Microsoft Files Suit to Stop Alleged Counterfeiting And Hard Disk Loading by Ontario Company

REDMOND, Wash. - May 29, 1997 - Microsoft announced today that it has filed a lawsuit for copyright infringement against an Ontario company, PC Village Co., LTD., for allegedly repeatedly distributing illegal copies of Microsoft® software to its customers.

According to the Statement of Claim filed in the Federal Court of Canada, Microsoft officials initially met with the company last November after obtaining evidence that PC Village was distributing counterfeit Microsoft products. At that time, PC Village voluntarily surrendered its inventory of counterfeit Microsoft products including operating system software, mice and "compilation" CD-ROMs containing numerous software publishers' programs. Two months later, however, an undercover Microsoft investigator purchased a computer system loaded with unlicensed copies of Office 95 software, an illegal practice known as hard disk loading. The day after Microsoft met with a PC Village representative to discuss the hard disk loading incident, PC Village sold a Microsoft investigator an allegedly counterfeit copy of the Windows® 95 operating system.

"Resellers who distribute counterfeit software or sell computers with illegally pre-installed software are, in effect, stealing from their customers," said Norm Dupuis, anti-piracy manager for Microsoft Canada, Inc. "Customers expect and deserve genuine software with the quality, license, warranty and technical support that they associate with the Microsoft name."

"The piracy in this case is flagrant," said Jim Lowe, Microsoft corporate counsel. "PC Village was warned repeatedly about the illegality of pirating our products. This case demonstrates that, in the case of repeat offenders, Microsoft will do whatever is necessary to protect consumers and stop piracy."

According to court papers, Microsoft is seeking a permanent injunction against any further software piracy activity by PC Village, as well as actual damages and punitive damages.

Microsoft works hard to educate consumers about the warning signs that may indicate pirated software. These signs include:

• No end user license agreement.
• No Certificate of Authenticity
• Prices that are "too good to be true."
• No product registration card.
• No backup disks, manuals, or other materials for software installed on a new computer system.
• Backup disks have hand-written labels, are not shrink-wrapped, or appear to be of inferior quality.
• Manuals are photocopied, are not shrink-wrapped, or appear to be of inferior quality.

Microsoft works closely with the Canadian Alliance Against Software Theft (CAAST) to protect consumers from hard disk loading and other forms of software piracy.

To report piracy of Microsoft products or to inquire about the legitimacy of Microsoft products, consumers should call the Microsoft Anti-Piracy Hotline at 1-800-RU-LEGIT, e-mail piracy@microsoft.com or visit the Microsoft Canada Anti-piracy web site located at http://www.microsoft.com/Canada/piracy/default.asp. To receive industry-wide information about software piracy, consumers can call the Canadian Alliance Against Software Theft (CAAST) Anti-Piracy Hotline at 1-800-263-9700 or visit their web site located at (http://www.bsa.org/canadadocs/default.htm).

Founded in 1975, Microsoft (NASDAQ "MSFT") is the worldwide leader in software for person 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.

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