Are you a software pirate?

Home Office Computing, July, 1998 by Ira P. Rothken

Home workers who violate copyright laws, beware. The software police may be on to you

At 6:30 on a warm morning in July 1995 near Salt Lake City, Miki Casalino was suddenly awakened by the ringing of her doorbell. When she opened the door, a troop of United States marshals and Novell employees flashed a court order and announced, "We've come to seize your son's computer." Although Casalino had no idea her 18-year-old son was illegally pirating Novell's and other programs on his bulletin board service, she was guilty in the eyes of the law. The marshals raided the house, impounded the computer equipment, and left. Another software pirate shut down.

The Casalino family is just one of many who've become targets of the "software police," government law officers and private prosecutors who enforce civil search and seizure laws. (In this instance, the court permitted the raid without prior notice, because it was likely that evidence would've been destroyed.) Whether you have a home office with two PCs or work for a corporation with 100, the law does not discriminate if you violate a soft-ware publisher's copyright. In fact, software raids on small offices are on the rise as publishers and trade groups stiffen their fight against pirates. According to Ken Wasch, president of the Software Publishers Association (SPA), a watchdog group in Washington, D.C., companies with as few as 25 PCs can be targeted.

Why the crackdown? The accumulated losses to manufacturers from people who borrow business software from colleagues or download commercial games from bootleg Internet Relay Chat sites add up. And these losses reduce the ability of software publishers to spend money on R&D. As a result, you pay more for every program you purchase. According to the Business Software Alliance (BSA), piracy costs consumers $15 for each $100 spent.

Want to save yourself some money? Avoid program pilfering. Here's how.

Guilty as Charged There are several ways in which you might lift intellectual property from software makers. First, you can softlift--that is, buy one copy of, say, Microsoft Office and install it on your home office system, your laptop, even your kids' PC. You may also be guilty of LANlifting. That's when you purchase a single-user license for an application but load it on your LAN, giving every PC on the network access.

In addition, you might have a nasty habit of versionlifting. This is when you buy the same number of software packages as the number of PCs you own, but you only upgrade one or two programs and load the latest versions on all your computers. Think a few recent versions lying around the home office will insulate late you from liability? You're wrong.

Hard-core pirating--common among college students--is called Netlifting. Scores of hackers maintain Web sites and BBSs that offer illegal programs. Within seconds, a pirate can upload a compressed version of, say, Quicken to his or her Web server and offer it to anybody, anywhere as a download. One telltale sign that an online software offer is illegal is if you aren't provided with a way to register your program.

Another form of piracy is hard-drive bundling: resellers who hawk bargain-basement computers with unlicensed versions of Microsoft Office, AutoCAD, and popular games loaded on the hard drives. Walk away from that PC deal if it doesn't include diskette or CD-ROM originals and documentation for all preinstalled programs. Disreputable dealers also sell counterfeit copies of programs, often at flea markets and online. Clues that software is counterfeit is the lack of a registration card and a box or jewel case that's not shrink wrapped.

Clamping Down on Criminals Copyright infringement laws are nothing to scoff at, since they're enforced by both the civil and criminal courts. In fact, in 1992, Congress approved a stiff criminal law that makes commercial software piracy a felony. That means that if someone willfully and without permission reproduces or distributes 10 or more copies of a package with a retail value exceeding $2,500, penalties include imprisonment of up to five years, fines of up to $250,000, or both. In addition, the No Electronic Theft Act may lead to more prosecutions. It calls for stiffer penalties and a longer statute, of limitations, and it has removed prerequisites for prosecuting pirates. Fortunately, these laws are rarely enforced against casual abusers.

You, on the other hand, might face penalties from the civil law enforcement agencies, which are software publishers and trade groups like the SPA and BSA. Although you probably won't be thrown into jail, you must pay the publisher actual damages and losses to profits if found guilty.

In certain instances these damages may not amount to much money, but the court's left a loophole: The publisher can collect statutory damages instead. That means that if found guilty, your fines can range from $500 to a whopping $100,000--for each pirated package. And if the manufacturer registered a copyright within three months of publication, your IOU can also include attorneys' fees.