Microsoft Files Software Piracy Actions Against Five Oklahoma Resellers

Oklahoma's Economy Negatively Impacted as Piracy Rate Rises by Six Percent

TULSA, Okla. - Sept. 9, 1999 - Microsoft Corp. today announced that the company has filed lawsuits against five resellers in Oklahoma as part of its ongoing efforts to protect consumers and legitimate resellers and to lessen the negative effects of software piracy on Oklahoma's economy. The five resellers allegedly distributed counterfeit software and/or installed unlicensed software on computers.

According to a recent study by International Planning and Research Corp., in 1998 Oklahoma's software piracy rate of 35 percent cost Oklahoma more than 1,500 jobs, translating into over $36 million in wage and salary losses. The state also lost more than $8 million in tax revenue that otherwise could have contributed to local and state improvement projects.

"When it comes to software piracy, there are days when you feel like the dishonest reseller is winning. Microsoft's lawsuits prove that it's only a matter of time before these people run out of luck," said Chris Lieberman, president of NT Solutions in Tulsa, Okla. "Customers are taking a huge risk when they install and use illegal software. Despite the obvious legal implications, they need to realize that there is no quality control in pirated software. The disks can be incomplete, not work at all or even contain viruses. The welfare of our businesses and our customers - as well as Oklahoma's economy - depends on our decision to distribute legitimate, working product to our consumers."

Most investigations are initiated by tips called in to the Microsoft anti-piracy hot line by customers or other resellers who have obtained suspicious software. Microsoft customarily notifies a company that it is suspected of acting illegally and asks the company to stop the illegal activity. Microsoft then determines whether the suspect company has continued its illegal activity before filing a lawsuit. The complaints, which were filed in the U.S. District Court for the Eastern, Northern and Central Districts of Oklahoma, allege hard disk loading and/or the distribution of counterfeit software and/or components to investigators and/or customers, as follows:

• Alliance Computer Corp. allegedly distributed counterfeit components of the Microsoft® Windows® 95 and Windows 98 operating systems and components of Office 97 Professional Edition (Case No. XCIV-99-489-S).
• Compu-Rents Inc. allegedly hard disk loaded Office 97 Professional (Case No. CIV-99-1325-M).
• Delta Computer Systems allegedly hard disk loaded Windows 98 and Office 97 Professional (Case No. 99-CV-0751-K).
• Gorilla Systems Inc. allegedly distributed counterfeit components of Windows 95 and Office 97 Professional (Case No. 99-CV-0749-H).
• Interactivities Inc. allegedly distributed counterfeit Windows 95 and components of Office 97 Professional (Case No. 99-CV-0750-K).

"Although Microsoft has been actively working to thwart software piracy for several years - and we are beginning to see some positive results - there is clearly a lot of work to be done," said Janice Block, corporate attorney for Microsoft. "Oklahoma's piracy rate is 10 percentage points higher than the national average. It's critical that we work with the community to lessen the impact on honest resellers, consumers and the local economy."

Microsoft has announced that, in addition to its other community affairs activities, it expects to donate an estimated $25 million over the next five years - half of its software piracy recoveries. Funds will be donated to a variety of nonprofit organizations focused on providing access to technology for disadvantaged communities. In 1998, software piracy caused losses to the U.S. economy amounting to nearly $1 billion in taxes and 109,000 jobs.

Consumers and resellers are encouraged to become familiar with the warning signs that can help them identify counterfeit or illegal software:

• Prices that are "too good to be true"
• Software marked with a phrase, such as "For distribution with a new PC only," "Special CD for licensed customers only," "Not for retail or OEM distribution" or "Academic price - not for use in a commercial environment," that does not describe the transaction
• Microsoft OEM Windows 98 or OEM Office 2000 that is not accompanied by a user manual that incorporates a Certificate of Authenticity as the cover, as well as backup media and an end-user license agreement that is visible on screen when the programs are first run

Customers or resellers with questions about the legitimacy of Microsoft software should contact the Microsoft anti-piracy hot line, toll free, at (800) RU-LEGIT (785-3448) or send
e-mail to piracy@microsoft.com. In addition, a list of authorized distributors and details regarding the OEM System Builder program are available at http://www.microsoft.com/oem/. Consumers can obtain more information about software piracy by calling the Business Software Alliance anti-piracy hot line at (888) NO-PIRACY (667-4722) or sending e-mail to software@bsa.org.

About Microsoft

Founded in 1975, Microsoft (Nasdaq "MSFT") is the worldwide leader in software for personal computers. The company offers a wide range of products and services for business and personal use, each designed with the mission of making it easier and more enjoyable for people to take advantage of the full power of personal computing every day.

Microsoft and Windows are either registered trademarks or trademarks of Microsoft Corp. in the United States and/or other countries.

Other product and company names herein may be trademarks of their respective owners.

Note to editors: If you are interested in viewing additional information on Microsoft, please visit the Microsoft Web page at http://www.microsoft.com/presspass/ on Microsoft's corporate information pages.