US v. Chalupnik
BMG Columbia House (“BMG”) sells CDs and DVDs by mail. Many BMG discs prove to be undeliverable. During the time in question, BMG arranged with the United States Postal Service (“USPS”) to gather and discard undeliverable discs, as it was less costly for BMG to produce replacement discs than to pay for the return and restocking of undeliverable discs. James Chalupnik, a janitorial supervisor at the downtown post office in Fargo, North Dakota, took several thousand undeliverable CDs and DVDs from the post office trash and sold them to used record stores. Initially charged with felony mail theft, Chalupnik pleaded guilty to misdemeanor copyright infringement in violation of 17 U.S.C. § 506(a) and 18 U.S.C. § 2319(b)(3). The district court sentenced Chalupnik to two years probation and ordered him to pay BMG restitution in an amount equal to his documented sales proceeds, $78,818. Chalupnik appeals the restitution award. We conclude that the government failed to prove the amount of loss to BMG proximately caused by Chalupnik’s offense. Accordingly, we vacate the restitution award and remand for resentencing.
