OPINION
FABE, Justice.
I. INTRODUCTION
An employee of Doyon Universal Services sustained a head injury while working at a pipeline pump station. She applied for and received workers' compensation benefits for the injury. She also brought a tort suit against Alyeska Pipeline Service Company, the operator of the pipeline pump station, alleging that its negligence was a proximate cause of her injuries. Alyeska sought summary judgment in the lawsuit, asserting that it was a statutory employer under the Alaska Workers' Compensation Act and thus was immune from suit. The superior court granted summary judgment to Alyeska and also awarded it Alaska Civil Rule 68 attorney's fees. Because Alyeska is a project owner, and immune from suit based on that status, we affirm the summary judgment order dismissing the lawsuit. But we reverse the award of Rule 68 attorney's fees because the offer of judgment was not valid.
II. FACTS AND PROCEEDINGS
Sharin Anderson was injured while working for Doyon Universal Services at Pump Station 5 on the Trans-Alaska Pipeline System. Alyeska Pipeline Service Company, which operates the pipeline, contracted with Doyon to provide security, medical support, lodging, and catering services for employees who operate and maintain the pipeline. As part of its contract with Doyon, Alyeska agreed to provide workers' compensation insurance for Doyon's employees.
On July 25, 2007, Anderson was helping the head cook clean the loading dock area where food was stored. While Anderson was vacuuming, the head cook moved a "heavy duty industrial cart" that was used for food storage from its position near a wall. A table weighing at least seventy pounds had been placed in a vertical position behind the cart; the cases of food on the cart obscured the table from view.
Anderson was squatting while vacuuming. When the head cook removed the cart, the table, which was unsecured, fell directly on Anderson, hitting her in the head. According to the head cook, the force of the table hitting Anderson pushed her ten to twelve feet from her original position. Anderson was unconscious for at least three or four minutes after the table hit her. The head cook reported that Anderson "was having severe convulsions," and he was afraid that she would die. She was transported to Fairbanks Memorial Hospital by helicopter. She filed a report of injury with the Alaska Workers' Compensation Board and received more than $72,000 in workers' compensation benefits on the claim.
An investigation by Alyeska concluded that the table, which belonged to Alyeska, had been propped against the wall for several months. On December 20, 2007, Anderson filed a negligence action against Alyeska in superior court, seeking damages in excess of $500,000. Before Alyeska filed its answer, it wrote a letter to Anderson's attorney, highlighting the 2004 amendments to the exclusive liability provisions of the Alaska Workers' Compensation Act. The exclusive liability provisions limit an injured worker's remedy against the employer for work-related injuries to workers' compensation when the employer secures payment of compensation. Alyeska informed Anderson that the amendments extended the exclusive liability provisions to project owners, not just employers. Alyeska contended that it was a "project owner" as defined in the amendments and therefore immune from suit for Anderson's injuries.
AS 23.30.055.
Alyeska answered Anderson's complaint on January 15, 2008, and raised these exclusive liability provisions as an affirmative defense. A little more than two weeks after its answer, Alyeska made an offer of judgment to Anderson in the amount of ten dollars, plus prejudgment interest, costs, and Alaska Civil Rule 82 attorney's fees. The fax transmittal that accompanied the offer of judgment stated that Alyeska "believe[d] the exclusive remedy protection of AS 23.30.055 applie[d] to this case." Anderson did not accept the offer.
Alyeska moved for summary judgment on March 6, 2008; it asked for a judgment dismissing Anderson's suit because Alyeska was her statutory employer and exempt from suit under AS 23.30.055, the exclusive liability provisions of the Alaska Workers' Compensation Act. Anderson opposed the motion, arguing that the statute should not be construed to include Alyeska within its ambit because Alyeska was not a "project owner" within the meaning of the statute. Anderson argued that applying the definition of "project owner" in AS 23.30.045(f) would create absurd results and that the court should construe "project owner" according to its common usage. She then argued that the pipeline was not a "project," that Alyeska did not own it, and that Alyeska was therefore not protected by the exclusive liability provisions of AS 23.30.055. In response, Alyeska disagreed with Anderson's proposed method of statutory construction and maintained that it fell within the statutory definition of "project owner." It argued in the alternative that maintenance of the pipeline was a project and that it was a "project owner" even if the term was construed according to its common usage.
The superior court granted summary judgment to Alyeska after oral argument on the motion. The court found that there were no genuine issues of material fact. It concluded that Alyeska was a "project owner" within the statutory definition and was therefore entitled to judgment as a matter of law. The court specifically limited its holding to the facts of the case because of the policy arguments Anderson made, noting that "there [was] some power and force" to Anderson's argument that the statute should not be construed broadly.
After the superior court entered final judgment, Alyeska moved for Alaska Civil Rule 68 and 82 attorney's fees in the amount of $12,409.88. Anderson opposed the motion for Rule 68 attorney's fees, asserting that Alyeska's offer of judgment was a "token offer" and should not trigger the provisions of Rule 68. She did not oppose imposition of Rule 82 attorney's fees. In response, Alyeska claimed that its offer was made in good faith and thus it was entitled to Rule 68 fees. Alyeska maintained that it had good reason to believe when it made its offer that "its exposure was nominal." It pointed out that it had notified Anderson's attorney before it filed its summary judgment motion that it would be relying on the exclusive liability provisions of the Alaska Workers' Compensation Act. It stated that its offer of judgment "was based upon an honest and good faith assessment of its potential liability" to Anderson.
The superior court granted Alyeska's motion for attorney's fees. The court disagreed with Anderson's argument that Alyeska's nominal offer of judgment should not trigger a Rule 68 fee award. It found that Alyeska's offer of judgment "was a reasonable, good faith offer" and granted Alyeska's attorney's fee request for Rule 82 fees of $175.50, Rule 68 fees of $12,234.38, and costs.
Anderson appeals the dismissal of her suit and the award of Rule 68 attorney's fees.
III. STANDARD OF REVIEW
We review a grant of summary judgment de novo. Summary judgment is proper if there is no genuine factual dispute and the moving party is entitled to judgment as a matter of law. In reviewing summary judgment, we draw all reasonable inferences in favor of the nonmoving party. Interpretation of a statute is a question of law to which we apply our independent judgment; we interpret the statute according to reason, practicality, and common sense, considering the meaning of the statute's language, its legislative history, and its purpose.
Parker v. Tomera, 89 P.3d 761, 765 (Alaska 2004).
Id.
Moore v. Allstate Ins. Co., 995 P.2d 231, 233 (Alaska 2000).
Grimm v. Wagoner, 77 P.3d 423, 427 (Alaska 2003) (citing Native Vill. of Elim v. State, 990 P.2d 1, 5 (Alaska 1999)).
Whether an offer of judgment complies with Civil Rule 68 is a question of law that we review using the independent judgment standard. The amount of attorney's fees awarded is reviewed for abuse of discretion.
Ellison v. Plumbers Steam Fitters Union Local 375, 118 P.3d 1070, 1073-74 (Alaska 2005) (citing Thomann v. Fouse, 93 P.3d 1048, 1050 (Alaska 2004)).
Lowell v. Hayes, 117 P.3d 745, 750-51 (Alaska 2005) (citing Van Deusen v. Seavey, 53 P.3d 596, 603 n. 23 (Alaska 2002)).
