As a follow-up to the story about Eric Lundgren being sentenced to prison, Microsoft published a blog post with “the facts” about the case.
In the last few days there have been several stories about the sentencing of Eric Lundgren in a case that began in 2012, and we have received a number of questions about this case and our role in it. Although the case was not one that we brought, the questions raised recently have caused us to carefully review the publicly available court documents. All of the information we are sharing in this blog is drawn from those documents. We are sharing this information now and responding publicly because we believe both Microsoft’s role in the case and the facts themselves are being misrepresented.
As a counterpoint to Microsoft’s blog post, Techcrunch’s Devin Coldewey claims Microsoft is trying to spin “the facts”.
Earlier this week Eric Lundgren was sentenced to 15 months in prison for selling what Microsoft claimed was “counterfeit software”, but which was in fact only recovery CDs loaded with data anyone can download for free. The company has now put up a blog post setting “the facts” straight, though it’s something of a limited set of those facts.
“We are sharing this information now and responding publicly because we believe both Microsoft’s role in the case and the facts themselves are being misrepresented,” the company wrote. But it carefully avoids the deliberate misconception about software that it promulgated in court.
At this point, we’ve covered all the possible angles on this story.
Everyone, Eric Lundgren, Microsoft, The court apointed experts, Devin Coldewey, everyone agrees on one particular fact (quote from Devin C):
That is literally the highest order of copyright infringement, the kind that brings the attention of the FBI. Large scale mass production, attempting to pass the duplicates off as the real thing, etc. Its not just copyright infringement – its fraud. Hell it might even be racketeering, considering this service, as everyone continually points out attempting to defend this guy, is completely unnecessary if all you actually want is a disc with a software install image on it. They are free – just go download some and burn them…
Are people doing all of these mental gymnastics because the guy is involved with recycling??? Doesn’t it piss you off that he is preying on people who are actually trying to help the environment, selling them counterfeit discs and passing them off as the real thing?
WHY did he duplicate the labels, including the trademarks, copyright, even the inner ring serial numbers? WHY did he instruct his brokers to withhold that they were duplicates? This guy was a scam artist, pure and simple.
The fact that the software on the discs is actually free to download makes it even worse in my view. It doesn’t in any way excuse what he was doing. He wasn’t offering a burned CD clearly marked as such, he was pretending they were the real thing to give them legitimacy they simply didn’t have.
I would not want to be the guy buying a refurbished PC with an “original OEM restore disc”, only to find out its fake and doesn’t work (which according to court records happened quite a lot). The Windows license on most of these PCs is built into the BIOS ROM, but it can be overwritten, destroyed, faked, read off and used on another computer, etc. etc. There is literally no way to know if it is legitimate or not.
Of wait, there is… Buy a $25 license from Microsoft. That is WHY they sell them for refurbishes, because once a PC is actually used by someone the license status cannot be guaranteed anymore. It might be recoverable, might not be, might have been stolen already, etc.
I blame Microsoft for having a shitty licensing system that doesn’t have a clean and reliable way to transfer legally. Blame them for that all you want, but this guy wasn’t doing anything useful for anyone…
Edited 2018-04-29 01:21 UTC
galvanash,
This hasn’t been the case for several years now. Recovery media for OEM PCs is not provided by microsoft. The policy going several years back is for users to go buy recovery media from the manufacturers.
We covered this last time the topic came up:
http://www.osnews.com/comments/30199
If I am mistaken and you know of a different place to get authorized recovery media that still works today, please provide a link for it since it would be very useful to have.
Edited 2018-04-29 03:11 UTC
https://www.microsoft.com/en-us/software-download/windows7
Granted, that is only Windows 7, and it isn’t an OEM restore image, it is vanilla. Regardless, it will work with an OEM license if you actually have the license code.
I get it though, and personally I would not at all have been outraged if this guy was actually doing what he says he was doing, i.e. just trying to help make it easier to refurbish machines. He could have distributed the actual software images on clearly labeled discs with disclaimers that they were 3rd party duplicates, and he could have chosen to give them away for free. It would have still been copyright infringement, but he would have had a pretty interesting fair use case if he had done that, because your right, it is a cluster and its too hard to deal with this crap if all your trying to do is refurb a bunch of hardware. That said, that isn’t what he did…
Edited 2018-04-29 03:21 UTC
galvanash,
They acknowledge that ebay may be a viable option for obtaining recovery media, haha.
