BSA Targets New York Businesses with Report Software Piracy, Get Rewards Ad Campaign

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Business Software Alliance(BSA) runs New York radio ads promoting up to $1 million cash rewards for reports on software piracy. Software audit defense firm, Scott & Scott, LLP, offers four suggestions on how New York companies can protect themselves.

Scott & Scott, LLP

In many instances, the informant is the same person responsible for software compliance at the company they are reporting

Scott & Scott, LLP, a Dallas based law and technology services firm, reports that the Business Software Alliance(BSA) has targeted New York as its number three anti-piracy market, based on statistics from TNS Media's AdScope. The BSA, a global software industry group funded by big name companies, including Apple, Adobe, Microsoft, and Autodesk, has placed 81 ads on New York radio stations in the BSA's national "whistleblower" campaign.

The BSA has been aggressively marketing financial incentives to disgruntled employees to make anonymous software piracy tips against their employers with reward payments up to $1 million in cash.

"In many instances, the informant is the same person responsible for software compliance at the company they are reporting," according to Robert J. Scott, Managing Partner of Scott & Scott, LLP. That fact, coupled with the promise not to disclose the informant's name, leads Scott & Scott to believe that the BSA is incentivizing non-compliance to generate revenue in an economic downturn, and significantly damages the organization's credibility.

Scott says: "While we understand the Business Software Alliance's desire to protect the intellectual property rights of its software publisher members, the firm believes it's important to inform businesses about some of the questionable enforcement methods the organization uses and offer recommendations for reducing the risks of external software audits from the Business Software Alliance, the Software Information and Industry Association or software publishers."

The BSA has done nothing to simplify or standardize the license agreements of its member companies, which are all unique, lengthy and complex. This leaves the onus of compliance entirely on software customers - the very customers that the software publishers actively pursued to generate revenue.

Scott & Scott recommend companies implement the following procedures into their business practices:

1. Create Standardized Agreements With Publishers: Many companies do not realize that they have leverage when negotiating license agreements with publishers. In fact, companies can develop favorable software license agreements with the assistance of their own legal counsel. Favorable provisions can include "no audit" clauses or voluntary "true-ups" to reduce the costs of compliance management and the total costs of ownership.

2. Retain Proofs of Purchase and Keep Accurate Records: Contrary to popular belief, trade associations and publishers only accept dated proofs of purchase, with an entity name matching that of the audited company. Anything less will fall short of publishers' mandated proof of ownership and therefore, repurchase of the assets in question may become necessary.

3. Choose Integrated, IT Asset Management Tools: Asset management should be built into every company's ongoing business processes to ensure that this process and license compliance become core competencies. The ability to conduct routine reconciliations is required to ensure software license and Sarbanes-Oxley compliance.

4. Obtain Expert Assistance in the Event of An Audit: Audit defense is most effective with the representation of specialized legal counsel to avoid the common mistakes that may jeopardize a company's legal position. Any automated discovery that is conducted under the supervision of legal counsel will be protected by attorney-client and work-product privileges, should an out-of-court resolution not be possible.

For additional free resources visit: Scott & Scott, LLP, and BSAdefense, where you'll also find Scott & Scott's Fine Calculator. Hundreds of firms have found it to be a helpful risk assessment tool.

About Us:
Scott & Scott, LLP is one of the only U.S. law firms with a practice group dedicated to BSA and SIIA Defense. Scott & Scott's legal and technology professionals provide software audit defense and software compliance solutions and have years of experience successfully defending software audits.


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Anita Scott

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