decoration decoration
Stories

GROKLAW
When you want to know more...
decoration
For layout only
Home
Archives
Site Map
Search
About Groklaw
Awards
Legal Research
Timelines
ApplevSamsung
ApplevSamsung p.2
ArchiveExplorer
Autozone
Bilski
Cases
Cast: Lawyers
Comes v. MS
Contracts/Documents
Courts
DRM
Gordon v MS
GPL
Grokdoc
HTML How To
IPI v RH
IV v. Google
Legal Docs
Lodsys
MS Litigations
MSvB&N
News Picks
Novell v. MS
Novell-MS Deal
ODF/OOXML
OOXML Appeals
OraclevGoogle
Patents
ProjectMonterey
Psystar
Quote Database
Red Hat v SCO
Salus Book
SCEA v Hotz
SCO Appeals
SCO Bankruptcy
SCO Financials
SCO Overview
SCO v IBM
SCO v Novell
SCO:Soup2Nuts
SCOsource
Sean Daly
Software Patents
Switch to Linux
Transcripts
Unix Books
Your contributions keep Groklaw going.
To donate to Groklaw 2.0:

Groklaw Gear

Click here to send an email to the editor of this weblog.


Contact PJ

Click here to email PJ. You won't find me on Facebook Donate Paypal


User Functions

Username:

Password:

Don't have an account yet? Sign up as a New User

No Legal Advice

The information on Groklaw is not intended to constitute legal advice. While Mark is a lawyer and he has asked other lawyers and law students to contribute articles, all of these articles are offered to help educate, not to provide specific legal advice. They are not your lawyers.

Here's Groklaw's comments policy.


What's New

STORIES
No new stories

COMMENTS last 48 hrs
No new comments


Sponsors

Hosting:
hosted by ibiblio

On servers donated to ibiblio by AMD.

Webmaster
Why Is Microsoft Seeking New State Laws That Allow it to Sue Competitors For Piracy by Overseas Suppliers?
Thursday, March 24 2011 @ 09:46 AM EDT

Microsoft seems to be trying to get its own personal unfair competition laws passed state by state, so it can sue US companies who get parts from overseas companies who used pirated Microsoft software anywhere in their business. The laws allow Microsoft to block the US company from selling the finished product in the state and compel them to pay damages for what the overseas supplier did.

You heard me right. If a company overseas uses a pirated version of Excel, let's say, keeping track of how many parts it has shipped or whatever, and then sends some parts to General Motors or any large company to incorporate into the finished product, Microsoft can sue *not the overseas supplier* but General Motors, for unfair competition. So can the state's Attorney General. I kid you not. For piracy that was done by someone else, overseas. The product could be T shirts. It doesn't matter what it is, so long as it's manufactured with contributions from an overseas supplier, like in China, who didn't pay Microsoft for software that it uses somewhere in the business. It's the US company that has to pay damages, not the overseas supplier.

Awful, I know. But the real question is, Why? Why is Microsoft doing this? Does Microsoft need a new revenue stream, now that folks are switching to smartphones instead of PCs? Or is it something worse, something Machiavellian? I ask that because I noticed two things, one, that Microsoft said that it came up with the laws because it is dissatisfied with patent law and two, something odd and frankly alarming in the Washington State version of this bill that leads me to suspect that this is Microsoft's Plan B in its litigation storm against Linux -- its Ace in the hole in case the Supreme Court decides that its software is unpatentable.

Not that Microsoft would mind having more than one way to harass Linux and it competitors in general, or two revenue streams without having to actually work to make better products. I'd like to show you how Open Source is deliberately excluded, though, a deliberate carve out.

How can there be state copyright-related statutes without conflicting with US Copyright Law, which is federal? You may well ask. Some are already saying that they think the bills are unconstitutional, but not only has such a bill just passed the Senate and the House in Washington State, 90-4 natch, Louisiana passed such a bill already, the Unfair Trade Practices and Consumer Protection Law, which you can read about here. Microsoft tried and failed in Utah, so far, but similar bills are working their way through the state legislatures in Massachusetts, Kentucky, New York, Connecticut, Arizona, Illinois and Oregon. So what might Microsoft do with such a bill?

Let us analyze it by repeating. If a company overseas uses Microsoft's software, a pirated version, not in any step of the manufacturing process alone but anywhere in that business, and then sells the parts to a US company to become part of a larger product, the US company can be liable for damages, tripled if it was knowingly done and it can be blocked from selling the product in Washington State. The "victim" can sue in civil court and the Attorney General can go after the "wrongdoer" US company, if a notice is sent and no amelioration occurs. But if the violation is of an *open source license*, the victim can't sue anyone under the bill, and the Attorney General does nothing for you. It's an exception to the law.

Think Android, for example. Do you think there could be anticompetitive effects of such a law? Well. Fairness isn't exactly Microsoft's middle name. If you reread the Supreme Court's ruling in AT&T v. Microsoft, I think you can see at least some reasons why Microsoft might be unhappy with patent law. In that instance, it benefited them. But they have lawyers. I think they got more than they wanted, and they might be imagining how things might go if they were the plaintiff instead of the defendant. I'd rather not elaborate, in that I don't wish to teach Microsoft anything it doesn't already have in mind.

But getting back to the new law, while it is awful on its face, what makes it worse is that in the Washington State version that just passed both the House and the Senate and which is now being worked on to merge the two, if the violation is of an Open Source license, there is no recourse under the proposed law.

Here's the Senate report [PDF] on the bill in Washington State, which I've done as text, and which explains what those for and against the bill argued as to why it should or should not be passed, and I've red-text-ed the parts about Open Source, because it's long. Also, in purple you see the neat trick whereby no one can sue Microsoft over its software under this law. This report is, as it explains, not the bill but what legislative staff wrote up to explain it:

SENATE BILL REPORT SHB 1495

As Reported by Senate Committee On: Labor, Commerce & Consumer Protection, March 17, 2011

Title: An act relating to the unfair competition that occurs when stolen or misappropriated information technology is used to manufacture products sold or offered for sale in this state.

Brief Description: Regarding the unfair competition that occurs when stolen or misappropriated information technology is used to manufacture products sold or offered for sale in this state.

Sponsors: House Committee on Judiciary (originally sponsored by Representatives Eddy, Rodne, Kirby, Armstrong, Hunter, Hinkle, Chandler, Pettigrew, Carlyle, Springer, Maxwell, Anderson, Clibborn, Kelley and Kenney).

Brief History: Passed House: 2/22/11, 90-4. Committee Activity: Labor, Commerce & Consumer Protection: 3/14/11, 3/17/11 [DPA-WM, DNP, w/oRec].

SENATE COMMITTEE ON LABOR, COMMERCE & CONSUMER PROTECTION

Majority Report: Do pass as amended and be referred to Committee on Ways & Means. Signed by Senators Kohl-Welles, Chair; Conway, Vice Chair; King, Assistant Ranking
Minority Member; Keiser.

Minority Report: Do not pass.
Signed by Senator Kline.

Minority Report: That it be referred without recommendation.
Signed by Senator Holmquist Newbry, Ranking Minority Member.

Staff: Ingrid Mungia (phone)

Background: Consumer Protection Act. The state's Consumer Protection Act (CPA) prohibits unfair or deceptive acts or practices and unfair methods of competition in the conduct of trade or commerce that directly or indirectly affect the people of Washington. Several statutes specify practices that constitute unfair acts, but they do not provide an exhaustive list. A court may find that conduct not specifically enumerated in statute may constitute an unfair or deceptive act.

末末末末末末末末末末末

This analysis was prepared by non-partisan legislative staff for the use of legislative members in their deliberations. This analysis is not a part of the legislation nor does it constitute a statement of legislative intent.

Senate Bill Report - 1 - SHB 1495


Either private plaintiffs or the Attorney General may bring civil actions to enjoin future violations of the CPA or to recover damages caused by an unfair act. Private plaintiffs may recover actual damages and costs, including reasonable attorneys' fees. Courts also may award private plaintiffs damages of as much as three times actual damages, in an amount not to exceed $25,000.

Personal vs. In Rem Jurisdiction. In order for a court to hear and determine a controversy, it must have jurisdiction over the matter. Often, courts have personal jurisdiction over a person sued in a civil lawsuit because the person made certain minimum contacts with the state; for purposes of the CPA, this includes transacting business within Washington.

Foreign defendants whose actions give rise to a lawsuit in a Washington court but who have never visited the state and who have no assets within Washington might not be subject to personal jurisdiction. Yet state courts may have jurisdiction to enter judgment regarding property located within the state, even if the courts do not have personal jurisdiction over that defendant. Such actions against property are called proceedings in rem.

Intellectual Property. Federal and state laws protect certain intellectual property rights in creations, such as computer software (programs) and hardware (equipment). A federal copyright gives the owner of an original work that expresses ideas, such as certain software, exclusive rights to copy, distribute, and adapt the work. A federal patent may protect a publicly disclosed computer-related invention for a period of time. Federal and state trade secret laws prohibit misappropriation of trade secrets, such as formulas, programs, and techniques.

Some holders of software copyrights license other people to modify and redistribute source code for those programs for free. Such programs commonly are called open source software.

Summary of Bill: The bill as referred to committee not considered. Summary of Bill (Recommended Amendments): A business that manufactures a product while using stolen or misappropriated information technology (stolen IT) in its business operations engages in unfair competition when the product is sold in Washington, either separately or as a component of another product, in competition with a product made without use of stolen IT. A new cause of action allows private plaintiffs or the Attorney General to sue businesses that engage in these unfair acts.

Stolen or misappropriated IT is defined as hardware or software that a person acquired, appropriated, or used unlawfully, unless the hardware or software was not available for stand-alone retail purchase at or before the time it was stolen. Using information technology in business operations means using IT to design, manufacture, distribution, marketing, or sales of products.

