Software Companies Sue IRC Warez Pirates

(November 23, 1999) Seven leading software companies filed a lawsuit in the U.S. District Court in California against 26 individuals who participated in a warez IRC channel which facilitated the large scale distribution of unlicensed copies of commercial software products over the Internet.

Related Pages
Tech Law Journal Summary of Adobe v. Moore.
Amended Complaint for Copyright Infringement, 11/10/99.

The lawsuit reflects a new enforcement strategy being employed by software companies to counter piracy that is conducted using new Internet technologies, including IRC channels, file downloading, and high speed cable and DSL connections.

The plaintiffs are Adobe, Autodesk, Corel, Macromedia, Network Associates, Microsoft, and Symantec. All are members of the Business Software Alliance (BSA), a software industry group which advocates for intellectual property rights.

The defendants are 25 named individuals, and one John Doe. They are identified in the amended complaint by their names, addresses, IRC channel alias, and the products which they illegally distributed.

The amended complaint reveals that at least four are female. According to Bob Kruger of the BSA, some are minors. The lead defendant, Keith Moore, used the alias W4C-Abel. Other aliases included LordChaos, Madtek, and W4C-Krypto.

"We have seen an immediate impact on piracy in IRC channels as a result of the lawsuit," said Bob Kruger, VP for enforcement at the BSA. "BSA will continue to fight piracy on the Internet to keep it a safe place for those who are engaging in legitimate commerce."

Software piracy has long been a major problem for the software industry. Software companies frequently bring copyright infringement suits against violators. However, this lawsuit is brought against a new class of infringer using a new technology for distribution.

None of the defendants are either bootleg CD makers, corporate users making unlicensed additional copies, or hardware manufacturers or sellers installing unlicensed copies of software products. The defendants are individuals who are making available unlicensed copies for free over the Internet.

The method of distribution involves an IRC channel called "warez4cable" where the defendants and other users communicated in real time and anonymously regarding the plaintiffs' software products. The defendants then made the software products available for downloading.

The amended complaint alleges that "By identifying their computers on the "warez4cable" channel as having "fserves," these Defendants, all of whom use aliases, indicate to other Internet users that their computers can be readily accessed to obtain and download whatever software Defendants are making available on their "fserves." "

Also, the use of file compression technologies, combined with the deployment of high speed Internet access via either coaxial cable by cable companies or digital subscriber line (DSL) by phone companies, have made the downloading of huge applications much quicker and easier. A download of an unlicensed copy of an application which might have taken hours over a 56 kbps modem might take only minutes with a high speed cable or DSL modem.

The lawsuit names as defendants individuals who distributed the software, not the parties who downloaded the software.

The amended complaint states that some of the defendants have had their computers seized. The complaint requests that the defendants be restrained from committing any further acts of copyright infringement. It also seeks "actual damages" or an award of "statutory damages".

Many, if not all, of the defendants lack the financial capacity to pay the judgment that the plaintiffs might receive in this case.

The amended complaint states that numerous software products were illegally distributed, including Adobe's Illustrator and Photoshop, Autodesk's AutoCad and Studio Max, Corel's WordPerfect, Macromedia's Director and Dreamweaver, Microsoft's Office 2000, Visual Basic, Visual C++, Visual J++, Network Associates' Firewall, and Symantec's Norton Utiltities.

Several members of the BSA are not participating in this lawsuit. 

Plaintiffs are represented by the law firm of Proskauer Rose.

Excerpts from the Amended Complaint.

"Unauthorized copying and distribution of works of intellectual property, such as software products, is becoming a pervasive problem on the Internet. The basic nature of the copyright infringement (i.e., unauthorized copying and distributing) is familiar; given the speed and ease of reproducing and widely distributing information on the Internet, however, the potential harm to copyright owners is exponentially greater than the threat posed by traditional acts of infringement."

"The extensive misuse of the Internet for unlawful purposes is in part due to the nature of the medium. The ease with which information can be copied to and from Internet sites, the simplicity of efficiently downloading ever-larger files based on improved data compression technologies, and the relatively minor cost to a user of communicating with an audience of millions create unparalleled opportunities for copyright infringement. The relative anonymity with which Internet communications may be conducted further facilitates illegal conduct."

"Unscrupulous Internet users can covertly copy and transmit to the Internet copyrighted software products (in which they have no rights and which they have no authority to copy or distribute) thereby making available to a worldwide audience, identical reproductions of copyrighted works that can be and are further copied, distributed and used by others in virtually unlimited, and entirely uncontrolled, fashion."

"The industry estimates that financial losses from traditional piracy cost the business software industry approximately $11 billion a year. In the United States alone, annual losses are estimated to be $2.8 billion. With the explosive growth of the Internet, these figures may be dwarfed by the type of online piracy at issue in this case unless such acts of wholesale copying and distribution of copyrighted works is deterred by the courts, applying well-established principles of copyright law to infringing online conduct."