Louis Rossman - Eric Lundgren Windows Copyright Prosecution Case

[EEVblog]

and a follow-up




I thought this one was a big miscarriage of justice until Microsoft responded:

https://blogs.microsoft.com/on-the-issues/2018/04/27/the-facts-about-a-recent-counterfeiting-case-brought-by-the-u-s-government/

With this as context, here are some facts of the case worth noting – all of which are spelled out in detail in the court documents.

Microsoft did not bring this case: U.S. Customs referred the case to federal prosecutors after intercepting shipments of counterfeit software imported from China by Mr. Lundgren.
Lundgren established an elaborate counterfeit supply chain in China: Mr. Lundgren traveled extensively in China to set up a production line and designed counterfeit molds for Microsoft software in order to unlawfully manufacture counterfeit discs in significant volumes.
Lundgren failed to stop after being warned: Mr. Lundgren was even warned by a customs seizure notice that his conduct was illegal and given the opportunity to stop before he was prosecuted.
Lundgren pleaded guilty: The counterfeit discs obtained by Mr. Lundgren were sold to refurbishers in the United States for his personal profit and Mr. Lundgren and his codefendant both pleaded guilty to federal felony crimes.
Lundgren went to great lengths to mislead people: His own emails submitted as evidence in the case show the lengths to which Mr. Lundgren went in an attempt to make his counterfeit software look like genuine software. They also show him directing his co-defendant to find less discerning customers who would be more easily deceived if people objected to the counterfeits.
Lundgren intended to profit from his actions: His own emails submitted as evidence before the court make clear that Mr. Lundgren’s motivation was to sell counterfeit software to generate income for himself.
Microsoft has a strong program to support legitimate refurbishers and recyclers: Our program supports hundreds of legitimate recyclers, while protecting customers.

[EEVblog]

Louis said he's doing an interview with the Microsoft VP 

[rsjsouza]

Interesting turn of events; thanks for sharing Microsoft's official answer.

[Bud]

Louis said he's doing an interview with the Microsoft VP 

Lets see if he can do it without swearing and raising middle fingers.

[IanB]

I think what puzzles me here is why it isn't possible (or is it?) to simply download the ISO image of a [Dell OEM] restore disk and burn it yourself?

Apparently Dell wants to charge something for that service, but I have bought software downloads from Amazon, and it's quick and easy. So if Dell wants to charge a few bucks, why can't I give them my credit card info, download the image, and burn it? I can pay ten or twenty bucks for that service if they are so acquisitive that they don't want to offer it for free (and I'll feel free to hate them for it), but I expect I'll do it.

Now Microsoft says they sell installation disks to PC refurbishers with a complete new Windows licence key at a discount, which is nice, but why the need? If the original PC has a product license key already fixed to it on a holographic sticker, why can't that be reused? It should be possible to do a factory reset using the original software and license without needing a new product key.

At the end of the day, I'm not sure the law makes sense. The law should acknowledge that business is an exchange of value. If I do something that costs time or money, then I have a right to charge for that service. But if someone else is investing their time and money to do what I could do and saving me from having to do anything, then how can I be offended? That is just free market competition.

[C]

The Debian x64 net install ISO is less than 300 MB.

That is enough to start PC and use most network cards to download and install a full version of latest software.

Today most PC's can do a net boot and can load an ISO over the network.
A raspberry Pi can be the net boot server, does not take much.
And it's easy to hit key on boot to get to the boot from menu.


There is even very small versions that can use the net boot to let you pick what OS and install to over the net.

The capability exists to do a factory restore to a new disk drive and not need an ISO.

So only reason for a ISO is to let you do many computers with out having to download again for each PC.

For Current windows 10 you can use a microsoft image.
Older versions of windows you need a Dell image for Dell computer.

Any computer that has had windows 10 installed can be reloaded to new hard drive from Microsoft image and will have licensing valid.

C
 

[nuclearcat]

First of all sorry for my terrible english.

Microsoft published very interesting paper: https://blogs.microsoft.com/uploads/prod/sites/5/2018/04/2LUNDGREN6.pdf
From page 31, they tested that this disc doesn't ask for license keys nor doesnt do activation during install phase. But, when this discs was used on non-Dell PC's it shows that Windows is not activated/invalid key.
It means definitely software does check license and wont work on non-dell PC's without entering valid key, period.

