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MS Wants Laws To Block Products Made By Software Pirates

kaptink writes with this quote from Groklaw: "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. So 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."

32 of 617 comments (clear)

  1. OK by MikeRT · · Score: 5, Insightful

    I'm cool with that. Let's add a law that says that if your company steals the source code from a partner's product that as punitive restitution they get a perpetual, non-exclusive right to your entire source control for the product which bundled the stolen goods.

    Fair is fair, Microsoft.

  2. More complicated than a carbon tax. by wisty · · Score: 5, Interesting

    If Microsoft China employs engineers who wear pirated Nike t-shirts, can Nike sue Microsoft?

    1. Re:More complicated than a carbon tax. by qbast · · Score: 3, Insightful

      Sure they can. Also if Microsoft engineer works on computer which contains a chip produced by Chinese company employing janitor wearing pirated Nike t-shirt. Why restrict chain of responsibility to one or two links?

  3. Re:Good for US economy by Partaolas · · Score: 3, Insightful

    "Unfair competition laws" == Laws against unfair competition.

    The problem here is that GM is not competing with Microsoft.

  4. this is an EU concept... by Hazel+Bergeron · · Score: 4, Insightful

    ...and it's not as insane as it seems. Regulation is usually to protect the small guy while the big guys have the lawyer power to avoid it. By phrasing regulation in terms on unfair competition laws, you end up with big businesses paying to enforce regulation. Which do you prefer:
    (i) One big business forcing another business to abide by some law;
    (ii) That same big business also ignoring the law.

    Perhaps the underlying law is unjust. But then you tackle the underlying law - you don't tackle some principle which makes it harder to enforce a law. Let us have more rule of law and less rule of men, yes?

    1. Re:this is an EU concept... by trims · · Score: 5, Insightful

      Normally, I'm pretty OK with a lot of EU regulatory concepts (their banking rules a notable exception). But, if this is a common idea of EU regulators, I'm going to have to rethink my support of them...

      This "principle" breaks one of the foundations of modern law - that you should be held responsible for you own actions, and not actions of others which you neither had controller over, nor knowledge of (which is one of the big reasons I hate the "felony murder" laws here in the US). The "principle" of which you speak isn't a good one, and I'm fine with being rabidly opposed to it. Just because it may be bad for Big Business, doesn't make it right, or even good for anyone else.

      I'm not excessively worried, though. The laws don't fit the "consumer protection" mold, and pretty obviously overstep Constitutionally-set boundaries - they regulate interstate commerce (which is a federal area), and also likely are to be looked at as attempting to set Copyright and national import standards, neither which are allowable by states. That is, these type of laws most likely would have to be passed at the Federal level to be Constitutional. Given the potential enormous impact on large manufacturers, you can be sure that if they actually get passed, they'll be some Big Corp with Deep Pockets funding a challenge in US Federal courts.

      --
      There are always four sides to every story: your side, their side, the truth, and what really happened.
  5. Fair enough... by Anonymous Coward · · Score: 4, Interesting

    ...then U.S. companies should also be prohibited from selling goods manufactured or obtained from companies overseas who don't follow all the other U.S. laws, not just copyright laws. This would include all U.S. laws regarding the environment, labor, accounting, etc. Why pick and choose?

    What could go wrong?

  6. Good thing they don't sell Windows XP anymore by Gubbe · · Score: 5, Interesting

    I'm sure Sound Forge authors are just waiting for this law to pass.
    Seeing as under this law they could sue Microsoft for big bucks!

  7. Just silly... by goodgod43 · · Score: 4, Insightful

    How are they going to prove that the foreign company used Excel instead of Open Office? Or is the idea to force the entire world have to purchase Microsoft licenses just to do business in America?

    --
    "On the Internet, nobody can hear you being subtle." -Linus Torvalds
  8. "An offer you cannot refuse" gamut by mlts · · Score: 4, Informative

    This is a good way for companies with large law departments to cudgel smaller businesses. Just like how the endangered species act is misused sometimes, find some product, no matter how esoteric, that a company used that might be called into question, then threaten to sue that company out of existence unless they take an offer to be bought out.