Notice. Before an injured plaintiff can file suit, the owners of stolen IT must provide written notice to the party allegedly using the stolen IT giving the party the opportunity to prove it is not using stolen IT or 90 days to stop using it or begin legalizing or replacing the stolen IT they are using, subject to any extensions approved by the owner or the court. The notice must state (1) the identity of the IT; (2) the identity of the lawful owner; (3) the identity of

Senate Bill Report - 2 - SHB 1495


the applicable law being violated; (4) the manner in which the IT is being used, if known; (5) the products related to the stolen IT; and (6) the basis and evidence supporting the allegation.

Jurisdiction. A court may proceed in rem against certain products only if a court is unable to obtain personal jurisdiction over a party who violated the act.

Elements of a Claim. A person is injured by the sale of a product if the person establishes by a preponderance of the evidence that:

  • the person manufactures articles or products sold or offered for sale in Washington in competition with articles or products made using stolen IT;
  • the person's articles or products were not manufactured using stolen IT;
  • the person suffered economic harm, which may be shown by evidence that the retail price of the stolen IT was $20,000 or more; and
  • the person is proceeding in rem or seeks injunctive relief, that they have suffered a material competitive injury.
Remedies Against Manufacturers. If the use of stolen IT continues despite the required notice, an injured person or the Attorney General may bring an action to enjoin violations of the act's provisions, including ordering a person not to sell products in Washington. A plaintiff also may seek the greater of actual damages or the amount of the retail price of the stolen IT. The court may triple the damages if the defendant willfully used stolen IT. A court may award costs and reasonable attorneys' fees to the prevailing party for all litigation expenses incurred in actions brought by an injured person.

Remedies Against Third Parties. The plaintiff may add to the action a claim for actual damages against a third party who sells the products made with stolen IT, but only if a court has first entered judgment against the person using stolen IT. Damages may be imposed against a third party only if certain conditions are met, including the requirement that the third party received 90-days notice before entry of the judgment and the person who was found to have used stolen IT either did not appear in court or has insufficient attachable assets to satisfy the judgment.

Damages against a third party are limited to the lesser of $250,000 or the retail price of the stolen IT, minus any amounts recovered from the person using stolen IT. The court may award attorneys' fees to a third party who qualifies for an affirmative defense if the third party notified the plaintiff of the affirmative defense prior to being added to the action.

A court may not enforce an award of damages against a third party for a period of 18 months from the effective date of the bill.

The bill creates remedies exclusive of the Consumer Protection Act.

Stay and Dismissal of Proceedings. The court must dismiss an action against a person using stolen IT or a third party if the person or third party has been subject to a final judgment, or has entered into a final settlement, in a proceeding in any federal or state court arising out of the same theft. If the person or third party is subject to a pending action in a federal or other state court, the court must stay the action pending resolution of the prior action.

Senate Bill Report - 3 - SHB 1495


Exceptions. A person may not sue under this cause of action when:

1. the end product sold or offered for sale in Washington is:
a. a copyrightable work under the United States Copyright Act;

b. merchandise manufactured by or on behalf of a copyright owner and that displays a component or copyrightable element of a copyrighted work;

c. merchandise manufactured by or on behalf of a copyright owner or trademark owner and that displays a component or copyrightable elements relating to a theme park or theme park attraction; or

d. packaging or promotional material for such copyrightable works or merchandise.

2. the allegation that the IT is stolen is based on a claim that the IT infringes on patents or trade secrets;

3. the allegation that the IT is stolen is based on a claim that the use of the IT violates the terms of an open source software license; or

4. the allegation that a person aided, facilitated, or otherwise assisted someone else to acquire or use stolen IT.

Affirmative Defense for Third Parties. A court may not award damages against a third party if the third party establishes that:
  • it is the end consumer of a product or acquired the product after its sale to an end consumer;
  • it is a business with annual revenues of less than $50 million;
  • it acquired the products in reliance on either a code of conduct that governs the commercial relationship with the manufacturer or in general undertook commercially reasonably efforts to implement a code of conduct with its manufacturer regarding the use of stolen IT; or
  • it does not have a contractual relationship with the manufacturer that stole the IT.
EFFECT OF CHANGES MADE BY LABOR, COMMERCE & CONSUMER PROTECTION COMMITTEE
(Recommended Amendments as Passed Committee): Includes in the definition of copyrightable end product, mask works protections as specified in the United States Code. Clarifies the written notice provided to a third party alleging the use of stolen IT must be properly served to a third party痴 agent for service of process. Clarifies in an action brought by a private plaintiff, a court may award costs and reasonable attorneys fees to a third party for all litigation expenses, including without limitation, discovery expenses, incurred by a party that prevails when a person either manufactured the final product or produced a component equal to 30 percent or more of the value of the final product. Restructures Section 8 for clarity.

Appropriation: None.

Fiscal Note: Available.

Committee/Commission/Task Force Created: No.

Effective Date: Ninety days after adjournment of session in which bill is passed.

Senate Bill Report - 4 - SHB 1495


Staff Summary of Public Testimony on Proposed Amendments as Heard in Committee:
PRO: This bill will help many companies which are in the business of developing information technology that is used in the manufacturing of goods worldwide. While many companies purchase their back office software, there are some manufacturers that do not purchase their back office software. We have not been able to contain the misappropriation of property when it is used in manufacturing. International law has failed us and we have a duty to protect the information technology of American companies. This is an important piece of legislation that will give the technology industry the ability to keep growing and provide jobs. The problem of piracy has been an impractical one. This bill will provide an important tool to address the unfair competition and level the playing field by providing a cause of action by the manufacturers playing by the rules against those that are not. It also provides various incentives through notice and cure provisions to correct the problem before litigation. This bill will level the playing field. The latest amendments address the concerns of various companies. We have broadened the safe harbor provisions and added protection against multiple litigation by strengthening the notice provisions and opportunity to cure. This bill has a number of safe harbor defenses to address the concerns. This cannot be enforced without a notice and opportunity to cure the problem. Software piracy hurts economic growth and limits jobs. Intellectual property has to be protected. It is not unusual for the Legislature to regulate intellectual property rights. Without protections like these in the bill, there are no incentives for companies to produce products.

CON: This bill does not accomplish its intended goal and will tie businesses up in litigation. Software compliance is difficult and complex. This bill is flawed because it includes many provisions that are broad and undefined and will lead to unintended consequences. This bill will discourage competition in this state. The Retail Association wants to work on this issue during the interim and ask Congress to work on this issue at a national level. This bill will not help curb the piracy of software products because legitimate retailers do not want to buy pirated products. There are already national laws that address this issue. Most legitimate retailers will have representations and warranties in their sale agreements which require a vendor to sell products that do not violate any laws. Retailers do not want to be the policing force for another company that they believe is using pirated software internationally. There should be an absolute defense written into the legislation. Protections of brands is a high priority for General Motors. Motor vehicle manufacturing is a complex process and complex supply chain. We are concerned that the provisions in the bill could interrupt the supply chain and interrupt the timely delivery of vehicles to dealers. The extra territorial effect in the bill leads to concerns about the bill's constitutionality.

Persons Testifying: PRO: Representative Eddy, prime sponsor; Nancy Anderson, Microsoft; Lew McMurran, Washington Technology Industry Association; TK Bentler, Motion Picture Association of America.

Senate Bill Report - 5 - SHB 1495


CON: Jim Halstrom, IBM; Rene Albury, Software Information Industry Association; Mark Johnson, Washington Retail Association; Cliff Webster, General Motors.
Is that not peculiar? See what I mean about Open Source? Monopolies get to thinking everything should benefit only them, of course, and a fair and even playing field is the last thing they are after, no matter what the proponents said. It isn't fair to Open Source. Look at the wording, the definition of Open Source. They are pretending that there's no money in Open Source, that it's just given away, but Red Hat, I assure you, does not give its software away to businesses who wish to contract with them. And if there is a violation of the GPL, the license that comes with Linux, it would indeed do harm, monetary harm, to the company. But for Red Hat, there is no relief under this law. Only Microsoft can harass its competitors, who must, under this law, stand still and take it, I gather.

As to the argument I've seen Microsoft offer that this will get the attention of the overseas infringers and they'll shape up in no time, I find that a little laughable. It's the US company that pays, not them. And the booming market currently isn't the US. It's China. Do you really think they'll care?

Meanwhile, back in the US, Microsoft will be able to tie up competitors with civil litigation in Washington State, blocking them from selling in the state while the litigation this bill authorizes proceeds -- and you know how long that can take from watching the SCO saga -- but a company that sees Microsoft's overseas partners violating the GPL or the Apache license, for example, can't sue Microsoft under this new law. Talk about unfair competition. It's a law that benefits only Microsoft, while disadvantaging its chief competition.

Some oppose the bill in Washington saying it will harm businesses and that it's not Constitutional. Jan Teague, Pres. & CEO, Washington Retail Association, wrote an article in Seattle PI last week, saying so:

Bills sponsored on Microsoft痴 behalf would hold unsuspecting, law-abiding retailers liable for lawsuits if someone accused them of buying merchandise from suppliers who use pirated software. It would require large companies to establish expensive tracking to ensure their suppliers were not using illegal software.

Microsoft has introduced similar bills in several other states instead of going to Congress, a more efficient way to attack this problem than a varied and piecemeal state-to-state approach. Software piracy is, after all, an international problem that can稚 be solved by a random array of state bills.

Regardless, piracy is Microsoft痴 problem to solve as it has been trying to do for several years. It is a problem akin to what retailers call 都hrink, or the loss of income from merchandise stolen either by outsiders or employees. Unfortunately, shrink is a painful cost of doing business. But retailers no more would seek Microsoft痴 help with this problem than Microsoft should be asking retailers to help pay for solving its challenges with software piracy....

The bills under consideration are so sweeping in their scope they represent an invitation to a legal challenge on their constitutionality in light of federal copyright and trade authority. Even if this never became a U.S. constitutional debate, retailers are hardly capable of finding the means to assist Microsoft in becoming a worldwide police force to protect against software piracy.

Of course, Microsoft pushes the bills, saying they'll help create jobs in the US. Dell, Intel, IBM, General Motors, Wal-Mart, and HP disagree, among others, and the tech firms sent a joint letter to the WA legislators, which was ignored, I guess. "These bills would create a new and unjustified cause of action against many American employers, fueling business uncertainty, disrupting our supply chains and undermining the competitiveness of U.S. firms," the companies' letter said.

