Microsoft Takes Legal Actions to Thwart Software Piracy And Protect Consumers in Illinois, Michigan, Ohio and Oklahoma

Defendants Allegedly Continued to Distribute Counterfeit Software Despite Warnings

REDMOND, Wash., July 26, 2001 — Microsoft Corp. today announced legal actions against seven companies in Illinois, Michigan, Ohio and Oklahoma for the alleged distribution of counterfeit software. Microsoft took these actions to help protect consumers and legitimate distributors from the negative impact of software piracy.

Consumers who acquire counterfeit software -- either online or from "brick-and-mortar" retailers -- could find that in addition to the increased potential for viruses, such software may be missing key elements, including software code, which could render the program unusable. Consumers with pirated software are also ineligible for technical support, warranty protection or upgrades.

"Efforts like those announced today by Microsoft draw attention to the software piracy problem and ultimately help to level the playing field for honest businesses," said David Bean, sales manager of the Network Solutions Division of Kissane Business Systems in Addison, Ill. "We at Kissane lead by example though ensuring proper software compliance and stressing to our customers the importance of proper licensing."

In addition to harming software resellers and consumers, software piracy and counterfeiting takes a toll on the U.S. economy and adversely affects the software industry worldwide. According to a Business Software Alliance study, software piracy in 1999 resulted in the loss of $12 billion in revenue worldwide, which translates into nearly 107,000 lost jobs and more than $5 billion in unrealized wages in the United States alone.

"Microsoft is dedicated to raising awareness of the prevalence of software piracy in an effort to protect consumers and honest resellers from the very real threat that piracy holds," said Janice Block, corporate attorney for Microsoft. "Software piracy ultimately diminishes consumer confidence in acquiring software and hardware."

The lawsuits announced today allege that the defendants distributed counterfeit and/or infringing copies of Microsoft® software or software components to investigators and/or customers. The complaints are as follows:

Filed in the U.S. District Court for the Northern District of Illinois, Eastern Division:

Chicago Cyber Corp., doing business as Chicago Cyber Exchange of Chicago, Ill., allegedly distributed counterfeit components of Office Professional 97 (Case No. 01C5698).
Media Basket Inc., doing business as Cyber Exchange Software a k a Cyber Exchange of Downers Grove, Ill., allegedly distributed counterfeit components of Office Professional 97 and Office Professional 2000 (Case No. 01C5699).
Sun Environmental Co. Inc., d/b/a Cyber Exchange Computer Center of Arlington Heights, Ill., allegedly distributed counterfeit components of Office Professional 97 and Office 2000 (Case No. 01C5697).

Filed in the U.S. District Court for the Eastern District of Michigan, Southern Division:

Ergonocon Corp., Engineering & Computer Systems Consulting of Ann Arbor, Mich., allegedly distributed counterfeit components of Office Professional 97, Office Professional 2000, Windows® 95 and Windows 98 (Case No. 01-72770).

Filed in the U.S. District for the Southern District of Ohio:

Retech Computer Equipment Inc. of Cincinnati, Ohio, allegedly distributed counterfeit components of Office Professional 97 and Office Professional 2000 (Case No. C-1-01 491).
Pro-Onsite Technologies, LLC/Proline Computer Outlet, of Cincinnati, Ohio, allegedly distributed counterfeit components of Windows 98 and Office Professional 2000 (Case No. C-01-01-490).

Filed in the U.S. District Court for the Western District of Oklahoma:

The Software and Hardware Store of Oklahoma City, Okla., allegedly distributed counterfeit components of Office 2000 (Case No. CIV-01-1099-M).

"Consumers are often duped into purchasing merchandise that is not genuine," said Jane Hardin, president of the Oklahoma City Better Business Bureau. "To help avoid becoming victims of fraud, it's important for consumers to be smart shoppers and thoroughly research the products they're interested in buying. We applaud Microsoft's efforts in helping to create a safer marketplace for consumers to acquire genuine software."

Some warning signs that can help consumers and resellers identify counterfeit or illegal software are as follows:

Prices that are "too good to be true"
Suspicious methods of delivery and/or payment
Retail software distributed in jewel cases only, rather than in full-color retail boxes
Software marked with a phrase, such as "For distribution with a new PC only" or "Special CD for licensed customers only," that does not accurately describe the transaction

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. Additional information on software piracy is available at Microsoft's anti-piracy Web site at http://www.microsoft.com/piracy/ . Consumers can also obtain information by calling the Business Software Alliance anti-piracy hot line at (888) NO-PIRACY (667-4722) or by sending e-mail to software@bsa.org.

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