    This would be a field day for law departments. If one thought the patent lawsuits flying back and fourth with the phone company makers is insane, wait until the lawsuits because a bolt made from an offshore company just might be considered being made with a bogus copy of XP Embedded on the CNC mill.

    For those not of the bar association, it means higher prices for everything (since companies have to pay bucks to CYA, and create additional internal auditing divisions, or fight these claims.) It also raises the barrier for entry for small businesses.

    It will be interesting to see who will end up the lawmakers' master on this one. Companies who don't want the trouble of additional IP regulation, versus the usual people who keep fighting for more Draconian IP laws to protect their tired old stuff. This might get interesting because it may pit well-heeled lobbyists against other lobbyists of companies who just don't want the legal liability if this law passes.

    1. Re:"An offer you cannot refuse" gamut by MickyTheIdiot · · Score: 5, Interesting

      IANAL, but as I see it basically Microsoft could sue ANYONE. I doubt that there is any business in the United States that doesn't have some part somewhere that was made by a Chinese company that didn't pirate something Microsoft along the way. If the burden is on the company to prove they didn't do anything wrong then you've got a great formula for putting small businesses into bankruptcy.

      We don't only have a class war in the U.S., we have a war between big and small businesses.

    2. Re:"An offer you cannot refuse" gamut by mlts · · Score: 5, Interesting

      Nail, head hit.

      This proposed law would instantly make Microsoft billions. If done right, companies would have to prove their supplies didn't use pirated products in order to not get sued.

      It also will force companies to buy Microsoft products for CYA reasons. This happened with Sarbanes-Oxley and the fact that operating systems on up had to have some sort of compliance (FIPS, Common Criteria) in order for IT departments to show due diligence. This caused wholesale migrations to Windows just for this reasons.

      I can see companies not just moving to MS, but demanding their supplies be Microsoft based, so they can show that they are compliant.

      Big win for MS, big win for businesses with lots of lawyers, small businesses now are easily destroyed should they show some innovation that can't be bought up easily.

      Plus, if one of the copyright lawsuits for an insane amount does go through, a company can easily owe Microsoft trillions, especially with the precedents seen with LimeWire and other cases.

  9. Re:Good for US economy by gstoddart · · Score: 5, Insightful

    I understand that some of you people want to allow piracy for personal use, but this is business.

    Except, how is a business supposed to know if its suppliers are running pirated software?

    This basically says that Microsoft now demands that anybody buying a widget from anywhere in the world effectively enforces a software audit on its suppliers. You know what happens if you tell your supplier they need to open up their stuff to you for scrutiny just in case they're doing something offensive to a 3rd party? They laugh at you, and cancel the deal.

    If I'm buying foam packing peanuts from China, do you really think I have the clout to get them to prove to me they haven't pirated Excel? Because, that's what this bill is asking for. This is a stupid law, and one that tries to make enforcement of Microsoft's products the responsibility of people who might not even be in the computer industry.

    It's just not practical or feasible.

    --
    Lost at C:>. Found at C.
  10. Re:Good for US economy by cbiltcliffe · · Score: 4, Insightful

    In that case, Microsoft should no longer be able to blame business partners, contractors, customers, or whatever for their own problems, either.

    http://www.computerweekly.com/Articles/2011/01/20/244979/Microsoft-blames-third-party-for-excessive-Windows-Phone-7-data.htm
    http://theregoesdave.com/2009/10/15/microsoft-goes-schizo-starts-blaming-danger-for-lost-data/
    http://www.itnews.com.au/News/70560,microsoft-blames-vista-insecurity-on-third-party-applications.aspx

    You can't have it both ways, Microsoft. You want GM liable for software piracy in China, then you should be liable for Windows 7 phone phantom data usage.

    --
    "City hall" in German is "Rathaus" Kinda explains a few things......
  11. Re:Good for US economy by m50d · · Score: 3, Insightful

    Their supplier is competing unfairly with US suppliers, though. I think we already have similar regulations for environmentally damaging suppliers? To my mind this is no different.

    --
    I am trolling
  12. Re:Good for US economy by mehrotra.akash · · Score: 5, Funny

    Also, if you are buying XYZ from China and selling it to MS, do they sue themselves?

  13. Re:Free Market Economy by 0123456 · · Score: 4, Insightful

    This is what these giant corporations want.