IV. DISCUSSION
A. Alyeska Is A Project Owner Under AS 23.30.045.
The first issue presented in this appeal is the narrow question whether Alyeska is a "project owner" as defined in AS 23.30.045 and is therefore immune from suit under AS 23.30.055. Anderson urges us to construe "project owner" in AS 23.30.045(f) so that it applies only to projects, particularly construction projects, that have a limited duration. Alternatively, she asks us to determine that because Alyeska does not own the pipeline, it is not a "project owner." Alyeska counters that it falls within the definition of "project owner" set out in AS 23.30.045(f)(2) and is therefore immune from suit for Anderson's injuries. It also points out that it provided the workers' compensation insurance that covered Anderson's workers' compensation claim, so application of the exclusive liability provisions of AS 23.30.055 is particularly appropriate here.
Neither party has pointed to disputed facts that would preclude summary judgment.
The Alaska Legislature changed the exclusive liability provisions of the Alaska Workers' Compensation Act in 2004. The 2004 amendments made project owners potentially liable for workers' compensation benefits to their contractors' and subcontractors' employees and expanded the definition of "employer" for purposes of the exclusive liability provision of the workers' compensation act. Alaska Statute 23.30.045(a) now provides:
Ch. 80, SLA 2004.
Id.
An employer is liable for and shall secure the payment to employees of the compensation payable under AS 23.30.041, 23.30.050, 23.30.095, 23.30.145, and 23.30.180- 23.30.215. If the employer is a subcontractor and fails to secure the payment of compensation to its employees, the contractor is liable for and shall secure the payment of the compensation to employees of the subcontractor. If the employer is a contractor and fails to secure the payment of compensation to its employees or the employees of a subcontractor, the project owner is liable for and shall secure the
payment of the compensation to employees of the contractor and employees of a subcontractor, as applicable.
Alaska Statute 23.30.045(f)(1) defines "contractor," for purposes of AS 23.30.045, as "a person who undertakes by contract performance of certain work for another but does not include a vendor whose primary business is the sale or leasing of tools, equipment, other goods, or property." "Project owner" is defined as "a person who, in the course of the person's business, engages the services of a contractor and who enjoys the beneficial use of the work."
AS 23.30.045(f)(2).
The exclusive liability provision of the workers' compensation statute, AS 23.30.055, provides in part:
The liability of an employer prescribed in AS 23.30.045 is exclusive and in place of all other liability of the employer and any fellow employee to the employee . . . and anyone otherwise entitled to recover damages from the employer or fellow employee at law or in admiralty on account of the injury or death. . . . In this section, "employer" includes, in addition to the meaning given in AS 23.30.395, a person who, under AS 23.30.045(a), is liable for or potentially liable for securing payment of compensation.
1. The statutory definition is controlling.
Anderson asks us to construe the words "project" and "owner" according to common usage and general principles of statutory construction to determine whether Alyeska is a "project owner" for purposes of AS 23.30.045 and .055. She argues that broad application of the statutory definition would have unintended consequences, making many businesses potentially liable for workers' compensation benefits when they hire independent contractors and taking away an employee's right to pursue a negligence action. To minimize these possible results, she contends that "project" should be construed to encompass only construction-type projects of limited duration and that the legislative history supports this narrow reading.
Alyeska responds that the legislature itself defined "project owner" and maintains that the separation of powers doctrine prohibits Anderson's proposed method of construing the statute. It relies on State v. Jeffery to argue that the canons of construction on which Anderson bases her argument only apply when the words in a statute do not have a "peculiar meaning, by virtue of statutory definition."
See 170 P.3d 226, 232 (Alaska 2007) (quoting Div. of Elections v. Johnstone, 669 P.2d 537, 539 (Alaska 1983)).
Alaska Statute 01.10.040(a) provides, in part, "Technical words and phrases and those which have acquired a peculiar and appropriate meaning, whether by legislative definition or otherwise, shall be construed according to the peculiar and appropriate meaning." With a few narrow exceptions, we do not construe statutory language according to its common meaning when the legislature has provided a definition of a word or phrase, and our statutory construction cases look first to see if the word or phrase to be construed has a specific definition.
See, e.g., Ranney v. Whitewater Eng'g, 122 P.3d 214, 218 (Alaska 2005) (construing "wife" for purposes of the workers' compensation act according to its common usage because it "has not been defined statutorily and has no technical meaning in the present context").
Anderson's proposed construction of "project owner" does not fall within the narrow exceptions to this rule. The definition of "project owner" is not circular: It does not, for example, define "project owner" as "a person who owns a project." Nor does Anderson argue that the language of the definition is ambiguous; she does not, for example, argue that her work was not "in the course of" Alyeska's business and for that reason should fall outside the provisions of AS 23.30.045 and .055. Instead, Anderson asks us to construe the term "project owner" according to the common usage of "project" and "owner," arguing that application of the statutory definition would be contrary to the legislative history.
See Parks Hiway Enters., LLC v. CEM Leasing, Inc., 995 P.2d 657, 661 (Alaska 2000) (construing "owner" according to common usage because the statutory definition was "circular," defining "owner" as "in the case of a facility, any person owning . . . the facility").
See Alaska Hous. Fin. Corp. v. Salvucci, 950 P.2d 1116, 1121-22 (Alaska 1997) (examining legislative history to determine whether "reports to a public body" in AS 39.90.100 included reports to an employee's own employer).
But even accepting Anderson's invitation to examine the legislative history does not persuade us that Alyeska falls outside the statutory purview. Anderson argues that the legislative history shows that the legislature only meant "project owner" to apply to construction-type projects, not to all businesses that use independent contractors. She illustrates her point by using hypothetical examples where broad application of the statutory definition might impose liability when a business owner was not negligent and had little control over the activities that caused an injury. But our review of the legislative history does not support Anderson's contention that the statute was meant to apply only in the construction context. As Alyeska pointed out at oral argument before us, the legislative history contains at least two hypothetical examples of project owners that involved the oil and gas industry's use of contract labor.
Moreover, the policy considerations that prompted the legislature to enact the 2004 amendments to the workers' compensation act apply outside the construction context. As we noted in Schiel v. Union Oil Co. of California, the 2004 amendments had the following purposes: "to ensure or expand workers' compensation coverage for workers, to increase workplace safety, to prevent `double dipping,' and to provide protection from tort liability to those who are potentially liable for securing workers' compensation coverage." Limiting application of the amendments to the construction field or exempting large employers with ongoing businesses from the definition of "project owner," as Anderson urges, would undermine some of these goals. If Anderson's limited construction of "project owner" were adopted, a grocery store could use contract labor to stock its shelves and completely avoid workers' compensation liability for work-related injuries to the contract laborers simply because its use of contract labor was not related to building or construction or because it used contract labor as part of its day-to-day operations. We see nothing to suggest that the legislature intended such a result.
219 P.3d 1025, 1032 (Alaska 2009).
Even though we reject Anderson's argument that the term "project owner" should be limited to the construction context, we acknowledge that she has posed difficult hypothetical examples about the potential workers' compensation liability of small business owners that use contractors to carry out functions extraneous to their businesses. But because we hold that Alyeska falls within the statutory definition of "project owner," we do not have to decide the questions posed in these hypothetical examples.
