E-Waste Innovator Will Go To Jail For Making Windows Restore Disks That Only Worked With Valid Licenses (gizmodo.com)
An anonymous reader quotes a report from The Washington Post: California man Eric Lundgren, an electronic waste entrepreneur who produced tens of thousands of Windows restore disks intended to extend the lifespan of aging computers, lost a federal appeals court case in Miami after it ruled "he had infringed Microsoft's products to the tune of $700,000," the Washington Post reported on Tuesday. Per the Post, the appeals court ruled Lundgren's original sentence of 15 months in prison and a $50,000 fine would stay, despite the software being freely available online and only compatible with valid Windows licenses: "The appeals court upheld a federal district judge's ruling that the disks made by Eric Lundgren to restore Microsoft operating systems had a value of $25 apiece, even though they could be downloaded free and could be used only on computers with a valid Microsoft license. The U.S. Court of Appeals for the 11th Circuit initially granted Lundgren an emergency stay of his prison sentence, shortly before he was to surrender, but then affirmed his original 15-month sentence and $50,000 fine without hearing oral argument in a ruling issued April 11." All told, the court valued 28,000 restore disks he produced at $700,000, despite testimony from software expert Glenn Weadock that they were worth essentially zero.
Brave new world ! Hail Microsoft !
It boggles my mind that such verdict is possible. How come jury nullification didn't happen in this case?
I just don't see how this ruling could stand the way it is described here.
If the software market value is zero, how did the original judge get to $700,000 damages? That calculation or at least argument would have to be shown. Does anyone know what it was?
That decision is surprising. Is there more to this story that is not presented in this Slashdot article?
I'm glad the government is wasting money on this instead of tracking down the thief that stole my car.
"First they came for the slanderers and i said nothing."
If you're going to make OS restore disks for old computers, make sure that they use open source software!
If this guy was making Ubuntu or CentOS based restore DVD's, he wouldn't be going to prison right now. Sure, he would have got more tech support calls from people who were confused by the new UI, but that's nothing compared through the hell he's going through.
Oh, and I hope that this story gets national attention. Microsoft deserves a good PR hit for going after this guy.
He should go to jail for foisting windows on 28,000 people. Can't someone think of the children?
Well, repairing computers is obviously stealing from manufacturers of new ones and re-using valid Windows licenses is obviously stealing from MS! This person got what he deserved for his unpatriotic, almost treasonous actions. True Americans throw things away when they get old or break! This person was trying to sabotage capitalism and the rich getting richer. We cannot have that. So I am 100% behind this ruling, except that the sentence is wayyyy to lenient. Maybe we can find some terrorism charge in there as well? Maybe something like "inciting people to not buy new computers" or the like? After all, this _is_ threatening the stabiliy of society, just like terrorism.
Most ACs are not even worth the keystrokes to insult them. Be generically insulted by this and ignored otherwise.
Who gives a flying crap about Microsoft's stinking licenses?
Damping absorbs vibrations. Dampening is caused by moisture.
They know they weren't being hurt. They need to make a public plea and help a further appeal.
It may be that the value is in the license, but that doesn't change the way the actual laws work. The idea is in the word: "copyright" is a right to make copies. It doesn't matter whether money changed hands: Microsoft has a copyright on those bits, and he copied them without their permission, so legally, he violated their copyright.
Is it a jerk move on Microsoft's part, to prosecute this guy for helping people keep software working which they've already paid for? Sure, and they deserve to be publicly shamed for it.
But there's nothing wrong with this ruling from a legal perspective. Everyone benefits when the law is clear and applied consistently, and in this case it was. Remember that those same laws which allow Microsoft to prosecute a guy for copying "free" bits also allow people who write GPL software to prosecute companies for copying "free" bits without giving back their changes.
TCP: Why the Internet is full of SYN.
When the post mortem on the US is written a big factor, certainly in the top 5, will be foolish judicial decisions. Some are big, like legal bribery via McDonnell v. United States and saying that cash is free speech, some are small like this one. But too many bad decisions and bad precedents are being made.
Depends on the Linux distribution. If it's RHEL, probably, if it's Debian, probably not. The license has a lot to do with it. You can't download Oracle or Red Hat Linux without a proper license. They may give away licenses to home users and non-profits but for-profit businesses are expected to pay. Another one of those is TeamViewer, plenty of people use it, but in a business setting you're supposed to pay for it and yes, they do go after companies using the free version.
