Re: Looking for License/Copyright Infringement Penalties

I think you should note though that the SPA does not sue on shrink wrap but rather on copyright infringement. Thus, the validity of shrinkwrap has not been an issue as yet. I asked Peter Baruch (?) of the SPA, but he wouldn't give away litigation strategy. I would suspect though that it has something to do with the fact that the C/R is by far the stronger cause of action. (Also, I don't think they want to have the shrinkwrap thrown out in court - because then inclusion would be somewhat unethical).

Also note that it is the SPA that controls the litigation, so they are the ones deciding which causes of action to use. Thus, even if you had the deep pockets, you probably couldn't get the shrinkwrap issue resolved in a SPA suit.  

> One of SPA's tactics has been to offer to settle out of court for 1/10 to
> 3/10 of the actual amount due for Copyright infringement. Considering the
> cost and hassle of the investigation, most companies readily settle.
> Unfortunately this prevents the "judgement by a group of your peers" that
> the courts are susposed to provide.

Well, that depends on the damages that you are going to get. Obviously, they are going to argue for $100k statutory damages or something like that. Unfortunately, that doesn't mean that they have any chance of getting those damages.

My impression is that the penalty is to pay the SPA the retail cost (suggested retail value - not actual cost), then force you to buy copies yourself. This means that you essentially have to buy two copies of the software, one at actual retail, and one at mfg. suggested retail. Personally, I would guess that this is similar, if not maybe even a little higher than they would get on averege if they pursued the case through trial.

> I'm not sure SPA has actually gone to court and won...perhaps someone
> could enlighten us on this point?

Talking with Peter from the SPA at the CLA conference in Monterray in October, I think he indicated that they had not had to actually go to court. However, the international equivalent to the SPA had.

But I think that this is because they tend to have a pretty good case. Remember, they sue for copyright infringement, and not license violation. I think that it would be very hard to argue that the extra, "unlicensed" copies of software were not the result of copyright infringement. After all, where did they come from?

Finally, they try the case in the papers if need be. Thus, they let the business editor of the local paper know that your company has been sued for bootlegging software by the SPA. This is not good for business.

Bruce E. Hayden                 1720 South Bellaire Street
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