Intellectual Property Law

Microsoft Wins Most of Georgia Counterfeiting Case

By Michael Atkins

In 2006, Microsoft Corp. brought suit in the Northern District of Georgia against Silver Star Micro, Inc., and its principal, Chase Campbell, for trademark and copyright infringement. On Jan. 6, Judge William Duffey, Jr., granted in large part Microsoft’s motion for summary judgment and imposed a permanent injunction against the defendants.

The court found in April 2005, Silver Star Micro, doing business as USA Tech Store on the Internet at www.techusastore.com, sold a counterfeit copy of MICROSOFT SQL SERVER 2000. Microsoft notified defendants that it had purchased improperly sold Microsoft software and demanded that defendants cease further infringing activity.

In September 2005, law enforcement executed on a search warrant at defendants’ premises and seized disks containing counterfeit copies of MICROSOFT OFFICE 97, MICROSOFT WINDOWS XP PROFESSIONAL, 72 counterfeit Microsoft Product Key labels and 300 units of Microsoft Volume License Media.

In December 2005 and on three occasions in March 2006, defendants sold WINDOWS XP PROFESSIONAL CD-ROMs with counterfeit product key labels and counterfeit product keys.

On summary judgment, the court found: “Microsoft’s trademarks are associated worldwide with Microsoft products, and there is little doubt that the Defendants sold infringing software with the intent that its customers believe the software was authorized by Microsoft. ‘Where, as here, one produces counterfeit goods in an attempt to capitalize upon the popularity of, and demand for, another’s product, there is a presumption of a likelihood of confusion.’ Polo Fashions, Inc. v. Craftex, Inc., 816 F.2d 145, 148 (4th Cir. 1987). Like in Polo Fashions, confusion is presumed here, and the Court grants summary judgment to Microsoft of trademark infringement on Nos. 1,200,236, 1,872,264, 1,815,350, and 2,744,843.

“Plaintiff has not, however, shown infringement of its trademarks related exclusively to the Microsoft Office 97 suite of programs. The Lanham Act and appellate precedent require that a defendant must use a mark ‘in commerce’ to be liable for trademark infringement. The undisputed facts in this case show that the Defendants possessed an infringing copy of Microsoft Office 97. The facts of this case do not show that the Defendants used the marks related to Microsoft Office 97 in any sort of commercial transaction. In the absence of evidence showing the ‘in commerce’ requirement, the Court denies summary judgment of trademark infringement and false designation of origin as to Trademark Registration Nos. 1,475,795 (‘POWERPOINT’), 1,741,086 (‘MICROSOFT ACCESS’), and 2,188,125 (‘OUTLOOK’).

The court awarded Microsoft $30,000 for each of the nine copyrights infringed, plus $25,000 for each of the four trademarks infringed, for total of $370,000. The court also found this was an “exceptional” case under the Lanham Act, entitling Microsoft to an award of its attorneys’ fees and costs.

Finally, the court entered a permanent injunction against the defendants, enjoining them from copying, selling, or making any other infringing use of Microsoft products.

The case cite is Microsoft Corp. v. Silver Star Micro, Inc., No. 06-1350 (N.D. Ga. Jan. 9, 2008).

Full post as published by Seattle Trademark Lawyer on January 20, 2008 (boomark / email).