The first case of someone being convicted under the DMCA for bypassing a phone unlock has been recently closed, with the government winning its case against one Mohamed Majed for mass unlocking handsets and reselling them.
After it was discovered that he was unlocking stolen handsets on a mass scale, up to several thousand phones for resale in Michigan in Hong Kong, he was arrested in 2009 by the FBI and denied bail due to the flight risk involved. The FBI alleged that Majed was reselling the phones and funneling the profits to Hezbollah.
For Tracfone to invoke the DMCA against one individual for unlocking and succeeding would be a very dangerous precedent as the Library of Congress ruled in 2006 that handset unlocking was indeed legal and further language codified earlier this year effectively keeps it legal for personal use, but there is a little known addition to the initial exemption that effectively allows prepaid carriers to go after mass unlockers and resellers.
If Majed were a typical user, then the move to convict under the DMCA would have served to send a message to other users to not tamper with cellphones for unlocking, as the conviction implies that the DMCA exemption does not apply to prepaid products. Further language codifies the additional exemption against mass unlockers and resellers by the Copyright Office not long after the initial codification by the library this summer.
The Register finds that the exemption should be limited to include only "used" mobile phones. The term "used," as applied in this context, refers to a mobile phone that has been activated with the carrier or provider that sold the phone at a subsidized price and that the person activating the phone must actually have used on that carrier’s network.
In effect, the ruling and conviction only affects mass unlockers and resellers, so any concern about the legality of unlocking for personal use is unfounded, at least for the next three years before the exemptions come up for further review. Majed was arrested as a part of an FBI sting operation involving him and 26 others in the same group. By pleading down to one count of what is essentially copyright infringement from 33 more severe counts, he may have avoided more severe punishment from the initial 33 counts. Majedâ€™s sentencing is slated for later this month.