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Microsoft wins lawsuit against Malaysian computer firm

AvantiKumar | May 7, 2012
Vital IT Marketing Services action of installing pirated software onto new computers brought cyber security risks, said Microsoft.

Jonathan Selvasegaram, Microsoft Corporation's Corporate Attorney

PHOTO - Jonathan Selvasegaram, Microsoft's corporate attorney.

Software giant Microsoft has successfully won a civil copyright lawsuit against a Malaysian computer dealer, Vital IT Marketing Services, for installing pirated software onto branded new computers, which were then sold to consumers.

Pirated software brings cyber security risks, said Microsoft Corporation attorney Jonathan Selvasegaram, adding that the company -- Vital IT Marketing Services (Vital IT) -- infringed on copyrights in respect of Windows 7 and Office Enterprise 2007.

After a three-day trial, the honourable judge Dato' Hanipah Binti Farikullah of the Kuala Lumpur Intellectual Property High Court on 4 April 2012, awarded Microsoft a permanent injunction, as well as additional and exemplary damages, against Vital IT, which has been in operation for more than nine years.

Microsoft's Selvasegaram said: "We file a lawsuit as a last resort when all negotiations fail. In most cases, our investigations start when we receive consumer complaints that the new computer they purchased encountered problems such as validation failures and virus infections, or when we receive complaints from other computer dealers against certain outlets unfairly undercutting their price by selling new computers with pirated software. Our lawyers will issue legal letters to seek a settlement meeting. In most cases, dealers are remorseful and agree to settle the matter amicably, which would be our preference."

"On Microsoft's part, we wanted to ensure computer dealers not only play fair when competing with other dealers, we wanted to take firm action against dealers that risk consumers' online safety by preinstalling new computers sold with pirated software," he said. "Dealers selling computers with pirated software are passing on to consumers a risk where the impact will be felt much later, when they least expect it and at the worst possible time. Imagine losing all your valuable data, work and photos the day before your examination or business presentation when the computer crashes due to viruses and malware in the pirated software."

 Government launched SAFE with GENUINE campaign

Earlier on 7 March 2012, Malaysian ICT security agency CyberSecurity Malaysia's chief executive officer  Lt. Col. (R) Prof. Dato' Husin Jazri launched the 'SAFE with GENUINE' campaign in response to the 88 percent increase in cyber security incidents recorded in 2011.

Speaking during the launch of the initiative, which was also supported by the Ministry of Domestic Trade, Cooperatives and Consumerism, Husin said: "Pirated software may not get crucial updates or may already contain malware if downloaded from the Internet, thus exposing computers to exploitation by cyber criminals. Further, there have been incidences around the world where cyber criminals have been able to exploit unprotected and outdated computer systems to steal bank account information or even 'siphon' money from people's bank accounts."

According to Microsoft's investigations during the last two years, many well-known branded laptops are also 'falling victim' to software piracy, said Microsoft's Selvasegaram. "Our investigators purchased 56 computers in the last two years across nine computer brands, and all were found to contain pirated software. The biggest victims affected by the conduct of errant computer dealers were Acer and Compaq machines which represented a majority of the purchases at 38 computers. According to our test reports, 46 of the computers were installed with some additional software commonly used by hackers to bypass and circumvent software activation. Such software usually works by tampering with the memory of the computer. The pirated software in the remaining computers were found to be installed using product keys downloaded from the Internet, mostly found in sites run by hackers."

A media statement by Ministry of Domestic Trade, Co-operatives & Consumerism's director of enforcement, Mohd. Roslan Bin Mahayudin, said: "[The government is] very concerned that more and more computers, even some of the branded ones, are now sold without any software to drive more sales, requiring consumers to go out and find their own 'solution'. What inevitably happens is that either computer dealers are pressured to install pirated software , or consumers on their own may patronise night markets stalls to buy pirated DVD-ROMs. This is not the trend we want to see in Malaysia. Computer manufacturers also have a part to play in this fight against piracy. By doing this, they are causing piracy and may likely result in an increase in security incidents. We strongly urge computer manufacturers not to put profits ahead of ensuring a clean and safe computing experience for consumers."


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