TechFlash has been covering this story too:

Microsoft wants a state law in Washington to allow it to sue companies that use pirated Microsoft products to manufacture products sold in Washington. The proposed law also would allow the state to seek legal action against companies, The Olympian reports. Two bills SB 5449 and HB 1495 have been passed. And now the House and Senate are trying to work out the differences.
Look how the House bill defines "use," though: "(b) Information technology is considered to be used in a person's business operations if the person uses the technology in the manufacture, distribution, marketing, or sales of the articles or products subject to section 2 of this act." So if a company has some allegedly pirated Microsoft software used to create an ad, for example, regarding a product, this bill would apply? Wow. Microsoft must really need money.

Here's how the bill was introduced in Utah by Microsoft, as "Protection Against Unfair Competition Through Misappropriated Technology Act/Microsoft Anti-Piracy Bill" (SB 201), and why it didn't pass, as described [PDF] by the Utah Food Industry/Utah Retail Merchants Association, which opposed the bill, in a 2011 legislative wrap up:

Microsoft made an attempt to run its model bill regarding the unauthorized use of its software overseas. As introduced, SB 201 would have placed significant and unreasonable burdens on retailers and manufacturers. Microsoft had this bill introduced during the closing days of the legislative session and attempted to push it through under the radar and without much discussion. The association engaged fully on the bill and was able to prevent its passage. The association continues to stand in favor of addressing software piracy in a responsible manner and without the draconian penalties and burdens that are contained within Microsoft痴 current model bill.
Here are the minutes from the initial step in the process, dated March 2, 2011. As you see, Microsoft deputy general counsel Nancy Anderson spoke, as did Jonathan Zuck, President of ACT. Against the bill were the Utah retail association folks and David Stewart for Verizon.

What else might Microsoft do with such a bill? Imagine if you will that it's really Microsoft behind the sale of Novell to Attachmate. They are for sure trying to buy the Novell patents, via the entity they organized for the purpose, and the two deals depend on each other, so is it a huge stretch to imagine that Microsoft is behind it? What might Microsoft do with those assets, whether directly or through a proxy?

Let's also imagine that Microsoft was the wind beneath SCO wings. We don't actually have to imagine that, since there was testimony by witnesses that it was the case.

Let's imagine further that Microsoft hates Google, Android, and Linux in particular and that it likes to see lawsuits brought against them so as to create a cloud of FUD over them, so Microsoft can sell competing products in the climate of manufactured fear, and also get a revenue stream from Linux companies, not just to aid Microsoft's bottom line directly but also to force Linux to cost more, so Microsoft can compete better.

No stretch there.

Finally, let's imagine that reality finally sank in and Microsoft realized that SCO was a loser against Novell, that Novell actually never did transfer the copyrights SCO was building its litigation lottery with. What if Microsoft and whoever else is the money behind SCO think Novell owns the copyrights to UNIX? Let's imagine they want them so they can continue the SCO strategy but in their own special way.

I don't think anybody much does own the UNIX copyrights, by the way, not even Novell, not on the fundamental UNIX code, for reasons I've covered in earlier articles, but in a nutshell because AT&T in the early days didn't apply for copyrights, back when the law said you had to if you wanted copyright protection. AT&T relied on trade secret instead.

But the SCOfolk have never been closely tied to tech reality, and they don't need to be if the real goal is FUD litigation, so let's imagine that the same wind beneath SCO's wings has transferred to Novell, or is trying to, and that is what is really behind the sale of SCO's software assets to unXis and the sale of Novell to Attachmate.

Now think about the laws Microsoft is lobbying to get passed. The law would make it possible for Microsoft to block Android sales in whatever state passed such laws if it could find some tie between the Android product and some manufacturer of a contracted part in China or wherever who happened to use a pirated version of Microsoft Word -- not to make the part but to write up an ad for it. Ephemeral, much? But can you imagine how much litigation could spring from a law like this? How little it would take to keep litigation in the air forevermore? And you don't have to even prove infringement in China, just allege it to initiate proceedings.

The law works with any proprietary software, though, not just Microsoft's. UNIX is proprietary software, is it not? So once unXis owns the UNIX software assets, it could sue anyone using UNIX "inappropriately" in their view under this law just like Microsoft can sue over pirated Word or Excel. Remember Wayne Gray's big dream of providing an operating system to compete with all current operating systems, a dream that meant he needed to try to get the UNIX trademarks?

I know. But it's no more far-fetched than what SCO did. If your goal is really FUD litigation, what do you care? How hard would it be to find someone using pirated software in China? Meanwhile, Motorola or Barnes & Noble might see a GPL violation in a Nokia-Microsoft phone and be unable to do a thing under the new Microsoft laws.

Of course it would work just as well to block sales of supercomputer hardware running GNU/Linux instead of Microsoft software. Microsoft is already behind a number of companies nipping at IBM's heels over high end computers, is it not? How handy would such a law be to tie up sales for years and years, so Microsoft could get folks to buy its own products instead in the interim?

In short, I see these new laws as FUD litigation manufacturing machines ironically called laws to prevent unfair competition.

Like I told you before, this is SCO II. And there's nothing fair about it.

Update: Here is a summary [PDF] of the Oregon proposed consumer protection bill, HB3315. It also excludes Open Source:

SECTION 2. (1) A person may not sell, offer for sale, lease, barter, trade or exchange a product that has been produced by the person using stolen or misappropriated information technology if another person is selling, offering for sale, leasing, bartering, trading or exchanging a similar product in this state that was produced without using stolen or misappropriated information technology. The prohibition in this subsection applies regardless of whether the product is sold, offered for sale, leased, bartered, traded or exchanged individually or as a component of another product.

(2) The prohibition in subsection (1) of this section does not apply to:...

(c) Claims based on violation of the terms of a license that allows licensed users to modify and redistribute source code associated with information technology free of charge;


  


Why Is Microsoft Seeking New State Laws That Allow it to Sue Competitors For Piracy by Overseas Suppliers? | 447 comments | Create New Account
Comments belong to whoever posts them. Please notify us of inappropriate comments.
Why Is Microsoft Seeking New State Laws That Allow it to Sue Competitors For Piracy by Overseas Suppliers?
Authored by: Stumbles on Thursday, March 24 2011 @ 09:47 AM EDT
Where is the Judge that is supposed to be ridding rough shod over the abusive
monopolistic practices?

---
You can tuna piano but you can't tune a fish.

[ Reply to This | # ]

Why Is Microsoft Seeking New State Laws That Allow it to Sue Competitors For Piracy by Overseas Suppliers?
Authored by: webster on Thursday, March 24 2011 @ 09:53 AM EDT
The only safe thing to do is to make the chain of suppliers all swear they they
did not use Monopoly software.

[ Reply to This | # ]

Why Is Microsoft Seeking New State Laws That Allow it to Sue Competitors For Piracy by Overseas Suppliers?
Authored by: Anonymous on Thursday, March 24 2011 @ 10:06 AM EDT
The law of unintended consequences.....

Once the lawsuits start some suppliers will move to 100% open source and tout
that as a plus to buyers in the US. Buyers who are sued will require their
suppliers to prove compliance and moving to 100% open source may (will) be the
best solution for many of them.

So despite trying to game the system, Microsoft's actions will likely result in
more open source usage, not less.

[ Reply to This | # ]

Incredible
Authored by: scav on Thursday, March 24 2011 @ 10:06 AM EDT
Absolutely incredible.

But the take-home message for all US companies is this:
***

Make sure your suppliers use only open source software.
It's the only way to be safe, and this bill *guarantees* it.

And while you're at it, make sure you get rid of that
Microsoft software and upgrade to Linux + LibreOffice, if
you want to sell to anyone within the US, wherever you are
in the world.

***

Did SCO auction off the footgun, or did MS just "innovate"
it off them while they weren't looking? ;)



---
The emperor, undaunted by overwhelming evidence that he had no clothes,
redoubled his siege of Antarctica to extort tribute from the penguins.

[ Reply to This | # ]

Actually doesn't sound unreasonable in general
Authored by: Anonymous on Thursday, March 24 2011 @ 10:07 AM EDT
Say that you spend a billion dollars to develop a new drug, patent it, and
find that companies are copying your drug overseas and bringing it to the
US. wouldn't you want to stop that?

In my case, I ran a visual effects company, where the software used by
each of our artists cost $100,000 dollars. We are being undercut by
companies using pirated software. Should we be able to sue to prevent
the fruits of that stolen software from coming to this country?

I believe that like Caesar's wife, Open Source advocates must be even
more respectful of copyrights than everybody else, as copyright is what
makes the GPL possible.

Thad

[ Reply to This | # ]

Why Is Microsoft Seeking New State Laws That Allow it to Sue Competitors For Piracy by Overseas Suppliers?
Authored by: Anonymous on Thursday, March 24 2011 @ 10:12 AM EDT
Obviously the strategy is if the overseas company for example uses a Nook or
other Android product or one of the many Microsoft patents they claim Linux
violates then they can go after the US company as if it was a copy of Windows or
Office.

Is there not some sort of constitutional violation of equal protection laws by
excluding authors who use Open Source licenses to protect their intellectual
property?

[ Reply to This | # ]

Simple and pure protectionism
Authored by: Winter on Thursday, March 24 2011 @ 10:19 AM EDT
This is so popular in the states because it allows US companies to use US law
for protectionism.

Any supplier *outside* the USA will now have to prove that *all* of their
software has MS' approval and also to be responsible for their suppliers.

Just a legal backing of a Buy American campaign. With added revenues for MS.

And if the supplier uses FLOSS, how can they prove that?


---
Some say the sun rises in the east, some say it rises in the west; the truth
lies probably somewhere in between.

[ Reply to This | # ]

i4i can shut down the US import?
Authored by: Anonymous on Thursday, March 24 2011 @ 10:23 AM EDT
Does that mean, that i4i can shut down any import into the US? Because MS Word
is used in every office around the world and it has unlicensed IP from i4i.

