judgment

entered on the grounds that § 1201(a)(2)(A) is unconstitutionally vague. At the hearing, Defendant

initialed each page of the plea agreement, including the pages containing the stipulated facts, set

forth below. During the plea hearing, the prosecutor read the plea agreement into the record. When

asked if the plea agreement the prosecutor read constituted Silvius’ “complete understanding of what

the plea agreement [was],” Silvius said, “Yes, sir.” [Plea Transcript, PageID# 204.] When asked

2 if there was anything he had a question about or did not understand, Silvius said, “No, sir,” and

subsequently pleaded guilty. [Id. at PageID# 205.]

Defendant conceded, as the factual basis for his plea, that, beginning before June 11, 2007,

and continuing until on or about August 1, 2007, he offered to the public via an internet website,

www.thegiantstore.com, “the sale of illegal modification chips and swap discs, which were designed

to circumvent the copyright protection features designed into Sony Playstation 2, Microsoft Xbox,

and Nintendo Wii video game consoles by the video game console manufacturers to prevent the

playback of pirated and/or counterfeit video games.” [Plea Agreement, PageID# 109 (emphasis

added).] Silvius also admitted that he operated two other websites, www.modking.com and

www.modmonster.com, which both advertised the sale of modification chips and swap discs.

He further admitted that, on or about June 11, 2007, an undercover Special Agent from the

Department of Homeland Security, Immigration and Customs Enforcement (“ICE”) office in

Cleveland, Ohio, ordered five AppleX7 modification chips and four PSTwo Slim Flip Top Covers

with Swap Magic 3.6 Plus swap discs from Silvius’ website, www.thegiantstore.com, for a total

price of $213.99, including shipping. Then, on June 18, 2007, the ICE agent sent a money order for

$213.99 via U.S. mail to Silvius’ address in Homosassa Springs, Florida, as instructed during the

ordering process via www.thegiantstore.com. Silvius also admitted that records obtained from

HSBC Bank revealed that the money order was deposited into an HSBC bank account maintained

by him.

He admitted that, on June 28, 2007, the ICE agent received five AppleX7 modification chips

and four PSTwo Slim Flip Top Covers with Swap Magic 3.6 Plus swap discs at an undercover

mailbox in Strongsville, Ohio, and that the packaging listed the return address of Silvius’ business.

He also admitted that an expert who examined the five modification chips and four swap discs

received by the ICE agent determined that they were illegal circumvention devices for the Microsoft

3 Xbox console and Sony PlayStation 2 console, respectively. Finally, he admitted that, on August

1, 2007, ICE agents executed a search warrant at his business in Homosassa, Florida, seizing various

electronic components and equipment, including several computers and computer hard drives,

numerous modification chips and swap discs, a “pre-modded” gaming console, and documentation

about selling illegal modification chips.

On June 14, 2013, the district court sentenced Silvius to two years of probation and ordered

him to pay a $2,500 fine and a $100 special assessment. The court also ordered Silvius to complete

100 hours of community service. The court entered a final judgment on June 21, 2013. Silvius filed

his Notice of Appeal on July 1, 2013.

II.

“In reviewing a district court’s ruling on a motion to dismiss an indictment, this Court

reviews the district court’s legal conclusions de novo and its finding of fact for clear error or abuse

of discretion.” United States v. Rose, 714 F.3d 362, 370 (6th Cir. 2013) (citations omitted).

III.

The DMCA prohibits trafficking any device that circumvents copyright control access

technology without the copyright owner’s permission, by providing that:

No person shall manufacture, import, offer to the public, provide, or otherwise traffic in any technology, product, service, device, component, or part thereof, that . . . is primarily designed or produced for the purpose of circumventing a technological measure that effectively controls access to a work protected under this title.

17 U.S.C. § 1201(a)(2)(A). Under 17 U.S.C. § 1204, a person who “willfully” violates

§ 1201(a)(2)(A) “for purposes of commercial advantage or private financial gain” faces a five-year

statutory maximum imprisonment sentence and a maximum $500,000 fine.

Silvius argues that the district court erred when it denied his motion to dismiss the indictment

4 and that he was subject to conviction without due process under the Fourteenth Amendment to the

United States Constitution because § 1201(a)(2)(A) is void for vagueness with respect to the sale

of modification chips and swap discs.1 Specifically, he contends that § 1201(a)(2)(A) does not

sufficiently make clear that the prohibition against trafficking control access circumvention tools

applied to his sale of modification chips or swap disks because they are not named in the statute and

because there exist legitimate uses for these items which would permit their fair use by a consumer

under 17 U.S.C. § 107 or the exemptions set forth in § 1201(d)–(k). However, in the factual basis

for his plea agreement, Silvius admitted that he offered to the public, via his website, “the sale of

illegal modification chips and swap discs, which were designed to circumvent the copyright

protection features designed into Sony Playstation 2, Microsoft Xbox, and Nintendo Wii video game

consoles by the video game console manufacturers to prevent the playback of pirated and/or

counterfeit video games.” [Plea Agreement, PageID# 109 (emphasis added).]

