Microsoft Takes Action to Stop the Diversion of Software From Education Programs

Software intended for students and schools allegedly sold to unsuspecting retail consumers.

Microsoft Corp. announced efforts to shut down alleged international software smuggling operations. As part of that effort, Microsoft has filed nine lawsuits and issued more than 50 cease and desist letters.

Companies in Jordan and elsewhere have made millions of dollars in illegal profits by trafficking in specially priced academic software diverted from education programs, according to allegations in the lawsuit complaints. This software was passed off to consumers in the United States who unknowingly lacked the license to use it. The lawsuits were filed in federal courts in California, New York, New Jersey, Florida, Nevada and Montana.

“To those who say software piracy is a victimless crime, I would say this case tells a different story,” said Bonnie MacNaughton, senior attorney at Microsoft. “The defendants in these lawsuits and others are charged with profiting from selling clearly marked educational software to unsuspecting retail customers who were not licensed to use it — and potentially depriving students and schools of the opportunity to benefit from the latest technologies.”

Microsoft routinely works with governments and public agencies around the world to provide heavily discounted software to the global academic community. Through these programs, students and schools are provided with access to the latest technologies that they might not otherwise be able to afford.

Today’s lawsuits allege that companies in Jordan and elsewhere posing as academic resellers obtained hundreds of thousands of copies of discounted Microsoft® Windows® and Office system software intended for students in the region. These companies reaped millions of dollars in illegal profits by allegedly selling the software to Internet retailers in the United States rather than supplying it to the students. Many of the Internet retailers, in turn, allegedly made hefty profits by selling the software at retail prices to unsuspecting American consumers who were deceived into buying software that was not licensed for their use.

“Jordan has invested heavily in transforming itself into a full-fledged knowledge economy,” said His Excellency Eng. Basem Rousan, Jordan’s minister of Information and Communications Technology. “Companies that break Jordan’s intellectual property laws will be prosecuted to the full extent of the law.” Investigations are being pursued in other countries where a similar scheme has been used.

EDirectSoftware.com, one of the largest offenders, has already agreed to settle Microsoft’s lawsuit out of court for more than $1 million in cash and property. Other merchants that received cease and desist letters have agreed to voluntarily stop selling the software, which is clearly marked “Student Media” and “Not for retail or OEM distribution. Not for resale.”

Microsoft continues to be committed to providing educational organizations and students around the world with affordable software through its academic programs, and will initiate legal action to protect the integrity of those programs.

Tips to the Microsoft anti-piracy hot line at (800) RU-LEGIT (785-3448) helped the company identify this illegal scheme. Anyone who receives Student Media or academic software being sold as retail is asked to call the hot line and report the offense.

Founded in 1975, Microsoft (Nasdaq “MSFT”) is the worldwide leader in software, services and solutions that help people and businesses realize their full potential.

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Legal Case Summaries


Filed in the United States District Court for the Northern District of California

Microsoft Corp. v. EEE Business Inc.,dba eBusZone.com and EBZ EBZ, Ming Ni Shang, Alice Wang, aka Lifeng Wang, Nancy Linker and John Does 1–5 (Fremont, Calif.), alleging importation and distribution of infringing Windows XP Professional, Windows XP Professional x64 Edition and Office Professional Enterprise Edition 2003 software.


Filed in the United States District Court for the Northern District of California

Microsoft Corp. v. Eric Chan and Ruhui Li, dba LCTech, and John Does 1–5 (Union City, Calif.), alleging importation and distribution of infringing Windows XP Professional, Windows XP Professional x64 Edition and Office Professional Enterprise Edition 2003 software.


Filed in the United States District Court for the Northern District of California

Microsoft Corp. v. Intrax Group Inc., dba Surplus Computers, Michael Mak, and John Does 1–5 (Santa Clara and San Jose, Calif.), alleging importation and distribution of infringing Windows XP Professional, Windows XP Professional x64 Edition, Office Professional Enterprise Edition 2003 and Office Standard 2003 software.


Filed in the United States District Court for District of Nevada

Microsoft Corp. v. Global Online Distribution, LLC, Dale Harelik and John Does 1–5 (Las Vegas, Nev.), alleging importation and distribution of infringing Windows XP Professional and Office Professional Enterprise Edition 2003 software.


Filed in the United States District Court for the Southern District of Florida

Microsoft Corp. v. Big Boy Distribution LLC and Steven Blackburn (Riviera Beach, Fla.), alleging importation and distribution of infringing Windows XP Professional, Windows XP Professional x64 Edition, Office Professional Enterprise Edition 2003 and Office Standard 2003 software.



Filed in the United States District Court for the District of New Jersey

Microsoft Corp. v. Technology Enterprises, LLC, James Craghead, and John Does 1–3 (Palm Beach Gardens, Fla.), alleging importation and distribution of infringing Windows XP Professional software.


Filed in the United States District Court for the Southern District of Florida

Microsoft Corp. v. John Does 1–10 (Miami, Fla.), alleging importation and distribution of infringing Office Standard 2003 software.


Filed in the United States District Court for the District of Montana

Microsoft Corp. v. eDirectSoftware, Jesse Willms, Linda Willms, Dave Willms, 1016363 Alberta Ltd., 1021018 Alberta Ltd. and John Does 1–10 (Billings, Mont.), alleging, among other claims, importation and distribution of infringing Windows XP Professional, Windows XP Professional x64 Edition, Windows XP Home, Office Professional 2003, Office Professional Enterprise Edition 2003, Office Small Business Edition 2003, Office Standard 2003, Windows 2000 Professional, Office XP Professional, Office Professional 2000, Money 2004, Windows Server® Standard 2003, Windows Server Enterprise Edition 2003, Exchange Server Enterprise Edition 2003, Project Professional 2003, Project Standard 2003, Visio® Professional 2003, Visio Standard 2003, FrontPage® 2003, Microsoft SQL Server™ 2000 Enterprise Edition, Windows 2000 Advanced Server, Windows 98 Standard, and Office 97 Professional software..


Filed in the United States District Court for the Western District of New York

Microsoft Corp. v. Aron Tauber, dba T&A Compubank, TACompubank.com, and T-A-Compubank.com (East Amherst, N.Y.), alleging, among other claims, distribution of infringing Office Professional 2003, Office Professional Enterprise Edition 2003, Office Small Business Edition 2003, Office Standard 2003, Office XP Professional, Office XP Standard, Office Small Business Edition 2000, Exchange Server Enterprise Edition 2003, Project Professional 2003, Visio 2003 Professional, and FrontPage 2003.