With all of the recent flap in Congress about the labeling and record-keeping requirements (18 U.S.C. �2257), inspections are inevitable. Are you ready? Is everything shipshape?
Remember the rules of compliance: Perfect = OK. Non-compliant = 0-5 years. 99% compliant = 0-5 years. This is serious stuff.
Recall that the PROTECT Act - that "Amber Alert Law" that supposedly represented a crackdown on child abduction and child pornography - included some nasty provisions about 2257. The Act requires the Department of Justice to send a report to Congress detailing its enforcement of 2257 within one year of its effective date, which was April 30, 2003. United States v. Cotto, 347 F.3d 441, 445 (2nd Cir. 2003). This article goes to press on the eve of the due date, but so far nobody has heard anything about any report. Conventional wisdom, however, suggests that inspections are imminent.
So, the first question is what individual might knock on what door. The statute says that anyone required to keep records "shall maintain the records required by this section at his business premises, or at such other place as the Attorney General may by regulation prescribe and shall make such records available to the Attorney General for inspection at all reasonable times." That's �2257(c).
That leads you to the regulations, which are found in the Federal Code of Regulations, or "C.F.R.", at Title 28, Chapter I, Part 75, sections 75.1-75.7. Those regulations, by the way, can be found on the Internet at www.gpoaccess.gov/cfr/retrieve.html.
There, you can retrieve them one-by-one by way of the incredibly cumbersome process of typing them in one at a time. So if you are looking for section 75.1, for example, you access that site and type in 28 under "Title", 75 under "Part" and 1 under "Section." Only the federal government could make such a simple process so complicated!
Section 75.5 says that the record-keeper "shall make such records available to the Attorney General or his delegee for inspection at all reasonable times." The key to this is "delegee." It doesn't say anywhere who can be a "delegee," and there are no known limitations. A check of available lexicons reveals that "delegee" is not a word, nor can it be found in Black's Law Dictionary, which is supposed to include all legal terms. It sounds like the attorney general can designate just about anyone he wants, which is rather frightening.
Rumor has it that the attorney general will deputize local vice squads to accomplish these inspections. And if you are confronted by such a person who demands inspection of your records, you should demand proof of authority. If it is someone from the FBI, Department of Justice, local United States attorney's office or other such federal official, their regular, government identification should be regarded as sufficient. They are agents of the attorney general, who is in charge of all of those folks, by way of employment.
Another issue is what a "reasonable" time is. It would be difficult to argue that times when your business is open are not reasonable. Importantly, however, there is not any requirement for notice, and don't expect a call to make an appointment.
Preparedness for such a visit begins with the question of what records, if any, you are required to have. If your company simply purchases completed video, and has nothing to do with taking the pictures or arranging for the hiring of the performers, then you only need to be sure that all qualifying pictures (such as the ones on video boxes) have the disclosure about where the records are located, the custodian, and so on. Now, if you read the regulations, they will tell you that if you purchase pictures and re-package them in any way, then you too are required to have records at the ready because you are a "secondary producer." Not so! That requirement was thrown out in a case called Sundance Associates, Inc. v. Reno, 139 F.3d 804 (10th Cir. 1998). Now, an obvious exception lies in the situation where your company has designated itself as the record-keeper on the disclosure labels, thus acknowledging that you are a producer; under those circumstances, of course, you are on the hook for having the records available.
Another exception that isn't so obvious is old stuff. The regulations say that �2257 applies to qualifying depictions "made [e.g. , photographed] after November 1, 1990, and produced, manufactured, published, duplicated, reproduced, or reissued on or after May 26, 1992." 28 C.F.R. ��75.6, 75.7(a)(1). But you have been reading AVN, so you know that the effective date of the regulations is July 3, 1995. But, why?
Section 2257 was held unconstitutional before the regulations ever became effective, but the attorney general appealed from that ruling. The court of appeals reversed, and the mandate of reversal, which had the effect of dissolving the injunction that had been pending for years, was issued on July 3, 1995. Not until then did �2257 become effective. American Library Ass'n. v. Reno, 33 F.3d 78 (C.A.D.C. 1994) rehearing denied 47 F.3d 1215 (1995), certiorari denied 115 S.Ct. 2610, 515 U.S. 1158, 132 L.Ed.2d 854 (1995). Certiorari was denied (i.e. , the Supreme Court refused to hear the case) on June 26, 1995. Shortly thereafter, July 3, 1995, the mandate of reversal (an order by the court of appeals that the pending injunction be dissolved) issued, eliminating any enforcement constraint.
Also, of course, �2257 applies only to visual depictions of "actual sexually explicit conduct." Now, think about that for a second. A depiction is of "actual sexually explicit conduct" regardless of whether you can see the sexual conduct in the picture. So, even if the photos are cropped, taken at a "softcore" angle or have "dots" obscuring the penetration, �2257 applies, so long as qualifying sexual activity was happening when the picture was made.
"Actual sexually explicit conduct" also is limited to genital contact and sadomasochistic activity which, obviously, must be actual, not simulated, for �2257 to apply. If, for example, the conduct involves only massaging someone's buttocks or a woman's breasts, that conduct alone does not trigger �2257. And it is assumed that the depictions must be of real people, because the purpose of the statute is to protect minors from being in sexually explicit movies; if it is a computer or artistic image with no human model, there is nobody to protect.