Microsoft trying their best turn case upside down, and to make people forget, that while those pc's was bought, buyer paid for bundle, windows license as well. Eric was guilty for using their logo, and he was guilty for trying to fool customs(this is especially terrible thing), but he did very right thing helping people to make proper tool to run pc again. Also remember all that story was a sting operation, doing best to provoke him for worst things.

Microsoft can get out from this story by finding suitable settlement with Eric, but they dont care they look evil, they just pushed guy behind bars for 15 month.

My experience talking with big (evil) corporations top managers, when they talk honestly, they said something like this "Social responsibility is just inevitable expenses, and we know we should find someone to deal with, it should be some good inexpensive deals and doesnt matter if its really charity or show off, so next time someone come to us and beg for money, we say them - get lost, we are already helping A,B,C"
Thats exactly about:
"Microsoft has a strong program to support legitimate refurbishers and recyclers: Our program supports hundreds of legitimate recyclers, while protecting customers."

And important, Microsoft force manufacturers include license with each PC (https://en.wikipedia.org/wiki/Bundling_of_Microsoft_Windows) and it is extremely hard for people to get this money back if they don't want to use Windows, now Microsoft doing their best to prevent people reusing and recycling that bundled software.
As most here (i guess) hardware guys, just imagine if hardware vendor will lock your CPU and motherboard, if you disassembled your pc and changed location, and you need special $25 proprietary screwdriver to make your PC running again, and it is forbidden to manufacture such screwdriver by 3rd parties.

[alwashe]

I can't believe this. I am seriously thinking switching from Windows to Linux. I can't support this company anymore.

GUEST: eWaste Entrepreneur Eric Lundgren, Founder of I.T. Asset Partners is going to prison for recycling technology In depth interview before Eric goes to Federal prison for 15 months. Hear how he started his business, what are/were his goals and why Microsoft ended up getting him prosecuted.:
https://tunein.com/podcasts/Technology-News/Computer-and-Technology-Radio-p29078/

[T3sl4co1l]

Everyone should keep in mind that this is not a civil Microsoft VS Eric Lundgren case, this is a criminal United States vs. Eric Lundgren case.  Microsoft only gave a recommendation to the prosecution.  They were not the plaintiff/prosecutor in this case.

A case of this visibility also has the tendency to attract briefs from other lawyers and parties, if there is merit to its arguments.  Apparently, none were filed.  That further implies the criminal intent and outcome were clear to anyone watching.

It appears this is nothing about right-to-repair, and everything about a person going out of his way to import counterfeit goods.

Tim

[ebastler]

I can't believe this. I am seriously thinking switching from Windows to Linux. I can't support this company anymore.

GUEST: eWaste Entrepreneur Eric Lundgren, Founder of I.T. Asset Partners is going to prison for recycling technology In depth interview before Eric goes to Federal prison for 15 months. Hear how he started his business, what are/were his goals and why Microsoft ended up getting him prosecuted.:
https://tunein.com/podcasts/Technology-News/Computer-and-Technology-Radio-p29078/

I think you missed some of the evidence. Mr Lundgren himself might not be entirely impartial on this matter...

[wraper]

With this as context, here are some facts of the case worth noting – all of which are spelled out in detail in the court documents.

Microsoft did not bring this case: U.S. Customs referred the case to federal prosecutors after intercepting shipments of counterfeit software imported from China by Mr. Lundgren.
Lundgren established an elaborate counterfeit supply chain in China: Mr. Lundgren traveled extensively in China to set up a production line and designed counterfeit molds for Microsoft software in order to unlawfully manufacture counterfeit discs in significant volumes.
Lundgren failed to stop after being warned: Mr. Lundgren was even warned by a customs seizure notice that his conduct was illegal and given the opportunity to stop before he was prosecuted.
Lundgren pleaded guilty: The counterfeit discs obtained by Mr. Lundgren were sold to refurbishers in the United States for his personal profit and Mr. Lundgren and his codefendant both pleaded guilty to federal felony crimes.
Lundgren went to great lengths to mislead people: His own emails submitted as evidence in the case show the lengths to which Mr. Lundgren went in an attempt to make his counterfeit software look like genuine software. They also show him directing his co-defendant to find less discerning customers who would be more easily deceived if people objected to the counterfeits.
Lundgren intended to profit from his actions: His own emails submitted as evidence before the court make clear that Mr. Lundgren’s motivation was to sell counterfeit software to generate income for himself.
Microsoft has a strong program to support legitimate refurbishers and recyclers: Our program supports hundreds of legitimate recyclers, while protecting customers.

