Feeds

Call for reform as unlicensed software use rises

'Couldn't care less' attitude needs to change

High performance access to file storage

There was a 25 per cent increase in the number of companies settling for unlicensed software use in the UK last year, according to the Business Software Alliance. But the sums paid go some way to showing how UK law provides little deterrent to such piracy.

The Business Software Alliance (BSA) figures were published on Monday. It opened 420 investigations in 2005 into UK businesses reported to be using software illegally, an increase of 24 per cent on 2004. According to the BSA, the strength of the economy was a key contributor to the rise: as businesses enjoy rapid growth, managers often overlook their software licensing. It put 80 per cent of the settlement cases down to negligence.

The largest settlement was for £31,000 and eight settlements exceeded £20,000. But these sums are not wildly different from what each company would have paid had it been properly licensed in the first place because copyright law does not set out to punish for simple infringement.

OUT-LAW spoke to Graham Arthur, a senior associate with law firm Covington & Burling, who acts as BSA's UK counsel and author of many threatening letters sent on behalf of BSA members like Microsoft and Adobe. And he hopes legal reform will give his letters more bite.

He explained that when a copyright owner has his rights infringed – such as the use of a computer program with no licence – the law seeks to put that copyright holder back in the position it would have been in had no infringement taken place. When the infringement is a matter for the police – selling illegal copies of Windows XP at the local market, for instance – significant fines and even imprisonment may follow.

But licence creep – such as 150 installations of Windows XP in a company that has bought the right to 25 – is a matter for the civil courts. Here, damages are available but are generally pegged to the licence fee for the unlicensed copies. It is difficult to deter piracy if the unlicensed user only runs a risk of paying a sum that he should have paid sooner. So, at least for now, a bit of creativity is required when assessing the loss.

Other countries allow for punitive damages in intellectual property lawsuits – perhaps a licence fee in addition to a lump of cash that sends a strong warning to others. But in the UK it's harder. "The problem is that companies may refrain from buying a licence until they're caught – then pay for a licence and argue that because they've paid, there is no loss," said Arthur.

Additional damages and The Sun

Section 97(2) of the Copyright, Designs and Patents Act of 1988 offers some hope for creative industries: "The court may in an action for infringement of copyright having regard to all the circumstances, and in particular to – (a) the flagrancy of the infringement, and (b) any benefit accruing to the defendant by reason of the infringement, award such additional damages as the justice of the case may require."

It sounds like an opportunity for punitive damages and in a way it is; but there are few examples of its application in court. Arthur points to a rare example: The Sun newspaper ran a story under the headline: "Double killer pops out for a McDonald's – Outrage over jaunt for psycho". A picture of the convicted killer appeared next to the story. But the picture was originally taken for his medical records when he was detained at a hospital. It was used by The Sun without authorisation.

Nottinghamshire Healthcare NHS Trust sued for infringement. That bit of its case was easy. But since the NHS Trust would never have licensed the photograph for publication, arguably it suffered little or no loss. So it sought to rely on section 97(2) damages. Mr Justice Pumfrey considered these "additional damages" at length.

Justice Pumfrey concluded: "…careless infringement sufficiently serious to amount to an attitude of 'couldn't care less' is in my judgment capable of aggravating infringement and of founding an award of damages under section 97(2)."

He awarded basic infringement damages of £450 – the sum he felt that a willing copyright owner would be paid for a picture of similar size, interest and prominence being used by The Sun. But he brought that figure up to £10,000 using the powers in section 97(2).

High performance access to file storage

More from The Register

next story
Audio fans, prepare yourself for the Second Coming ... of Blu-ray
High Fidelity Pure Audio – is this what your ears have been waiting for?
Dropbox defends fantastically badly timed Condoleezza Rice appointment
'Nothing is going to change with Dr. Rice's appointment,' file sharer promises
Did a date calculation bug just cost hard-up Co-op Bank £110m?
And just when Brit banking org needs £400m to stay afloat
MtGox chief Karpelès refuses to come to US for g-men's grilling
Bitcoin baron says he needs another lawyer for FinCEN chat
Zucker punched: Google gobbles Facebook-wooed Titan Aerospace
Up, up and away in my beautiful balloon flying broadband-bot
Nokia offers 'voluntary retirement' to 6,000+ Indian employees
India's 'predictability and stability' cited as mobe-maker's tax payment deadline nears
Apple DOMINATES the Valley, rakes in more profit than Google, HP, Intel, Cisco COMBINED
Cook & Co. also pay more taxes than those four worthies PLUS eBay and Oracle
It may be ILLEGAL to run Heartbleed health checks – IT lawyer
Do the right thing, earn up to 10 years in clink
France bans managers from contacting workers outside business hours
«Email? Mais non ... il est plus tard que six heures du soir!»
prev story

Whitepapers

Mainstay ROI - Does application security pay?
In this whitepaper learn how you and your enterprise might benefit from better software security.
Five 3D headsets to be won!
We were so impressed by the Durovis Dive headset we’ve asked the company to give some away to Reg readers.
3 Big data security analytics techniques
Applying these Big Data security analytics techniques can help you make your business safer by detecting attacks early, before significant damage is done.
The benefits of software based PBX
Why you should break free from your proprietary PBX and how to leverage your existing server hardware.
Mobile application security study
Download this report to see the alarming realities regarding the sheer number of applications vulnerable to attack, as well as the most common and easily addressable vulnerability errors.