Edited 2018-04-29 03:52 UTC
This is pure whataboutery and it is also ancient history.
coherence,
Well, so what? It was making a point that powerful corporations and their executives very often get off with less/no punishment for their crimes. There’s tons of examples of this in the world, sure they are all unrelated, but we can still recognize that there’s an imbalance in punishments depending on who you are.
Edited 2018-04-29 15:20 UTC
Which was exactly my point in the original, first post about this. If you truly believe someone needs to go to prison for an entirely victimless crime like this -especially the 3rd world-level prison system of the US – you are inhumane.
If you sell counterfeit software (which this was). There is no way for a normal consumer to tell what is and what isn’t legitimate. The guy went out of his way to have these disks look like the originals.
There is no way for the consumer to know that this disk isn’t full of some nasty stuff, since it is a counterfeit disk.
If he just supplied a copy to get the machine working on a disk burned from a regular rewriter drive and was identified by a sharpie, I suspect he would have got a slap on the wrist. He went out of his way to deceive. It happened to be victimless, however he acted like a criminal.
Also I stand by the point that is is whataboutery. It is the equivalent of a child saying “Look miss, he did something naughty last week and you told me off worse”. This mentality is fundamentally faulty. The cases were at different times, different states, different courts etc etc. You cannot compare the two.
You don’t not live in the country of prosecution of either cases, you certainly not someone that is an expert on legal matters. All you can really say is that it seems unfair.
Also the US prison system isn’t a 3rd world prison system. Just look at the state of prisons in somewhere like El Salvador/Russia/Saudi Arabia vs the USA. Also not all internment is maximum security.
Edited 2018-04-30 20:44 UTC
Then you missed the point. It isn’t whataboutery, because it SHOULDN’T be so varied just because they were in different states and different courts and different times. You really think it’s a good thing that there is such a variance between states and courts?
You think it’s a good thing that corporations can use their power over an individual in a battleground of their choosing to get the most favourable outcome for them?
Firstly, any entity will do its best to make any situation favourable to them. That is just reality unfortunately.
Well the only reason that corporations have so much power is that they collude with government. Make sure you vote for people that advocate against such things.
Edited 2018-05-01 19:27 UTC
coherence,
Sure, this is the theory, but there are many problems in practice. Parties that use gerrymandering can guaranty wins even with a minority of votes. Voting on politicians to represent us only works when they are truthful during the election and committed to serving us after the election. This is almost laughable today since lies are the norm. And it’s no wonder why, there’s no accountability to voters after the fact.
I am not an american. However this bollox that corporations control everything is ridiculous.
I stand by my original remarks.
Whoop de do. That’s nothing more than a fancy way of saying “I’m covering my ears and going la la la la!”
I am sorry to disagree with you. However you haven’t refuted a single one of my points.
I think it is ridiculous as previously stated that a different crime in a different place and in a different time should have the same punishment. Your thinking is simply faulty.
Just because you happen to think that in a completely different case the punishment wasn’t harsh enough. It doesn’t mean that punishment was too harsh in this case. They are two separate events and must be judged on their own merits.
This nonsense that corporations control everything, is a fantasy that a lot of people concoct so they can feel important being keyboard warriors as they fight the man.
Edited 2018-05-03 19:38 UTC
coherence,
I said it before, you are right that these cases have nothing to do with one another, but IMHO that’s simply not a good reason at all to ignore the imbalance. The problem with ignoring it is that we end up with a legal system that is effective at prosecuting people who have no influence and ineffective at prosecuting the people who have all the influence.
Edited 2018-05-04 17:12 UTC
So, “entirely victimless”? …why aren’t you sensitive rather towards the people he scammed (from his emails – very willingly) with those counterfeit discs?
Just because one group of white collar criminals got off easily in the past / now, doesn’t mean that all should.
So basically the scale of the deception really only amounts to $25 per refurbished PC.
For comparison, Bernie Madoff got 150 years for estimated actual investor losses of $18 billion. That’s 1 year per $120m.
