December 19, 2017

In a modern dictionary, under the word “software pirate” you might find this definition: “A person or company who makes illegal copies of software for personal or commercial use, including college students sharing music and videos on the Internet and businesses that may not even be aware they are doing something illegal.”

Be Cautious

To help ensure that you’re buying legal software, be wary of:

1. Prices too good to be true.

2. Products without documentation or manuals.

3. Packaging or materials that have been copied or are of inferior quality.

4. Sellers offering to make “back-up “copies.

5. Products labeled academic, OEM, NFR or CDR.

6. Compilations from more than one manufacturer or programs that are not typically sold together.

7. Mail order or online offers without appropriate guarantees of legitimacy.

Software piracy occurring in businesses takes two forms:

1. Copies made for employees to take home.

2. Copies to distribute around the office.

Both situations might seem efficient and cost-effective. But, unless you have permission from the software maker, the legal rule of thumb is: one software package per computer.

Your business can be sued on civil and criminal charges if an employee installs unauthorized software copies on company computers or acquires illegal software through the Internet. And under the law, it doesn’t matter whether management knew about it or not.

On the civil front, the copyright holder can sue to stop you from using the software immediately and seek damages, which can include the amount lost, profits attributable to the infringement and statutory damages of up to $150,000 for each program copied.

The violations turn criminal if the federal government gets involved. Under thefederal No Electronic Theft Act, violators can face prison sentences and fines as high as $250,000 for each violation.

In addition to the legal consequences, pirated software can damage your business in several ways, including:

  • Exposure to computer viruses and defective software.
  • No warranties and insufficient documentation.
  • Lack of technical product support.
  • Ineligibility for software upgrades.
  • System disruptions if serial numbers clash.
  • An inability to back-up or recover programs when there are no original disks.
  • A tarnished reputation if found guilty of copyright infringement.

To avoid piracy at your company, here are some issues to consider:

  • In a written policy, ban the duplication, distribution and use of copyrighted materials within your workplace. Make sure employees know the law, as well as the penalties.
  • Reinforce the policy with detailed instructions for handling original software and ensuring that it is not copied illegally.
  • Keep a detailed inventory of software purchased and where it is installed in your workplace.
  • Audit networks and workstations regularly to match software against your records and immediately remove unauthorized copies.
  • Install site-metering software to monitor application usage and prevent overuse of a networked application.
  • Purchase software only from authorized dealers.
  • Check to ensure that all software you buy comes with documentation and licenses. By doing so, you avoid buying illegally bundled software on computer systems that has been preloaded with several copies of programs. (See box above for more tips on how to prevent pirated software purchases.)

© 2017

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