Microsoft provided fake evidence by saying that free Restore disk without a licence is worth as much as a refubrishers CD with licence ($25) and were functionally identical. They were not as with $25 you get a licence. Only based on that it became a criminal case, otherwise maximum it could resulted with would be relatively small fine for trademark infringement. As of last point, yeah, Microsoft wants that refubrisher buys $25 licence while there is already a lincence coming with hardware to be refubrished. Those disks were only functional on computers with licence already present.
Also those disks were to be supplied with refubrished computers at no charge, not sold. As of how much such restore CDs are worth, Lundgren had also bought a shitload of genuine windows restore CDs for a few cents a piece.

[alwashe]

...I think you missed some of the evidence...

Sorry, i must have missed something. Tel me, Please.

[bd139]

There’s no angels on either three parties here.

1. US enforcement started this.
2. This happened after Microsoft spent years lobbying for greater controls. The recycling program is not free to enter. The second license costs money even though the box is stickered with a license. Plus they are constantly changing rules and misleading sellers.
3. The reseller was hooky as fuck as they all are and wasn’t complying with the terms either way.

Best thing you can do is avoid dealing with all three parties.

I’ve dealt with MSFT licensing for 20 years and it’s all fucking smoke and mirrors shit. You’re never compliant.

[mikeselectricstuff]

I just listened to the interview.
TL;DR
He admits it was a mistake to use the trademarks on the CD, that would have been a civil case that he would have accepted the consequences of.
Microsoft lied in court to get a prosecution
His lawyers, teh government prosecutors and the judge were incompetent. provably altered evidence was accepted as fact, independent evidence was rejected in favour of thet from Microsoft, who had vested interests.
Bob Wolff probably faked evidence to save his own arse

[Brumby]

Microsoft lied in court to get a prosecution
His lawyers, teh government prosecutors and the judge were incompetent. provably altered evidence was accepted as fact, independent evidence was rejected in favour of thet from Microsoft, who had vested interests.

This is precisely the issue that inspired me to start this thread: https://www.eevblog.com/forum/chat/technology-and-the-law-how-informed-are-the-decision-makers/

[BBBbbb]

Microsoft lied in court to get a prosecution
His lawyers, teh government prosecutors and the judge were incompetent. provably altered evidence was accepted as fact, independent evidence was rejected in favour of thet from Microsoft, who had vested interests.

This is precisely the issue that inspired me to start this thread: https://www.eevblog.com/forum/chat/technology-and-the-law-how-informed-are-the-decision-makers/

Somewhat related - did you hear some of the questions Zuckerberg was asked by the members of the Senate commerce and judiciary committees regarding the Cambridge Analytica scandal. Made me question how are some of those people questioning him even allowed to use a computer.

[nuclearcat]

There’s no angels on either three parties here.

1. US enforcement started this.
2. This happened after Microsoft spent years lobbying for greater controls. The recycling program is not free to enter. The second license costs money even though the box is stickered with a license. Plus they are constantly changing rules and misleading sellers.
3. The reseller was hooky as fuck as they all are and wasn’t complying with the terms either way.

Best thing you can do is avoid dealing with all three parties.

I’ve dealt with MSFT licensing for 20 years and it’s all fucking smoke and mirrors shit. You’re never compliant.

I hope Eric next time remember 2 points:
1)Better to provide preloaded Linux instead
2)How Eric promote recycling and same time importing thousands of plastic CD's, while there is tons of available alternatives. I might agree Windows XP wont go well from regular USB flash, but he can provide cheap, reusable USB flash emulating CD-ROM, and more than that, boot from this flash very custom live Linux, show customer UI and necessary microsoft EULA, download restore CD image from Microsoft(as he stated it is freely available), verify checksum and existence of SLIC license in BIOS, burn it to special partition on flash, enable ISO emulation mode for this image. It doesn't need even custom hardware, just a bit of software development. And no damn way Microsoft can come even close to this with their death squad lawyers.