Great.

[ Reply to This | # ]

MS better look out.
Authored by: jesse on Thursday, March 24 2011 @ 10:26 AM EDT
As they could be sued for stealing IP from foreign companies as well.

A conviction would put a stop to MS selling anything.

[ Reply to This | # ]

Easy enough to engineer around...
Authored by: eggplant37 on Thursday, March 24 2011 @ 10:35 AM EDT
Request for Quote:

...
Please detail for us how and where you use any and all software
products from the Microsoft Corporation.
...

Any and all bids where bidders use Microsoft software for any
purpose whatsoever will be rejected.

[ Reply to This | # ]

Why Is Microsoft Seeking New State Laws That Allow it to Sue Competitors For Piracy by Overseas Suppliers?
Authored by: Anonymous on Thursday, March 24 2011 @ 10:47 AM EDT
So lets say I was a multi-billionaire that owned a publicly trade US company
that produced an unnamed hand held communications product that was dominant over
Microsoft products. I then happen to need a new organ and decide to go to an
Asian country where they have their own IP laws that for the good of humanity
they happen to have decide not to allow it to include bio-tech pharmaceutical
products based on gene therapy. I get my new organ grown in a lab and return to
the USA.

Then if Microsoft owned the IP rights to that gene therapy or worse the company
that created the gene therapy was using their unlicensed copy of windows or
Linux/Android IP, then Microsoft would be able to do what to me? Could they
prevent me from re-entering the USA or could they go after my holdings in my US
publicly traded company? Does anybody see how quickly and how sadistically evil
this can get?

So then other countries have no right to make and pass their own IP laws. Well
if that's the case, then I suppose all governments around the world are forced
to have the same exact laws as in the US, so they might as well just close-up
their government offices and like a monkey or a good slave/colony to the US
empire just enact whatever the US wants.

[ Reply to This | # ]

So how transitive is it?
Authored by: overshoot on Thursday, March 24 2011 @ 10:48 AM EDT
Assume that Company A uses pirated copies of Flight Simulator in their employee break room, and Company B buys materials from Company A, Company C buys machine tools from Company C, etc. until Retailer U sells the goods they import from Company T.

Can Microsoft go after Company U? I'm having a hard time seeing that degree of vicarious liability holding up in court.

On the other hand, if they don't go for transitivity you can bet that absolutely every single importer will have a corporate cutout that does nothing but pass along the goods they. No value added, but just a zero-assets shell corporation which insulates its customers from their suppliers.

[ Reply to This | # ]

Allegation is not "due course of law"
Authored by: Anonymous on Thursday, March 24 2011 @ 10:49 AM EDT
Any law that places the full force of law behind unproven allegations violates
fundamental protections under the constitution.

[ Reply to This | # ]

Off Topic
Authored by: JamesK on Thursday, March 24 2011 @ 11:13 AM EDT
Since nobody else has bothered...


---
IANALAIDPOOTV

(I am not a lawyer and I don't play one on TV)

[ Reply to This | # ]

Why Is Microsoft Seeking New State Laws That Allow it to Sue Competitors For Piracy by Overseas Suppliers?
Authored by: Anonymous on Thursday, March 24 2011 @ 11:20 AM EDT
The thing that bothers me about this is that MS is using
this as a way to enforce laws that are explicity *not*
binding in some of the countries of origin for these parts.
We know that some countries (for various reasons) do not
sign on to Copyright, Patent, Trademark, etc. Accords.

So now, Microsoft is trying to use American Corporations
that may have dealings with countries in which they do not
have any legal standing to enforce the American version of
Copyright/Patent/Trademark/Servicemark Law.

That's a pretty low a despicable way to in my book.

I think the other reason MS is trying to do this now: there
is reform to our current "intellectual property" laws in the
air (personally, I haven't seen anything good coming from
this) and they are taking this as a preemptive step to avoid
some of the issues that might arise from those changes.

SndChaser

[ Reply to This | # ]

I don't think the open-source carve-out is a problem.
Authored by: gafter on Thursday, March 24 2011 @ 11:23 AM EDT
I don't think the open-source carve-out is a problem. Suppose overseas company
X violates an open-source license, say by failing to publish the sources of its
changes. The offended IP holder can sue a third party on the basis that the
copyrighted materials were used by the overseas supplier without any license
whatsoever. The existence of an open-source license (or any license that does
not apply to the supplier) need not be part of the allegation of violation.

---
-Neal

[ Reply to This | # ]

Why Is Microsoft Seeking New... Jurisdiction?
Authored by: Anonymous on Thursday, March 24 2011 @ 11:49 AM EDT
This is amazing.

1) Does a state have the subject matter jurisdiction to determine that a
foreigner is illegally using Microsoft's property in the first place. They can
not compel discovery on foreigners so how does Microsoft get standing in a US
court? Doesn't the law require a prima facie showing that you have a
possibility of winning your case but how can you do that if the court can not
control the evidence because it is in the hands of foreigners?

2) Knowing that tariffs have historically been a primary cause of trouble, has
anyone considered the impact on trade? With all the treaties concerning IP law
enforcement, it is likely that this law is somehow in conflict with them. What
has precedence: the law or the treaty?

3) Does a state have the authority to enact laws when fall under the authority
of the Universal Commercial Code?

4) When is someone like the BSA going to audit Microsoft for illegal software?

5) How can it be enforceable when it violates the equal protection clause on its
face?

6) Of course we are not dealing with criminal code here, we are dealing with
civil law so all Microsoft has to show is that the foreigners might be using
Microsoft property. They do not have to prove it and we all know how friendly
courts are to foreigners.

[ Reply to This | # ]

Enough to Make Your Blood Boil
Authored by: DaveJakeman on Thursday, March 24 2011 @ 12:05 PM EDT
Two recurring phrases in this are: "unfair competition" and
"stolen or misappropriated IT".

If you were asked to name a company, any company, whilst considering the phrase
"unfair competition", is there any one company that would spring to
mind?

If you were asked to name a company, any company, whilst considering the phrase
"stolen or misappropriated IT", is there any one company that would
spring to mind?

Aside from the underhanded nature of Microsoft's devious business method here --
getting laws passed to benefit its illegal monopoly -- why does Microsoft feel
so hot under the collar about this topic?

[ Reply to This | # ]

The thing that is sick about this
Authored by: Anonymous on Thursday, March 24 2011 @ 12:08 PM EDT
... is the way our corrupt state governments just blindly
pass whatever legislation a big corporation gives them
without giving it any thought whatsoever.

[ Reply to This | # ]

How do they certify compliance?
Authored by: Anonymous on Thursday, March 24 2011 @ 12:59 PM EDT
How will the courts determine if the supplier is licensed or not? IIRC, the BSA
applied a standard that nobody could meet because they required documentation
that neither Microsoft nor the hardware vendors would give to their customers.
Something about needing a separate line item on the receipt for products that
were bundled with the computer.

[ Reply to This | # ]

I don't think the opensource exclusion would work
Authored by: tz on Thursday, March 24 2011 @ 01:06 PM EDT
You can't sue over an opensource license violation, but the violation causes a
breach of copyright.

I.e. you have no right under copyright law to redistribute, modify, etc. any
software or work. An opensource license only permits going beyond this if you
comply with the terms.

SCO - the moment it violated the GPL and still distributed binaries was in
violation of copyright law. The GPL even says this - there is nothing else
giving them the right to redistribute the code.

When the BSA and Microsoft sue in cases of copying, it usually isn't over some
minutiae in the EULAs, they claim a copyright violation.

[ Reply to This | # ]

Please place any corrections (if needed) here ...
Authored by: nsomos on Thursday, March 24 2011 @ 01:24 PM EDT
If it be possible, it may be helpful to include a summary
of the correction in the title ...
e.g. MS Corp -> Miserable Sociopathic Corp

[ Reply to This | # ]

Bang!
Authored by: Anonymous on Thursday, March 24 2011 @ 01:24 PM EDT
Microsoft just shot, not only itself, but the US in the foot.
Well done, Microsoft.

[ Reply to This | # ]

  • Bang! - Authored by: Anonymous on Friday, March 25 2011 @ 12:12 AM EDT
    • Bang! - Authored by: Anonymous on Friday, March 25 2011 @ 06:01 AM EDT
      • Bang! - Authored by: Anonymous on Friday, March 25 2011 @ 05:14 PM EDT
Swords are double-edged
Authored by: Anonymous on Thursday, March 24 2011 @ 01:29 PM EDT
I wonder if Microsoft believes that all the software that it uses is
appropriately licensed. It seems to me that this bill could stop Microsoft from
making software. Is that a bad thing?

[ Reply to This | # ]

News Picks comments here please
Authored by: nsomos on Thursday, March 24 2011 @ 01:42 PM EDT
Please place comments on News Picks in this thread.
Don't make us guess what article you are posting about,
but clue us in plainly, instead. Since the News Picks
can be updated rapidly, the article you are referring
to may no longer be on the main page. Giving a link
to the article may be appreciated and helpful.

Follow the instructions on Posting in HTML mode, and
remember .... Preview, is your friend. Thanks

[ Reply to This | # ]

I think that this legislation is a footgun of biblic proportions for MS
Authored by: vadim on Thursday, March 24 2011 @ 01:47 PM EDT
I believe that this legislation will cause US companies to
press their non-US suppliers to switch to Open Source software
to avoid problems.

[ Reply to This | # ]

Here is Why: Overseas Sales!
Authored by: Anonymous on Thursday, March 24 2011 @ 01:49 PM EDT
The key target is not the US victims (the 'third parties'). Its the OVERSEAS
suppliers. This law could best be titled the Efficient Extortion Act.

The key provision is the language that requires a notice to the accused overseas
supplier that offers an opportunity for the accused to prove it is not using
stolen IP.
a.) there is no referral to, or recognition of, the law or courts of the
accused supplier's country.
b.) the Washington State law places the burden of proving innocence on the
accused.
c.) there is no provision for adjudication of the 'Stolen IP' accusation in
Washington State. Thus the accusation is presumed true for the Washington State
proceedings.
d.) The only requirement for proceedings against the US third party is the
making of an accusation against the overseas supplier in a prescribed format.

