Microsoft's Motion for Partial Summary Judgment in Microsoft Corp. v. Pronet Cyber Technologies, Inc., 2009 WL 66111 (E.D.Va. 2009), caused the Court to address whether the "knowingly" element of 18 USC 2318 (which prohibits trafficking in counterfeit or illicit computer program labels) requires that defendant know his conduct is unlawful. The court awarded partial summary judgment to Microsoft, holding that the statute requires only that defendant have knowledge of facts that constitute a violation, not knowledge that his conduct is unlawful.
Defendant Pronet Cyber Technologies, Inc. ("Pronet") distributes computer software and components on the Internet, including Microsoft software. Microsoft's complaint alleged that Pronet had trafficked in counterfeit or illicit product labels in violation of 18 USC 2318 and Microsoft sought summary judgment on that count. Defendants argued that they did not know their acts were unlawful and therefore could know have "knowingly" trafficked in counterfeit or illicit labels.
In reaching its result, the Court relied on prior case law that states that the term "knowingly" requires only proof of knowledge of the facts that constitute an offense unless the statute states otherwise. The Court also noted that while there was little case law interpreting the knowingly requirement of 18 USC 2318, those cases supported the result reached in this case.
The Court granted summary judgment as to counterfeit labels used by Pronet but held that the evidence as adduced did not support summary judgment as to illicit labels. A counterfeit label appears to be genuine but is not. An illicit label is a genuine label that is distributed not in connection to the copy to which it was intended to be affixed by the copyright owner or is knowingly falsified in order to designate a higher number of authorized users than permitted by the copyright owner. Because defendants knew they were selling products with labels that appeared to be genuine but were not, defendants had knowingly trafficked in counterfeit labels. However, the evidence before the court showed that defendants claimed the genuine labels they obtained were distributed in connection to the copy to which they were intended to be affixed by Microsoft. Also, there was no evidence that defendants had knowingly falsified any genuine labels in order to permit a higher number of users than intended by Microsoft.
Comments