Microsoft Legal Action Aims to Help Fight Piracy

REDMOND, Wash. — Sept. 19, 2006 — As part of Microsoft Corp.’s commitment to honest business partners that distribute the company’s products, the company announced 20 lawsuits today against resellers allegedly engaged in the distribution of infringing software and software components. The company also announced research findings from its first large-scale forensic analysis of counterfeit versions of Microsoft® Windows® XP acquired in 17 countries around the world, which it says demonstrates that counterfeit software contains risks for typical users, not just the “pirates” who manufacture and sell it.

The lawsuits, filed against 20 defendants throughout the U.S., are against companies that allegedly distributed counterfeit software or software components or participated in hard-disk loading. Hard-disk loading is the installation of unlicensed software on computers that are then sold to unsuspecting businesses or consumers who will be denied the benefits of genuine Microsoft software. Lawsuits were filed against companies in nine states: Connecticut, Florida, Georgia, Kansas, New Jersey, New York, Ohio, Oregon and Texas.

Microsoft said that the lawsuits announced today are part of a broader company initiative to combat counterfeiting and other forms of software piracy. “We want to make it clear to people who try to profit illegally,” said Microsoft senior attorney Mary Jo Schrade. “Microsoft is determined to protect its intellectual property, while also helping protect consumers and honest resellers from the deceptive and dangerous practices of counterfeiting and hard-disk loading. We devote significant resources to helping ensure the integrity of the software marketplace and will not sit by as consumers are put at risk and honest resellers are hurt.”

The legal actions and results of the forensic analysis announced today are part of a broader Microsoft program, the Genuine Software Initiative (GSI), designed to protect the company’s intellectual property. GSI focuses the company’s resources targeting the distribution of infringing Microsoft software into three areas: education, engineering and enforcement.

Forensic Analysis of Counterfeit Microsoft Software Media

Findings from the forensic analysis of counterfeit Microsoft Windows XP software disks in June 2006 highlighted that one in three counterfeit disks could not be installed on a computer. The remaining counterfeit disks proved to have risks due to tampered code, which could result in denial-of-service attacks, bypass of password protection and application memory corruption.

  • Of the 348 disks studied:

    • Thirty-four percent of the counterfeit copies analyzed could not be installed on a computer.

    • Forty-three percent had additional programs, or binary code, that are not part of genuine Microsoft Windows.

  • Of the remaining 228 disks:

    • Sixty-six percent had additional programs, or binary code, that are not part of genuine Microsoft Windows.

    • More than 40 percent of these added software programs or binaries had faults, and many included illegally created product keys, other tampered code, or code invisible to the user.

“Counterfeit software is big business worldwide,” Schrade said. “As this research highlights, consumers and businesses need to make informed choices when purchasing software or risk the possible consequences of using counterfeit software.”

The evidence gathered for the lawsuits announced today were received via Microsoft’s hot line, (800) RU-LEGIT (785-3448), or via e-mail through piracy@microsoft.com. Microsoft purchases software and computers from sellers throughout the country in the same way a consumer or business would make the purchase, and tests them for authenticity, which enables Microsoft to determine whether pirated Microsoft software is being distributed in the market.

Founded in 1975, Microsoft (Nasdaq “MSFT”) is the worldwide leader in software, services and solutions that help people and businesses realize their full potential.

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Legal Case Summary

Filed in the U.S. District Court for the Northern District of Ohio, Western

Microsoft Corp. v. Cyber Solutions (North Baltimore, Ohio), alleging distribution of infringing Office XP Professional software.

Case No. 3:06CV2224

Filed in the U.S. District Court for the Southern District of Ohio, Western Division

Microsoft Corp. v. ComputerME.net (Hamilton, Ohio), alleging distribution of counterfeit and infringing Office 2000 Professional software.

Case No. 1:06CV611

Filed in the U.S. District Court for the District of Connecticut

Microsoft Corp. v. Sumner Transatlantic (Fairfield, Conn.), alleging distribution of counterfeit Windows XP software.

Case No. 3:06CV1450(MRK)

Filed in the U.S. District Court for the District of Oregon

Microsoft Corp. v. Byte Me Computers (La Grande, Ore.), alleging distribution of infringing Office 2003 Professional software.