She posed one hypothetical example involving a small law firm that used the services of a courier to deliver papers or a snow plower in maintaining its building.
2. Alyeska meets the statutory definition.
Alyeska clearly meets the statutory definition of "project owner" in AS 23.30.045(f)(2). In the course of Alyeska's business, which is operating the Trans-Alaska Pipeline System, it engaged the services of Doyon Universal Services. No one contests that Doyon is a contractor. Doyon undertook performance of work for Alyeska, including catering services for employees who operate and maintain the pipeline. It is also uncontested that Alyeska enjoys the beneficial use of Doyon's services: Because of its contract with Doyon, Alyeska does not need to hire its own employees to perform the work done by Doyon. Because Alyeska satisfies the definition of "project owner" in AS 23.30.045(f)(2), it is covered by the exclusive liability provisions of AS 23.30.055. The superior court correctly granted summary judgment to Alyeska and dismissed Anderson's lawsuit.
B. It Was Error To Award Alyeska Rule 68 Attorney's Fees.
Anderson also asks us to reverse the award of attorney's fees under Alaska Civil Rule 68, arguing that Alyeska's ten-dollar offer of judgment made at the outset of the case was only "nominal" and therefore should not have triggered an enhanced attorney's fee award. We agree with Anderson that our opinion in Beal v. McGuire controls our analysis of this issue.
216 P.3d 1154 (Alaska 2009).
The superior court issued its order for attorney's fees before we decided Beal. In Beal, we held that the one-dollar offers of judgment made at the outset of that case were invalid as a matter of law and could not trigger application of Rule 68 for awarding attorney's fees. We stated that a one-dollar offer of judgment did not serve the purpose of Rule 68, which is "to encourage settlement and avoid protracted litigation" and characterized such an offer as a "tactical demand[] that plaintiffs dismiss their claims to avoid exposure to Rule 68 fee[] awards." We noted that other courts require that an offer "be made in good faith with the goal of settling the case rather than obtaining a larger fee award." We did not explicitly adopt a good-faith test for offers of judgment in Beal, but we decided there that given the timing and amount of the offers, they "could not be considered valid offers of settlement or compromise, or valid attempts to encourage negotiation."
Id. at 1176, 1178.
Id. at 1178.
Id. at 1177 (citing Warr v. Williamson, 359 Ark. 234, 195 S.W.3d 903, 904 (2004); Century 21 Today Inc. v. Tarrant, No. 240696, 2003 WL 22443624, at *1 (Mich.App. Oct.28, 2003)).
Id. at 1178.
There is no principled distinction between the ten-dollar offer that Alyeska made to Anderson at the outset of this case and the initial one-dollar offer in Beal. Even though the superior court found here that the offer was a "reasonable, good faith offer," it also acknowledged that Anderson's policy arguments had "some power and force." We have no doubt that when Alyeska made the offer, it believed that it would prevail in the lawsuit. But there was no objectively reasonable prospect that Anderson would accept ten dollars to settle her case — or that the offer would even start a dialogue that could lead to settlement — at that stage of the litigation. This was particularly true in light of the fact that Anderson's claim raised an issue of first impression that involved interpretation of a new statute and raised difficult policy issues. Moreover, nothing in the record suggests that Alyeska knew, when it made its offer of judgment, what legal arguments Anderson might make to counter its reliance on AS 23.30.055, so it could not assess the strength of those arguments. Alyeska's offer was in effect an opening, "walkaway" offer that had no reasonable chance of acceptance or of fostering further settlement negotiations. This is precisely the type of offer that we indicated in Beal could not trigger application of Rule 68.
While the dissent attempts to distinguish Beal because of the timing of the offer, Alyeska's offer, like that in Beal, "was effectively zero in what appears to be a good faith dispute involving potentially substantial damages." Beal, 216 P.3d at 1178.
As we noted in Beal, we have not adopted a good-faith test for offers of judgment, and we do not do so here. Our disapproval of nominal offers made at the outset of a case is due to their failure to serve the purposes of Rule 68: to encourage settlement and avoid protracted litigation. When nominal offers are made at the outset of a case and have no prospect of acceptance or of furthering settlement negotiations, they are simply attempts to shift the cost of litigation onto the other party, without regard to the purpose and intent of Rule 68.
Id.
Id.
We do not mean to suggest that a small offer of judgment can never be valid or that the validity of the offer of judgment should be determined simply by comparing the offer to the amount demanded in the lawsuit. An offer in a case with a tenuous factual basis or controlling legal precedent may be much lower than an offer in a case with a novel legal question. And a nominal offer that might be invalid when made at the outset of a case could trigger application of Rule 68 when made later in the litigation: During the course of litigation, discovery may prompt a reassessment of a case, an offer including Alaska Civil Rule 82 fees and costs may have increased value, or a new court decision could alter the legal strength of a party's case.
See Deltona House Rentals, Inc. v. Cloer, 734 So.2d 586, 588 (Fla.App. 1999) (holding that $101 offer of judgment was valid in "a case of zero liability from the outset" but noting that a low offer may not be in good faith when a legal dispute is "novel or complex").
Cf. Hartline v. Kaiser Found. Hosps., 132 Cal. App.4th 458, 33 Cal.Rptr.3d 713 (2005) (holding that an offer of judgment to waive a claim for costs made after summary adjudication of one of two of the plaintiff's claims was valid).
Although the dissent characterizes Anderson's case as weak, our opinion recognizes that Anderson posed troublesome policy questions. Moreover, the superior court acknowledged that Anderson's arguments had "some power and force" and limited its decision to the facts of the case. From the perspective of assessing the offer of judgment, though, there is simply no way that Alyeska could reasonably have assessed the strength or weakness of Anderson's case. Nothing in the record suggests that Alyeska knew what Anderson's legal arguments might be — whether she would be challenging the constitutionality of the statute or making a fact-based argument peculiar to her case — when it made its offer of judgment. Finally, Anderson's case presented a novel legal question: The new statute had not been definitively interpreted by any court when she brought her case.
In the context of Anderson's case, Alyeska's ten-dollar offer was made shortly after it filed its answer. Anderson was seeking $500,000 in damages for an undisputedly serious head injury caused by a table that belonged to Alyeska. Alyeska's planned defense relied on a newly enacted statute that had not been interpreted by the courts. Under these circumstances, Alyeska's offer did not serve the legitimate purpose of Rule 68 and thus cannot serve as a basis for an award of Rule 68 attorney's fees.
We also note that it was error to award both Rule 68 and Rule 82 attorney's fees to Alyeska. Ellison v. Plumbers Steam Fitters Union Local 375, 118 P.3d 1070, 1078 (Alaska 2005). Although no one raised this issue and our disposition of the Rule 68 attorney's fees makes it moot, we note the error to provide guidance in future cases.
V. CONCLUSION
Because Alyeska is a "project owner" as set out in AS 23.30.045, we AFFIRM the superior court's order dismissing Anderson's claims against Alyeska. We REVERSE the superior court's order awarding Alyeska Rule 68 attorney's fees because Alyeska's offer of judgment was invalid as a matter of law, and we REMAND for an award of Rule 82 attorney's fees.