Is $25 per refurbished PC something that’s really worth so much jail time? You even previously said that his sentence did not go far enough.
15 months? Unless he screws up or does something stupid he would to serve no more than 7.5 months, possibly as little a 3 months. I dunno, that sounds fair enough considering what he was doing. There is very little chance he would actually serve out the full sentence, he would have to do some pretty stupid stuff in prison for that to happen.
But I dunno. I’m honestly torn on the sentencing to be honest, because it is based on a $700k damage calculation, which is clearly ridiculous. At the same time though, the guy is clearly a crook…
Edited 2018-04-29 03:35 UTC
Yes, which is why he’s been found guilty and has been sentenced.
If only getting off early for parole was our actually problem…
Its really mandatory minimums that screws things up, which is basically the opposite. No possibility for parole, judge has no digression in sentencing, you get what the law says you get, mitigating circumstances be damned.
1st offense for possession with intent to distribute of 1kg or more of cocaine or heroine is 10 years. 2nd offense is 30 years, but if the drugs you have are linked to a serious injury or death its life. Most of the people in prison for this crime are hired mules – it wasn’t their drugs and they were only getting paid to transport it.
Yes, they were stupid. Yes, they should have known better. But if I were a judge and I saw a dumb 17 year old kid in my court room who got caught with a trunk full of drugs on the interstate, I would actually want the ability hear his case and sentence appropriately. Maybe he was desperate for money for some reason, who knows. But it doesn’t matter in US court – if he gets a guilty verdict he is going to prison for 10 years minimum.
tldr; time off for parole is not really the problem.
Edited 2018-04-30 03:37 UTC
Yet, mandatory minimums are popular because of what those people perceive as a parole loophole.
No mandatory minimum should be necessary – just don’t set a 15-month jail sentence for what is at most a 3-month crime (or 0-month crime according to some). If they set a reasonable jail sentence they can take into account those mitigating circumstances, then no parole is necessary, no perception of loopholes through parole.
kwan_e,
I agree with you, judges should be able to use discretion. Inevitably there will be times when their hands are tied and justice can not prevail when rules get applied blindly without regards to the details of the case. It’s pretty stupid when you think about it.
Seriously. Check the exhibits. He made over $92,000. Not exactly a not for profit organisation. That’s far more money than I make per year.
Furthermore, he was trying to replicate the discs exactly to pass them off as legitimate because the customers wouldn’t accept them otherwise.
And seriously, Techcrunch wasn’t even in the court at the time probably.
Sorry, this is a case of piracy. I agree with Microsoft here. $92000 is a lot of money. It’s not like he was going to donate it back to the community either.
Also. Why is it when Microsoft does anything, osnews posts a refute. But when Apple does anything, strangely, there doesn’t ever seem to be.
If osnews really wasn’t biased, you’d interview people who were at the court at the time. Just a day ago the Apple airport post ended with about how sad it is.
Either act neutral, or don’t even pretend to.
Edited 2018-04-29 01:32 UTC
The guy was engaged in fraud, so why does this keep getting put up as though it is relevant:
Again, how is this relevant? The refurbishing businesses are there to make money. That’s why there are lots of them. They don’t “donate” to the “community” either. What “community”? They’re businesses looking to make money – they’re not charities or benevolent societies. To demonize “intending to make a profit” is the wrong way to go here.
Want to know why osnews and other tech blogs posts these refutes?
Because it looks like some upper middle class white guy got caught red-handed committing a crime.
Edited 2018-04-30 15:08 UTC
But hey, haven’t you “disaffected white voters” kept telling us that the reason why there is a lack of representation in certain jobs is because they don’t want the job or their biology wasn’t suited for it?
By that logic, the only reason why upper middle class white guys are over represented in white collar crimes is because they wanted to do that and that their biology is suited for committing fraud.
Were companies not charging for recovery discs, like pre-2010, this would be a non issue. They only care because Dell and others now charge for recovery discs and it’s the only way to get oem keys working on windows.
In my opinion, that’s also double dipping by Dell and Microsoft, and if it’s any indication, that’s how it will continue to be.
Now, I would understand him being guilty of violating Technology export and import laws on certain countries, but that’s a whole different case, much harder to prove or win.