Microsoft has launched a Copyright lawsuit against Ocean Enterprises and Alex Sumetsky in Minnesota. In the bigger picture it's about software piracy. Our report provides you with a detailed overview of Microsoft's case along with the latest statistics from The Software Alliance (BSA) that was published this week. The BSA's membership includes Microsoft, Apple, Oracle, and others.
Report Update March 18, 2015: This Case is in the Process of Dismissal as the Court Document Entry Illustrates Below
Those wishing to investigate this further can do so by reviewing the U.S. District Court, U.S. District Minnesota, civil docket for case #: 0:14-cv-02028-SRN-JSM.
Defendants: Ocean Enterprises, Alex Sumetsky
Defendant Ocean Enterprises LLC is a Minnesota limited liability company that does business on the Internet and in Minneapolis, Minnesota as Ocean Tech. Ocean Tech is engaged in the business of advertising, marketing, installing, offering, and distributing computer hardware and software, including purported Microsoft software.
Upon information and belief, defendant Alex Sumetsky, an individual, is an owner, operator, officer, shareholder, manager, and/or otherwise controls Ocean Tech. Upon information and belief, Alex Sumetsky resides and transacts substantial business in this district. Upon information and belief, Alex Sumetsky (a) personally participated in and/or (b) had the right and ability to supervise, direct and control the wrongful conduct alleged in this Complaint, and (c) derived direct financial benefit from that wrongful conduct.
Microsoft's Registered Trademarks and Service Mark
Microsoft's formal complaint before the court establishes the trademarks and service mark involved in this case as follows: "Microsoft has also duly and properly registered a number of trademarks and a service mark in the United States Patent and Trademark Office on the Principal Register, including, but not limited to:
A. "MICROSOFT," Trademark and Service Mark Registration No. 1,200,236, for computer programs and computer programming services;
B. "MICROSOFT," Trademark Registration No. 1,256,083, for computer hardware and software manuals, newsletters, and computer documentation;
C. WINDOWS, Trademark Registration No. 1,872,264 for computer programs and manuals sold as a unit; and
D. COLORED FLAG DESIGN, Trademark Registration No. 2,744,843, for computer software;
The Heart of the Complaint against Ocean Enterprises
According to Microsoft's formal complaint before the court we see that in the bigger picture, this case is about software piracy. Microsoft states that the "Defendants advertised, marketed, installed, offered and distributed unauthorized copies of Microsoft software, infringing Microsoft's copyrights, trademarks and/or service mark.
On information and belief, Defendants advertise that the computers that they sell come pre-installed with Microsoft software. In their advertisements, Defendants misappropriate and/or infringe Microsoft's copyrights, advertising ideas, style of doing business, slogans, trademarks and/or service mark.
Computers sold by Defendants actually have infringing copies of Microsoft software installed.
By e-mail dated June 4, 2012, Microsoft warned Defendants about the consequences of making and distributing unauthorized copies of Microsoft software on computers.
Nevertheless, in or about July 2012, Defendants distributed a computer system with an unauthorized copy of Windows XP installed on it to an investigator.
Again, in or about May 2014, Defendants distributed computer systems with unauthorized copies of Windows XP installed on them to an investigator.
On information and belief, these are not isolated incidents. Rather, Defendants have been and continue to be involved in advertising, marketing, installing, offering, and/or distributing counterfeit and infringing copies of Microsoft's software and/or related components to unidentified persons or entities.
On information and belief, Defendants have committed and are continuing to commit acts of copyright and trademark infringement against Microsoft. On information and belief, at a minimum, Defendants were willfully blind and acted in reckless disregard of Microsoft's registered copyrights, trademarks, and service marks.
Microsoft's Six Counts against Defendants
Count 1: Copyright Infringement
Count 2: Trademark Infringement
Count 3: False Designation of Origin, False Description and Representation
Defendants' wrongful conduct includes the use of Microsoft's marks, name, and/or imitation visual designs, specifically displays, logos, icons, graphic designs, and/or packaging virtually indistinguishable from Microsoft visual designs, in connection with their goods and services.
Count 4: Minnesota Common Law Unfair Competition
Defendants' acts and conduct as alleged above have damaged and will continue to damage Microsoft and have resulted in an illicit gain of profit to Defendants in an amount that is unknown at the present time.
Count 5: For Imposition of a Constructive Trust upon Illegal Profits
Count 6: Accounting
The amount of money due from Defendants to Microsoft is unknown to Microsoft and cannot be ascertained without a detailed accounting by Defendants of the precise number of units of infringing material advertised, marketed, installed, offered, or distributed by Defendants.
Microsoft's copyright case presented in today's report was filed in the Minnesota District Court. The Presiding Judge in this case is noted as being Judge Susan Richard Nelson. The Referring Judge is noted as Janie S. Mayeron.
Fighting Software Piracy
BSA | The Software Alliance (www.bsa.org) is the leading advocate for the global software industry before governments and in the international marketplace. Its members are among the world's most innovative companies, creating software solutions that spark the economy and improve modern life. Some of the companies listed are Microsoft, Apple, Oracle, Siemens, Autodesk, Adobe and more
With headquarters in Washington, DC, and operations in more than 60 countries around the world, BSA pioneers compliance programs that promote legal software use and advocates for public policies that foster technology innovation and drive growth in the digital economy.
The BSA offers a paid informants program. The group recruits informants through Facebook and other venues, offering them hard cash in return for a successful tip. According to a BSA executive, this approach has put a dent in software piracy rates.
A new BSA report published last week points out that globally the percentage of pirate software increased slightly, representing a total value of $62.7 billion. The report presents a detailed accounting of where software piracy takes place around the globe along with several detailed charts.
The particular chart noted below is a general overview of software piracy via "Average Rate of Unlicensed Use" and "Commercial Value of Unlicensed Software Use (in Billions).
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