Counterfeiters sing the 'Blue' as Microsoft lawyers up

A 12-nation crackdown on software counterfeiters is keeping Microsoft's lawyers busy this week, with 63 legal actions under way against shady online sellers.

The majority of cases announced on Thursday involve fake versions of XP and XP-related software; no surprise, as popular products at the end of their life cycle are often vulnerable to counterfeiters' wiles, as would-be buyers freak out and stock up. What's surprising is the amount of effort the auctioneers put into their marketing schemes -- a trend toward "more brazen" pirate activity, according to Matt Lundy, a senior attorney with Microsoft's World-Wide Anti-Piracy Team.

One effort, involving the "Blue Edition" of Office, illustrates the problem nicely. You're not slacking on your Office trivia; there is no "Blue Edition." The auctioneers, however, claimed that would-be buyers hadn't heard of it because it was a special, limited release. Buyers who took the bait on Blue Edition auctions -- many of which were conducted on respectable sites such as eBay, Amazon and (ouch) MSN Shopping -- received, essentially, writable CDs or DVDs with a blue design printed on and a copy of Office burned in. In some cases, the "Blue Edition" code appeared to have been altered, though Lundy declined to say whether those changes included malware or the like.

Burned buyers turned to Microsoft for help, and that's where the fun began. Over the past several months, the proprietors of hundreds of sketchy auctions were contacted, and Microsoft worked with auction sites to remove questionable listings. ("We partner with eBay to remove, daily, listings for counterfeit software," says Lundy.) All of the sellers who could be located were served with cease-and-desist letters, and those who chose not to comply are being sued.

Action is underway against counterfeiters in the US (16 legal proceedings this week), Germany (12), France (12), and the UK (7), plus cases in Argentina, Brazil, Canada, Colombia, the Dominican Republic, Japan, Mexico and New Zealand. Lundy points out that each country has its own way of handling copyright and trademark issues, so Thursday's efforts were even more complex that you'd expect.

In the US, civil cases were filed in district court in western Washington against defendants from 12 states. Other countries make violations a matter for law enforcement; there were police raids on suspected vendors in Brazil and Canada. An investigation in Japan found one seller funneling shoppers from a legitimate e-commerce site to his own, where he sold the fakeware. And some cases make you wonder what else the accused parties were up to -- in Colombia, cases in Bogota and Medellin netted suspects who are also believed to be engaged in tax evasion and fraud, neither of which charge is anything to sniff at.

A savvy observer might wonder why China's not on the list, especially since at least some of the actual warez came from there. China has, notes Lundy, been on the receiving end of Microsoft's anti-piracy efforts before; this week's group just doesn't happen to involve any China-based sellers. Likewise, busts like these happen year-round -- though Microsoft acknowledges that the timing, near the top of the holiday shopping season, has a certain consumer-education aspect.

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