Microsoft Canada Co.

Microsoft Canada Co.

January 31, 2007 08:00 ET

The Federal Court of Canada Finds Inter-Plus, a Software Reseller, Infringed Microsoft's Rights by Dealing in Counterfeit Software

Court awards significant damages including $500,000 in statutory damages and $200,000 in punitive damages

MISSISSAUGA, ONTARIO--(CCNMatthews - Jan. 31, 2007) - Microsoft Canada Co. today welcomed a recent Federal Court of Canada decision in which Montreal-based software reseller Inter-Plus and its directing mind, Carmelo Cerrelli were found to have infringed Microsoft's rights by selling, distributing, offering for sale and possessing counterfeit CD-ROMs as well as related documentation, including packaging, frontliners, backliners, licenses and Certificates of Authenticity when they know or should have known such materials were counterfeit. In addition to awarding one of the highest statutory damage awards in Canada for copyright infringement, $500,000 in statutory damages, the court also awarded $200,000 in punitive damages, what is believed to be the highest such award in Canada in an intellectual property case.

The corporate defendants, 9038-3746 Quebec Inc. and 9014-5731 Quebec Inc. which carry on business under the name Inter-Plus, and their principal, Carmelo Cerrelli, were found jointly and severally liable to Microsoft Corporation for the maximum amount of statutory damages available under the Copyright Act $20,000 per work, totalling $500,000 for the 25 copyrights in question. The copyrights infringed included versions of the Microsoft® Windows® operating system such as Microsoft Windows 98, Microsoft Windows 98 Second Edition and Microsoft Windows NT® Server, as well as versions of Microsoft Office. This is the first time that the maximum amount of statutory damages, $20,000 per work, has been awarded by a court in Canada. The court also found that Inter-Plus's "sale of such counterfeit items at low prices prejudicially affected Microsoft's relationship with its chain of legitimate suppliers".

"Intellectual Property infringement affects everyone from the right's holder to consumers to legitimate businesses. We are pleased with the Federal Court of Canada's decision to award the maximum amount of statutory damages for copyright infringement," said Michael Hilliard, corporate counsel, Microsoft Canada Co. "Microsoft Canada firmly believes that education and enforcement are important ways to help reduce the piracy rate in Canada and support distributors and resellers of legitimate software".

The decision stems from a lawsuit that Microsoft Corporation commenced in August 2000 in the Federal Court of Canada relating to counterfeit Microsoft products, including software that was seized from Inter-Plus's premises by the Royal Canadian Mounted Police in November 1999 and products that were seized by the Montreal Urban Community Police in March 2000, which after being returned, were subsequently disposed of by Inter-Plus "under extremely suspicious circumstances" as stated by the Federal Court. Microsoft alleged that copyright in 25 of its programs was infringed and that various registered trade-marks were infringed in connection with several thousand counterfeit copies of Microsoft CD-ROMs and related components. The matter went to trial in Montreal on October 31, 2006 for twelve days. The Amended Reasons for Judgment of the Honourable Mr. Justice Sean Harrington were released by the Federal Court of Canada on January 16, 2007.

A permanent injunction was also granted against the corporate defendants, Carmelo Cerrelli and Adam Cerrelli restraining them, their servants, employees or agents and any other person, corporation or entity acting under their instructions or control from selling, distributing or importing into Canada counterfeit copies of the programs in issue and from infringing Microsoft's trade-marks.

The defendants are appealing the award of statutory damages, punitive damages and the finding of personal liability but are not appealing the court's determination that they were dealing in counterfeit Microsoft products.

To learn more about protecting intellectual property and to learn "how to tell" some of the security features of genuine software which help ensure product authenticity, go to http://www.microsoft.com/canada/piracy/. To report piracy of Microsoft software or to inquire about whether certain items are legitimate, call the Microsoft Anti-Piracy Hotline at 1-800-RU-LEGIT or email piracy@microsoft.com.

About Microsoft Canada

Established in 1985, Microsoft Canada Co. is the Canadian subsidiary of Microsoft Corporation (NASDAQ:MSFT) the worldwide leader in software, services and solutions that help people and businesses realize their full potential. Microsoft Canada provides nationwide sales, marketing, consulting and local support services in both French and English. Headquartered in Mississauga, Microsoft Canada has 10 regional offices across the country dedicated to empowering people through great software - any time, any place and on any device. Visit Microsoft Canada's web site at www.microsoft.ca.

(C) 2007 Microsoft Corporation. Microsoft, Windows and Windows NT are either registered trademarks or trademarks of Microsoft Corporation in the United States and/or other countries.

The names of actual companies and products mentioned herein may be the trademarks of their respective owners.

Contact Information