    Big corporations _LOVE_ regulation, because the costs keep smaller, smarter, more innovative competitors out of the market. Big business and big government are not enemies, they're symbiotic organisms.

  14. Re:Good for US economy by HungryHobo · · Score: 4, Interesting

    there are limits. you have to be selling more than 50 million worth of stuff per year before the law kicks in.

    funnily enough it completely exempts software.
    If microsoft use pirated software to develop code for windows then they get off completely scot free.
    Likewise if they use a pirated copy of photoshop to make their ads for windows then they're also in the clear.

    open source violations are also excepted so if a company ignores an open source liscence they and their downstream customers also get off scot free.

    isn't that convenient.

  15. Re:Good for US economy by DickBreath · · Score: 5, Insightful

    Try this hypothetical.

    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}

    --

    I'll see your senator, and I'll raise you two judges.
  16. Re:Possession of Stolen Goods by somersault · · Score: 4, Insightful

    You really think that copyright law should be on the same level as basic human rights? Human rights should be universal on compassionate grounds. Even animals have compassion to an extent. Copyright law is something we as humans completely made up, and if some country chooses to not see "intellectual property" as US law proclaims it, it should not matter.

    --
    which is totally what she said
  17. Re:Good for US economy by drinkypoo · · Score: 5, Insightful

    Democrats and Republicans are both populists.

    An anarchist wants government out of everything. A populist wants government to control everything. An actual liberal wants government to control business but not morality. An actual conservative wants the opposite.

    I think it's clear that both Democrats and Republicans want business laws that promote their own agenda, and equally, they both want to say what you can or cannot do in your home. Neither party is the party for less government involvement in any aspect of life; they simply both wish to tell you how the government will control you.

    Even if you believe in a difference between the parties and don't see it as an elaborate game conceived to convince the masses that there is someone representing your interests, you have to see that both parties want total control over your life.

    --
    "You're right," Fisheye says. "I should have set it on 'whip' or 'chop.'"
  18. Excellent. by Ant+P. · · Score: 4, Interesting

    If this passes, people relying on proprietary software will get a rude awakening.

    If your suppliers are using Windows or Photoshop, how can you verify that they're all using licensed copies? Either you call the BSA in to kick their office's doors down and ransack it on your behalf, which is going to get you some "special" customer service once they find out you did it, or someone else will after you've bought from them in which case you'll be screwed when they get caught.

    The only way you'll be safe under this regime is to require everyone in the supply chain uses FOSS.

  19. WTF by sorak · · Score: 5, Informative

    (Admit: Did not fully RTFA)

    TFA and TFS keep focusing it on MS, as if they are the only people who can sue, but from the excerpts quoted, it sounds like any closed software can. Here's the kicker that should have been in the summary:

    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.

    So, you can sue someone for infringing upon someone's rights, as long as you aren't violating an FOSS agreement?

    There are some odd ideas in there (like the exclusion for theme park operators), but I'm surprised that one flew under the slashdot radar.

    1. Re:WTF by burnin1965 · · Score: 5, Insightful

      LOL, those guys at Microsoft are quite the jokers.

      So they cover their ass with an exception that says it is okay if their copyrighted material is packaged over seas by a company that pirates software so nobody can sue Microsoft under this law and then they block open source software from the same protection under the law even though the most popular open source software in use is protected by copyright.

      Yep, scum bags will be scum bags, never fails.

  20. Re:Good for US economy by DavidTC · · Score: 3

    Uh, I think we've pretty clearly demonstrated we can't afford to take the hit, as our economy is in shambles.

    But perhaps more importantly, the workers in other countries, despite what they tell you, are not doing any better. They are working for microscopic wages, in unsafe conditions, without any medical care or benefits or anything. Often they are slave labor.

    You want to help those people, get a job paying $30,000 a year and donate $5,000 to a fucking charity dedicated to helping there. Don't let their companies put you out of work, and hire them for $100 a year and keep $29,900. Neither of you is better off, the only people who came out better from that deal are the superrich.

    Although perhaps someday the money will 'trickle down' when they hire you to give them a foot massage...or, wait, they'll just get an illegal immigrant to do it. They're cheaper and can't complain to the police about abusive conditions or violations of labor laws.

