China claims world's largest piracy bust

PIRACY : China claims world's largest piracy bust

Eleven men sentenced to record terms for masterminding piracy ring

by Shaun Nichols in San Francisco

vnunet.com

03 Jan 2009

http://www.vnunet.com/vnunet/news/2233213/china-lays-claim-world-largest

The Chinese state government has issued lengthy prison sentences after cracking what is believed to be the largest and most lucrative software piracy operation in the world.

Courts in Shenzhen issued prison terms to 11 men thought to have masterminded the counterfeiting ring. The operation was said to be based out of southern China with distribution to 36 countries on five continents.

Microsoft said that the ring was distributing at least 19 of its products with a market value of $2bn (£1.37bn).

The syndicate was broken up by Chinese authorities in 2007 at the conclusion of a joint operation by Chinese and American law enforcement agencies.

Microsoft also claimed a role in the investigation, saying that it collected thousands of user reports and information from some 100 resellers that had provided payment information and correspondence with the piracy ring.

The jail terms handed down by the courts range from 18 months to six and a half years for each of the men, record sentences for piracy infractions in China. The country had received criticism from western governments for its lenient stance on patent infringement.

"Enforcement of intellectual property rights is critical to fostering an environment of innovation and fair competition," said Fengming Liu, Microsoft's vice president of the greater China region.

"Thanks to the actions of the Chinese government, we have seen a significant improvement in the environment for intellectual property rights in China."

The investigation brought to light what Microsoft describes as a global epidemic of piracy. Cybercrime experts have pointed to the global nature of internet crimes, and a lack of clear-cut jurisdictions, as major hurdles for law enforcement groups.

David Finn, associate general counsel at Microsoft's worldwide anti-piracy and anti-counterfeiting operation, echoed that sentiment.

"Unfortunately, software counterfeiting is a global, illegal business without borders," he said. "Criminals may be on the other side of the globe and may not even speak the same language, but they prey on customers and partners all over the world."