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Wednesday, July 23, 2008

CDs Too Cheap To Be Legal?

By T.J. Wilham
Journal Staff Writer
       An Albuquerque record store's bargain-basement prices have landed it in hot water with the state Attorney General's Office.
    State agents said Tuesday that they seized about 7,400 pirated CDs and equipment used to make them after searching Krazy Kat Records, Tapes & CDs, 9012 Central Ave. SE. The equipment was capable of burning up to seven CDs at once.
    Officials with the Recording Industry Association of America, who were present Tuesday, said the raid is the largest they know of in New Mexico.
    No one has been charged, but Ed Griego, a special agent with the Attorney General's Office, said investigations show that the store has been manufacturing and selling pirated CDs since 2001.
    He said anyone who has sold seven or more pirated CDs at the store could be charged with a fourth-degree felony under state law.
    Agents said they are going to present the case to Attorney General Gary King, who will decide whether charges will be filed.
    Asked by the Journal whether his store sold pirated music, owner Ed Stange said "I can't say at this time."
    The Attorney General's Office "is here looking for questionable product," he said during a phone interview while the raid was under way. "They are saying it is (pirated). I don't know. We will have to see what develops. I am not upset at them. They are just doing their job."
    The AG's Office launched an investigation into the store in January after receiving complaints from a competitor and officials with the recording industry.
    Investigators from the Recording Industry Association of America had been investigating the store since 2001. RIAA lawyers had sent two letters to the store and spoken with the owners, asking them to stop selling pirated records. Each time, the owners agreed to stop but didn't, association investigators said.
    "Retailwise, they are the largest player in New Mexico," said Aaron Aguilar, an association investigator. "When we have been in there, the store is full, and that is what everyone is buying. There have been lines waiting to look at their catalog."
    Undercover state agents had previously bought 28 pirated CDs at the store, prompting Tuesday's search warrant, investigators said.
    The store doesn't advertise pirated CDs. Customers who want to buy them have to ask for a catalog in a black binder, which is made up of CD covers, state officials said.
    Investigators said the store sold the CDs for $5 each. If customers bought four, they got the fifth free. Most of the CDs were by hip-hop and Spanish-language artists.
    Most newly released CDs retail for about $13.99.
    Many of the pirated CDs had professional-looking labels on them, came in a clear case and were wrapped in cellophane, state investigators said.
    "It's impossible to tell how many they have sold since 2001," Griego said. "This is serious. It's a crime. It's not something we investigate every day, but it has an effect on other businesses, the economy and the music industry."
    Authorities said the store developed a large customer base, which knew what to ask for at the store.
    Stange said he and his family have operated the business since 1985. The store sells movies, tapes, records and CDs.
    Abel Cuevas has been working at the store for a month. But when he went to work Tuesday, he was greeted by state agents who had made their way into the business about 10 minutes after it opened. Cuevas said he never saw or sold pirated music at the store.
    "I am shocked," he said. "I have never heard of police being this concerned over music before."
    An Albuquerque city employee was looking through the catalog of allegedly pirated CDs when authorities raided the store. He said he was at the store to use the restroom.
    He was placed on leave by city officials for being at the store while on city duty.