Example:
You make nuts and bolts outside the US. You have a completely open-source
company. No MS or any other proprietary software.

The local MS guy shows up and says "A company your size should have 100
licenses for MS products. You do not have any. You are using stolen IP. Here is
the written notice. You have 90 days to pay us, or your products will be
excluded from the US."

Note: No legal proceedings in the host country.

If the victim doesn't pay up, MS recruits a company in Washington State that
could theoretically compete with the overseas victim, and has THAT COMPANY sue
ITS (potential) CUSTOMER(S).

The beauty here is that MS itself never shows up in the litigation as a
plaintiff! It will always be reported as a victim of the overseas company's
theft of its 'stolen IP".

The purported plaintiff is some other US company (or litigation firm) claiming
that they have been hurt by the overseas company's alleged but unproven use of
'stolen IP' to manufacture products sold to the US victim (the 'third party').

Even if the overseas company does not use any MS products, all that is needed in
the Washington State court is an accusation. Which does not have to be proved
true, and cannot be disproved. (There does not appear to be any provision for
litigating that accusation in Washington State).

So, once this law gets passed in a few states, the MS mafia overseas will be
visiting every company that exports to the US, regardless of whether there is
any 'stolen IP' in the shop, with the message "Nice place ya got here; be a
shame if something happened to it".

Brilliant! And all legal!
Al Capone and John D. would be proud

IANAL
JG






[ Reply to This | # ]

So Microsoft can violate open source licenses?
Authored by: Anonymous on Thursday, March 24 2011 @ 01:52 PM EDT
I read the exceptions clauses slightly differently. If Microsoft violates an
open source license (accidentally OR deliberately), then they can't be sued
under this law. Right?

So let's say an developer writes a bit of open-source software, and someone at
Microsoft adopts it. The code is out first under the open license, but
Microsoft is first to release software actually using it. Which came first, and
who gets to sue who?

[ Reply to This | # ]

Using Hardware with embedded Linux
Authored by: Eeyore on Thursday, March 24 2011 @ 01:52 PM EDT
I suspect that Microsoft (or whoever) included the open source exception in
there so they wouldn't get hammered if it turns out that their network farm uses
some foreign made equipment (think routers and other embedded systems) that has
a GPL violation against it.

Of course, I think the entire thing is creepy, but we are talking about
Microsoft, so....

[ Reply to This | # ]

What info is there about OREGON?
Authored by: baomike on Thursday, March 24 2011 @ 01:53 PM EDT
I have searched the BILL INDEX for the Oregon leg. and I can find nothing. Which
likely means it's under something weird.

PJ do you have any specifics: bill number, sponsor, title ...

I want to do a little messaging to my "elected representative".

Mike

[ Reply to This | # ]

  • Found it. - Authored by: baomike on Thursday, March 24 2011 @ 02:33 PM EDT
    • Found it. - Authored by: Anonymous on Thursday, March 24 2011 @ 03:20 PM EDT
      • Found it. - Authored by: PJ on Friday, March 25 2011 @ 12:00 AM EDT
Why do we let corporations write laws?
Authored by: Anonymous on Thursday, March 24 2011 @ 01:53 PM EDT

Microsoft said that it came up with the laws ...

Nobody can even pretend we live in a democracy any more. It's now openly acknowledged that powerful, rich corporations can write laws to damage or eliminate their competitors.

[ Reply to This | # ]

Microsoft Bankruptcy Prediction
Authored by: The Mad Hatter r on Thursday, March 24 2011 @ 02:21 PM EDT
PJ,

About a Eighteen Months ago I predicted that Microsoft would be entering Chapter
11 bankruptcy in five years. The result from all quarters was laughter.

But... I based my prediction on Microsoft's own financial statements, which I
read in full. And my numbers do make sense, being based on Microsoft's revenue
per employee/cost per employee figures, their profit centers, how the company
makes money, and where the market was going.

If I'm right, and the IPad is impacting Microsoft the way I think it is,
Microsoft's year end sales should show a significant drop from 2010. Now
Microsoft has had a sales drop once before, at the start of the current
recession. If Microsoft sales drop now, while Apple and other IT companies are
showing sales increases, that would indicate that I might be right, and that
they have started into a Death Spiral.

Of course Microsoft can, and will adjust their sales to hide any drop. Every
company does. It's supposed to be illegal, but if some sales come in a few days
early, well, it happens.

But management will know the true state of the health of the company. This
legislative push, which I hadn't heard of until someone tweeted about your
article is a good indication that someone high in Microsoft management is really
worried. They are spending a lot of political capital to push this through, and
quite frankly they aren't going to be able to get it in all fifty states. It's
going to end up being like the Uniform Computer Information Transactions Act
(UCITA), adopted in some states, and ignored in others. We may see some
businesses move out of states like Washington, to neighboring states like
Oregon, to avoid the problems that this law can bring.

Which puts more pressure on the politicians and Microsoft. What do the
politicians in Washington State do if businesses pack up their bags and leave,
putting voters out of work? And what does Microsoft do, if a court tells them
that suing Joe's Corner Store isn't appropriate even if the law says that they
can?

May you live in Interesting Times Microsoft.


---
Wayne

http://madhatter.ca/

[ Reply to This | # ]

Why Is Microsoft Seeking New State Laws That Allow it to Sue Competitors For Piracy by Overseas Suppliers?
Authored by: Alan(UK) on Thursday, March 24 2011 @ 02:40 PM EDT
I am really not sure what to make of this.

Is it just another of the nutty state laws like the annual round of creationism
(sorry, academic freedom) bills?

If the State of Washington passes this law, what happens about goods imported
via other states and then shipped to Washington? Surely this is a matter of
interstate commerce and you have some laws about that.

A simple solution to the GPL exemption. IBM, Redhat, or someone writes a piece
of code that becomes part of a GPL project. They donate the code under the GPL
but also dual licence it under a commercial licence. Infringing the GPL makes
that licence irrelevant and the software is now in breach of the commercial
licence.

As the use of unlicenced software is rampant in those countries with the will
and ability to actually manufacture anything, this law could be amusing.

You will be burning witches next.

---
Microsoft is nailing up its own coffin from the inside.

[ Reply to This | # ]

It may be "the Camel's Nose" Legislation
Authored by: deck2 on Thursday, March 24 2011 @ 02:59 PM EDT
The old saying "If the camel once gets his nose in the tent, his body will
soon follow" may be applicable to this law. This may be the first move in
having laws where all that Microsoft has to do is accuse a business of
misappropriating their software to have the business essentially shut down.
Even if a company were running 100% open source, Microsoft would claim that they
couldn't do it without running MS Crudware and had just covered up that fact.
Microsoft could further accuse them of destroying the evidence since all that is
needed in Microsoft-think is that there are unfounded accusations. This points
to the MS Monopoly being threatened by a source that they cannot defeat or make
money from without the use of the Government through throughly non free market
laws that may conflict with consitutional or other fundemental law.

And also, how can an unprovable accusation be used as the prime evidence in a
court of law? One thing I can see (and which may have been said by someone
else) is Microsoft infiltrating companies that source things to downstream
companies they consider competitors and having the MS agent insert pirated
copies of MS software into the upstream companies' IT system so that there is a
provable accusation. They may also use the Business Software Alliance standards
of compliance which make legal copies of MS software illegal as a way to declare
piracy. (Forgive me, I just can't call it BSA as to me that is Boy Scouts of
America) I would not put those scenarios past the low moral and ethical
standards of MS personnel in their business capacity.

[ Reply to This | # ]

Theme park?
Authored by: Anonymous on Thursday, March 24 2011 @ 03:47 PM EDT
The bill excludes

c. merchandise manufactured by or on behalf of a copyright owner or trademark owner and that displays a component or copyrightable elements relating to a theme park or theme park attraction; or

That is ridiculously specific. What on earth is that all about! Laws are supposed to be written on the basis of general principles. You are not supposed to write laws pointed at individuals.

Is this kind of thing common in the US? It looks like a very poorly drafted law to me.

[ Reply to This | # ]

What State Law?
Authored by: Anonymous on Thursday, March 24 2011 @ 04:14 PM EDT
This sneaky backdoor measure points to a fallacy in the
"United" States of America. It shows that MS has failed in its
efforts to lobby Washington for such provision. As others have
observed, this is the downhill slide for MS. If I were an overseas
supplier I would have my US agent uphold my rights under
Federal Trade law.

[ Reply to This | # ]

Isn't this a two edged sword?
Authored by: DannyB on Thursday, March 24 2011 @ 04:21 PM EDT
Those who live in glass houses should not throw lawsuits.

Imagine:

Out of country party uses pirated version of some Google software. (But what
possible software could it be?)

Microsoft uses that out of country party for something, a part, contract work,
etc.

Google sues Microsoft using new law.


Couldn't lots of companies go after Microsoft? Hypothetically, say Adobe, IBM,
Oracle, etc.


---
The price of freedom is eternal litigation.

[ Reply to This | # ]

Why Is Microsoft Seeking New State Laws That Allow it to Sue Competitors For Piracy by Overseas Suppliers?
Authored by: rnturn on Thursday, March 24 2011 @ 04:25 PM EDT

It seems that Microsoft is taking a page from the RIAA and MPAA playbooks. Try and get laws enacted to get everyone else except the vendor to be a policing body that tracks down anyone and everyone who is misusing their software. Can't get people to stop copying your music or movies? Then get a law passed to force ISPs to monitor their networks for anything that looks like a music of movie file. The East German secret police would be proud.

Do they really expect to be able to force, say, GM to create a police force to scour the IT infrastructure across the planet for PCs that might be running a questionably licensed copy of Excel? Dream on. Something tells me that one shouldn't expect these laws to last very long in court.

