Judge Rules Against Microsoft Infringer

Although an alleged infringer claims he did not know he was buying and selling counterfeit Microsoft software, a federal judge has found him liable for copyright and trademark infringement and entered an $800,000 judgment in the company's favor.

Microsoft Corp. filed suit against Illinois-based ERA Soft Corp. and its owner, Aleks Rechanik, in the U.S. District Court for the Northern District of Illinois in November 2004.

The suit alleged that the defendants were distributing counterfeit Microsoft software and related components.

They were doing so even though Microsoft had previously sued Rechanik in 1999 for copyright and trademark infringement, according to the complaint. That suit resulted in a permanent injunction and judgment against Rechanik.

Microsoft filed the earlier suit when Rechanik was doing business in Ohio as Altim International Trading Co. Microsoft won statutory damages of $980,000 and a permanent injunction barring Altim from infringing Microsoft's intellectual property rights.

The current suit alleged that Microsoft learned through an investigator that Rechanik created ERA Soft and was continuing to distribute counterfeit software, including Windows 98, Windows 2000 Professional, Excel 97, Outlook 97, PowerPoint 97 and Word 97.

All the software programs are copyrighted, and Microsoft has trademarks for MICROSOFT, WINDOWS, POWERPOINT, the colored Windows logo and the Windows flag logo.

Microsoft said the defendants obtained the counterfeit software from unauthorized vendors and that their willingness to deal in counterfeit items showed not only an utter disregard for Microsoft's intellectual property rights, but also a complete lack of concern for the legality of the software they were providing to their customers.

Microsoft moved for summary judgment, arguing that the evidence unequivocally demonstrated that the defendants infringed its copyrights and trademarks.

Judge James B. Moran granted the motion, saying Rechanik did not deliberately seek out counterfeit software, but he did seek to buy software as cheaply as he could.

The judge rejected Rechanik's contention that he was not liable for dealing in counterfeit products unless he intended to market them while knowing they were counterfeit.

Judge Moran awarded Microsoft $180,000 in statutory damages for copyright infringement and $700,000 damages for trademark infringement.

The judge also entered a permanent injunction against Rechanik and his company that bars them from continuing to deal in counterfeit Microsoft software products.