Custom electronics and digital signage for your business: www.evcircuits.com
He produced a bunch of disks to sell.
Then argued in court that they had no value.
I dislike Microsoft as much as anyone, but the defendant in this case contradicts himself.
Microsoft's argument is that only they have the right to sell Windows disks, he did not.
Downloads? He was saving them terabytes on their akamai bill.
Stay out of jail: Use free software!
Knowledge is power; knowledge shared is power lost.
Like everyone else here, I'm wracking my brain trying to figure out what the crime was and why the court upheld it. The clue is in these two points:
...in what seems to have been a huge mistake, the disks had “labels nearly identical to the discs provided by Dell for its computers and had the Windows and Dell logos,”
If I had just written ‘Eric’s Restore Disc’ on there, it would have been fine.”
Yeah, he "accidentally" *wink wink, nudge nudge* labeled them just like full-blown licensed copies of Windows. The reality is that It seems like he was trying to pawn these off as actual Windows installs.
Technically, it was the customer's responsibility to understand the EULA and only use this disk on a computer that already has a valid license. But he had no intention of letting people know that. It didn't come with literature explaining that they needed their original license key to install it. He labeled them to look like Dell Windows CDs, and people would think "Score! I got an actual licensed copy of Windows for only 25 cents!"
This is kinda gray in my opinion - is the customer who installs it without a license the one in violation of copyright, or is it the one who makes the CD? In practice, there's no way to go after the person installing it. Instead, they chose to go after the distributor.
The punishment seems too harsh, since he made no profit and this probably ruins his entire life. No normal person will every be able to pay-off that kind of a fine. But I recommend against betting your fortune and freedom on a gray area hole in the law.
Anyone have a link to the court ruling? It should contain the reasoning.
Never sell or distribute Microsoft products. Send your refurbished PCs out with Ubuntu disks instead.
Have gnu, will travel.
for just returning the unused cd of their productand then whatever they value the software as at retail?
So there is an uproar that this guy is penalized for providing copies of software that could be gotten elsewhere for free. It's free, so how could there be a problem?
So let's extend this line of thought. How would any open source license ever be enforceable with that mindset? It's free to get a copy of GPL project, how could the copyright holder have any basis to sue a company for taking that and doing as they please?
As a matter of law, this seems sound. As a matter of good business, it may not be the best course to bring suit against this guy, and it may be good to have a license that explicitly allows for this sort of thing. Now if someone did have an argument that there were some permissive licensing that should have allowed him to do it, then ok, but let's not pretend copyright requires the holder to charge for the product.
XML is like violence. If it doesn't solve the problem, use more.
Let this be a reminder that Microsoft is still evil, after all these years. They only look less evil compared to what Google, Apple, and Facebook have been doing.
If I understand correctly, this guy was selling Microsoft software that he wasn't authorized to distribute and because that made it less likely someone would buy a new Windows license (or machine with Windows installed), Microsoft argued that their monetary loss for each disk amounted to the value of a new Microsoft license: $299.
The judge reduced that value to $25 per disc, though I'm not sure where that number came from. A quickly Google search indicates that one can buy an Windows 10 OEM license (what you'd get with a new computer) for the similar price of $27.99.
Eric Lundgren, the guy charged, argued that the nature of the software illegally distributed should give him immunity from charges of copyright infringement.
All I can say is:
Posted from Linux Mint 18.
PS If you have a Windows 10 license key, you can install Linux over Windows 10, download a Window 10 disk image from Microsoft's website for free, and use the key to run Windows 10 via Virtual Box on Linux.
What? You want me to drink TAP water??? No thanks. Instead I'll pay $2 a bottle for fluoride flavored water. Mmmmmm. Fluoride.
"Prediction: within 10 years, Windows will be a Linux distribution." Me, 7-6-2016
if he had just created a restore partition on each of the hard drives. The issue is in providing separate physical media. Had the systems been sold "intact", meaning wiped of all personal information but with HDD partitions in place, there would have been no copyright infringement. He had a great plan but poor execution; he left himself open, and now he will have to pay the price...sad but true.
Yes, the courts have determined that open-source software is still valuable.
As for the key codes, they're still usable with legally-produced media, like the small stack of old Windows disks I have on a bookshelf, or anything Microsoft (or its licensees) might still produce and sell.
