Feeds

Court punishes software sellers 'not lining Bill Gates's pockets'

'I'll do you an Office without a licence for £85'

Top three mobile application threats

Microsoft has won a judgment against three individuals behind a company which unlawfully sold genuine and counterfeit Microsoft software and certificates.

The three were found to be selling counterfeit software and of selling 'loose' certificates of authenticity – i.e. certificates not attached to computers – in breach of the licence terms of the software.

Judge Richard Havery of the High Court issued a summary judgment for Microsoft, which means that he found in the corporation's favour and that the case will not go to a full trial.

Havery wrote in his judgment that "there is no real prospect of any of the defendants resisting" the various claims, and that "there is no other compelling reason why the case should be disposed of at a trial".

Among the evidence produced were transcripts of conversations which Microsoft claimed took place between a test purchaser, Kenneth Anderson, and Edward Hill, the principal salesman of the company involved, Digital Now! Limited.

Hill was quoted as telling Anderson, whom he thought was a buyer, "I can do you an Office 2003 [Microsoft software] without a licence for eighty-five quid. The licensed version is one hundred and eighty-five quid. With the eighty-five quid one we're not lining Bill Gates's pocket. If he's installing it in a business or something he might want to do the licence. He might want to do it properly."

Hill claimed that his remarks were taken out of context and that the confusion arose because he did not know if Anderson had a volume licence. "The reference to not lining Bill Gates's pockets was to emphasise that there was no point in paying twice for the same right," he said in his witness statement.

Havery ruled that: "It is clear on the totality of the evidence that there is no real prospect of any of the defendants successfully defending the claim against them that Digital to their knowledge traded in counterfeit products of Microsoft".

The defendants in the case, two of whom owned the company between them, argued that in some of the cases they were trading in licences for which Microsoft had already been paid.

The defence argued that if a large organisation, such as a bank, bought a large number of computers and never used the bundled Microsoft software and sold on the licences, that a company such as Digital could sell those licences, for which Microsoft had already been paid.

The judge rejected the argument. "The fallacy in the argument is that if the bank does not accept the EULA [licence] terms [by operating the software and agreeing the terms], it receives no licence. Thus it can confer no licence for the use of any Microsoft software by passing on the COA (certificate of authenticity), nor can the COA be evidence of, or itself confer, such a licence. Thus, provided that the licensing system is enforceable in law, the circumstances exemplified cannot give rise to a legitimate trade in COAs."

In fact, there are circumstances in which disused or unwanted volume licences for some Microsoft software can be transferred; but this trade must be compliant with Microsoft's own transfer terms and conditions.

Havery gave judgment for Microsoft, including its claim for additional damages to be assessed.

See: The judgment

Copyright © 2006, OUT-LAW.com

OUT-LAW.COM is part of international law firm Pinsent Masons.

Build a business case: developing custom apps

More from The Register

next story
BBC goes offline in MASSIVE COCKUP: Stephen Fry partly muzzled
Auntie tight-lipped as major outage rolls on
iPad? More like iFAD: We reveal why Apple fell into IBM's arms
But never fear fanbois, you're still lapping up iPhones, Macs
Amazon Reveals One Weird Trick: A Loss On Almost $20bn In Sales
Investors really hate it: Share price plunge as growth SLOWS in key AWS division
Bose says today is F*** With Dre Day: Beats sued in patent battle
Music gear giant seeks some of that sweet, sweet Apple pie
There's NOTHING on TV in Europe – American video DOMINATES
Even France's mega subsidies don't stop US content onslaught
You! Pirate! Stop pirating, or we shall admonish you politely. Repeatedly, if necessary
And we shall go about telling people you smell. No, not really
Too many IT conferences to cover? MICROSOFT to the RESCUE!
Yet more word of cuts emerges from Redmond
Chips are down at Broadcom: Thousands of workers laid off
Cellphone baseband device biz shuttered
Twitch rich as Google flicks $1bn hitch switch, claims snitch
Gameplay streaming biz and search king refuse to deny fresh gobble rumors
prev story

Whitepapers

Designing a Defense for Mobile Applications
Learn about the various considerations for defending mobile applications - from the application architecture itself to the myriad testing technologies.
Implementing global e-invoicing with guaranteed legal certainty
Explaining the role local tax compliance plays in successful supply chain management and e-business and how leading global brands are addressing this.
Top 8 considerations to enable and simplify mobility
In this whitepaper learn how to successfully add mobile capabilities simply and cost effectively.
Seven Steps to Software Security
Seven practical steps you can begin to take today to secure your applications and prevent the damages a successful cyber-attack can cause.
Boost IT visibility and business value
How building a great service catalog relieves pressure points and demonstrates the value of IT service management.