CHRISTEN, Justice, dissenting in part.
I write separately to express my disagreement with the court's conclusion that the trial court erred by awarding Rule 68 attorney's fees.
The court disapproves of the nominal offer of judgment Alyeska made at the outset of this case due to its "failure to serve the purpose of Rule 68: to encourage settlement and avoid protracted litigation." In my view, Alyeska's early attempts to settle this case combined with the weakness of Anderson's legal claims support the trial court's award of Rule 68 attorney's fees. I would affirm the superior court's order.
Alyeska responded to Anderson's complaint by writing to explain that the legislature's 2004 amendments to AS 23.30.055 — Alaska's Workers' Compensation Act — extended the statute's exclusive remedy provisions to Alyeska because Alyeska fell within the statute's amended definition of "project owner." Alyeska actually forwarded its legislative history research to Anderson's counsel and invited counsel to "discuss the law and your dismissal of this suit prior to any additional fees being incurred." When that attempt was unsuccessful, Alyeska answered the complaint and asserted that the suit was barred by the exclusive liability provisions of AS 23.30.055. Alyeska made an early — and admittedly nominal — settlement offer under Rule 68. The offer was accompanied by a cover sheet reiterating that because "the exclusive remedy protection of AS 23.30.055 applies to this case, we think it makes sense to try and secure an early dismissal . . . before incurring costs and attorney's fees." Apart from offering to pay a significant amount of money despite its lack of litigation risk, it is hard to identify steps Alyeska could have taken that would have been more likely to avoid incurring significant fees, or to foster a constructive dialogue about the 2004 statutory amendments.
The court "finds no principled distinction between the ten-dollar offer Alyeska made to Anderson at the outset of this case and the initial one-dollar offer in Beal [ v. McGuire]." In my view, there are several reasons Beal is distinguishable. First, the defendants in Beal "served their individual offers of judgment before they asserted their counterclaims." Under those circumstances, our court viewed the early one-dollar settlement offers in Beal to be consistent with "tactical demands" rather than a "valid attempt[] to encourage negotiation." Because the settlement offers in Beal were conveyed before the counterclaims had been asserted, the opposing parties had a very limited ability to assess the merits of the dispute. In contrast, Alyeska expressly communicated its theory of the case to Anderson and even forwarded its research on the applicable legislative history. Alyeska's actions were objectively consistent with an attempt to settle the case in its earliest stages before significant fees were incurred.
Beal v. McGuire, 216 P.3d 1154, 1178 (Alaska 2009).
Id.
Id.
The court observes that "nothing in the record suggests that Alyeska knew what Anderson's legal arguments might be . . . when it made its offer of judgment." In my view, the salient point is that Anderson was in a position to assess the merits of the statutory interpretation question Alyeska gave her its research and analysis. Alyeska was the only one disadvantaged by the fact that Anderson had not disclosed her legal argument.
The early offers in Beal were also less likely to result in fruitful settlement discussions because fact discovery was needed in order to gauge the merits of the parties' respective arguments. Alyeska's defense to Anderson's claim was not fact dependent. In the decision issued today, the court acknowledges that "an offer in a case with a tenuous factual basis or controlling legal precedent may be much lower than an offer in a case with a novel legal question." But the court does not acknowledge that it was not necessary to conduct fact discovery to assess the merits of Alyeska's defense; it turned on a purely legal issue of statutory interpretation.
The court seems to place considerable weight on its view that Anderson's case presented a novel legal question because Alyeska relied on a newly enacted statute that had not been interpreted by the courts. I agree there was no case law precedent controlling Anderson's claim, but that is because it relied on a recently enacted statute. Anderson's claim was not based on any ambiguity or circularity in the statute. It was based on the argument that the superior court should not construe the term "project owner" according to its statutory definition. As the supreme court's decision observes, "we do not construe statutory language according to its common meaning when the legislature has provided a definition of a word or phrase." The court goes on to reject Anderson's view that the legislative history of the 2004 amendments supports her position, and concludes that Alyeska "clearly meets the statutory definition of `project owner' under AS 23.30.045(f)(2)." Yet the court suggests that nominal offers of judgment should be deemed invalid when a case presents a novel legal question. Here, the troublesome policy questions presented by Anderson apply to hypotheticals not at issue in her case. A novel claim may also be a weak one, and in my view a party defending against a weak legal claim should be able to employ Rule 68 to increase the chances of reaching an early settlement before incurring significant legal fees.
For the same reasons our court concludes that the statutory definition of "project owner" so "clearly and unambiguously" applies to Alyeska, I conclude that Alyeska's early and nominal offer, which was accompanied by its legal analysis and not dependent on factual discovery, was reasonable and valid under Rule 68. And I respectfully dissent from the portion of the court's decision that reverses the superior court's Rule 68 fee award.
: "1. to cause to exist; give rise to. . . . 2. to bring into existence. . . . 7. to bring (a play, movie, opera, etc.) before the public." We also consider the surrounding words, "arranges for" and "finances." The dictionary offers the following relevant definitions of "arrange" as in "arranges for": "3. to prepare or plan. . . . 5. to make plans or preparations. . . ." For "finances," it offers the following relevant definition: "3. to supply with money or capital. . . ."
The definitions of "arranges for," "finances," and "produce" afford obvious insight into how the adjoining term "make" should be interpreted. When these four words are viewed together, their relatedness or common meaning becomes increasingly apparent — each constitutes a verb selected by the Legislature to communicate that persons included within this subsection are those who are somehow responsible for the creation or origination of child sexually abusive material. Those who arrange for child sexually abusive material are involved at the front end of the process, by identifying and coordinating the participants, equipment, and locations. That is, the arranger has undertaken actions that lead to the actual production of the child sexually abusive material. Those who finance child sexually abusive material provide funding that leads to the same result. The terms "arranges for" and "finances" suggest that the most reasonable understanding of "produce" is "to bring (a play, movie, opera, etc.) before the public." In other words, one should envision a producer as a person similar to the producer of a play, movie, or opera who is directly responsible for the creation or origination of a particular production, in this case child sexually abusive material. "Produce" refers to the conduct of those persons but for whom the production (the material) would not exist in the first place, i.e., those who have transformed an idea into a reality. Without those who have arranged for, financed, or produced, there would be no child sexually abusive material at all.
This leaves the term "makes." Given the related definitions and understandings of "arranges," "produces," and "finances," we believe that "makes" should be interpreted in a similar manner as meaning "to cause to exist or happen" or "to cause to become." That is, "makes" should be interpreted in the common fashion as referring to someone who is primarily involved in the creation or origination of the child sexually abusive material.
While we agree with the first part of the definition adopted by the Court of Appeals, "to bring into existence," we reject the second half of that definition, "by shaping, changing, or combining material," Hill, 269 Mibh App at 518, because it adds a limiting dimension to "makes" that is inconsistent with the meanings of the surrounding terms, "arranges for," "produces," or "finances."