“[T]he void-for-vagueness doctrine requires that a penal statute define the criminal offense

with sufficient definiteness that ordinary people can understand what conduct is prohibited and in

a manner that does not encourage arbitrary and discriminatory enforcement.” Kolender v. Lawson,

461 U.S. 352, 357 (1983) (citations omitted). Where, as here, “the first amendment is not

implicated, a ‘void for vagueness’ challenge must be unconstitutional as applied to the defendant

1 The United States argues that Defendant has waived any argument that 17 U.S.C. § 1201(a)(2)(A) is unconstitutionally vague or overbroad with respect to the sale of swap discs since he failed to articulate that argument in his Appellant’s Brief. If so, the United States argues that any decision we might reach with respect to his challenge to the statute as applied to his sale of modification chips would be advisory in nature because his conviction for the sale of swap discs forms an independent factual basis for his guilty plea. We need not resolve this issue because any argument with respect to either swap discs or modification chips was forestalled when Defendant agreed in his plea that his sale of these items fell within the scope of behavior forbidden by the statute as explained in this decision.

5 and ‘must be examined in light of the facts of the case at hand,’” United States v. Levy, 904 F.2d

1026, 1032 (6th Cir. 1990) (quoting United States v. Barnes, 890 F.2d 545, 552 (1st Cir. 1989)), not

with respect “to the conduct of others.” Holder v. Humanitarian Law Project, 130 S. Ct. 2705, 2719

(2010) (internal quotation marks and citation omitted). Thus, “[o]ne to whose conduct a statute

clearly applies may not successfully challenge it for vagueness.” Cohoon v. Rees, 820 F.2d 784, 786

(6th Cir. 1987) (quoting Parker v. Levy, 417 U.S. 733, 756 (1974), and citing Village of Hoffman

Estates v. Flipside, Hoffman Estates, Inc., 455 U.S. 489, 495 n.7 (1982)).

Defendant has admitted that he offered modification chips and swap discs for sale that were

intended to circumvent copyright protection features of certain devices and has conceded that the

statute clearly applies to his conduct, his arguments on appeal notwithstanding. Under Federal Rule

of Criminal Procedure 11(b)(3), “[b]efore entering judgment on a guilty plea, the court must

determine that there is a factual basis for the plea.” A “district court may determine the existence

of the Rule 11(f) factual basis from a number of sources including a statement on the record from

the government prosecutors as well as a statement from the defendant.” United States v. McCreary-

Redd, 475 F.3d 718, 722 (6th Cir. 2007) (quoting United States v. Tunning, 69 F.3d 107, 112 (6th

Cir. 1995)). The factual basis for Silvius’ guilty plea included his admissions that the modification

chips and swap discs that he sold were, in fact, circumvention devices as described by the language

of the statute. [Plea Agreement, PageID## 108-10; Plea Tr., PageID## 198-200, 204–05.] Thus,

his argument that “[a]n unflashed modification chip for a video game console does not have the

ability on its own to circumvent a technological measure,” [Appellant’s Br. at 24], is irrelevant in

the face of his own admission that the modification chips and swap discs that he offered for sale

were “primarily designed to circumvent technological measures which were designed to effectively

6 control access to a [copyrighted] work,” including the “copyright protection features designed into

Sony Playstation 2, Microsoft Xbox, and Nintendo Wii video game consoles.”2 [Plea Agreement,

PageID## 108–109.] Therefore, Silvius “cannot challenge the sufficiency of the evidence [justifying

the district court’s finding of guilt] when he pleaded guilty because [he] accepted the facts as set out

in the plea.” Sexton v. United States, No. 94-5611, 1995 WL 521157, at *5 (6th Cir. Sept. 1, 1995)

(citing United States v. Manni, 810 F.2d 80, 84 (6th Cir. 1987)).

Finally, Silvius offers no support for his claim that he was wrongfully prosecuted because

he was “arbitrarily chosen from hundreds, if not thousands, of retail modification chip providers

in the United States.” [Appellant’s Br. at 30.] “It is a ‘settled appellate rule that issues adverted

to in a perfunctory manner, unaccompanied by some effort at developed argumentation, are deemed

waived.’” Spirko v. Mitchell, 368 F.3d 603, 612 (6th Cir. 2004) (quoting United States v. Elder, 90

F.3d 1110, 1118 (6th Cir. 1996)). We will not “put flesh” on the bones of Silvius’ “skeletal”

argument and will consider it no further. United States v. Robinson, 390 F.3d 853, 886 (6th Cir.

2004) (citations omitted).

IV.

For all of the reasons stated above, the judgment of the district court is AFFIRMED.

2 Silvius elected to enter into a guilty plea at which time he stipulated to the facts concerning his conduct. See Fed. R. Crim. P. 11(b)(3). Without a factual basis, the district court could not have accepted his guilty plea, conditional or not, and there would have been a trial to determine the facts. Id. Because Silvius made that stipulation, the factual question which prompted the district court to deny his Motion to Dismiss no longer exists, and the facts conceded by Defendant Silvius during his guilty plea, conditional though it was, are the only facts before this panel. We decline to reopen this matter for fact-finding on direct appeal and consider only the legal import of Defendant's stipulation.