Microsoft and The MPO Group Announce Counterfeiting Settlement
Replicator agrees to pay Microsoft for producing counterfeit software.
PARIS — 19 Dec 2006 — Microsoft Corporation today announced a multi-million dollar settlement with The MPO Group, a Microsoft® authorised disk replicator, following a several-year investigation into the production and distribution of counterfeit Microsoft server software. As part of the settlement, MPO has acknowledged that it breached the disk replication agreements it had in place with Microsoft after unlawfully replicating thousands of Microsoft server software disks in reliance on a fake Microsoft licensing agreement.
Headquartered in Averton, France, with operations in Ireland and Thailand, MPO Group's Thai subsidiary manufactured 20,000 counterfeit copies of Microsoft Exchange and SQL Server™ products in July 2003. In the ensuing year, investigators and attorneys in Microsoft’s Worldwide Anti-Piracy team, often working in collaboration with law enforcement officials, recovered some of the counterfeits in court-authorised searches and test purchases and traced them back to the MPO Group’s Thailand manufacturing facility at MPO Asia.
According to MPO, their local Thai office had manufactured the disks after relying on what turned out to be forged documentation from a third party that purported to have a license from Microsoft to distribute Microsoft software. In fact, no such license existed, and Microsoft does not license its software to be reproduced and distributed in this way.
MPO Thailand’s production of the counterfeit disks resulted in copyright and trademark infringement and a breach of the Disk Replication Agreements between Microsoft and MPO. Once MPO realised what it had done, MPO cooperated with Microsoft in a joint and comprehensive worldwide investigation that continues to find counterfeit Microsoft software in the international distribution channel.
“We are pleased to have settled this case with the MPO Group so quickly and look forward to an ongoing relationship with them,” said David Finn, Associate General Counsel, Worldwide Anti-Piracy and Anti-Counterfeiting. “We appreciate the steps MPO has taken to tighten their security procedures to prevent a recurrence of this type of wholesale counterfeiting of Microsoft software, and to help track down all those responsible for distributing the counterfeits.” Frank Holland, Microsoft vice president of operations, said, "Security, controls and compliance are absolutely vital in the supply chain of a company like Microsoft, where intellectual property is at the heart of our business."
Gerard Courcier, MPO industrial manager, said, "As France's largest independent replication plant, MPO values and recognises the rights of artists and creators of intellectual property. We are active members of the International Recording Media Association's Anti-Piracy Compliance Program, which helps manufacturers of prerecorded media protect the intellectual property rights of their customers. In this particular case we have worked together with Microsoft to track down those responsible for distributing the counterfeit software and have now taken steps to tighten our security procedures to prevent a recurrence of this type of event."
Intellectual property-based industries are significant drivers of local economic growth. According to IDC , software, hardware and software-related services add US$1.7 trillion per year to the global economy, payment of $900 billion in taxes and the creation of more than 11 million jobs. Software counterfeiting, however, threatens the industry’s ability to maintain its significant contribution to the economies around the world.
For those outside the software industry, it can be difficult to appreciate the scope and impact of one of the industry’s biggest problems, counterfeit software. The Business Software Alliance has estimated that 35 per cent of all PC software used worldwide is counterfeit or otherwise illegal, and the recent IDC Economic Impact Study asserts that if the piracy rate was lowered by 10 percentage points over the next four years, this would contribute 2.4 million new jobs and $400 billion in economic growth to the global economy.
Microsoft encourages consumers to become familiar with the following warning signs that can help them identify counterfeit or illegal software:
• Prices that are “too good to be true”
• Suspicious methods of delivery and/or payment
• Counterfeit software can come from a number of sources. Consumers should make sure that they obtain all software from a reputable source. They can look to see what the genuine Microsoft software, labeling and packing look like, and pick up some tips on how to make sure they are getting what they are paying for at Microsoft’s “How to Tell” website (http://www.microsoft.com/howtotell).
About Microsoft
Founded in 1975, Microsoft (Nasdaq “MSFT”) is the worldwide leader in software, services and solutions that help people and businesses realise their full potential.
About Microsoft EMEA (Europe, Middle East and Africa)
Microsoft has operated in EMEA since 1982. In the region Microsoft employs more than 13,000 people in over 60 subsidiaries, delivering products and services in more than 138 countries and territories.
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