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Illegal software use costs one Mississippi city $17,000 fine

Modern-day pirates cruising cubicles, labs and living rooms

There seems to be little doubt that software piracy – using copies of computer software without having paid the proper licensing fee – is widespread both by businesses and the estimated 45% of households in the U.S. that now have a personal computer.

Borrowing your brother-in-law`s copy of Word Perfect might seem pretty innocuous and easy to justify. After all, Microsoft`s CEO Bill Gates is the richest man in the world, so it hardly seems like the software giant will be hurt if your hard-earned bucks go into the kid`s college fund instead.

For many people software piracy doesn`t really seem like stealing. It`s not like shoplifting, for example. But, in fact, the penalties for software piracy are far, far higher than for petty theft. Software piracy is an infringement on copyright laws that is a criminal offense and punishable by up to five years in prison and a $250,000 fine.

You don`t often hear about businesses or individuals prosecuted for software piracy. Microsoft`s anti-piracy report on its Web page, for example, has news clips about raids in South African, Turkey and Arab countries – but not a word about anything in the U.S. A telephone call to Microsoft for comment on software piracy wasn`t returned.

Software piracy may be a strong temptation because it seems a difficult law to enforce.

Probable cause?

Laws require probable cause before searching a home or business for evidence of a criminal offense, so how would someone get caught pirating software in the first place?

That question has been asked recently in the wake of the City of Gulfport agreeing to pay a $17,000 fine for unauthorized software use after an employee put unauthorized copies of Windows, Word Perfect, Lotus 123 and DOS on a fire department computer.

“We don`t know how we got caught,” said Havard Jordan, chief administrative officer for the City of Gulfport. “That isn`t the issue. The issue is that someone illegally put it on, and the city did not try to cover it up. We were asked to check it out, and when we did we said, yes, it is correct. I assume an individual, maybe someone disgruntled, called in on someone.”

Jordan said when the city found out the software wasn`t properly licensed, it admitted the violation and negotiated the $17,000 fine.

“We have a policy now, if it happens again, that individual will be terminated,” Jordan said. “Anybody who puts the city in harm`s way with illegally used software will be dealt with by termination. We`re not going to pay a fine, and tolerate what has been done wrong. I understand that people do it, but that doesn`t make it right.”

The city also sent out a memorandum telling city employees that the city does not condone employees using illegal programs or software. The city`s data processing manager has been visiting different departments to verify that programs being used are properly licensed. Any improperly licensed programs are to be removed immediately.

Jordan said it takes time to go to the hundreds of different computer stations throughout the government of the second largest city in the state. He believes the computer in the fire department was an isolated case.

“How do you defend it? Wrong is wrong,” Jordan said. “It may be standard in the industry that there is piracy both in government and private industry. You have to draw the line. Some people say it is a gray line, but look where we are. And the law is pretty clear about it. Wrong is wrong until they change the law, and that is not going to happen.”

Jordan said some people violate software laws unknowingly. For example, teachers have to be careful about copying books, other printed material and videos for use in classrooms. Even when the intent is good, such as educating children, violations of copyright law are still considered a serious offense.

Who`s next?

The Gulfport case has reportedly caused a scare among businesses that have learned about the case. There have been rumors of widespread investigation of Mississippi businesses for illegal software use. However, it appears the Gulfport case was an isolated incident, and it is unlikely that Mississippi businesses are being targeted or that investigators are going to show up asking to see what programs are on a businesses` computers.

But, just as a disgruntled former spouse or employee can turn someone in to the IRS for tax violations, the Gulfport case shows that businesses could face similar reprisals if software is used illegally.


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