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posted by chromas on Thursday April 26 2018, @04:20AM   Printer-friendly
from the don't-copy-that-floppy dept.

Engadget reports that Eric Lundgren, who ordered unauthorized copies of Microsoft Windows, has lost in appeals court. He had received a 15-month prison sentence and $50,000 fine.

From Engadget:

Lundgren realized that people were simply discarding old computers and buying new ones, rather than trying to restore Windows. He decided to begin manufacturing restore CDs that could be sold to computer repair shops for a quarter each.

[...] However, things began to go downhill after US Customs got ahold of a shipment of these disks in 2012. They charged Lundgren with conspiracy to traffic in counterfeit goods, as well as criminal copyright infringement. The premise here was that Lundgren was providing users with a copy of the Windows operating system on these restore disks, but that was untrue. The users needed to have a previously purchased license, or the restore disks wouldn't work.

[...] While Lundgren argued that these disks had zero value, Microsoft claimed (through a letter and an expert witness) that these were "counterfeit operating systems" and that they had the potential to hurt Microsoft's sales. The pricing was set at $25 a piece, which was what Microsoft claimed it charged repair shops for these disks. The catch here is that this is the price for a fully licensed operating system, not Lundgren's version.

From The Verge:

Microsoft issued this statement to The Verge on the ruling:

"Microsoft actively supports efforts to address e-waste and has worked with responsible e-recyclers to recycle more than 11 million kilograms of e-waste since 2006. Unlike most e-recyclers, Mr. Lundgren sought out counterfeit software which he disguised as legitimate and sold to other refurbishers. This counterfeit software exposes people who purchase recycled PCs to malware and other forms of cybercrime, which puts their security at risk and ultimately hurts the market for recycled products."

The Right to Repair has been hotly debated in recent months, particularly because California proposed a law that would require electronics manufacturers to make repair information and parts available to product owners and to third-party repair shops and services. Seventeen other states have proposed similar legislation. Most major tech companies, including Apple and Microsoft, are opposed to the idea of letting users fix their own devices on the grounds that it poses a security risk to users, which we can see in Microsoft's above statement. Although as Lundgren's case demonstrates, the companies are likely more concerned over a loss in profit than anything else.


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  • (Score: 2) by All Your Lawn Are Belong To Us on Monday April 30 2018, @09:58PM

    by All Your Lawn Are Belong To Us (6553) on Monday April 30 2018, @09:58PM (#673942) Journal

    Regardless of what you feel about whether it was copyright infringement, or counterfeit goods (which nobody is really credibly disputing...), what is generally missing here is that Lundgren pled guilty. Yes, one can take a plea agreement because a defense is more costly / risks too much even if one may be innocent. However, Lundgren was saying by pleading guilty that he is willing to be guilty of both counterfeiting and criminal copyright infringement.

    And the whole free vs. cost thing.... I have sympathy for that - if it is free somewhere then how can it be damaging? Both sides had expert witnesses that testified on the matter. The court chose to believe that Lundrgren would not have invested $80,000 in a clear attempt to make more (a $32,000 profit minimum if I get it) for something that has "no value." I think that's arguable.... But the core of the appeal he just lost was this very fact - the valuation provided by Microsoft ($25 per disc and discounted to 75% because of actual revenue of the disc unit for the period of the scheme - sounds like they took total income and divvied by number of units, I dunno...) was inflated is exactly what the court didn't but and the appeals court affirmed the trial court's judgment in.

    At any rate, if you say you're guilty of the act, you're going to do the time.

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