Microsoft finds new front in software piracy battle

As part of its fight against software piracy, Microsoft has filed lawsuits against eight US resellers for allegedly buying and selling fake and used Certificate of Authenticity labels.

The lawsuits, which allege copyright and trademark infringement, followed a 12-month investigation by Microsoft, the software maker said in a statement.

As part of the investigation, Microsoft bought Certificate of Authenticity labels and products bearing the labels, the company said.

Microsoft uses Certificate of Authenticity labels to identify its products as genuine. Each rectangular-shaped label is unique and belongs with the software product it was created to accompany and authenticate. For example, with the Windows operating system a label is affixed to the PC if the software is preloaded or to the top of the box on packaged software. A Certificate of Authenticity includes a product key code and it is designed to prevent counterfeiting.

Some resellers were abusing the labels to sell pirated software as genuine, Microsoft alleged.

In its investigation, the company found that most misused Certificate of Authenticity labels were authentic but did not belong with the products they were sold with.

Resellers separated labels from PCs after they had been sold and re-used them on systems loaded with pirated copies of Windows, according to Microsoft. Resellers also tried to sell the labels separate from the software to make more money, Microsoft said.

The action against abuse of Certificate of Authenticity labels is part of Microsoft's crackdown on software piracy, which the company acknowledges cuts into its earnings.

Nearly 36 per cent of all software worldwide is pirated, according to the Business Software Alliance, a software industry group.

Worldwide, 96 per cent of Microsoft software was sold by partners, Microsoft said.

The action against the resellers who allegedly abused the authenticity labels and competed unfairly was also meant to protect those Microsoft resellers that followed the rules, the company said.

Microsoft sued the resellers that it charges with copyright and trademark infringement only when they continued their alleged abuse after being contacted by Microsoft, the company said.

Microsoft said it sued: Monarch Technology; Kenneth Xu; Era; Micro Info Tech (USA); Affordable Computer Warehouse; Warp Systems/Computers LLC; Master Computer; and Software Provisions.

The crackdown on Certificate of Authenticity abuse would continue, Microsoft said.

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Joris Evers

IDG News Service
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