The United States Attorney's Office for the Northern District of California announced that Walter J. Buchholz, Jr., 67, of Amherst, New York pleaded guilty today in federal court to one count of violating the Digital Millennium Copyright Act (DMCA) and one count of mail fraud for his role in a satellite piracy scheme. According to the plea, Buchholz admitted to manufacturing and distributing software and devices which were used to steal satellite programming from DISH Network
According to court documents, DISH Network uses a direct broadcast satellite system to deliver its programming to homes and businesses that are equipped with specialized equipment, including a satellite receiver box. DISH Network electronically "scrambles" its satellite transmissions in order to prevent unauthorized viewing of their programming. In order to receive the programming services, DISH Network customers are required to purchase or lease satellite equipment, which includes "Smart Cards," that are inserted into the satellite receiver. In violating the DMCA, Buchholz reprogrammed Smart Cards to circumvent the technological measures which limited access to only the legitimate subscribers of DISH Network satellite signal programming. Buchholz then sold the reprogrammed Smart Cards to others around the United States and used the mail in doing so. According to the plea agreement, as a result of the scheme, Buchholz unlawfully received approximately $308,000.
On September 29, 2004, defendant Buchholz was indicted by a federal grand jury in San Jose, California, on two counts, including the unauthorized manufacture and distribution of satellite television access service, and manufacture and distribution of technology primarily designed to circumvent encryption technology protecting a right of a copyright owner (DMCA). The DMCA, enacted in 1998, enforced intellectual property laws by focusing on conduct that was primarily intended to circumvent technological measures protecting copyrighted works. On June 10, 2005, a one-count information was filed in the Western District of New York charging defendant Buchholz with mail fraud for his role in the satellite piracy scheme in that district. After the indictment in San Jose, the defendant elected to plead guilty in the Western District of New York in a Rule 20 proceeding that allowed him to resolve the charges of both districts in New York, the district where he resides.
The maximum statutory penalty under the DMCA count is five years imprisonment, and twenty years imprisonment for the mail fraud count. Each count also carries a maximum fine of $250,000, a three-year term of supervised release, a mandatory special assessment of $100, and restitution. However, any sentence following conviction would be imposed by the Court after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553. Defendant Buchholz is scheduled to be sentenced on September 23, 2005 at 9:00 a.m. before United States District Judge John T. Elfvin in Buffalo, New York.
The prosecution is the result of an investigation by the Federal Bureau of Investigation's Cyber Crime Squad in San Jose and Buffalo. In the Northern District of California, the investigation was overseen by the Computer Hacking and Intellectual Property (CHIP) Unit of the United States Attorney's Office for the Northern District of California. Mark L. Krotoski is the Assistant U.S. Attorney from the CHIP Unit who is prosecuting the case in San Jose, and Paul J. Campana, Chief, White Collar & General Crimes Division is prosecuting the case in Buffalo. Echostar Communications doing business as DISH Network assisted and worked in conjunction with law enforcement in this investigation.
A copy of this press release and related court filings may be found on the U.S. Attorney's Office's website at www.usdoj.gov/usao/can. Related court documents and information may be found on the U.S. District Court website at http://www.cand.uscourts.gov or on http://pacer.cand.uscourts.gov.
All press inquiries to the U.S. Attorney's Office should be directed to Assistant U.S. Attorney Christopher P. Sonderby, Chief of the CHIP Unit, at (408) 535-5037, or Luke Macaulay at (415) 436-6757 or by email at Luke.Macaulay3@usdoj.gov.
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