Software Audit Defense Lawyer – responding to infringement letters based upon fraudulent reseller conduct (selling bootlegged software) & General Surfcam Copyright Notices.

2020 Vero Software Licensing Update:  Vero software audit letters (and phone calls), things to know.  When you are being accused of pirating Vero software (Edgecam, Surfcam, Alphacam), you might first receive a threatening phone call from a Vero representative.  I am not going to name names here, but most likely from a guy (ex-police officer) who may threaten your business, or if you are a employee of a company, may threaten to call your employer and tell them about your activities (i.e. try to get you in trouble).  This, even after you have retained legal counsel.  My point is, this company is extremely aggressive and is not afraid to seek to jeopardize your employment and interfere with that relationship.  I have not seen any other software firm allow this to happen, but it is IMPORTANT TO IMMEDIATELY CALL US, AND PERHAPS TO RETAIN LEGAL COUNSEL BEFORE THEY PROCEED DOWN A PATH LIKE THIS.  I hate to report this, but it's what we are seeing.  While companies have a right to engage in anti-piracy enforcement, there should be a certain amount of dignity that goes along with it.

Introduction

Surfcam is a software product (owned by Vero Software) located in Thousand Oaks, California and also an address in the U.K.  They make a product known as “CAM” (computer aided manufacturing) for milling, turning and mill-turning machinery.  Like many of the other software publishers, they take their intellectual property rights very serious.  Recently, we had a concerned member of the public reach out to us for more information and help with a legal situation they were dealing with.  We are going to share the general concepts  on this post so hopefully our responses will provide some practical benefits from others in the public who may be facing the need to respond to a software infringement letter.

This is general legal information only.  If you need specific advice NOW, call (877) 276-5084 before you speak with anyone about your case.  As there are normally copyright infringement damages of $150,000 for willful and intentional copyright infringement (per title), the stakes are extremely high and you need to be very careful not to say too much.  Many people come to us for help AFTER there is a damaging email trail.  DO NOT CONTACT THEM OR THEIR “BRAND PROTECTION COORDINATORS” until you first speak with legal counsel.  This is a very serious situation.

NOTE;  If you received a demand letter entitled “NOTICE OF COPYRIGHT INFRINGEMENT” from the law office of Flyer & Flyer this is real.   We have dealt with this firm, and so think twice before throwing the letter away.  Call us for a free initial consultation at (877) 276-5084.  Some of the products that may be at issue are SURFCAM Designer, SURFCAM 2-Axis Base Edition (Advanced), SURFCAM 3, SURFCAM 3 Axis Advanced Edition, SURFCAM 4, Axis Advanced Edition, SURFCAM 5 Axis Advanced Edition, CATIA V4, Autodesk / Inventor Translator, ProEngineer/Wildfire?Creo Translator, Surfcam maintenance, Unigraphics / NX Translator, 3-Axis Multi Cut, CATIA V5 / V6 translator, Machine Stimulation, True Mill 2-Axis, and 3-Axis.

Demand Scenario #1

The concerned party purchased software from what they assumed was a valid reseller.  The reseller's website looked legitimate and offered to sell the product at issue, at what seemed like a fair retail price.  The purchase was made by credit card.  The CAM software was the delivered and the software was accessed and opened for limited purposes.  Subsequently, party received a letter requesting damages for intentional copyright infringement (while also noting there may be “innocent infringement”) seeking damages in the amount in excess of $75,000.  Downloading party (they were sent a download link after purchasing the software from the reseller whom they were led to believe was an authorized reseller) is a small business and cannot possibly afford this amount and feels there is no way out, being threatened with a lawsuit they turned to us.  What do you do?  Is the reseller liable?  Is the business owner liable for software piracy?  Is this a copyright crime?  Can the case be settled?  Should the business owner respond? Should the reseller be sued?  There are obviously lots of concerns when an infringement letter is received.

Demand Scenario #2

You get a letter entitled “Notice of Copyright Infringement” which points out that even “innocent” infringement will cost you dearly.  You may be charged with using “unauthorized copies of surfcam” that is “produced by the software piracy group LEGENDS NEVER DIE, also known as LND.”  The letter may go on to site you the terms of the end user license agreement (EULA), and may talk about their “TPM” (“technical protection measures.”)

According to ViLabs.com:

• The top five piracy groups (out of 212) contributed 59 percent of the cracked releases in the research sample. The top five most active groups in this sample were Lz0 (Linear Zero), NULL, Shooters, LND (Legends Never Die) and Magnitude.

The Vero Software letter may include details from the TPM scan which may look like this:

Software Version: 2014.1

Servercode: INCR-EDIB-OEFR-SSWE-PLMR-2014

The letter goes on to request that you call them to discuss a possible settlement (meanwhile dropping a not so subtle hint that their software costs about $81,558.40 U.S. Dollars.  This is enough to make most business owners panic and call our IP Law firm for legal advice and representation.

What if I bought the software from a company I think is a valid reseller?

