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Practical IP The Intellectual Property Law Blog

Unauthorized Unlocking of Cell Phones Now Illegal

Posted in Copyrights, In the News, Software, Websites, Domain Names & Apps

Pursuant to a ruling by the Librarian of Congress in his triennial review of potential exemptions to the Digital Millennium Copyright Act (DMCA), which prohibits circumventing technological measures that protect copyrighted works, it is now illegal to “unlock” a new mobile phone purchased from a carrier after January 26, 2013, without the approval of the carrier.

In other words, consumers who purchase a new mobile phone from a carrier on or after January 26, 2013, will either have to obtain the carrier’s permission to unlock the device or buy a new phone in order to change service providers.  Additionally, consumers traveling abroad won’t be able to use SIM cards from international carriers on a locked phone without the carrier’s permission.  “Legacy” phones “previously purchased or otherwise acquired by a consumer” prior to January 26, 2013 (whether used or unused) may legally be unlocked because they have been grandfathered in under the ruling.

Consumers who unlock a phone without the carrier’s consent could be fined $200 to $2,500 per act, and willful violators may now face criminal penalties of up to 5 years in prison and/or $500,000 in fines.

Unauthorized unlocking (even of legacy phones) may also violate the terms of the carriers’ contracts, and can result in contact termination fees, penalties, and/or discontinued service.

The unlocking exemption (which was granted in 2006 and 2010) could be reinstated in another three years during the Librarian of Congress’ next DMCA rulemaking proceeding, which will be initiated in late 2014.  There is also a We the People petition that calls for the White House to ask the Librarian to rescind the decision or support legislation that would make unlocking permanently legal.

It’s interesting to note that the same ruling exempts “jailbreaking” of cell phones (but not tablets or game consoles).  “Jailbreaking” occurs when a user removes restrictions on a device in order to download of apps or software not approved by the manufacturer or otherwise makes unauthorized modifications to the operating system. Jailbreaking voids the phone warranty, often violates the terms of phone license agreements, and can cause operating issues with the phone.  Once a consumer jailbreaks a phone, it can be unlocked; however, unlocking a phone through jailbreaking is now illegal and legitimate unlocking by a carrier is no longer an option.