Microsoft Files Lawsuits Against Three Portland-Area Resellers In First Oregon Anti-Piracy Sweep

REDMOND, Wash., Nov. 23, 1998 — Microsoft Corp. officials today announced they have filed lawsuits against two computer resellers in the Portland area, alleging copyright violations and trademark infringement as the result of the company’s first anti-piracy investigations in the area. The investigations were conducted to help protect legitimate distributors and customers from the effects of software piracy in Oregon.

The lawsuits were filed Nov. 19 in the U.S. District Court for the District of Oregon against two Portland-area companies.

World Solutions Ltd., of Portland, Ore. (Civil Action No. CV 98 1454 HA), allegedly distributed counterfeit copies of the Worldwide Fulfillment version of Microsoft® Office 97 Professional. Fulfillment versions of Microsoft software are intended as replacement parts for customers with Microsoft licensing agreements. In its lawsuit, Microsoft cited World Solutions’ explicit advertising of Office Professional 97, while repeatedly selling customers counterfeit fulfillment components. Consumers who purchase counterfeit products could find they are missing key elements, such as user manuals and product identifications, Certificates of Authenticity and even software code. They may also find that the counterfeit software contains viruses.

Computrade Inc., dba Computer Renaissance, of Beaverton, Ore. (Civil Action No. CV 98 1453 AS), allegedly hard disk loaded computers with unauthorized copies of the Microsoft Windows® 95 operating system and Office 97 Professional. Hard disk loading is the installation of software for which a company has no license onto a computer’s hard disk before it is sold to a customer. Hard disk loading, counterfeit distribution by resellers and unauthorized multiple installations of software in businesses are the three most prevalent forms of software piracy.

“As one of the larger resellers of computer equipment in the United States, we realize the importance of ensuring that all resellers play by the rules,”
said Mike Flynn, president of Computer Renaissance in Minneapolis, which has four independently owned franchises in Oregon.
“It is part of our franchise agreement that Computer Renaissance franchisees operate their businesses legally. We support Microsoft in its efforts to protect honest resellers and consumers from the crime of software piracy in an environment that is already very competitive.”

The companies were investigated as a result of tips to the Microsoft anti-piracy hot line, most of which are received from honest resellers or from customers who obtain suspicious products. In such cases, Microsoft customarily notifies the defendants that it suspects them of acting illegally and then determines whether this behavior has continued before filing a lawsuit.

“In 1997, Oregon lost more than 1,940 jobs and $81 million in combined lost wages, retail sales and tax revenues from software piracy, and a significant portion of those jobs and revenues rightfully belong to honest businesses,”
said Jules Michel of Precision Computers, a systems integrator providing the hardware, software and services necessary for digital communications.
“By filing suits against companies in Oregon that engage in alleged illegal advancement of technology in the state.”

Microsoft encourages consumers to become familiar with the warning signs that can help them identify counterfeit or illegal software.

  • Prices that are
    “too good to be true.”
    These may indicate counterfeit product or product that has been misdirected, such as product authorized for distribution only to educational institutions but being offered to the general public.

  • Backup disks or CD-ROMs with handwritten labels, or components that appear to be of inferior quality

  • Manuals that appear to be photocopied or are of inferior quality

  • Products marked with a phrase, such as
    “For distribution with a new PC only,” “Special CD for licensed customers only,” “Not for retail or OEM distribution”
    or
    “Academic price – not for use in a commercial environment,”
    that does not describe the transaction

In addition, when users acquire a new computer system, it will include operating system software. If that software is the Microsoft Windows 98 operating system, it will be accompanied by a user manual that incorporates a Certificate of Authenticity as the cover. The customer will also receive a CD-ROM with the software program. There must be an end-user license agreement (visible onscreen when the program is first run). If any of these elements is missing, the product is suspect.

Customers or resellers with questions about the legitimacy of Microsoft products should contact the Microsoft anti-piracy hot line, toll free, at (800) RU-LEGIT (785-3448), or send e-mail to piracy@microsoft.com. In addition, a list of authorized distributors and details regarding the Original Equipment Manufacturer (OEM) System Builder program is available at http://www.microsoft.com/oem/ . Consumers can obtain more information about software piracy by calling the Business Software Alliance anti-piracy hot line at (888) NO-PIRACY (667-4722) or sending e-mail to software@bsa.org.

Founded in 1975, Microsoft (Nasdaq
“MSFT”
) is the worldwide leader in software for personal computers. The company offers a wide range of products and services for business and personal use, each designed with the mission of making it easier and more enjoyable for people to take advantage of the full power of personal computing every day.

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Other product and company names herein may be trademarks of their respective owners.

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