Microsoft busts pirates selling on TradeMe

Microsoft says a New Zealand-based website has been selling counterfeit software across four continents, shipping the software from China.

The American software giant has mounted 63 legal actions in 12 countries as part of a worldwide crackdown on software piracy.

Lawyer Matt Lundy told the San Francisco Chronicle most of the 63 actions involved counterfeit versions of Windows XP or its components.

The fact that small piracy operations have been able to extend their reach globally through the internet, was "very alarming'', Mr Lundy said.

A Microsoft spokesman said there were two separate international investigations against individuals based in Auckland selling high-quality counterfeit software - both likely sourced from China.

Both were alleged to have sold through internet auction site TradeMe.

TradeMe spokesman Mike O'Donnell, said they had noticed increasing sales of Microsoft and Adobe products by specific members, so it asked for, and was shown receipts for the software.

"They looked okay, and we checked with Microsoft's director of intellectual property, who confirmed they were okay, so we let them continue to trade,'' said Mr O'Donnell.

"Later, Microsoft raised other concerns about the same members, and we consequently banned them.''

Offering counterfeit items on TradeMe was a breach of the website's conditions, he said.

People who showed they held intellectual property rights could alert TradeMe to counterfeit material, and obtain a copy of the audit trail for use in prosecutions.

Microsoft said an Australasian investigation was made into dlive Ltd, Xu Lei and Liao Yaopei, between July 2007 and October 2008, after people who had purchased software on TradeMe found it did not work.

The software included high-quality copies of Microsoft's Windows Vista Business, Office Professional 2007, Office Professional 2003 and Windows XP Professional.

In a statement Microsoft quoted Tina Tweedie, a small business owner who purchased her software online from Lei: "I assumed I was buying the genuine thing''.

"But when I loaded the software I realised that I had been duped into buying counterfeit. This had real financial implications for me and my business.''

The second case followed a nine-month international investigation against three Auckland men, Jun Li, Gong Qi and Jingtao Jin, who were allegedly offering Microsoft software products over internet auction sites, including TradeMe, OZtion, and iOffer.

Many consumer complaints were filed on TradeMe and iOffer against the reseller, and Microsoft bought a sample of 27 items of software, which was all high-quality counterfeit software.

The recommended retail value for that sample alone was over NZ$22,000.

"As part of its follow-up investigation in this case, Microsoft learned that the Auckland-based auctioneers sold high-quality counterfeit Microsoft Windows and Office software to unsuspecting consumers in Australia, Canada, the Netherlands, New Zealand, the United Kingdom and the US and shipped it directly from China,'' Microsoft's spokesman said.

This week, Li agreed to a High Court judgement for damages in the amount of $100,000 and requiring him to restrain from infringing Microsoft's copyright, engaging in misleading and deceptive conduct in the course of trade, and to deliver up to Microsoft all infringing product in his possession, and pay Microsoft's legal costs.

So far there has been no judicial determination for Qi and Jin.

In both cases, Microsoft obtained High Court orders freezing bank accounts and assets, and requiring both sets of traders to cease trading in counterfeit Microsoft products until the claims of copyright infringement are investigated.

- NZPA