This understanding of "produces" and "makes" is consistent with the opening clause of MCL 750.145c(2), which describes other individuals subject to punishment under that subsection: "[a] person who persuades, induces, entices, coerces, causes, or knowingly allows a child to engage in a child sexually abusive activity for the purpose of producing any child sexually abusive material!.]" The terms used in the opening clause clearly refer to those who have had direct contact with a minor, either through the minor's recruitment or through the minor's "performance" in the prohibited material. While those identified in the opening clause definitely are persons who directly deal with the children, those identified in the second clause, the arrangers, producers, makers, and financers, may also on frequent occasion have direct contact with the children.
When the terms "produces" and "makes" are understood in this light, it is simply untenable to conclude that downloading an existing image from the Internet and burning it to a CD-R for personal use constitutes producing or making child sexually abusive material under MCL 750.145c(2). While such conduct certainly constitutes proof of knowing possession of such material, it does not constitute sufficient proof of the making or producing of that material. Thus, when we consider the statute as a whole, especially the maxim of noscitur a sociis in conjunction with the graduated scheme of offenses and punishment, we conclude that MCL 750.145c(2) is primarily concerned with punishing those who are involved in the creation or origination of child sexually abusive material and not those who download and maintain that material for personal use.
Indeed, we note that before the instant Court of Appeals opinion, all published Michigan caselaw only applied the portion of MCL 750.145c(2) concerning a person who "produces" or "makes" child sexually abusive material to those involved in the creation or origination of prohibited images. See, e.g., People v Heim, 206 Mich App 439; 522 NW2d 675 (1994) (defendant who photographed his 16-year-old niece), People v Hack, 219 Mich App 299; 556 NW2d 187 (1996) (defendant who coerced two children to engage in sexual acts that he videotaped), People v Riggs, 237 Mich App 584; 604 NW2d 68 (1999) (defendant who photographed and videotaped four young girls), People v Harmon, 248 Mich App 522, 526-528; 640 NW2d 314 (2001) (defendant who photographed two minors engaged in sexual acts), and People v Wilkens, 267 Mich App 728; 705 NW2d 728 (2005) (defendant who recorded himself and two minors engaging in sexual acts). Thus, those who originate or create child pornography are guilty of violating MCL 750.145c(2), even if they only intend to keep the material for personal use.
The Court of Appeals held that defendant had made child sexually abusive material, in violation of MCL 750.145c(2), because he brought into existence something that had not previously existed. We respectfully disagree with this analysis. While the burned CD-Rs may not have previously existed, this does not mean, in our judgment, that defendant made child sexually abusive material within the scope of MCL 750.145c(2). The fact that defendant placed prohibited images from different websites onto CD-Rs does not by itself rise to the level of making child sexually abusive material within the scheme enacted by the Legislature. Rather, such a reading of the statute can only be reached if one fails to give full consideration to the statute's, graduated scheme of offenses and punishments and if the term "makes" is read in isolation and without considering the immediately surrounding words. When "makes" is given a meaning reasonably compatible with those companion terms, its most reasonable interpretation pertains to the creation or origination of the child sexually abusive material in the first instance.
In Tombs, we held that the criminal intent to knowingly possess child sexually abusive material was not the same as the criminal intent to promote or distribute child sexually abusive material. Tombs, 472 Mich at 448 (opinion by KELLY, J.). Similarly, we hold here that the criminal intent to knowingly possess child sexually abusive material, when the possession is accomplished by burning a CD-R for the purpose of possessing the prohibited images and not for future distribution or promotion, does not establish the criminal intent to produce or make child sexually abusive material. In Tombs, we also held that one who handed a computer containing child pornography to someone else did not distribute child pornography, even though the act of handing a computer to another person would satisfy a dictionary definition of "distribute." The Court held that the act of intentionally handing a computer over to another was insufficient by itself to constitute distributing child pornography. Rather, there had to be some criminal intent to distribute, and the defendant in Tombs did not possess that intent. Similarly, defendant here burned CD-Rs, and these acts by themselves did not constitute making or producing child pornography because there was no proof beyond a reasonable doubt that this was defendant's intent when he burned the CD-Rs for his personal use.
We believe our conclusion is reinforced by consideration of the manner in which most persons ordinarily think about other types of Internet downloading. It is common today for computer users to legally, and sometimes illegally, download songs, movies, television shows, music videos, and books from the Internet. When such materials are subsequently burned to a CD-R or recordable DVD or some other storage device, as they often are, few would be inclined to characterize that conduct as the making or producing of that song, movie, television show, music video, or book. Such a characterization would, to say the least, be strained and incompatible with the "common and approved usage of the language" MCL 8.3a.
We further believe the Court of Appeals' analysis produces highly anomalous results. Consider two persons, one of whom downloads and burns child sexually abusive material to a CD-R for his personal possession and one of whom takes that CD-R and attempts to sell it. Under the dissents and the Court of Appeals' decision, the downloader has committed a 20-year felony while the seller has committed only a 7-year felony. We do not believe that this is consistent with the Legislature's intentions because the three tiers of MCL 750.145c instead suggest that the distributor is more criminally culpable than the downloader who, in order to obtain possession, has burned the prohibited images to a CD-R. When the Legislature has deemed the maker more culpable than the distributor, we' disagree with the dissents' broad interpretation of "make," which we believe casts a far broader net than intended by the Legislature.
The Court of Appeals and the dissents focus on the fact that MCL 750.145c(1)(m) defines "child sexually abusive material" as "any depiction," including any "reproduction [or] copy," of a "computer-generated image, or picture. . . ." Thus, they read the prohibition against making or producing child sexually abusive material in conjunction with the fact that a reproduction or copy of a computer-generated image falls within the ambit of prohibited images in concluding that burning a prohibited image to a CD-R constitutes making prohibited material. Again, we respectfully disagree. If an image constitutes child sexually abusive material, this is true without regard to whether a defendant is someone who arranges for, produces, makes, or finances, or who distributes or promotes, or who only knowingly possesses. In other words, once it is determined that an image constitutes child sexually abusive material, it must then be determined into which of the statute's three tiers the defendant's conduct falls.
The fact that the definition of "child sexually abusive material" in MCL 750.145c(1)(m) includes copies of computer-generated images does not provide particular insight into what either "makes" or "produces" means in MCL 750.145c(2). Rather, the fact that child sexually abusive material includes not just originals but also copies simply communicates that a person may be charged with knowingly possessing a copy of a computer-generated image, or with promoting or distributing a copy of a computer-generated image, or with arranging for, producing, making, or financing a copy of a computer-generated image, in a manner indistinguishable from the person engaged in those same activities in connection with an original image.
Defendant here was convicted of five counts of producing or making child sexually abusive material on the basis of 5 specific images. A review of his 2 laptop computers and 50 CD-Rs revealed 5 copies of one of the images and fewer, or no, duplicates of the other images that sustained his convictions. The fact that 5 copies of a single prohibited image were found after searching 52 different locations containing approximately 70,000 images is insufficient, in our judgment, in the absence of other evidence to establish beyond a reasonable doubt a criminal intent on defendant's part to produce or make this material. Since a common definition of "child sexually abusive material" applies to all three tiers of MCL 750.145c, we conclude that the Legislature did not intend that burning, or copying, images to a CD-R would have any special significance when determining which particular tier had been violated by that burning or copying.
