Governor Haslam Signs Tennessee Senate Bill SB 1659 Criminalizing Netflix & Other Entertainment Subscription Services Password Sharing

The next time someone gives out a password to one of his/her friends or associates, he/she should check to make sure he/she is not breaking the law. Tennessee just passed a law that will make the sharing of a password to an entertainment subscription service like Netflix a crime. The bill is Senate Bill 1659.

The bill, which has been signed by Gov. Bill Haslam [on May 30, 2011] and takes effect July 1, was pushed by recording industry officials to try to stop the loss of billions of dollars to illegal music sharing. They hope other states will follow.

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SB 1659 by *Tracy. (*HB 1783 by *McCormick, Shepard, Lollar, Haynes, Parkinson, Miller D, Alexander, Dean, McManus, Todd, Maggart, Williams R.)

Criminal Offenses - As introduced, includes entertainment services in services the theft of which constitutes theft of services and adds enhanced violation for repeat offenders; specifies that victims may report violations and testify. - Amends TCA Title 39.

Fiscal Summary

Increase State Expenditures - $14,100/Incarcaration*

Bill Summary

As described below, this bill specifies that the offense of theft of services includes the theft of entertainment subscription services and provides for increased penalties when the offender has two or more prior offenses that involve theft of entertainment subscription services.

Under present law, a person commits the offense of theft of services who (emphasis added):

(1) Intentionally obtains services by any means to avoid payment for the services;

(2) Having control over the disposition of services to others, knowingly diverts those services to the person's own benefit or to the benefit of another not entitled to such benefits; or

(3) Knowingly absconds from establishments where compensation for services is ordinarily paid immediately upon the rendering of them, including hotels, motels and restaurants, without payment or a bona fide offer to pay.

Theft of property or services is:

(1) A Class A misdemeanor if the value of the property or services obtained is $500 or less;

(2) A Class E felony if the value of the property or services obtained is more than $500 but less than $1,000;

(3) A Class D felony if the value of the property or services obtained is $1,000 or more but less than $10,000;

(4) A Class C felony if the value of the property or services obtained is $10,000 or more but less than $60,000; and

(5) A Class B felony if the value of the property or services obtained is at least $60,000.

This bill specifies that "services" includes entertainment subscription services. This bill specifies that any victim of theft of services would have legal standing to report the offense to law enforcement and to testify in support of corresponding criminal charges.

This bill specifies that the theft of property or services valued at $500 or less would be a Class E felony instead of a Class A misdemeanor if such offense is the offender's second or subsequent offense after July 1, 2011, which involves theft of entertainment subscription services.

ON MAY 18, 2011, THE SENATE ADOPTED AMENDMENT #1 AND PASSED SENATE BILL 1659, AS AMENDED.

AMENDMENT #1 adds to present law by specifying that a person commits theft of services by intentionally obtaining services by forgery or false statement, in addition to deception, fraud, coercion, false pretense or any other means, to avoid payment for the services. This amendment removes the bill's provision that makes the theft of property or services valued at $500 or less a Class E felony if such offense is the offender's second or subsequent offense after July 1, 2011, which involves theft of entertainment subscription services.