[ Reply to This | # ]

What about your business smartphone?
Authored by: Anonymous on Thursday, March 24 2011 @ 04:45 PM EDT
Surely stolen IT includes Android phones, but maybe even Blackberries. I don
know what they will allegedly infringe, but something will be trumped up.
As long as their software product is under a cloud of suspicion, the only safe
bet for your company phone will be: Windows Mobile.
Expect a lot of legal coud to be cast over competitors of both Apple and
Microsoft and enterprise IT policies to ban using anything but Apple or
Microsoft phones. Apparently there's not much faith Microsoft will be able to
market Windows Mobile in oter ways.
(Or this is a repeat of SCO Linux FUD, reworked for phones and tablets.)

[ Reply to This | # ]

Could China be the target?
Authored by: Anonymous on Thursday, March 24 2011 @ 05:09 PM EDT
Is MS assuming that every company in China must have at least one copy of
suspect software?
If so then this law would make it almost impossible for China to import any
goods into the U.S.
I wonder what Amazon, and others, would say if they find out they cannot sell
Chinese made goods.

[ Reply to This | # ]

Insane... and illegal?
Authored by: Anonymous on Thursday, March 24 2011 @ 05:16 PM EDT
Words fail me as to how bad this is. I couldn't come up with the words even if
I violated PJ's comment standards.

But surely, if the interstate commerce authority of the federal government is
large enough for them to require an individual to buy health insurance, it's
also large enough to overrule this insanity?

MSS2

[ Reply to This | # ]

Microsoft gets to police its own law
Authored by: soronlin on Thursday, March 24 2011 @ 05:31 PM EDT
In an action under this chapter, the use of stolen or misappropriated information technology may be established from the business records of a person subject to this section, by evidence derived from techniques used by the information technology owner to establish use of stolen or misappropriated information technology, or by other competent evidence.
So Microsoft not only accuses the defendant, they get to use their own methods for proving their case, and since those rights are enshrined in the act, they appear not to be arguable.

[ Reply to This | # ]

Why Is Microsoft Seeking New State Laws That Allow it to Sue Competitors For Piracy by Overseas Suppliers?
Authored by: Anonymous on Thursday, March 24 2011 @ 05:40 PM EDT
Two things I wanted to touch on here.

1. The Open Source carve-out. Realizing that Microsoft
drafted this crap, I don't think the Open Source carve-out
really matters. Why? Because the GPL provides it's own (and
probably more effective) legal protections. This is just
Microsoft's way of trying to catch up.

2. As far as smartphones go, it's a double-edged sword that
can bite Microsoft and Apple as well. Why? Because most
likely the same companies who manufacture components for
Android phones also manufacture the same components for
Apple's phones and phones that run WP7.

If I were a smartphone supplier (especially one that
supplies both Android and Windows Phones), and I got sued
for my Android Phones, I would turn to Microsoft and say "Oh
I can't sell your phones in <insert State here> now.
They're manufactured with the same components as the Android
Phones, and I'm in violation of YOUR law."

..... Or is that what the "can't sue for Microsoft's
violations" portion is meant to cover?

Have a great day:)
Patrick.

[ Reply to This | # ]

Why Is Microsoft Seeking New State Laws That Allow it to Sue Competitors For Piracy by Overseas Suppliers?
Authored by: Anonymous on Thursday, March 24 2011 @ 05:43 PM EDT
I wonder something.......

How many of the Legislators who voted for this law use
Android or iPhones. I think that people should send them a
bunch of mail, which points out that their phones could
potentially be in violation of the law that they just
passed. Which means that if they like those phones, they'd
better stick with what they have--as they probably won't
legally be able to buy a newer version of them now.

After all, Apple can be sued under this law just as easily
as HTC or Motorola can.

Have a great day:)
Patrick.

[ Reply to This | # ]

My speculation on probable motives
Authored by: dmarker on Thursday, March 24 2011 @ 06:08 PM EDT


Microsoft has not had any serious market success in China.

If we accept the following points then there is a motive for what Microsoft are
doing.

1) Microsoft's business is poor in China
2) Software piracy is a serious problem in China
3) Microsoft are regarded with significant suspicion in China

So if Microsoft can shift the burden of its poor business & image & also
the piracy, to other companies it can kick, it could force them to put heat on
Chinese companies to be 'nicer' to Microsoft & either do more business with
them (Microsoft's dream) or stop using Microsoft products altogether (certainly
my hope).

This tactic reminds me of the attacks on ISPs as a means of trying to solve
problems such as music copying.

DSM

[ Reply to This | # ]

Enforcing USPTO patents worldwide?
Authored by: Anonymous on Thursday, March 24 2011 @ 06:24 PM EDT
Given the broken nature of the USPTO, is this a hedge against
the possibility that other countries might rule that many US
patents are not valid. This has already been happening to an
extent. This law would effectively turn any and all bogus US
patents into worldwide patents regardless of what other more
sensible governments say about their validity.

I suspect that android phone manufacturers would be in the
crosshairs.

[ Reply to This | # ]

The pleasant thought I will take to bed with me
Authored by: Anonymous on Thursday, March 24 2011 @ 06:34 PM EDT
I wonder how much it would cost an oil company to audit not just its global
operation's software but also the software used by all its suppliers worldwide.

I can't help wondering if it would not be cheaper for them just to close down
every gas station in the state due to "An abundance of caution concerning
the Microsoft Law which was sponsored by Senators Brown, Pflug, Carrell, Harper,
Murray, Hobbs, Fain, Delvin, Roach, Ericksen, Shin, Tom, Kohl-Welles and
Kilmer"

It won't happen but I will go to bed with a smile.

[ Reply to This | # ]

"Microsoft tried and failed in Utah"
Authored by: Anonymous on Thursday, March 24 2011 @ 06:34 PM EDT
A party that believes that the solution for every problem is
more lawyers and more regulations would pass such laws.
But I doubt if it can pass such laws in a state like Utah,
or the US Congress.

[ Reply to This | # ]

Why Is Microsoft Seeking New State Laws That Allow it to Sue Competitors For Piracy by Overseas Suppliers?
Authored by: dio gratia on Thursday, March 24 2011 @ 06:41 PM EDT

Besides trying to raise copyrights to the status of real property ("stolen or misappropriated information technology (stolen IT)") conflating software and hardware, the bill attempts to regulate interstate or foreign commerce ("The extra territorial effect in the bill leads to concerns about the bill's constitutionality"). Article I. Section 8, The Congress shall have the power..., Clause 3, "To regulate Commerce with foreign Nations, and among the several States, and with the Indian Tribes", Clause 18, "To make all Laws which shall be necessary and proper for carrying into Execution the foregoing Powers and all other Powers vested by this Constitution in the Government of the United States, or in any Department or Officer thereof".

Section 10. "No State shall, without the Consent of the Congress, lay any Imposts or Duties on Imports or Exports, except what may be absolutely necessary for executing its inspection Laws: and the net Produce of all Duties and Imposts, laid by any State on Imports or Exports, shall be for the Use of the Treasury of the United States; and all such Laws shall be subject to the Revision and Control of the Congress".

The key words here are Imposts and imposition. Both imposts and duties meanings extend beyond actual taxes, also including obligation and costs of compliance. "To regulate Commerce" guarantees Federal preemption. Note also the proceeds should be turned over to the U.S. Treasury.

The exceptions appear to exempt works of authorship, meaning copyrightable products aren't the fruit of 'stolen' IT under the law, meaning it isn't about software competition. (All original works of authorship are eligible for copyright protection, Title 17 ァ 102, software as literary works; "Exceptions. A person may not sue under this cause of action when: 1. the end product sold or offered for sale in Washington is: a. a copyrightable work under the United States Copyright Act"). The fourth affirmative defense ("does not have a contractual relationship with the manufacturer that stole the IT") lets off most of the acquisition of products from China, wherein the distributor is not generally synonymous with the manufacturer.

All in all a feel good law with little actual effect, and as far as Microsoft is concerned affects mouse, keyboard, game console and kinect type device manufacturers, under the theory that someone would require standing to bring action for unfair competition under the law. And it does seem to have the effect of driving supply chains to switching to open source software.

The question is whether or not the exceptions will remain in the version as passed into law. You'd also wonder if Microsoft is contemplating expanding into more real goods, on the other hand this doesn't seem to be the law they actually proposed as in shades of the OOXML specification. Microsoft appears to have been bait-and-switch'ed again. The Louisiana Deceptive Trade Practices Laws appear to set up pay-as-you-go for winning favorable rule making. It appears Microsoft might not be willing to pay up front for what they actually want, and aren't doing so in Congress. Then again state legislature actions may be a prelude to Congressional action, although it's hard to imagine Microsoft taking the long view on anything.

[ Reply to This | # ]

Why Is Microsoft Seeking New State Laws That Allow it to Sue Competitors For Piracy by Overseas Suppliers?
Authored by: ThrPilgrim on Thursday, March 24 2011 @ 06:58 PM EDT
This could be fun as no major company could prove that all it's subsidiaries,
suppliers, and outsourced departments are in full compliance.

Now obviously MS expects the US Companies to lean on their suppliers to buy more
MS licences, but times are hard and it wont take many been counters telling
their CEO's that buying the required licences makes trading with the US
unprofitable before major US companies can't import from anywhere.

And the fastest way to become a medium sized company is to start of as a large
company who can no longer source their parts.

And then you get the problem with outsourcing. Can you trust that company you
outsourced your pay roll to because they ludicrously underbid everyone else to
have licensed every piece of software they are using.

I hope Microsoft throws a really good party for it's executives this year as I
don't see them getting may invites to other company's.

---
Beware of him who would deny you access to information for in his heart he
considers himself your master.

[ Reply to This | # ]

Why State Laws?
Authored by: cbc on Thursday, March 24 2011 @ 07:00 PM EDT
Long ago and far away, I was a manager with responsibility for signing and
renewing software contracts. A company policy required that each contract be
reviewed by the corporate lawyer. I would send the contract to the lawyer who
was a Senior Vice President far above my pay grade. Then we would have a
sit-down review. One thing he would always do is change the governing law
clause. (I got a "B" in Business Law 101, my total legal training
besides a few episodes of "The Paper Chase"). I asked "Why do you
always change the governing law clause?". His response "I know the law
in [our state], I don't know about [original state].
So that might be one reason for State Laws as a venue.
My other thought is that adding to 50 state laws may be *way* cheaper lobbying
cost. And until a Federal Circuit Court or above resolves...
Limbo
Limbo=Delay
Delay=Expense
My understanding from Business 101.

