Microsoft takes action against 21 Australian system builders

Microsoft has received $297,000 in settlements so far from the proceedings, from organisations in New South Wales and South Australia.

The 21 dealers were fined for their infringing practices and have signed restraining agreements to respect their fellow resellers and Microsoft’s copyright and trademarks in the future. An Australia-wide program run by Microsoft called the National System Builder Blitz highlighted 1270 system builders. Vanessa Hutley, director of intellectual property, Microsoft Australia & New Zealand said that they approached the program as an opportunity to educate the community with a particular focus on illegal hard disc loading.

“It is important to understand that this is a civil program not a criminal investigation so we are not convicting anyone. Rather we work to identify and investigate organisations that distribute or sell unauthorised Microsoft software,” explained Hutley. “These organisations are then presented with the opportunity to settle with us. If they refuse, our next step is to file a case in the courts for copyright infringement.”

Companies were targeted specifically and randomly to ensure a comprehensive cross-section. Two hundred and sixty eight were specific leads generated through the anti-piracy hotline, which receives 100 to 200 calls per month from channel partners and consumers. Additional companies were chosen at random through the Yellow Pages. With only 21 of the 1270 system builders illegally hard disk loading, the results showed a positive reflection on the Australian channel.

“We have received settlements ranging from $4000 to $70,000 from individual dealers. But what has stood out in this entire program is that dealers who were fined for their infringing practices have undertaken restraining agreements to respect their fellow resellers and Microsoft’s copyright and
trademarks in the future,” said Hutley.

Fast Tech, trading as Capitol Computer, is a NSW company that agreed to a settlement of $70,000 after acknowledging that its continuing illegal behaviour had greater consequences for the channel community and consumers. Also from NSW, Top Win agreed to pay the same amount after supplying a computer system loaded with unauthorised copies of Windows XP Home and Microsoft Office Professional with FrontPage.

“It is important for our channel partners to understand that we are continuing our support for the genuine channel. We will continue to address this issue and the damage it does to the honest dealer. Also as the program was a new one in South Australia we were encouraged by the way the system builders recognised that their activity was wrong and settled the matters and gave undertakings not to infringe Microsoft’s software in the future,” said Hutley.

“We rely on the channel to market, sell and support our products. So, we take protecting the channel ecosystem very seriously. We have ongoing education and investigation campaigns, such as this nationwide OEM investigation.”

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