You do not have a moral or legal right to do absolutely anything you want.
http://media.ca11.uscourts.gov/opinions/unpub/files/201712466.pdf
Laws are to facilitate justice, not there for their own sake. Once a state loses sight of that fact, it turns to authoritarianism, in this case quite clearly corptocracy.
Distributing freely available (but not free licensed) software should be a misdemeanor at best, not a felony, and that market value is riaa math.
Consider the fallout where you're turning a good chunk of the young teenage and adult population into felons as they are distributing while downloading 'more valuable' torrents.
Microsoft bald money motive here, wanting people to get rid of their computers faster so they buy another is quite on display here. Someone ought to shame Bill Gates for that while his net worth increases on this poor man's back.
Ze law is ze law is ze law is not a road we want to go down on.
*NEW floride flavored bottled water, NOW with crunchy plastic bits!*
What do you do when the judge is obviously corrupt? Clearly Microsoft got to him first.
What you said may be a better argument than "what I was selling can't be sold, it has no value". Obviously it has some value, he has thousands of copies made to sell.
Your argument is essentially "because Microsoft sold a license to use an existing copy, they can no longer control companies making and selling copies", right?
Of course it's called COPY right. From the beginning Microsoft has the sole right to make and sell copies. More questionable, perhaps, is to what extent Microsoft has the right to issue licenses. The license may have no value, because in general you can do what you want with stuff you buy. While Microsoft has the sole right to make and Al copies, it's less clear that they have any right to control what happens with those copies after the sale, to issue licenses of any kind.
That shit doesn't hold up in court. It's the legal bluff MS uses to force used PC shops to pay up.
OEM licenses are tied to the hardware. Are transferred when hardware is sold.
Retail licenses are tied to purchaser. Can be transferred from old PC to new PC.
Anything else is FUD spread by MS to scare PC refurbishers into buying licenses they legally don't need to.
"Prediction: within 10 years, Windows will be a Linux distribution." Me, 7-6-2016
While there are some interesting posts about various legal topics here, perhaps a summary of what actually happened would be helpful.
Lundgren restore discs were labeled in a way to make them look almost identical to similar restore discs sent out by Dell. Apparently they had Microsoft's Windows logo on them.
He was charging 25 cents each for the discs. This means that in effect he was making money from selling the discs.
Customs intercepted the shipment of his discs, possibly through a random inspection. Microsoft got upset because they deliberately want it to be very difficult to get old, but still legal version of Windows working this way because they want people to just give up a buy a new copy, which makes money for Microsoft.
He pleaded guilty to 2 of 21 charges he faced, which is the main reason he's going to jail. He pleaded guilty. And he may have had some questionable legal representation because some of the arguments he makes against the final verdict are really items that his attorney should have brought up in court, but apparently did not.
He created e-waste so he's an innovator?
Microsoft originally claimed the disks were worth $299
Fellow made 28,000 installation disks - that's a lot of disks.
The 'software expert' may testify that the discs, in his opinion, are 'essentially worthless', that doesn't make them worthless, or having no value.
The company that made the 28,000 discs didn't consider them 'essentially worthless', in fact, the disc maker charged the 'E-Waste Innovator' an amount of money to produce the discs.
And why did the 'E-Waste Innovator' create these discs, to increase the value of the computers he sells.
Ken
Why shouldn't Microsoft pursue him to the limits of the law? Sending him to prison sends a message: you pay Microsoft their licensing fees and adhere to the licensing terms, or you go to jail.
Microsoft has a program where refurbishers pay for legit OS licenses/media. Lundgren wasn't breaking new ground, and he wasn't saving the planet. He was just selling an illegal solution for less.
If he didn't ask for money, I'd give him the benefit of the doubt for being an idealist. But he chose to profit from it. I have very little sympathy.
---
According to the latest ruleset, this post should be modded as Vorpal Flamebait +5.
This fellow bought 28,000 discs, if made in the US and packaged in anything other than bulk spindles, likely cost 66-75Â/disc, less if done overseas. He spent significant money on these discs, it strains the limits of credulity to believe he did so to hand them out onsie-twosie to folks picking up otherwise waste computers.
If the software was actually freely downloadable, he could have simply attached a sticker to the computer with a Microsoft URL from which to download it from.
Ken
Someone please provide the "Free for download" link to get this software.
Presumably I can download the version of Windows that 'Auto-magically' detects that the computer has a valid license/via and will'just work' with my Dell, HP, Lenovo, etc. desktop - right?