The next issue is where the records must be located. There are two aspects to this, the legal considerations and the practical ones.
Legally, the records must be kept at the producer's place of business.
"Any producer required by this part to maintain records shall make such records available at the producer's place of business. The business address shall refer to a street address and not to a post office box number." 28 C.F.R. �75.4.
The regulations do not give consideration to what happens where the producer has more than one place of business. But it would seem reasonable to assume that anywhere the producer regularly conducts business would be "the producer's place of business."
Equally important are practical considerations. Do you really want some FBI agent sitting around your office while you conduct your business in his presence, listening to phone conversations, taking note of who is saying what to whom, watching vendors or customers come in and out? While records must be at your "place of business," they need not be in the same room with the functionaries of the business. To the contrary, they should be in a separate room where there is nothing else; in a separate filing cabinet in which nothing else is stored; and on a separate computer, which has none of your other records on it and which never had any of your other records on it. The reasons for a separate room and a separate filing cabinet should be obvious. The separate, virgin computer is suggested because, even if you are doing everything perfectly, something that creates probable cause that you are in violation could give rise to a warrant to seize the computer. Do you really want them reading all of your e-mails and financial records? And, remember, computer wizards - and the FBI has plenty of them - can "un-erase" computer files that you may think you've eliminated.
Since you now have a special "2257 Room," anyway, you might as well go for broke. Paint it red, white and blue, decorate it with flags, adorn the walls with copies of the Declaration of Independence and the Bill of Rights, and have a radio with all of the tuning buttons disabled, locked in to Air America and Al Franken. On the other hand, maybe not. A better choice would be a bunch of sports posters or memorabilia, for reasons that follow.
When confronted with one of these government inspectors, remember that included in the First Amendment (and the Fifth!) is the right to shut up, a privilege that you should exercise. After all, for the same reason that you don't want the inspector hanging around your office, you don't want to tell him about your business any more than the law requires. At the same time, you probably don't want to do anything to cause him to dislike you - he is a cop, remember. Good topics to talk about are the location of the records that the inspector properly requests, last night's baseball game, the day's weather, which restaurant has the best prime rib in town, how bad the traffic was this morning - you get the idea. Bad topics to talk about are how long you have been with the company, whether some other person with whom you do business is a nice guy, where your secretary worked before he or she came to your company - just avoid talking about your company altogether, which may be difficult. That is one reason why it might be a good idea to decorate your "2257 Room" with sports posters and such. All the inspector has to say is, "Oh, I see that you are a Dodgers fan," and you have a topic to chatter about during the entire process. Just don't talk about the people with whom you attend the games.
The last topic is the contents of your "2257 Room." First, you must have records for each performer including,
"(1) The legal name and date of birth of each performer, obtained by the producer's examination of an identification document, as defined by 18 U.S.C. 1028(d). [T]he records shall also include a legible copy of the identification document examined and, if that document does not contain a recent and recognizable picture of the performer, a legible copy of a picture identification card.
"(2) Any name, other than each performer's legal name, ever used by the performer, including the performer's maiden name, alias, nickname, stage name, or professional name. ... [S]uch names shall be indexed by the title or identifying number of the book, magazine, film, videotape, or other matter."
Now, two things merit comment here. First, qualifying identification under 18 U.S.C. 1028(d) includes a passport, a state driver's license or an identification card issued by the same governmental entity that issues driver's licenses. If someone looks young and doesn't have one of those, that should set off an alarm. There are other forms of identification that qualify under that statute, but none will receive any endorsement here.
The second topic is indexing. You are required to be able to respond to questions such as "I need a list of all of the titles in which an actor with the name Johnny Cumshot has appeared, and his records," or "I need all of the records for the performers that appeared in the feature Linda Lovely Does Hollywood," and so on. The best way to do this is a computer database, especially if you have any significant number of titles. Recipe (3x5) cards would work, but that can be a ton of work.
Two practical considerations: First, there is no requirement that the records be written on paper. They could be printed on a slab of granite, if you have a copier that will do that. The practical point is that, in the era of cheap scanning and computers, they can be in electronic form, such as an Adobe Acrobat file.
Second, keep duplicates. Like any other records, it is imperative to have an off-site backup. The last thing you need is to have your records destroyed in a fire, ending your ability to distribute your library.
While nobody has a clue when or where inspectors will show up, or who they will be, you should double check. If you are required to keep records, be sure they are in order. Your mother is coming over - clean up your room!
(Clyde DeWitt is a partner in the Los Angeles, California-based, national law firm of Weston, Garrou & DeWitt. He can be reached through AVN's offices, at his office at 12121 Wilshire Boulevard, Suite 900, Los Angeles, CA 90025 or over the Internet at [email protected]. Readers are considered a valuable source of court decisions, legal gossip and information from around the country, all of which is received with interest. Books, pro and con, are encouraged to be submitted for review, but they will not be returned. This column does not constitute legal advice but, rather, serves to inform readers of legal news, developments in cases and editorial comment about legal developments and trends. Readers who believe anything reported in this column might impact them should contact their personal attorneys.)