Case No. CV06-1315 HA

Filed in the U.S. District Court for the District of New Jersey

Microsoft Corp. v. JFG Tek Computers (Glendora, N.J.), alleging distribution of infringing Windows XP Professional and Office 2003 Professional software.

Case No. 06-CV-4331 (RBK)

Filed in the U.S. District Court for the Middle District of Florida, Orlando Division

Microsoft Corp. v. Reyder Enterprises, Inc. d/b/a Computers 4 Less (Orlando, Fla.), alleging distribution of infringing Windows XP Professional and Office 2003 Professional software.

Case No. 6:06-CV-1407-ORL-28KRS

Filed in the U.S. District Court for the Southern District of Florida

Microsoft Corp. v. EComp Computers (Miami), alleging distribution of infringing Windows XP Professional, Office XP Professional and Office 2003 Professional software.

Case No. 06-22320-CIV-GRAHAM/O’SULLIVAN

Filed in the U.S. District Court for the Middle District of Florida Tampa Division

Microsoft Corp. v. HecsPC.com (Port Richey, Fla.), alleging distribution of infringing Office 2003 Professional software.

Case No. 8:06-cv-1705

Filed in the U.S. District Court for the Middle District of Florida, Orlando Division

Microsoft Corp. v. Silver Eagle Computers, Inc. (Orlando, Fla.), alleging distribution of infringing Windows XP Professional and Office 2003 Professional software.

Case No. 6:06-CV-1405-ORL-19JGG

Filed in the U.S. District Court for the Middle District of Florida, Orlando Division

Microsoft Corp. v. The Wholesale Computer (Deland, Florida), alleging distribution of infringing Windows XP Professional and Office 2003 Professional software.

Case No. 6:06-cv-1406-ORL-31KRS

Filed in the U.S. District Court for the Northern District of Georgia, Atlanta Division

Microsoft Corp. v. Atlantatechnology (Norcross, Ga.), alleging distribution of infringing Office 2003 Professional software.

Case No. 06 CV 2209

Filed in the U.S. District Court for the Northern District of Georgia, Atlanta Division

Microsoft Corp. v. Dalsand Computers (Norcross, Ga.), alleging distribution of infringing Windows XP Professional and Office 2003 Professional software.

Case No. 06-CV-2207

Filed in the U.S. District Court for the Northern District of Georgia, Atlanta Division

Microsoft Corp. v. GForce Computer Sales and Services (Douglasville, Ga.), alleging distribution of infringing Windows XP Professional and Office 2003 Professional software.

Case No. 06 CV 2208

Filed in the U.S. District Court for the District of Kansas at Kansas City

Microsoft Corp. v. America’s Computers & Wireless (Olathe, Kan.), alleging distribution of infringing Windows XP Professional software.

Case No. 06 CV 2390 JAR

Filed in the U.S. District Court for the Eastern District of New York

Microsoft Corp. v. Gatecomusa.com (Flushing, N.Y.), alleging distribution of infringing Office 2003 Professional software.

Case No. 06 cv 5027

Filed in the U.S. District Court for the Eastern District of New York

Microsoft Corp. v. Unet Computer Inc. (Valley Stream, N.Y.), alleging distribution of counterfeit and/or infringing Windows XP Professional and Office 2003 Professional software.

Case No. 06 cv 5028

Filed in the U.S. District Court for the Southern District of Texas, Houston Division

Microsoft Corp. v. Computers and Laptops Fixture (Houston, Texas), alleging distribution of infringing Windows XP Professional and Office XP Professional software.

Case No. H-06-2926

Filed in the U.S. District Court for the Southern District of Texas, Houston Division

Microsoft Corp. v. ITQ Computers/One-Line (Houston, Texas), alleging distribution of infringing Windows XP Professional and Office XP Professional software.

Case No. H-06-2927

Filed in the U.S. District Court for the Northern District of Texas, Dallas Division

Microsoft Corp. v. Millennium Communications (The Colony, Texas), alleging distribution of infringing Windows XP Professional and Office 2003 Professional software.

Case No. 3-06CV1690-N

Filed in the U.S. District Court for the Eastern District of Texas, Marshall Division

Microsoft Corp. v. Computers Unlimited (Marshall, Texas), alleging distribution of infringing Office XP Professional and Windows XP Professional software.

Case No. 2-06CV-371