Cf. People v Peterson, 63 Mich App 538, 548; 234 NW2d 692 (1975):
[T]he quantity of [marijuana] seeds possessed was so slight that we are constrained to find that reasonable jurors could not infer the intent to deliver from that quantity. There was no other evidence on the question of defendant's intent. It was therefore error for the trial judge to deny defendant's motion for a directed verdict of acquittal on the charged offense.
We are persuaded that the Legislature did not intend to impose the same maximum penalty on a person who downloads a prohibited image from the Internet and burns it to a CD-R for personal use as on the person who is responsible for the creation of the pornographic images of children. The latter is obviously more morally and criminally culpable than the person who downloads an image and saves it to another medium for personal use; at least, this is what the Legislature, in our judgment, has communicated by its enactment of MCL 750.145c. Those who arrange for, produce, make, or finance child sexually abusive material are punished more severely because they are the reason the images exist in the first place.
While the Court of Appeals' definition of "makes" has some dictionary support, its analysis was incomplete because it did not consider the statute as a whole and because it did not consider that "makes" should be given a meaning compatible with its surrounding words. When properly construed, the terms "produces" and "makes" are best understood as addressing those who are involved in the creation or origination of child pornography, and not those who download and burn a CD-R of prohibited images for personal use.
V. RESPONSE TO THE DISSENTS
The dissents obscure the issue before the Court by emphasizing the large quantity of prohibited images found in defendant's possession. There is no doubt that defendant possessed a very considerable amount of child sexually abusive material. However, the question before this Court is not whether defendant was a committed user of child sexually abusive material — he was — or whether he criminally violated MCL 750.145c — he did — but whether burning even a single prohibited image to a CD-R constitutes producing or making child sexually abusive material in violation of MCL 750.145c(2).
Even Justice YOUNG recognizes this in asserting in his dissent that "[m]aking even a single copy of child pornography violates the statute." Whether there is a large number of prohibited images in defendant's possession may well be a factor for the trial court to consider at sentencing; however, this does not transform a violation of subsection (4) of MCL 750.145c into a violation of subsection (2) of that statute.
The dissents fail to adequately consider the statute's overall organization and graduated scheme of offenses and punishments. As a consequence, the dissents end up blurring, and eventually ignoring altogether, the very distinct criminal definitions and requisite states of mind necessary to obtain a conviction under MCL 750.145c when they interpret "makes" as encompassing the conduct of a person who burns a prohibited image to a CD-R for the purpose of storing, or making permanent, his possession of that image. Contrary to Justice YOUNG'S assertion that the majority "would prefer that the statute cease" after its most severe violation has been defined, it is the dissenting justices who inappropriately read this language in isolation, ignoring the overall structure and organization of the statute, ignoring the distinct offenses that the statute defines, and ignoring the gradations of punishment that the statute establishes. It is the dissents that distort what is manifest in the statute — that distinctions are to be made among criminal violators, distinctions predicated on whether the violator has created or originated the material, distributed the material, or merely possessed the material.
The dissents would compress nearly every criminal violator into the category of "creator" or "originator" on the basis of their having made a copy of material created or originated by others. Thus, to the dissenters, there is no distinction, as we believe is manifest in the statute, between a person who downloads and burns child sexually abusive material to a storage device and the person who procures the seven-year-old girl, pays her parents, and then produces a film or image in which she is depicted in sexual poses. However, these are distinctions that the Legislature has made, and they are reasonable distinctions. The dissents notwithstanding, we do not "relieve[] . . . of criminal responsibility" the computer downloader when we recognize that the Legislature drew distinctions in MCL 750.145c between types of misconduct. No criminal responsibilities are being "relieved" when legislative distinctions are respected and the computer downloader of prohibited material is made subject to a 4-year term of imprisonment and the distributor of the same material is made subject to a 7-year term of imprisonment instead of the 20-year term of imprisonment reserved for the producer of the material, but for whose actions the material would never have existed in the first place. The Legislature is entitled to draw distinctions in its definitions of criminal activity, and this Court is obligated as a general matter to abide by those distinctions.
The question of what offense a mass producer of copies of a single prohibited image would be guilty is not before us, and we do not address it in this case.
Given that various things can be downloaded from the Internet and burned to other media, the dissents' strained interpretation of the term "makes" would have consequences far beyond the instant case. A person can download — legally or illegally — songs, books, music videos, television shows, or movies from the Internet and burn them to another medium such as a CD-R or recordable DVD. Yet virtually no one beyond the dissenting justices would consider such a person to have "made" or "produced" those songs, books, music videos, television shows, or movies. The legal or illegal down-loader of Star Wars is not the equivalent of George Lucas, the legal or illegal downloader of The Da Vinci Code is not the equivalent of Dan Brown, and the legal or illegal downloader of the Sgt. Pepper's Lonely Hearts Club Band album is not the equivalent of John Lennon or Paul McCartney. Even if these downloaders preserve the materials on a CD or DVD, they have not "made" those movies, "made" those books, or "made" that music in the same way as the creators of the materials. Similarly, we are satisfied that a person who burns a prohibited image to a CD-R or recordable DVD for his personal use is not the equivalent of the person who procured the child, placed the cameras in front of her, and created or originated child sexually abusive material. While both are criminally liable, they are liable under different sections of the statute.
That the illegal downloading and burning of a song, movie, or book may constitute a violation of federal copyright law, as Justice YOUNG asserts, post at 692 n 8, bears little relevance to whether a person who downloads and burns for personal use a song, movie, or book and thereby infringes on the copyright is making or producing the song, movie, or book under MCL 750.145c(2).
Indeed, under the dissents' interpretations, one might argue that someone who only viewed a prohibited image on a computer screen is guilty of making child pornography, given that computers themselves automatically store viewed images in temporary files. In other words, if Justice YOUNG genuinely believes that burning even a single prohibited image to a CD-R always constitutes making child pornography because it increases "the net amount of child pornographic images in existence," it would seem that consistency would require that a defendant who is merely aware of such temporary files would also be guilty of making child sexually abusive material whenever he views those images.
Finally, the dissents also assert that the majority has created "out of whole cloth" an "additional hurdle" by requiring proof of a defendant's intent. This is plainly incorrect. There is nothing at all remarkable in a court's reading a criminal intent into a criminal statute, given that such statutes are generally presumed to include a criminal intent. See Morissette v United States, 342 US 246; 72 S Ct 240; 96 L Ed 288 (1952); Staples v United States, 511 US 600; 114 S Ct 1793; 128 L Ed 2d 608 (1994); Tombs, 472 Mich at 452-456 (opinion by KELLY, J.); Id. at 465-468 (TAYLOR, C.J., concurring). Absent any state-of-mind requirement, a wife who transported her husband's laptop to the police station because she suspected that it contained child sexually abusive material would herself arguably be a possessor and distributor of the material. See Tombs, 472 at 458-459 (opinion by KELLY, J.). Similarly in this case, absent any state-of-mind requirement, a wife who downloaded a child sexually abusive image from her husband's computer and brought it to the police would herself run the risk of being characterized as a maker of the material under the dissents' interpretations of MCL 750.145c. Contrary to the dissents, it does not create an "additional hurdle" to prosecutions, or create a new statute "out of whole cloth," to require proof of a criminal intent in a criminal statute.