    --
    If corporations are people, aren't stockholders guilty of slavery?
  21. Re:Good for US economy by h4rm0ny · · Score: 4, Insightful

    Their supplier is competing unfairly with US suppliers, though. I think we already have similar regulations for environmentally damaging suppliers? To my mind this is no different.

    Yes. It's similar to safety standards and workers rights. If a clothing manufacturer for example, can outsource production to a country where workers can be denied decent health and safety or normal workers' rights, whilst a company that uses workers in the US does not, then the former company is essentially doing an end-run around the US laws. Now (more thanks to public pressure than anything else), US companies selling products to people in the US, have to be more careful about adhering to standards abroad that are set at home. The principle behind this proposed law isn't unique to this law. It's the same principle that underlies sex tourism, employee health and safety and working hours and various security laws. It's the principle that if you're a US business or citizen, selling to US citizens or business, you can't get away with illegal behaviour by just shifting the illegal part of the process to another country.

    --

    Aide-toi, le Ciel t'aidera - Jeanne D'Arc.
  22. Re:Good for US economy by McKing · · Score: 4, Insightful

    Umm, you realize that NAFTA was signed by George Bush 1 month prior to Clinton taking office, right? And that Clinton was just honoring the agreements and treaties already signed, right?

    Don't let facts get in the way of your delusions, now.

    --
    If only "common" sense was actually that common...
  23. Re:Good for US economy by gmack · · Score: 3, Insightful

    In my experience both liberals and conservatives both want to control morality but disagree on what the morals should be.

  24. Re:/. News Network by wastedlife · · Score: 3, Insightful

    It's a good thing Microsoft's hardware divisions do not use any parts imported from Asia.

    Oh wait....

    --
    Said, "It's just like dice but it's got more sides And it tells me who lives and who dies"
  25. Good for Open Source by formfeed · · Score: 3, Insightful
    Not just piracy, any invalid license could trigger this law: Not updated your business license? Moved it to another computer? Worked in a virtual environment without MS permission? Built a backup server by mirroring drive (and license number)? ...

    This would make the use of any MS product a huge possible legal liability. Why not minimize the risk and go opensource? Companies that strive to sell complete workflow & service packages or servers might use that argument in the future. Good for Redhat, Oracle, IBM.

  26. Addtionally by ThatsNotPudding · · Score: 3, Interesting

    Summary execution of CEOs that intimate Linux has stolen IP while never ever offering any fucking proof.

  27. Re:Good for US economy by c6gunner · · Score: 4, Insightful

    But instead of being poor people working 14 hours in unsafe factories, they could be poor people working 6 hours a day on land they own growing food.

    See, I don't want to call you ignorant, because this is pretty typical for someone who grew up in a big city, and never left except for flying to a resort for a vacation. I would suggest that you do some research on the subject of farming, especially as it's generally practiced in low-tech agrarian societies. I can't discuss the subject with someone who honestly believes that farming is a 6-hour-a-day job.

    Working in a factory is inherently more work

    See above. There's a reason why these factory jobs are sought out by the locals.

    so it's up to you to demonstrate factory workers are better off

    Sure! It's quite simple: with the exception of forced labor, people generally choose the best work they can find ("best", of course, being a balance between money and effort that's different for each individual). If there are people working at these factories, and they aren't being forced to be there at gunpoint, then it means that the factory jobs are better than whatever other alternatives these people have. QED.

    but apparently you cannot read the word 'slavery', and think I'm just making that up.

    Oh, I know you're making it up. That's not even worth discussing. It's your other ideas that I'm curious about.

    Says the person who snipped every single historic reference I made

    Yep - none of your historical references were relevant to the discussion at hand. Moreover they're selective; you overemphasize the dangerous conditions in the factories, while ignoring the fact that the vast majority of the workers were there willingly because their alternatives were worse, and ignoring the fact that one third of deaths during the "industrial revolution" were caused by disease. You have no grasp of what the situation was actually like at the time, because you can't fathom a society where malnutrition and the lack of awareness about basic hygiene are the norm. I mean, sure, maybe you've read about these things, but you clearly don't understand them if you're making these claims. To compare conditions during the industrial revolution to factories in China is so pigheaded that it's truly mind-boggling.