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Microsoft sues Ontario VARs

Microsoft Corp. has launched Federal Court lawsuits against seven Ontario system builders for allegedly loading unlicensed copies of its software onto PCs and selling them without certificates of authenticity and other components of the company’s software.

According to court documents obtained by CDN, the resellers include Toronto-based 3P Computer and Network (Canada) Ltd., Computer Liquidation Outlet, ITPC Computers and Compufix Systems, 1515305 Ontario Ltd. in Mississauga, Ont., Peel Office Machines Canada Inc. in Brampton, Ont., and Morcor Computers 2000 Ltd. in St. Catharines, Ont. The programs allegedly installed include Microsoft Windows XP Professional and versions of Microsoft Office, including Microsoft Office Professional 2003, Microsoft Office XP Professional with FrontPage and Office 2000 Premium.
In each of the seven cases, which have still to be proven in court, the system builders are charged with copyright infringement and face statutory damages of up to $160,000.

Cease and desist
According to Microsoft Canada’s licence compliance manager, Susan Harper, cease and desist letters were sent lastspring to the defendants, notifying them of the consequences of hard disk loading and asking each to stop alleged illegal activity. After failing to meet the terms of the notice, Harper said, Microsoft took legal action.
“We give them a chance, a few weeks to start selling legal. We go back in, if they have not changed, that’s when litigation starts,” said Harper.
While a good deal of Microsoft’s leads come through the company’s anti-piracy hotline, 1-800-RU-LEGIT, Harper added that private investigators are also used to visit suspicious resellers and system builders in certain cities to confirm if the business is selling illegitimate software.
“Between the seven charges here, it would have been a combination of either a partner or end customer calling into the hotline or it could also be a result of investigator walk-in,” she said.
The latest round up of resellers adds to Microsoft’s growing list of infringement lawsuits. In March the company filed civil lawsuits against five Montreal-area system builders for hard disk loading.
Meanwhile, recently in the U.S., Microsoft for the first time filed lawsuits against resellers for allegedly selling not-for-resale software. The seven suits claim breach of a software agreement under which the individuals obtained a number of Microsoft Action Pack Subscriptions (MAPS), which are discounted Microsoft software packages for product evaluation and internal use only.
Harper said the strategy continues to be education, adding that getting the anti-piracy message out means positive PR by Microsoft as well as partner and user education of intellectual property.
She said that Microsoft will continue to invest in areas to protect partners and customers from illegal software vendors and resellers. “When people are selling illegal product, it brings the whole partner community down because it’s hard for them to compete.”
“So this is not just on behalf of Microsoft, it’s helping all the other software vendors as well.”