Is there a penalty for selling stolen digital files? Is it the same as selling other illegal goods? Is there no specific provision about it? If applicable, is there a Massachusetts-specific provision on this?

2 Answers 2


While it seems like a simple question, the answer is somewhat complicated. As is frequently the case for "white collar" misconduct, There are several civil and criminal legal theories that could be applied, depending upon the nature of the offense, at both the federal and state levels (e.g. how was it done and what is the relationship of the offender to the victim).

The penalty will generally be specific to the legal theory under which punishment or compensation is sought.

One of the more obvious ones (if the stolen files are legitimately classified as trade secrets) is violation of the state's trade secret law:

If a court finds that a defendant has unlawfully taken a plaintiff's trade secret(s), it may impose the following penalties and remedies:

Criminal Penalties: Unlawfully taking a trade secret (defined above) constitutes the crime of larceny in Massachusetts and is punishable by up to five years imprisonment, or by a fine of up to $25,000 and up to two years imprisonment. See Mass. Gen. Laws ch. 266, § 30.

Damages: A court can make a defendant pay money damages to the plaintiff in an amount up to twice its actual damages. See Mass. Gen. Laws ch. 93, § 42

Injunctive Relief: Massachusetts law gives a court the power to restrain the defendant from "taking, receiving, concealing, assigning, transferring, leasing, pledging, copying or otherwise using or disposing of a trade secret, regardless of value." See Mass. Gen. Laws ch. 93, § 42A. It appears that a court could order you not to publish a trade secret if it found that you had unlawfully taken it from the plaintiff. The First Amendment to the U.S. Constitution may limit the court's authority to do so, however.

Another would be a civil action for conversion of intellectual or intangible property, or a criminal action for theft or sale of stolen goods.

Depending upon the means by which the files were obtained, it might implicate common law fraud and criminal fraud offenses (including wire and mail fraud), and state and federal laws involving computer crimes. Another legal theory could be tortious interference with contract or tortious interference with business prospects.

Less aggressively a common law constructive trust could probably be imposed on the digital files and the proceeds from them, and the person receiving the proceeds of the stolen files could be sued for unjust enrichments/restitution.

In many cases, it would be a civil and criminal federal copyright law violation (if the victim owns the copyright and the files are copyrightable material).

The proper offenses and hence the available remedies, would depend to a significant extent both legally and from a practical and litigation tactics perspective, on the means by which the digital files were obtained.

  • A little side note: Wilful copyright infringement can cost up to 150000 $ per infringement, normally it's about 750-30000 $.
    – Trish
    Commented Sep 6, 2020 at 7:54

It depends on how they were "stolen". If a digital file resides on some storage unit and you steal the storage unit, that is theft in the legal sense, where the penalty is defined by how you steal it and what the value of the thing is, as you can see here for Massachusetts. That could be 5 years, or 2 years and $25,000 for a value over $1,200. There is also shoplifting; armed robbery is more about the implementation of the larceny.

Another sense in which digital files are "stolen" is by illegally copying them, which is in the usual case copyright infringement. If you infringe copyright, you can be sued (by the copyright holder) for whatever damage you did, which relates in part to what you do with the illegal copy (e.g. re-distributing a movie, vs. merely downloading and reading a Harry Potter book from a piracy site). This sums up the consequences of copyright infringement. The term "penalty" generally does not apply to damages that you have to pay as the result of a lawsuit. However, there is also a criminal provision, 18 USC 2319, where the criminal penalty depends on the nature of the infringement and how many times you've done it, up to 10 years in prison for a second offense. The essence of prison time for infringement is that it is imposed for infringement for profit, but it can include $1,000 forth of infringement for personal use.

There are other possibilities regarding trade secrets and possibly espionage, which depend on the ind of material.

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