[wraper]

I hope Eric next time remember 2 points:
1)Better to provide preloaded Linux instead
2)How Eric promote recycling and same time importing thousands of plastic CD's, while there is tons of available alternatives.

1. Who the hell will buy that unless intending to reinstall OS to begin with or just someone clueless who will regret the purchase. Someone who wants linux will choose own flavor of it. On top of that, why not use already existing and paid licence.
2. It was AFAIK 6 or more years ago. Not only flash would be and still is more expensive but it's also an electronic waste. Not to say those PCs might not be able to boot from flash.

[nuclearcat]

I hope Eric next time remember 2 points:
1)Better to provide preloaded Linux instead
2)How Eric promote recycling and same time importing thousands of plastic CD's, while there is tons of available alternatives.

1. Who the hell will buy that unless intending to reinstall OS to begin with or just someone clueless who will regret the purchase. Someone who wants linux will choose own flavor of it. On top of that, why not use already existing and paid licence.
2. It was AFAIK 6 or more years ago. Not only flash would be and still is more expensive but it's also an electronic waste. Not to say those PCs might not be able to boot from flash.

1. Then get ready to defend yourself and lose in court for Microsoft death squad.
Because redistributing non-free software images or copies often against the law. You may own the license to use your copy, but nothing else, it doesn't mean you OWN this software, you may freely download one more copy of software, BACKUP it elsewhere, but it does not allow you to redistribute this software copy(even without key) to others.
https://www.microsoft.com/en-us/legal/intellectualproperty/copyright/default.aspx
"WITHOUT LIMITING THE FOREGOING, COPYING OR REPRODUCTION OF THE SOFTWARE TO ANY OTHER SERVER OR LOCATION FOR FURTHER REPRODUCTION OR REDISTRIBUTION IS EXPRESSLY PROHIBITED, UNLESS SUCH REPRODUCTION OR REDISTRIBUTION IS EXPRESSLY PERMITTED BY THE LICENSE AGREEMENT ACCOMPANYING SUCH SOFTWARE."
This is not right on my opinion, but this is how things seems is working at least in US, and ignoring this - direct way to prison. This is why easier to supply anything that doesn't have Microsoft property onboard.
And if someone want only windows and at same time he is not smart enough to download and burn iso image by trivial instruction(you can even provide him shortcut on preinstalled ubuntu how to do that and automate it) - then he deserve to pay license money again to Microsoft, i call it "dumbass tax".
Playing with evil and trying to trick them and law - totally wrong way, while you can prove PC works by ubuntu and provide easy way to run windows and reuse license.
2. USB flash is reusable for other, daily purposes, same as computers, while recovery DVD clearly not.
Most of modern USB flash controllers have CDROM emulation mode, that will work with PC's capable to run Windows XP, i tested that many times.

[wraper]

1. Then get ready to defend yourself and lose in court for Microsoft death squad.

All nice, except it does not cover selling the computer with licence already present  .

2. USB flash is reusable for other, daily purposes, same as computers, while recovery DVD clearly not.

Add cost to the bill then. Also intention was to provide recovery media. Not screwing recovery media by user using it not as intended.

Most of modern USB flash controllers have CDROM emulation mode, that will work with PC's capable to run Windows XP, i tested that many times.

If PC cannot boot from USB, IT CANNOT BOOT PERIOD. The only way is to boot by other means, say floppy, which will further use flash to continue booting.

[nuclearcat]

1. Then get ready to defend yourself and lose in court for Microsoft death squad.

All nice, except it does not cover selling the computer with licence already present  .

2. USB flash is reusable for other, daily purposes, same as computers, while recovery DVD clearly not.

Add cost to the bill then. Also intention was to provide recovery media. Not screwing recovery media by user using it not as intended.

Most of modern USB flash controllers have CDROM emulation mode, that will work with PC's capable to run Windows XP, i tested that many times.

If PC cannot boot from USB, IT CANNOT BOOT PERIOD. The only way is to boot by other means, say floppy, which will further use flash to continue booting.

In this particular case we talk about Dell CD's, and logically - Dell PC's. I checked, USB boot is not an option only for 2001 Dell optiplex GX240, at 2002 GX-260 and Latitude C640 seems fine.
So i believe avoiding USB because it wont boot is not very justifiable.