[ Reply to This | # ]

WTO
Authored by: kh on Thursday, March 24 2011 @ 07:28 PM EDT
Apart from the difficulty of proving stuff not in your jurisdiction and the
problem
of states making laws about other countries (Foreign commerce clause) there's
the problem of acting in compliance with federal treaties like the WTO.

[ Reply to This | # ]

The dumpster diving getout clause
Authored by: Anonymous on Thursday, March 24 2011 @ 08:29 PM EDT
Stolen or misappropriated IT is defined as hardware or software that a person
acquired, appropriated, or used unlawfully, unless the hardware or software was
not available for stand-alone retail purchase at or before the time it was
stolen.


These Microsoft lawyers think of everything.

[ Reply to This | # ]

Very clever technicality - Evil and unfair but Very Clever as a gambit to stop the unstoppable
Authored by: SilverWave on Thursday, March 24 2011 @ 08:33 PM EDT
That's always the problem with MS... they are prepared to do anything to protect
their monopoly.

And they have loads of money to rig the game in their favour, and loads of money
to hire smart ppl to help them rig the game.

Interesting.

---
RMS: The 4 Freedoms
0 run the program for any purpose
1 study the source code and change it
2 make copies and distribute them
3 publish modified versions

[ Reply to This | # ]

It's easier for Microsoft to accuse than for companies to audit
Authored by: Anonymous on Thursday, March 24 2011 @ 09:15 PM EDT
I assume even pirated software phones home so Microsoft must have a huge pile of
IP addresses associated with computers with potentially dodgy software. Any PC
that hasn't been Windows Genuine Advantaged is clearly suspect.

Any company with its own entry in Whois should be big enough to be worth making
it a target so they just have to crawl whois (which is of course against the
terms and conditions of most registrars) to find names of companies with dodgy
software.

Given a company's name it should be easy for someone with Microsoft's resources
to work out who their biggest customers are. Think cold call from a new magazine
/ website wanting to print an article about successful businesses in the region.
If they find a company with a customer who trades in one of the states that has
passed this legislation then it's payday.

[ Reply to This | # ]

Why Microsoft Seeking New State Laws
Authored by: Sunny Penguin on Thursday, March 24 2011 @ 09:44 PM EDT
Microsoft likes exceptions, they can legally steal Linux code if this law
passes.


Exceptions. A person may not sue under this cause of action when:
1. the end product sold or offered for sale in Washington is:
a. a copyrightable work under the United States Copyright Act;

b. merchandise manufactured by or on behalf of a copyright owner and
that displays a component or copyrightable element of a copyrighted work;

c. merchandise manufactured by or on behalf of a copyright owner or
trademark owner and that displays a component or copyrightable elements relating
to a theme park or theme park attraction; or

d. packaging or promotional material for such copyrightable works or
merchandise.

2. the allegation that the IT is stolen is based on a claim that the IT
infringes on patents or trade secrets;

3. the allegation that the IT is stolen is based on a claim that the use of
the IT violates the terms of an open source software license; or

4. the allegation that a person aided, facilitated, or otherwise assisted
someone else to acquire or use stolen IT.

---
/FL

[ Reply to This | # ]

this is gonna back fire
Authored by: Anonymous on Thursday, March 24 2011 @ 09:47 PM EDT
companies will just see the usa as too much risk ot bother doing business in.

ENJOY stupidity i say.

[ Reply to This | # ]

Shades of the DMCA!
Authored by: DMF on Thursday, March 24 2011 @ 11:50 PM EDT
It appears (from my admittedly quick reading) that the cause of action is based on an allegation of "wrong-doing" with no requirement that the allegation be proven. Under the DMCA the third party (i.e. YouTube) is required to act on a mere claim. Similar here.

Of course, were it otherwise it might become necessary to prove the "wrong-doing" in the context of foreign law, e.g. that of China...

Which gives us yet another potential motive for Microsoft: to embed in state law the empowerment that the current DMCA gives to copyright holders - which empowerment might be subject to review and alteration soon at the Federal level.

[ Reply to This | # ]

Why Is Microsoft Seeking New State Laws That Allow it to Sue Competitors For Piracy by Overseas Suppliers?
Authored by: Anonymous on Friday, March 25 2011 @ 12:27 AM EDT
I know that the United States Constitution states that the
states may not regulate inter-state trade, but I am not sure
about international trade. Does anyone know the answer to
this?

Also, I find it hard to believe this would survive judicial
review. It is holding someone accountable for a crime they
had not part in. I know laws do say if you are involved in
a crime, and co-conspirator commits another crime during
that conspiracy, that they are on the hook for that. Unless
it can be proved that the individual or company had
knowledge of the misconduct of the company/individual they
were working with had committed it, that they could be held
responsible.

[ Reply to This | # ]

Why Is Microsoft Seeking New State Laws That Allow it to Sue Competitors For Piracy by Overseas Suppliers?
Authored by: hairbear on Friday, March 25 2011 @ 04:06 AM EDT
To me, the solution is simple. If you are a US business and don't want to be
sued, then you make it clear that you will only do business with people who use
only Open Source software.
I know that for the small guy, that is not practicable, but what do you think
would happen if the likes of IBM et al added such a clause to their procurement
contracts ?
After all, they want to comply with the law, and this is their only real way to
be sure.

hairbear

[ Reply to This | # ]

Come on, you lot! This is a good thing.
Authored by: Ian Al on Friday, March 25 2011 @ 05:14 AM EDT
For years I have struggled to find Linux alternatives to proprietary software.

Now there will be billions of dollars expended on development around the world to replace all the essential proprietary software with effective open-source alternatives. They have to be open-source and run on Linux both because that is the brand-leader operating system and because it is both ineligible under the bills and it cannot be pirated by just using it.

It might close down the music business in the short to medium term, though. Any music recorded with pirated music software or using pirated plug-ins or pirated microphone designs or pirated Stratocaster guitars would be proscribed by the bill. And the video industry. Just think, video editing software, video cameras, DVD and BlueRay pressing plants... Is it getting quieter already? No, there are still the sounds of music released under the Creative Commons licences.

---
Regards
Ian Al
SCOG: Intentionally left Blank Rome upt

[ Reply to This | # ]

I'm having second thoughts
Authored by: Ian Al on Friday, March 25 2011 @ 06:26 AM EDT
That doesn't mean I'm changing my mind.
while using stolen or misappropriated information technology (stolen IT) in its business operations engages in unfair competition
I know this is just an outline of the bill text, but I think the wording is dangerously broad, if this is anything to go by.

However, one thing that initially leaps to mind is whether it is allowable law that only applies to one class of product, even one as broad as IT. Why IT and not beverages?

OK, so lets ogle the broads.

What is an IT? Is a Sony PS3, IT? Is engine management chip firmware, IT? Toaster firmware... no, forget toasters: that causes too much controversy. I suggest that, at least, the following is IT.

Personal computers, mainframe computers, routers, printers, scanners, all computer peripherals, software, personal video recorders, internet enabled TVs, touchpads, smartphones, checkout-desk terminals, self-service checkout terminals, electronic voting machines, internet and all other servers, air traffic control systems, nuclear power plant controllers, police records systems and building alarm and security systems.

In the light of this inexhaustive list, what does 'while using stolen or misappropriated' mean? If one of your suppliers' employees steals a laptop in order to log on and use the company IT system for work, is that using stolen IT in its business operations? Supposing the employee is much more honest than that, but his company laptop breaks and he borrows a collegues laptop for a day while his is under repair? If the company policy is that you only use the laptop assigned and passworded to you, does using his colleague's laptop and password constitute 'misappropriated'? Supposing he borrows a colleagues company car. Is this 'misappropriation'. Is 'misappropriation' a legally defined word?

Of course, the text is just an explanation of the law. However, what we have seen so far suggests to me that the text of the bill is bound to be just as riddled with bad-law problems because of the bad-law principles it espouses.

I think that the states have been unnecessarily circumspect in couching this law. Let's cut the cow dung and do it right.

'Any Washington State company has the right to have the state courts impose an injunction on any other rich company within the jurisdiction until they pay the blackmail demands or become insolvent.'

See? I'm not even a state legislator and yet, for me, it's as easy as falling off a log!

---
Regards
Ian Al
SCOG: Intentionally left Blank Rome upt

[ Reply to This | # ]

When is an IT not an IT?
Authored by: Ian Al on Friday, March 25 2011 @ 08:01 AM EDT
From the Supreme Court majority opinion in Microsoft v. AT&T,
Opinion of the Court

Windows software does not infringe AT&T痴 patent any more than a computer standing alone does; instead, the patent is infringed only when a computer is loaded with Windows and is thereby rendered capable of performing as the patented speech processor. The question before us: Does Microsoft痴 liability extend to computers made in another country when loaded with Windows software copied abroad from a master disk or electronic transmission dispatched by Microsoft from the United States? Our answer is 哲o.
Microsoft and the United States argue that only a copy of software, not software in the abstract, can be a component. The significance of these diverse views becomes apparent when we turn to the second question: Were components of the foreign-made computers involved in this case 都upplie[d] by Microsoft 吐rom the United States? If the relevant components are the copies of Windows actually installed on the foreign computers, AT&T could not persuasively argue that those components, though generated abroad, were 都upplie[d] . . . from the United States
as such, it does not match ァ271(f)痴 categorization: 田omponents amenable to 田ombination. Windows abstracted from a tangible copy no doubt is information預 detailed set of instructions預nd thus might be compared to a blueprint (or anything else containing design information). A blueprint may contain precise instructions for the construction and combination of the components of a patented device, but it is not itself a combinable component.
(a) A copy of Windows, not Windows in the abstract, qualifies as a 田omponent under ァ271(f). Section 271(f) attaches liability to the supply abroad of the 田omponents of a patented invention, where such components are uncombined in whole or in part, in such manner as to actively induce the combination of such components. ァ271(f)(1)
So. a box of Microsoft software CDs is not an IT unless and until that specific CD set is installed in a specific computer and then the whole computer is the IT. Until then, it is merely a blueprint that can be used to make part of an IT.