VI. CONCLUSION
A defendant who downloads child sexually abusive material from the Internet and burns the images to a CD-R, when there is no evidence the defendant had a criminal intent to do something other than possess the CD-R for his own personal use, may not be convicted of violating MCL 750.145c(2), which makes it a 20-year felony for any person who "arranges for, produces, makes, or finances" "any child sexually abusive material. . . ." Rather, that person is properly convicted of knowing possession of child sexually abusive material in violation of MCL 750.145c(4), a 4-year felony. The three tiers of offenses and punishments in MCL 750.145c compellingly indicate the Legislature did not intend to impose the same maximum penalty on a person who downloads a prohibited image from the Internet and burns it to a CD-R for personal use as on a person who is involved in the creation or origination of child sexually abusive material. Therefore, we reverse in part the judgment of the Court of Appeals, vacate defendant's convictions under MCL 750.145c(2), and remand for further proceedings not inconsistent with this opinion.
KELLY, C.J., and CAVANAGH and HATHAWAY, JJ., concurred with MARKMAN, J.
WEAVER, J. (dissenting).
I dissent from the majority opinion, which reverses in part the judgment of the Court of Appeals and vacates defendant's convictions under MCL 750.145c(2). I would affirm defendant's convictions under MCL 750.145c(2) because defendant intentionally made copies of child sexually abusive material.
In this case, police officers obtained two laptop computers and numerous recordable compact discs from defendant's home containing approximately 70,000 to 80,000 pornographic images of boys ranging in age from "toddlers to teens." Within defendant's immense collection of pornographic images, authorities found multiple copies of a single pornographic image. The copies created the basis for charging defendant with making child sexually abusive material.
I agree with Justice YOUNG'S statement in his dissent: "[T]he majority opinion relieves a defendant of criminal responsibility for making copies of child pornography `for personal use' and creates out of whole cloth an additional hurdle for those prosecuting individuals who make child pornography. . . ."
YOUNG, J. (dissenting).
In this case, defendant admitted making 50 recordable compact discs (CD-Rs) containing approximately 70,000 to 80,000 pornographic pictures depicting boys from "toddlers to teens," as well as videos depicting 12- to 13-year-old boys engaged in sexual acts. Within this compendious library of child pornography, multiple copies of one particular pornographic image formed the basis of the charges that were lodged against defendant for making child sexually abusive material.
Five images, described as "Jeffl3015.jpg," were created on defendant's laptop computer on October 5, 2002, and September 9, 2003, and found on three separate CD-Rs created April 15, 2003, April 26, 2003, and June 11, 2003. The record also indicates that the Jeff0015.jpg file was attached to a November 28, 2003, e-mail. However, a computer forensic examiner testified that she was unable to determine whether defendant sent the e-mail or received it.
The statute under which defendant was convicted plainly applies to any person who "makes" copies of child pornography. Here, despite the uncontested proof that defendant made numerous copies of one particular pornographic image, the majority opinion reverses defendant's convictions because it contends that he merely intended to possess the copied images "for personal use" and because the majority opinion finds it "simply untenable" that the Legislature would punish "those who download and maintain that material for personal use" as harshly as those involved in the "creation or origination" of child pornography.
MCL 750.145c(1)(m); MCL 750.145c(2).
However, the straightforward language of the statute is not limited to the original creator of the child pornography. Rather, MCL 750.145c(2) explicitly criminalizes making copies of child pornography, without requiring the prosecution to prove what the defendant intended to do with the child pornography once the crime had been'committed, that is, once the copies had been made. Because the majority opinion relieves a defendant of criminal responsibility for making copies of child pornography "for personal use" and creates out of whole cloth an additional hurdle for those prosecuting individuals who make child pornography, I vigorously dissent.
The relevant portions of MCL 750.145c provide:
(2) A person who persuades, induces, entices, coerces, causes, or knowingly allows a child to engage in a child sexually abusive activity for the purpose of producing any child sexually abusive material,
or a person who arranges
for,
produces, makes, or finances, or a person who attempts or prepares or conspires to arrange for, produce, make, or finance
any child sexually abusive activity or child sexually abusive material is guilty of a felony, punishable by imprisonment for not more than 20 years, or a fine of not more than $100,000.00, or both. . . .
(3) A person who distributes or promotes, or finances the distribution or promotion of, or receives for the purpose of distributing or promoting, or conspires, attempts, or prepares to distribute, receive, finance, or promote any child sexually abusive material or child sexually abusive activity is guilty of a felony, punishable by imprisonment for not more than 7 years, or a fine of not more than' $50,000.00, or both
(4) A person who knowingly possesses any child sexually abusive material is guilty of a felony punishable by imprisonment for not more than 4 years or a fine of not more than $10,000.00, or both [Emphasis added.]
Also critical to interpreting the prohibition against making child pornography is the statutory definition of two relevant terms. "Child sexually abusive activity" is defined as "a child engaging in a listed sexual act," while "child sexually abusive material" is statutorily defined as
MCL 750.145c(1)(Z). When defendant created the images at issue, the definition was codified at MCL 750.145c(1)(k).
any depiction, whether made or produced by
electronic, mechanical, or other means, including a developed or undeveloped photograph, picture, film, slide, video,
electronic visual image, computer diskette,
computer or computer-generated image, or picture, or sound recording which is of a child or appears to include a child engaging in a listed sexual act; a book, magazine,
computer, computer storage device, or other visual or print or printable medium containing such a photograph, picture, film, slide, video, electronic visual image, computer, or computer-generated image, or picture, or sound recording; or
any reproduction,
copy, or print of such a photograph, picture, film, slide, video, electronic visual image, book, magazine, computer, or computer-generated image, or picture, other visual or print or printable medium, or sound recording.
I agree with the majority opinion that MCL 750.145c establishes a graduated scheme of offenses and punishments. Broken down into its simplest terms, the statute provides a 20-year maximum sentence for those who make child pornography, a 7-year maximum sentence for those who distribute child pornography, and a 4-year maximum sentence for those who knowingly possess child pornography. It is the most severe sanction — the 20-year maximum sentence for those who make child pornography — that is at issue in this case.
MCL 750.145c(2) contains two distinct clauses, separated by the conjunction "or." The first clause covers a person who "persuades, induces, entices, coerces, causes, or knowingly allows a child to engage in a child sexually abusive activity for the purpose of producing any child sexually abusive material. . . ." This clause penalizes those who cause a child to engage in a sexual act for the purpose of producing child pornography. These are the "creators" or "originators" of the child pornography, those whom the majority opinion acknowledges as having " direct contact with a minor."
While the majority would prefer that the statute cease at the creators or originators of the child pornography, it does not. The second clause of MCL 750.145c(2) imposes criminal sanctions on a person who "arranges for, produces, makes, or finances . . . any child sexually abusive activity or child sexually abusive material. . . ." (Emphasis added.) The latter portion of the statutory provision pertains to more than the child sexually abusive activity — significantly, it also relates to the child sexually abusive material. And that is a critical point in any effort to give full meaning to this statute.
The statute also imposes criminal sanctions on one who "attempts or prepares or conspires to" arrange for, produce, make, or finance any child sexually abusive activity or child sexually abusive material. MCL 750.145c(2).
