If I have duplicate content listed on my site, Google will penalize me correct?

What if the stolen content was deemed to be the original content? I would then be penalized, right?

If I am linking to and being linked from a banned domain, is that a warrant for some sort of penalization from Google?

By being penalized, I mean hitting the sand box again, being sent to supplemental hell, suffering a disastrous SERP penalty or some other sort of Google judgment.