The United States insists that CDs shipped out from Microsoft to foreign duplication and distribution companies are not the IT. Only the installation copies are IT and only after being installed in a computer.

The Windows code, in the abstract (say as a cracked file on a pirate website in Korea) is not even a component of an IT. So, if that cracked file is installed on a computer, has the resulting IT been stolen from Microsoft, the duplicator, a private customer or some other entity? Who has standing to sue in the State of Washington? Is stealing or misappropriating a blueprint the same as stealing an IT? It might break the copyright laws in the jurisdiction of a court in Korea, but does it break this cockamamie law in Washington State? What standing does Microsoft have under this law in this State?

---
Regards
Ian Al
SCOG: Intentionally left Blank Rome upt

[ Reply to This | # ]

A way for foreign company to hurt US company
Authored by: DannyB on Friday, March 25 2011 @ 10:11 AM EDT
Try this hypothetical I posted on Slashdot.

China wants to hamstring a US defense industry supplier like, say Lockheed Martin.

Chinese company A makes software.

Chinese company B is supplier to Lockheed Martin.

Chinese company B uses pirated copy of software from company A.

Chinese company A sues Lockheed Martin in the US.

Or try this: Airbus vs. Boeing.

${foreign car manufacturer} vs. GM or Ford

${foreign airline} vs ${US airline}

Rinse, repeat.

---
The price of freedom is eternal litigation.

[ Reply to This | # ]

Why Is Microsoft Seeking New State Laws That Allow it to Sue Competitors For Piracy by Overseas Suppliers?
Authored by: Anonymous on Friday, March 25 2011 @ 11:27 AM EDT
So if one writes an open source application a thief can use that application
(or perhaps code from it) without the original author's permission. The author
can not go after the thief to enforce their copyright because copyright law has
been subverted. The cherry on the top of this excrement sundae is that the thief
can go after anyone, seemingly on a whim, and claim damages and
"unfair" competition?

These proposals, those who are making them, and those who are passing them,
have an odour of decay about them. Such a stench as this does not belong in a
democratic-republic such as the United States of America. This is more akin to
the kind of thing found in a stereotypical 3rd world nation.

[ Reply to This | # ]

Interesting analogy in PJ's article...
Authored by: eggplant37 on Friday, March 25 2011 @ 11:34 AM EDT
She must be psychic about the GM thing. I've lived and worked for
many years in Metro Detroit, with a good deal of time spent taking
care of 2nd and 3rd tier automotive supplier businesses. I'd say
over 75% of them don't give a flying rat's patoot whether or not
their software is properly licensed, and a good deal of them are
using outright pirated software throughout their businesses. A law
like this in Michigan could threaten the entire industry unless
they all woke up and saw the light with regard to open source
alternatives.

[ Reply to This | # ]

A Bit of Detail to Flesh This Out...
Authored by: Jamis on Friday, March 25 2011 @ 12:05 PM EDT
If the states mentioned in the main article here do pass the "Microsoft
Law", here is a bit of detail that I think shows how much of an impact it
may have. There are three states in the list that have automotive assembly
plants located there. According to an article in the April 2011 issue of
"Car and Driver" magazine there are total of 22 automotive assembly
plants located in those three states. There are five manufacturers listed as
having plants in there, GM, Ford, Chrysler, Toyota, and Mitsubishi. Here's the
rub. The foreign content of the vehicles manufactured in these plants varies
from 10% to 60%. What do you think the odds are that much of that foreign
content comes from countries that MS is targeting. Those vehicles are sold all
over the country, but amount of foreign content in that small segment of
manufacturing is pretty telling, I think.

[ Reply to This | # ]

Why Is Microsoft Seeking New State Laws That Allow it to Sue Competitors For Piracy by Overseas Suppliers?
Authored by: Anonymous on Friday, March 25 2011 @ 01:58 PM EDT
Engineering companies do this to ensure the quality of their suppliers all the
time, especially on US government projects.

[ Reply to This | # ]

Not just serious Constitutional issues.
Authored by: reiisi on Friday, March 25 2011 @ 07:31 PM EDT
For starters, this is an end-run attempt around the Constitutional prohibition
against states making their own tarrif laws.

I saw this back in/around the year 2000, when Microsoft started their
"Freedom to Innovate" campaign. It was obvious that they were
demanding freedom for them to innovate over the freedom for others to innovate.

They have been using copyright and patent to undermine the mechanisms in the
Constitution which support freedom, to weaken the Constitution. Now they are
attacking the national Constitution through the state legislatures.

This is treason.

[ Reply to This | # ]

Isn't it obvious?
Authored by: Anonymous on Friday, March 25 2011 @ 07:47 PM EDT

The next logical step will be to enact some kind of visible assurance that people operate within a set of guidelines. A mark if you will:

No one may buy or sell except those who have the mark: A number or a name or a special symbol that designates them as authorized, for example. It would have to be on that person in a convenient place: like say their right hand or forehead.

Welcome to the world the way Bill Gates and Microsoft envision it.

[ Reply to This | # ]

It's worse than we've noticed, so far
Authored by: bprice on Saturday, March 26 2011 @ 03:17 AM EDT
Techdirt has linked to this article, and has its own article about it. Below the line is a comment from that article. The techdirt submitter has given license me and to Groklaw for this posting.

BTW, the 'Mike' mentioned below is Mike Masnick, who is to techdirt as PJ is to Groklaw.


I've read some of the source material that PJ provides on/via Groklaw. It's worse than either PJ or Mike have explained.

The Washington version, at least, shows signs of being a joint purchase by Microsoft, MPAA, and some theme park or theme park supplier. Since Washington is not big in the theme park biz, this suggests that the WA law has some vestigial provisions from a LA, CA, TX, or FL draft. Microsoft has protected itself this law may not be used to protect against anyone who has a 'Code of Conduct' in force. It was noted above that Microsoft meets that exemption.

Microsoft, being solely afraid of open-source software, has a provision that forbids use of this law to protect open-source software.

The law also has an MPAA provision it does not apply if the offending goods are primarily protected by copyright, like a movie created by 'pirated' software.

Other issues are cleverly taken care of. Microsoft can buy good legislative drafting.

The biggest issue is how in the world would you ever prove that the oversees supplier used pirated software. They're not going to cooperate with US supeonas, as it's outside jurisdiction.
I don't have to prove it. This is an in rem action, where the jurisdiction comes from the item on sale. I can determine that the seller bought something from someone I want to attack preferably a small someone. I file suit in WA for IT infringement. The defendant can't afford to show up and defend; I win by default; the default judgment means I WIN and can proceed against everyone in sight. Since I won in the original suit, I also win in the derivative actions.
Evidence collected overseas is not going to hold much credibility in a US court, especially since credible witnesses are going to be hard to find that will travel 1/2 way across the world.
See above no evidence from overseas is needed.
And as a US company, I have absolutely no way of knowing if they do or don't. If I'm buying screws from China, do I really have the time to ask the original manufacturer if they're using pirated software, especially since there is often a middleman?
You'd best make the time, if you want to sell your widgets containing these screws in WA, OR, or LA. If it's ok with you to restrict your market, you can sell them in UT and maybe some other states (at least until the next legislative session).

The best (only?) self-protection would be a recursive code of conduct on your suppliers (with a requirement to impose it on their suppliers), requiring that they provide certification of licensing (copies of license at first level; audit certification at lower levels) of all non-open-source software. They don't have to accept your code of conduct you just have to make good-faith effort to have them accept it. At least, that's how I read the law, but IANAL.

---
--Bill. NAL: question the answers, especially mine.

[ Reply to This | # ]

Sounds ok to me
Authored by: GreenDuck on Sunday, March 27 2011 @ 06:10 PM EDT
Lets ignore for a minute that this is MS or even software.

If you compete Walmart, and Walmert's suppliers use child
labour then having to sue each and every supplier rather feels
wrong compared to suing Walmart. After all, even if you
succeed at suing the supplier, Walmert will just change to
another.

[ Reply to This | # ]

Why Is Microsoft Seeking New State Laws That Allow it to Sue Competitors For Piracy by Overseas Suppliers?
Authored by: Anonymous on Monday, March 28 2011 @ 02:07 PM EDT
why does the DOJ allow bill gates to still run microsoft or
involve himself in politics that benefit microsoft.

bill gates said the same crap about education in a newsweek
article that the state are standardizing on education
whatever that means.

it is obvious microsoft has run into road blocks at the
federal level for a number of things but now they are going
to the states.

this bill is unconstitutional that is why it isn't at the
federal level and at the state level.

what a joke

[ Reply to This | # ]

The true reason for this bill...
Authored by: TennSeven on Monday, March 28 2011 @ 02:12 PM EDT
I don't think this bill has anything to do with Microsoft's
foreign revenue streams. Since the AG does not step in
until MS notifies a company, I think that MS will simply use
it to force US Companies to keep purchasing MS licenses
instead of switching to alternatives. If this were law MS
could go to any Fortune 500 company and say, "listen, you
know that somewhere one or more of your suppliers are using
pirated MS products, but we won't bring it up as long as you
keep using and upgrading our products on all of your
machines."

As an attorney I absolutely believe that a law like this
would be found unconstitutional if properly challenged in a
court of law.

-TennSeven

[ Reply to This | # ]

William Gibson was wrong
Authored by: stomfi on Wednesday, March 30 2011 @ 12:13 AM EDT
It's not the drug companies that are changing reality, it's those that make
cyberspace happen.

Is any country safe from the MS litigation machine, or must we find an
alternative to IP before we are safe from this juggernaut.

[ Reply to This | # ]

Groklaw © Copyright 2003-2013 Pamela Jones.
All trademarks and copyrights on this page are owned by their respective owners.
Comments are owned by the individual posters.

PJ's articles are licensed under a Creative Commons License. ( Details )