Feeds

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

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

High performance access to file storage

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.

SANS - Survey on application security programs

More from The Register

next story
Dropbox defends fantastically badly timed Condoleezza Rice appointment
'Nothing is going to change with Dr. Rice's appointment,' file sharer promises
Audio fans, prepare yourself for the Second Coming ... of Blu-ray
High Fidelity Pure Audio – is this what your ears have been waiting for?
Record labels sue Pandora over vintage song royalties
Companies want payout on recordings made before 1972
MtGox chief Karpelès refuses to come to US for g-men's grilling
Bitcoin baron says he needs another lawyer for FinCEN chat
Number crunching suggests Yahoo! US is worth less than nothing
China and Japan holdings worth more than entire company
Zucker punched: Google gobbles Facebook-wooed Titan Aerospace
Up, up and away in my beautiful balloon flying broadband-bot
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
prev story

Whitepapers

SANS - Survey on application security programs
In this whitepaper learn about the state of application security programs and practices of 488 surveyed respondents, and discover how mature and effective these programs are.
Combat fraud and increase customer satisfaction
Based on their experience using HP ArcSight Enterprise Security Manager for IT security operations, Finansbank moved to HP ArcSight ESM for fraud management.
The benefits of software based PBX
Why you should break free from your proprietary PBX and how to leverage your existing server hardware.
Top three mobile application threats
Learn about three of the top mobile application security threats facing businesses today and recommendations on how to mitigate the risk.
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.