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Viewing cable 08MOSCOW3752, IPR ROUNDTABLE: "WORKING WITH RUSSIAN LAW ENFORCEMENT"

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Reference ID Created Released Classification Origin
08MOSCOW3752 2008-12-29 10:33 2011-08-24 01:00 UNCLASSIFIED//FOR OFFICIAL USE ONLY Embassy Moscow
VZCZCXRO5926
RR RUEHAG RUEHAST RUEHDA RUEHDF RUEHFL RUEHIK RUEHKW RUEHLA RUEHLN
RUEHLZ RUEHNP RUEHPOD RUEHROV RUEHSK RUEHSR RUEHVK RUEHYG
DE RUEHMO #3752/01 3641033
ZNR UUUUU ZZH
R 291033Z DEC 08
FM AMEMBASSY MOSCOW
TO RUEHC/SECSTATE WASHDC 1361
RHMFIUU/DEPT OF JUSTICE WASHINGTON DC
INFO RUCNCIS/CIS COLLECTIVE
RUEHXD/MOSCOW POLITICAL COLLECTIVE
RUEHZL/EUROPEAN POLITICAL COLLECTIVE
RUCPDOC/DEPT OF COMMERCE WASHDC
UNCLAS SECTION 01 OF 02 MOSCOW 003752 
 
SENSITIVE 
SIPDIS 
 
STATE FOR EUR/RUS(TUMINARO), EEB/IPE(URBAN) 
STATE PLEASE PASS TO USTR SMCOY, KALVAREZ, PBURKHEAD 
USDOC 4231 JBROUGHER, MEDWARDS, JTHOMPSON 
USDOC PLEASE PASS WPAUGH 
USPTO TREVES, KFERRITER 
DOJ/CCIPS 
 
E.O. 12958: N/A 
TAGS: ETRD KIPR ECON PGOV RS
SUBJECT: IPR ROUNDTABLE: "WORKING WITH RUSSIAN LAW ENFORCEMENT" 
 
THIS CABLE IS SENSITIVE BUT UNCLASSIFIED.  NOT FOR DISTRIBUTION 
OUTSIDE USG CHANNELS OR FOR POSTING ON THE INTERNET. 
 
1. (U) Summary: On December 11, the Embassy and the American Chamber 
of Commerce (AmCham) co-hosted an IPR roundtable, "Working with 
Russian Law Enforcement on IPR Cases".  This was the first joint IPR 
Roundtable with AmCham and a deliverable of the U.S.-Russia IPR 
Working Group.  The Ministry of Economic Development noted that Duma 
legislation to make the Russian Civil Code compliant with the WTO 
TRIPS agreement was an important step towards WTO accession. 
Representatives from the Ministry of Interior's (MVD) Economic 
Crimes and Computer Crimes Units described procedures for 
investigating IPR cases and explained to AmCham members and rights 
holders how to more effectively cooperate with Russian law 
enforcement in IPR investigations.  U.S. industry representatives 
presented case studies on best practices for working with the MVD. 
Approximately 40 AmCham member companies participated.  END SUMMARY. 
 
 
2. (U) On December 11, jointly with the American Chamber of Commerce 
in Moscow, the Embassy provided a forum for U.S. rights holders to 
learn about the MVD's work on IPR cases, and hear best practices for 
working with the MVD from other AmCham members.  The event, "Working 
With Russian Law Enforcement on IPR Cases," held at AmCham's 
offices, marked the first joint Embassy-AmCham IPR Roundtable. 
Charge d'Affaires Eric Rubin opened the Roundtable and noted that 
the vigorous protection of intellectual property rights would help 
realize President Medvedev's vision of a diversified and innovative 
economy.  Approximately 40 Amcham member companies participated. 
The Roundtable was moderated by Post's PTO Attache; Emboffs from the 
Economic and Law Enforcement Sections also participated. 
 
3. (U) The idea to hold the Roundtable came out of the most recent 
meeting of the U.S.-Russia IPR Working Group in Washington, D.C in 
March 2008.  Vladimir Tsvetkov, representing the Russian law 
enforcement Ministry of Internal Affairs (MVD) suggested the need to 
educate U.S. rights holders in Russia on MVD procedures for 
investigating IPR crimes and to explain how better to work with the 
MVD. 
 
