We usually recommend cooperation and not litigation.
Dallas, TX (Vocus) June 30, 2010
Dallas-based intellectual property law firm, Scott & Scott, LLP reports that the Business Software Alliance (BSA), a global software industry group, including Adobe, Autodesk, Corel, Microsoft, and Symantec, are targeting Cleveland, Ohio for software piracy tips, according to AdScope research.
Robert J. Scott, Managing Partner, of Dallas-based Scott & Scott, LLP, says that “Although I have no objection to software publishers seeking to enforce their intellectual property rights and using a trade association like the BSA to do so, in my opinion, many of the BSA’s practices are questionable. The BSA entices disgruntled employees many of whom were responsible for any license compliance gaps, to report their current and former employers with the promise of cash rewards up to $1,000,000, which may or may not be forthcoming.
What Businesses Need to Know:
The BSA usually initiates an investigation after it receives a confidential report of unauthorized software use. Targeted companies are contacted by the BSA’s attorneys, who request that the company conduct a self audit and report the results. Companies targeted for audit are not required to cooperate with trade associations or publishers, but resolution without litigation is highly unlikely unless the target company agrees to participate in a voluntary audit. Scott says, “We usually recommend cooperation and not litigation.”
A number of legal issues are implicated in software audits. Although software usage is governed by a contractual license, the software industry generally relies on the stronger protections afforded b the federal Copyright Act of 1976. The act provides stiff penalties – up to $150,000 per violation if the infringement is willful. In addition, officers and directors of corporations who infringe copyrights may be found individually liable.
The audit process is lengthy and arduous and often affected by costly mistakes. Scott says, “I have seen many businesses make the mistake of scrambling to purchase additional software upon receipt of the BSA letter. The date of the first letter is the 'effective date' and they will not generally credit any licenses purchased after that date."
Another mistake is the use of an inadequate tool to conduct the kind of audit called for by the BSA.
There are many ways a business can tackle a software audit. It may hire a law firm that specializes in software audits, hire an external IT consultant or do an in-house audit.
The BSA often suggests a number of tools to assist with a self-audit, many available for little or no licensing fee, making them appear to be attractive alternatives. Because software tools are not sophisticated enough to discern between free trial software or remnants from previous installations and full installations, it can result in significant consequences. When conducting an in-house software audit, look for any mistakes in the audit results to ensure that the report reflects what was installed as of the effective date of the audit before submitting any information to the auditing entity.
Scott & Scott, LLP (http://www.scottandscottllp.com) (http://www.softwareaudit.com) (http://www.bsadefense.com) is a law and technology services firm dedicated to helping senior executives assess and reduce legal, financial, and regulatory risks associated with software compliance. Scott & Scott's legal and technology professionals provide software audit defense and software compliance solutions, all protected by attorney-client and work-product privileges.
Robert Scott, a recognized expert on software compliance and defense, is available for interviews.