As noted, "child sexually abusive material" is statutorily defined as any depiction of a child engaged in a sexual act. The statute uses broad language to cover a wide range of image formats, including images produced by electronic, mechanical, or other means, photographs, pictures, films, slides, videos, electronic visual images, books, and magazines. It also includes depictions on a computer diskette, a computer, or a computer storage device. Significantly, "child sexually abusive material" includes " any reproduction, copy, or print of such a photograph, picture, film, slide, video, electronic visual image, book, magazine, computer, or computer-generated image, or picture, other visual or print or printable medium, or sound recording."
MCL 750.145c(1)(m).
The definitive question in this case is quite simple: did defendant "produce [or] make" a "reproduction [or] copy" of an "electronic visual image," a "computer, or computer-generated image," or other "visual or print" medium when he took the deliberate action of copying "Jeff0015.jpg" to his computer hard drive? Unquestionably, the answer is yes. Defendant then took the additional, volitional steps of copying that image to his computer a second time, as well as copying it to several CD-Rs.
The majority opinion's conclusion that MCL 750.145c(2) is "primarily concerned" with punishing "the creation or origination" of child pornography and "not those who download" it "for personal use" has no basis in the language of the statute. Indeed, the majority opinion takes great pains to avoid noting or giving significance to the fact that by downloading and successively copying child pornography, defendant intentionally produced or made a "reproduction [or] copy" of the same illicit pornographic image five distinct times.
Forced to acknowledge that the plain language of the statute says what it says and that "a person may be charged with" "producing, making, or financing a copy of a computer-generated image" in a "manner indistinguishable from the person" who created the original image, the majority opinion nevertheless proceeds to write the second clause of MCL 750.145c(2) out of existence by concluding that a defendant's ultimate plans for the child pornography negate the criminal prohibition regarding the method of acquisition. Presumably, a defendant copying child pornography would only ever do so for one of two purposes — either to possess it for himself or to distribute it to others. Both of these purposes are reflected in MCL 750.145c(3) and (4), which provide for a 7-year maximum sentence for those who distribute child pornography and a 4-year maximum sentence for those who possess child pornography. Under the majority opinion, despite the clear mandate imposing a 20-year sentence on those who make copies of child pornography, a defendant who makes copies of child pornography will never face more than either 4 or 7 years' imprisonment.
Our criminal code is replete with examples of crimes that have heightened consequences because of a defendant's chosen method of committing the crime. For example, one who commits an assault is generally subject to a 93-day jail term for that misdemeanor. MCL 750.81. However, if the same assault is committed with a dangerous weapon, the crime is a four-year felony. MCL 750.82. If the analysis used in the majority opinion were applied to a felonious assault case, one would be forced to conclude that the defendant merely intended to commit a 93-day misdemeanor, not a four-year felony, despite the uncontested evidence that a dangerous weapon was used during the assault.
By holding that a defendant who makes copies of child pornography is guilty of only a 4-year felony when the copies are made "for personal use," the majority opinion essentially holds that defendant's criminal liability is limited to that of a mere possessor under MCL 750.145c(4). However, under the plain language of the statute, defendant is more than a mere possessor of child pornography. The majority's holding is especially hard to square with the fact that defendant took the additional, volitional steps of copying the images to his computer and separately to CD-Rs. I believe that these actions fall squarely under MCL 750.145c(2) rather than MCL 750.145c(4). As the Court of Appeals opinion noted, it is certainly possible to possess child pornography without copying or reproducing the images. Indeed, defendant could have satisfied his yen for "personal use" of child pornography and "merely possessed" the images by viewing them on the Internet without actually copying the images to his computer twice and recopying the images to several entirely separate compact discs. However, once he copied an image, he clearly violated MCL 750.145c(2). While the majority opinion maintains that the originator of child pornography is "obviously more morally" and "more criminally" culpable than the copier of child pornography, nothing in the statutory scheme indicates that the Legislature shares the majority's culpability assessment. Indeed, the clear language of the statute indicates that the Legislature has deemed that both are equally culpable, and certainly more culpable than a defendant who possesses an illicit image without having taken the additional step of copying it.
The majority opinion also indicates that defendant's making "5 copies of a single prohibited image" is insufficient as a matter of law to sustain defendant's convictions. This is a conclusion that has absolutely no basis in the text of the statute. It is unclear to me why making five copies of an identical pornographic image of a minor is insufficient to sustain defendant's convictions because the entirety of MCL 750.145c(2) contains no numerical minimum requirement concerning copies of child pornography. Making even a single copy of child pornography violates the statute. The reason the majority opinion makes no effort to explain the calculus involved in determining that making five copies is insufficient is because it simply cannot justify such a conclusion.
The majority opinion runs far afield in responding to this dissent — and naturally so because the statutory language is clear and the majority is forced to strain in order to justify its conclusion. Central to the majority opinion's argument is its false conclusion that MCL 750.145c(2) is limited to the originator of child pornography. Thus, only those defendants having " direct contact with a minor" may be charged with violating MCL 750.145c(2). Not surprisingly,' the majority opinion gives absolutely no meaning to the fact that the statute also encompasses those who make copies of child pornography, not merely those who "procured the child" and "placed the cameras in front of her."
While the hyperbole comparing child pornography to downloading materials from the Internet in violation of federal copyright laws certainly makes for entertaining reading, it is equivalent to comparing apples to orangutans. The federal copyright laws encompass those who willfully infringe a copyright, which includes making copies of the creator's copyrighted material. By including a "reproduction [or] copy" of pornographic child images in the definition of "child sexually abusive material," the very material prohibited under MCL 750.145c(2), the Legislature has unambiguously indicated that one need not be the Cecil B. DeMille of child pornography in order to run afoul of MCL 750.145c(2) for "mak[ing]" child sexually abusive material.
Title 17 of the United States Code establishes a creator's intellectual property rights in original works. 17 USC 102(a). The owner of the copyright has "the exclusive rights to do and to authorize . . . to reproduce the copyrighted work in copies," 17 USC 106(1), and "to distribute copies" of the copyrighted work, 17 USC 106(3). Federal law also establishes penalties for copyright infringement. It allows the copyright owner "to institute an action for any infringement," 17 USC 501(b), including injunctive relief ( 17 USC 502), impounding prohibited material ( 17 USC 503), and damages ( 17 USC 504).
Federal law also criminalizes an intentional copyright infringement committed "for purposes of commercial advantage or private financial gain[.]" 17 USC 506(a)(1)(A). There is a three-tiered system of punishment, as provided in 18 USC 2319(b): a 5-year maximum sentence for reproducing or distributing at least 10 copies of one or more copyrighted works whose total retail value is greater than $2,500, a 10-year maximum for repeat felony offenders, and a 1-year maximum for any other case. Thus, making unauthorized "copies" is precisely the nature of a copyright infringement claim.
I find nothing vexing, much less "simply untenable," about our Legislature's decision to place an increased sanction on defendants who make copies of child pornography, thereby increasing the net amount of child pornographic images in existence. Because there is no question that defendant intentionally made multiple copies of child pornography, his convictions were proper and should be affirmed. Because the majority opinion concludes otherwise, and because it creates additional hurdles to the prosecution of those who copy child pornography, I dissent.
CORRIGAN, J., concurred with YOUNG, J.