Press Release

Joint Novell-Microsoft Investigation Leads To Court -Ordered Shutdown Of Pirate Bulletin Board, Seizure Of Teen Operator's Computer System, And $25,000 Payment By Operator

CAMDEN, N.J.-February 3, 1995- A settlement has been reached between software manufacturers Novell, Inc., and Microsoft Corporation and a teenage computer operator who illegally distributed hundreds of copyrighted commercial software programs.
The settlement is the final chapter in an investigation that closed down The Deadbeat Bulletin Board, a large and sophisticated New Jersey computer bulletin board containing several hundred commercial software products. As part of the settlement, Novell and Microsoft were allowed to keep all of the computer equipment seized in an August raid of The Deadbeat Bulletin Board. The bulletin board operator also agreed to make a $25,000 payment to Novell and Microsoft.
The joint investigation is part of an active and aggressive campaign by Novell and Microsoft to find and prosecute "pirate" system operators who persist in illegally distributing Novell or Microsoft software via their bulletin board systems. The joint anti-piracy effort only began last summer, but has already resulted in the seizure of two pirate bulletin boards. Both companies expect more seizures in the near future.
Pirate bulletin boards allow users to download commercial products, either by paying a fee to the bulletin board system operator or by trading software the bulletin board does not have for software it does have. Such distribution violates the copyright and trademark rights of the manufacturers, as well as denying the manufacturer payment for its products. The resulting financial injury can be magnified when an unauthorized user takes advantage of the technical support offered by the manufacturer.

In addition, pirated software programs may be incomplete or otherwise altered, which damages the reputation of the manufacturer and also may damage the computer or data of the user of the pirated software. The Deadbeat bulletin board also contained several beta files, which are pre-release test files owned by manufacturers and distributed to a limited number of testers. These beta files often need to be debugged, or even completely redesigned before widespread commercial distribution, so their illegal distribution is particularly harmful to manufacturers.

Novell and Microsoft investigators gained access to The Deadbeat bulletin board in late July and early August. They eventually discovered more than 60 Novell and Microsoft products available through the bulletin board and asked the U.S. District Court in New Jersey to order an immediate end to the bulletin board operation and to allow seizure of all of the 17-year-old system operator's computer equipment. The order was granted and a raid was carried out in August. Until now, the case has been sealed by the court.

The settlement precludes Novell and Microsoft from pursuing further litigation against the system operator and from releasing the operator's name. Software piracy may be reported to Novell by calling its software piracy hot-line at 1-800-PIRATES or to Microsoft by calling its software piracy hot-line at 1-800-RU-LEGIT.

The business of Novell, Inc., is connecting people with other people and the information they need, enabling them to act on it anytime, anyplace. The company's software products provide the distributed infrastructure, network services, advanced network access and network applications required to make networked information and computing an integral part of everyone's daily life.


Contact:
Rebecca D. Faulkner
Novell, Inc.
(801) 429-7997
Fax (801) 429-7779
rfaulkner@novell.com
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