Private Software Piracy Police Crack Down on Copies

By Hendren, John | THE JOURNAL RECORD, December 29, 1992 | Go to article overview

Private Software Piracy Police Crack Down on Copies


Hendren, John, THE JOURNAL RECORD


States News Service

WASHINGTON _ The receptionist at Chicago's Davy-McKee Corp. didn't quite get it.

"Do you have an appointment?" she asked the battery of federal marshals and computer experts who barged into the construction engineering firm's office on a raid.

When Software Publishers Association lawyer Ilene Rosenthal flashed a court order permitting a search of the company's computers for illegally copied software, the receptionist asked if they wouldn't mind coming back Monday.

"I know, are you from `Candid Camera'?" she finally asked. "Should I call my mother?"

The surprise drop-ins by the software industry's trade association, relatively uncommon at the time of the November 1990 raid, have since become a staple in the anti-piracy battle, as courts dole out search warrants and the Software Publishers Association increases its piracy police.

In the Bay Area alone during the past two years, the Software Publishers Association has raided two companies __ Martinez-based Discovery Toys and Fuller O'Brien Corp. of South San Francisco _ audited 19 firms that cooperated following an Software Publishers Association warning, and issued "cease and desist" letters to another 27. Another six ongoing audits target local firms that hope to keep penalties and publicity low by cooperating.

Publicity from the raids has boosted corporate awareness of the ultimate cost of saving a few hundred dollars by making free copies, but the raids themselves more resemble a day at H R Block than a scene from "The Untouchables."

The anti-piracy squad, accompanied by U.S. marshals, shows the company president the court order, usually obtained with a sworn affidavit from a disgruntled employee, and computer consultants run print-outs showing the contents of all computer hard disks. Then it's up to the firm to show the receipts.

"You're used to seeing the FBI come knock three times and knock down the door _ I think our raids are probably genteel by comparison," Rosenthal said. "It's none of this, `Put down your mouse and come out with your hands up' stuff."

The unprecedented $300,000 settlement against Davy-McKee has since been eclipsed by a $500,000 penalty in a voluntary settlement with an undisclosed company. And the Software Publishers Association's anti-piracy squad, funded by member software makers and lawsuit settlements, has taken advantage of a court system that has shown a willingness to make pirates walk the judicial plank.

Initial results show a promising trend. Piracy losses among business software companies have dropped from $2 billion in 1990 to $1.2 billion in 1991, according to Software Publishers Association figures. But those losses still amount to more than the revenues of 81 of the top 100 independent software publishers and cost the industry 60,000 jobs, said Ken Wasch, the bearded anti-pirate who founded Software Publishers Association in 1984.

"There is sort of a rule of thumb that if the entire (piracy) problem would disappear overnight, our revenues would double," said David Curtis, associate general counsel at Microsoft Inc. in Redmond, Wash. "We feel these efforts are making a difference in the U.S. and abroad, but there is still a huge challenge out there and lots and lots of work to do."

Software manufacturers aren't the only ones who say anti-piracy efforts work. The early 1992 raid at Discovery Toys that led the company to agree to Software Publishers Association's terms also prompted policies designed to end accidental piracy.

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