3 Indicted in Biggest CD Piracy Case in U.S., Prosecutors Say

A federal grand jury indicted three men Wednesday in what prosecutors called the largest bust of pirated CDs in U.S. history.

The indictment follows the arrest last week of Ye Teng Wen, 29, Hao He, 30, and Yaobin Zhai, 33, who are accused of illegally reproducing 325,000 music and software CDs.

“The allegations of massive piracy of music and software reflect the potential loss of millions of dollars to the artists and businesses who legitimately own the copyrights on these works,” U.S. Atty. Kevin Ryan said.

“These individuals are charged with affixing counterfeit labels on CDs to create the appearance of legitimacy, including the FBI Anti-Piracy Warning that stated ‘Unauthorized copying is punishable under federal law.’ ”

Prosecutors said that the pirated CDs, which included Latin music and Symantec Corp. computer security software, circulated widely and that one of the disks was found at a store in Chicago. The three men, who live near San Francisco, have been released on bail and are scheduled to appear in court Oct. 27.

Music industry officials say piracy has led to a steady decline in CD sales over the last five years. Industry officials estimate that piracy costs software and music firms tens of billions of dollars worldwide.