--------------------- 
IPR and WTO Accession 
--------------------- 
 
4. (U) Following the Charge's remarks, a representative from the 
Ministry of Economic Development addressed progress on IPR 
protection and enforcement in the context of Russia's WTO accession, 
highlighting an amendment before the Duma to make Part IV of the 
Civil Code compliant with the WTO TRIPs agreement.  An IPR lawyer 
from Baker & McKenzie set the stage for the Roundtable by providing 
an overview of IPR challenges rights holders face in Russia, 
focusing concern on a pending decision in the Russian courts that 
will determine how imports of "grey" and parallel goods will be 
treated by the Russian Customs Service. 
 
-------------------------------------------- 
Three "Pillars" in IPR Enforcement Procedure 
-------------------------------------------- 
 
5. (U) The MVD has the main oversight and enforcement responsibility 
for IPR Crimes that are categorized as "economic crimes" under 
Russia's Criminal Code.  Vladimir Tsvetkov, Head of the Economic 
Crimes Unit of the MVD, outlined what he described as the "3 pillars 
of procedure" for IPR cases.  First, a complaint must be received 
from the rights holder.  This complaint will initiate an 
investigation.  Provided that a potential infringement is 
discovered, the next step is to calculate the damages to the right 
holder.  Finally, the MVD must complete a forensic examination of 
the seized goods.  Tsvetkov described the process as "lengthy" often 
taking several months.  He complained that rights holders lack 
"follow through," and are often unwilling to "do what it takes" with 
the MVD to find the source or the manufacturer of counterfeit goods. 
 
 
6. (SBU) The MVD has the reputation among many rights holders as 
being secretive and difficult to reach.  However, after patiently 
answering several procedural and technical questions, Tsvetkov 
surprised participants by providing his cell phone number, and 
encouraged AmCham members to contact him directly about potential 
IPR violations.  Only one comment seemed to ruffle Tsvetkov. One 
participant suggested that after a raid in Tula earlier this year, 
 
MOSCOW 00003752  002 OF 002 
 
 
the local MVD immediately returned the seized optical disc 
production equipment to the pirates.  Tsvetkov challenged the 
company representative to bring him some proof before making further 
accusations. 
 
--------------------------------------- 
Department K Reports on Internet Piracy 
--------------------------------------- 
 
7. (U) In addition to the enforcement activities of the Economic 
Crimes Unit, the MVD has a separate unit, "Department K," which is 
responsible for operational  investigation of computer crimes. 
Department K's Anton Kuznetsov discussed efforts to fight internet 
piracy. Kuznetsov reported that the MVD investigated 1500 cases of 
internet piracy in 2007, and 1150 cases though the first nine months 
of 2008. So far in 2008, 800 cases have been completed and forwarded 
to the courts. 
 
8. (U) Kuznetsov commented that although they are targeting illegal 
internet sites that make copyrighted material available for mail 
order or download, they are limited in what they can do because many 
illegal websites are registered in countries outside of Russia.  He 
offered as an example an illegal website registered in the U.S. that 
sells Autodesk and Microsoft programs internationally, including to 
Russian consumers.  Kuznetsov said that Department K launched an 
end-user notification campaign in 2008 to target businesses that use 
unlicensed software.  So far, 2500 notifications have been sent. 
Kuznetsov called for more public awareness and education, and said 
that judges in particular need more training, as evidenced from 
cases when judges have let people off who claimed they 
"accidentally" downloaded a pirated program from the internet. 
 
------------------------------------ 
Case Studies on Working with the MVD 
------------------------------------ 
 
9. (SBU) Representatives from Microsoft and the Baltic Law firm 
(representing the Business Software Alliance) provided case studies 
of best practices for working with Russian law enforcement on IPR. 
With 30 IP lawyers in 27 regions across Russia, Microsoft works 
closely with both federal and regional law enforcement on IPR 
protection.  In 2007, Microsoft brought over 1500 cases to the MVD 
for investigation.  Microsoft also conducts regional training 
programs and has trained over 1200 Russian police officers and 
investigators.  Baltic Law also backed-up the MVD's argument that 
enforcement of IPR only works when rights holders take initiative, 
by citing an example of a case in which Baltic Law reported to the 
local MVD in Novosibirisk that a Russian company was using illegal 
software.  The investigation led to a court decision in Baltic Law's 
favor and damages paid to the BSA member. 
 
------- 
Comment 
------- 
 
10. (SBU) Rights holders told us that they found the Roundtable 
useful and were please with the MVD's offer to open direct lines of 
communication.  Given the success of this roundtable, the embassy 
plans to meet with AmCham management to discuss themes and topics 
for a series of future IPR Roundtables.