This is a tough question and will depend upon the specific facts of the case, the end-user licensing agreement (“EULA”) and whether or not it was actually in affect at the time, and whether it is actually enforceable since the sale of the software at issue comes from a fraudulent online reseller who is actually the alleged software pirate.  Are you still following me here?  I know this is a little complicated.  But if the software publisher (could be any of the main ones Adobe, Vero, IBM, Adobe, Oracle, SAP, Microsoft, Autodesk, etc.) has KNOWLEDGE of a company holding itself out as a valid reseller (i.e. they look like an agent of the software publisher), there is good reason to argue that the Software company cannot sit around and watch a pirate sell infringing software and then go after the end-user who unwittingly purchases the software online.  There should be a duty of the technology company to “police” the marketplace and “google” the name of their products and make sure all the companies and individuals claiming to be resellers are actually legitimate resellers and that they are using the proper EULA licensing agreement.  If not, a cease and desist letter, or other legal action should be taken against the software company to protect both the brand and reputation of the software company and to protect innocent people and companies from being SCAMMED.  I don't think this is too much to ask for and I believe a legal argument could be made in this area that purchasing software from a fraudulent reseller is NOT intentional willful federal copyright infringement and NO damages should be assessed under these circumstances.

Again, there are a few theories to look at which may give you grounds to defend, or possible even take your own legal action (a more aggressive approach):

1.  Ostensible agency (the reseller held itself out as a agent/authorized representative of the software company.  Thus, software company is liable for fraud and misrepresentations and software piracy of the reseller.  In other words, BACK OFF AND GO AFTER YOUR RESELLER.
2.  Using technologies that spy on companies who buy software from a fraudulent reseller (Invasion of Privacy – failure to disclose what personally identifiable information the publisher is collecting and how that is being used).  Privacy laws exist under both state and federal laws.  End users should understand what type of spying and snooping is going on.  Especially under European Union (EU) privacy laws.
3. Waiver of legal rights (by not “policing” the marketplace to stop fraudulent resellers, sitting around and letting them operate so the publisher can later try to seek infringement damages in highly improper).
4. Entrapment/Extortion (seeking to collect infringement damages and possible attorney fees where this type of scheme is allowed to run its course.

How to respond to a copyright infringement notice

We have talked about this topic on our Attorney Steve Youtube channel.   You can find a great powerpoint VIDEO if you click on that last link.  Some clients simply prefer to watch the video.

At any rate, here are the top five things to do when you get a letter of phone call threatening copyright software piracy:

1.  Do not talk to them, lawyer up.

2.  Gather up all documentation pertaining to your case and call us (all emails, letters, notes, software licensing agreements (EULA), and other documentation)

3.  Do not destroy infringing software.  Destroying evidence may give the wrong impression that you are a willful copyright infringer (i.e. you had something to hide)

4.  Gather all information you can on the reseller (ex website screen shots, names of persons you were dealing with, use the WayBack machine to see older screenshots, research the domain on the WHOIS website).  All this information will help us analyze the claim and see what's going on.

5.  Let us represent your business to seek a confidentiality agreement, and to try to understand more about the informant.  We can help you lay the ground for negotiation and review any possible defenses to infringement that may be available.  Ultimately we can help you negotiate a fair settlement (which may mean YOU PAY NOTHING) in some cases where you had no reason to believe you did anything wrong and the blame is to be placed back on the software company.  We can then negotiate a release and ensure fair terms in a final release and settlement agreement.

Keep in mind, during this process, the software company and their representatives may be pressuring you all the way to:

(a) pay ungodly amounts of money even approaching $100,000 or more. and

(b) allow them to come on site to your business and request to see the software installed.  DO NOT LET THEM DO THIS.  A software raid is not something you should ever agree to.  This disrupts your business and could cause a loss of trade secrets and a lowering of company moral (ex “uh-looks like the software cops are here”).  We can usually help you avoid these unfortunate incidents.

Bonus materials:  Here is a sample letter you can see what a response letter might look like.  For viewing purposes only and not for commercial use.

Contact a copyright infringement intellectual property lawyer

We have a rich history in defending Clients accused of software companies, and this includes representing both small and large companies, both U.S.A. based and international.  We handle federal copyright law cases across the country and we offer AFFORDABLE FLAT RATE FEES and a FREE initial consultation to discuss your case.  Keep in mind, in this area of law where the stakes are EXTREMELY HIGH, there is no substitute for experience.

There are a handful of younger less experienced “software defense” lawyers who most likely have never been involved in even one litigation case with a software company (in federal court – ask them).  Because these cases can and do lead to federal lawsuits, you need a law firm that has been in federal court and knows the FRCP rules of civil procedure.  Click here to see our verifiable federal court experience.

Click here to see our sample software settlements page.  Do not hire any firm that wants to charge you a $10,000-$20,000 retainer fee (so they can bill you hourly with one or more lawyers working to “rack up the bill”), or who cannot show you direct federal court experience, or who cannot show you a proven track record of success, and multiple references and testimonials.   We are able to provide this upon request.  Click here to see our Avvo reviews from past clients.

Click here to meet Attorney Steve, the software piracy defense lawyer

Call us for more information at (877) 276-4084.