Ken
Normally, providing a backup of software with a computer is a good thing for customers and a show of good customer service.
In this case, the twisted way Microsoft licenses software made him a "criminal."
Here's how:
M$ licenses software to an OEM with the ability for that company to sub-license the software to end users. To the end user, OEM licenses aren't "from" M$, but from the company that made the computer.
The OEM license requires two parts: The first is the sticker, or firmware key that's on all PC's. The second is the "original media" as provided to the end user. That can be what is on the hard drive from the manufacturer or it can also be backup media. Both are considered part of the license and without both parts, the computer does not have a license.
Installing a generic OEM copy of Windows isn't possible without M$'s explicit permission -- even if the computer has a valid sticker. That's because the generic copy isn't licensed to the company that's distributing it.
For a refurbisher to install Windows 10 on a PC, they need to provide original media, or purchase new licenses from M$ (For about 25.00/each) and install that (with a new sticker) on the PC.
By making his own disks, Eric was essentially pirating software by distributing the wrong version with computers that had valid keys for one that was sub-licensed by other vendors.
Talk about a tangled web. Bit for bit, it is the same code. Legally, it might as well be Xenix.
-D
Our tap is wonderful here in Ottawa...
I still only drink water left over from the morning coffee boil and filtered through Brita.
End of Line.
otherwise it's working just fine.
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is we don't want just _anybody_ using it. I mean, imagine of those unwashed masses were to use it. Perish the thought.
This is why lefties like me think we need well rounded educations. They cover stuff like this in detail.
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is why the phrase "A Well Regulated Militia..." exists. I'm honestly asking. I can't find any discussions online about it with anywhere near a comprehensive historical treatment of the phrase. Why didn't the founders just write "The right of the people to bear arms shall not be infringed". What I do know is that _everything_ after the preamble has legal weight and is supposed to. Legal documents of the time put the fluff in a preamble and the real stuff after. What I don't know is how that phrase is supposed to be interpreted legally..
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of a possession, and that guy wasn't very rich (if he was he wouldn't care about something as small as a stolen car).
The guy hear was depriving a mega corporation of revenue. Perhaps millions (since they could have sold new computers). There is no greater crime.
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mega corps own all the media. I've complained about a right wing, pro corporate bias in media when it comes to economics, but people laugh at me when I do. This is what I'm talking about. Well, this and stuff like this. That last one went viral. Doesn't look like this will. There isn't a funny video for it on youtube.
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and we perceive this as an "Intellectual Property" case. It wouldn't be hard to convince a jury of Americans to convict. Especially if they guy's lawyer wasn't very good. He should have plead out like most people do. Unless you're very, very rich you don't go before a jury in this country.
Hi! I make Firefox Plug-ins. Check 'em out @ https://addons.mozilla.org/en-US/firefox/addon/youtube-mp3-podcaster/
Thank goodness this dangerous maniac is behind bars!
You make some valid points about jury nullification but I can't agree with the claim that Lundgren violated the spirit or intent of the law ... only the letter of the law.
At the end of the day, Microsoft always tries to "have its cake and eat it too" when it comes to Windows licensing. I've worked in I.T. for almost 30 years now, and it's been an underlying theme with Microsoft's products as far as back as I can remember working for a company using them. The "volume licensing" program used to be so complicated, practically nobody could figure out if they were really in compliance or not.
EG. It was standard practice to use imaging software like Ghost to blast workstation images onto your corporate PCs before deployment. Yet that image might have been licensed using a single Windows key code that didn't match the OEM keys that came printed on stickers affixed to the individual machines. Microsoft used to claim that put companies in legal violation and they were required to buy volume licenses for each PC they wanted to image that way. Of course, the logical assumption from the company's POV was that the computer was sold with a Windows license bundled with it, and they were still only running that same "flavor" of Windows after imaging. Since the license key stickers were still on each PC, it proved they legally owned a copy of Windows that shipped with that PC. There was no avenue to do anything ELSE with the copy of Windows they paid for with the PC, either. So this amounted to Microsoft trying to double-dip on sales, via a technicality.
I see this guy's case as pretty similar. Basically, Microsoft tried to prevent him from mass producing copies of their operating system that aren't even possible to install on a computer without an accompanying license key, which he WASN'T including with any of them. And in fact (according to an article about this on Gizmodo's web site), he was eventually only charged with 2 counts out of 21 original ones; the counts related to him using the Microsoft name and logo on his disc labels without permission. That's not even what they originally went after him for. More like, they stacked up as many counts as they could possibly find on him, and only those 2 "side issue" ones stood the legal test.
I remember as far back as the early 1990's, MANY mom and pop computer shops and online service places would run ads in the Yellow Pages and on mailings that had the Windows flag logo in the corner someplace, simply to indicate they serviced and sold those types of products. You might often find the Linux penguin logo right next to one to show they knew Linux too. Microsoft practically never prosecuted for THAT violation (because you know the majority of them didn't contact Microsoft for permission to use it first).
(Ultimately, I'm sure Microsoft couldn't see any value in going after the illegal re-printing of their logo like that, when it was clear that the people doing it were only helping them sell more products -- not less.)
Personal and Non-Commercial Use Limitation
Unless otherwise specified, the Services are for your personal and non-commercial use. You may not modify, copy, distribute, transmit, display, perform, reproduce, publish, license, create derivative works from, transfer, or sell any information, software, products or services obtained from the Services.
https://www.microsoft.com/en-u...
That's the terms of use for everything downloaded from the Microsoft website. Sounds like pretty cut and dry copyright infringement.
Seems pretty questionable to me. "Because Copyright" doesn't provide blanket ability for a company to control what it produces?
At best, this is a case of nitpicking over the "letter of the law" vs. intent and spirit of the law.
Because let's face it .... This level of control over distribution is USUALLY reserved for the scenarios that existed at the time the copyright laws were written, where the work itself wasn't protected from use in some manner like requiring a product key. (If I purchase a copy of Star Wars on VHS tape, I can't go making duplicates and reselling them or I'm violating copyright. I'm literally competing with the movie studio directly for sales of the movie. and my copy is just as easy to pop in a player and view as the original store bought one is.)
Windows is designed so it requires product activation over the Internet. Microsoft's server has to verify the unique key you typed in as part of the setup process, to determine you're ok to actually continue using it. IMO, that makes everything hinge on the product key -- not the installation media.
The fact that Microsoft has web sites anyone can visit where Windows 10's installation media can be downloaded as an ISO image, AND even a free tool to help you build a bootable USB stick version of it helps illustrate this. The install media isn't relevant to determining who properly licensed the software and who didn't.
The valuable lesson here for everyone is quite simply: Fuck proprietary software. Clearly Microsoft won't support even people supporting their platform so why should anyone go to any effort to promote their garbage? If he'd been wiping/installing Linux on the machines and preloading them with blender/libreoffice/gimp/krita/google chrome. There would have been no issue and he could still be in business and stayed out of jail. Instead now he's doing 15 months because he thought he had the freedom to help people. A great case studying in how doing the morally right thing, but "impacting" on a company gets you screwed.
A small but significant fact update: he was selling the discs to refurbishers. He got the idea while refurbishing systems he sold, and thought that other refurbishers might buy discs from him.
Seems like a small difference, but it makes all of this incorrect:
--
Upon (legally) taking ownership of the computer by buying it used, he was in possession of the computer (he didn't, and wasn't) with the license. It was during that time he downloaded the restore discs.
When he goes to sell that computer to someone else (he sold the Windows discs, in bulk, not computers), it is only then he no longer has possession of the computer with the license.
Since the restore disc went with the computer
--
The guy bought 48,000 discs at less than 5 cents/each.
He bought the discs in 2012, around the time of Windows 8 general release.
He intended to sell them to other computer recyclers for about 25 cents/each
He does not personally recycle PCs, so he was not going to include them with PCs with COAs.
He included the logo/likeness of the Dell recovery CDs on each one, so that they looked to the casual observer the same as the official restore CDs.
In case you have a hard time visualizing it, this Washington Post story has a picture of this guy laying on top of 48,000 install discs.
His conviction was for selling 28,000 discs for 15 cents each to a broker in Florida as part of a gov't sting.
Source: E-waste recycler Eric Lundgren loses appeal on computer restore disks, must serve 15-month prison term
Ken
America is now a sad parody of it used to claim to be.
Only boring people are ever bored.
Microsoft truly is a festering carbuncle on the asshole of the Universe. As for it's fans? Good for ya.
The shepherds did so well protecting the flock that the sheep no longer believed that wolves existed.