
E-waste recycler loses appeal on computer restore disks, must serve prison term - dnewms
https://www.washingtonpost.com/news/true-crime/wp/2018/04/24/recycling-innovator-eric-lundgren-loses-appeal-on-computer-restore-discs-must-serve-15-month-prison-term/?tid=ss_tw-amp&noredirect=on
======
Hasz
From the article

"“These sales of counterfeit operating systems,” Microsoft lawyer Bonnie
MacNaughton wrote to the judge, “displaced Microsoft’s potential sales of
genuine operating systems.” But Lundgren’s disks had no licenses and were
intended for computers that already had licenses."

and even worse,

"Hurley decided Lundgren’s 28,000 restore disks had a value of $700,000, and
that dollar amount qualified Lundgren for a 15-month term and a $50,000 fine.
The judge said he disregarded Weadock’s testimony."

Weadock was an expert witness (for the government no less) in a Microsoft
antitrust case. When asked what the value of the restore disk was, he
responded with zero, or near zero. The prosecutors were initially looking for
$299 a disk -- the value of a full license.

This is the most egregious case of a judge ruling on something he or she does
not understand I've seen in a while. This is an item Microsoft gives away for
free to anyone with an internet connection, all this guy was trying to do was
sell them for $0.25 to cover the cost of a disk and make it easier for people
to fix their broken computers (allegedly).

~~~
pweissbrod
I dont quite understand the basic legal details behind this.

Say I buy a computer with windows pre-installed that means the OS license cost
is bundled in to the price of the machine.

Say I have a computer without windows, or maybe an older cheaper version of
windows. Is it correct that these restore disks arent a utility to get a free
new copy of windows?

Just trying to understand

~~~
scott00
There's two stages of the legal process that are important to understand here:
what was the illegal act, and what is the sentence for that illegal act.

The illegal act was a copyright violation: he made and distributed copies of
copyrighted material without the consent of the copyright owner. I would be
inclined to argue that his use was fair use, but based on what I know about
copyright law, that argument is probably a stretch, and he didn't raise it in
his defense. He plead guilty to the charges.

As to sentencing, the sentencing guidelines make the value of the illegally
distributed goods the primary factor in determining the sentence. There is no
objectively correct answer to this question, because no one sells license-less
restore disks for any price. The three closest comparisons are

(1) The free restore disk image download offered by Microsoft. This is the
same intellectual property, but doesn't come with a physical disk.

(2) OEM Windows disks that Microsoft sells for $25. These come with a license
(unlike the defendant's disks) but do come with a physical disk.

(3) The original restore disks that come with a new computer. These match
perfectly the intellectual property and the physical form, but they only come
bundled as a small part of an expensive package, so it's hard to get a fair
price from looking at this.

The defendant argued the free download was the better comparison, the
prosecution argued the OEM disks were better. The judge sided with the
prosecution, and assigned a value of $25/disk, which resulted in a stiff
sentence.

~~~
cornholio
> (2) OEM Windows disks that Microsoft sells for $25. These come with a
> license (unlike the defendant's disks) but do come with a physical disk.

I'm confused, what exactly are these, where can a private individual buy one?
A Windows license key with (no media) is priced around $120, while an OEM
license with no support is in the $50-$90 area, depending on the business
relationship with Microsoft. If individuals were able to legally get a Windows
license by "restoring" it for $25, it would be a riot, nobody would pay the
retail price.

But if that $25 option is not available to consumers, then it makes the
comparison to the free disks even more tenuous, and the fair use issue
stronger, especially in light of the electronic waste issue. There is a
fundamental social value that is being protected.

~~~
treis
I posted this on another thread, but this is the crucial point:

>The original Microsoft (COA) attached to the PC does not allow you to reload
Microsoft Windows software when no original recovery media is present.

[https://blogs.msdn.microsoft.com/mssmallbiz/2011/10/05/looki...](https://blogs.msdn.microsoft.com/mssmallbiz/2011/10/05/looking-
to-provide-refurbished-pcs-what-you-need-to-know-about-the-microsoft-
refurbisher-program/)

So the $25 doesn't come with a license. It gives you the physical media to
comply with the license that came with the computer.

~~~
mcguire
The COA only applies to the original recovery media, or to new media supplied
by MS?

Dang. I should be treating those as more precious.

------
unethical_ban
This is one of the most unabashedly sinister first-world articles I've read in
a while.

Microsoft's argument hinges on two damages: Either, they didn't get to charge
a convenience fee to customers, or they were losing revenue by people
unexpectedly extending the life of their computers.

Foolish judges and evil lawyers putting a decent person away for 13 months.

~~~
cptskippy
No, this is an unabashedly sinister misinformation campaign by someone who
didn't read the article or understand what this guy was doing.

He wasn't distributing restore disks with refurbished PCs.

He manufactured 28000 Restore Disks containing Microsoft Windows and was
selling them. He justified his actions by saying they were only to be used on
licensed machines. That's like me selling a backup copy of your Book and
"you're only allowed to read this if you bought the book legitimately."

~~~
unethical_ban
Correct me if I'm wrong, but those restore disks only work if the machine is
already licensed. You can go download Windows 10 ISOs from microsoft.com right
now, but you can't install it without a key.

To use your analogy, it would be like you redistributing an encrypted book
file that the publisher had emailed me when I bought my hard copy, but I
couldn't open it anyway unless I had the key from the back cover.

~~~
cptskippy
Windows can be installed without a license but must be activated online using
a valid license within a certain time frame (128 days?).

Windows 10 activation is done by device fingerprinting to match a license
which is different from how windows was activated in the past. With previous
versions of Windows you activated by providing a product key.

Restore and Recovery discs are different form standard installation media, the
kind you can download for free from Microsoft.

R/R discs are custom builds from the OEM, who is required to have a software
distribution license from Microsoft, and don't usually prompt for license
activation. They circumvent the need for the user to input a key by either
storing it on a recovery partition, in the BIOS, or hardcoding it on the
media.

    
    
        >  To use your analogy, it would be like you redistributing an encrypted book file that the publisher had emailed me when I bought my hard copy, but I couldn't open it anyway unless I had the key from the back cover.
    

Not just distributing, selling without permission of the publisher and
decryption keys are widely available online.

------
vuln
Gizmodo[1] added this --

"Unfortunately, in what seems to have been a huge mistake, the disks had
“labels nearly identical to the discs provided by Dell for its computers and
had the Windows and Dell logos,” the Times wrote. As a result, Lundgren
pleaded guilty to two of 21 charges, conspiracy and copyright infringement. He
told the paper, “If I had just written ‘Eric’s Restore Disc’ on there, it
would have been fine.”

[1][https://gizmodo.com/e-waste-innovator-will-go-to-jail-for-
se...](https://gizmodo.com/e-waste-innovator-will-go-to-jail-for-selling-
windows-r-1825518742)

~~~
GFischer
Well, he was definitely guilty of trademark infringement.

------
cwyers
Everybody is reading this wrong, which isn't a huge surprise because the Post
seems to have nobody on hand who understands the facts of the case and relied
on an interview with Lundgren heavily. He was not providing people with
restore media they could use to fix their own machines. He was taking the
restore media, burning it onto discs _with official Microsoft and Dell logos
on them_ and then _selling them to computer refurbishers who would then
include them with PCs they were selling._ In other words, people were buying
PCs with these counterfeit restore discs passed off as actual Dell/Microsoft
product. Yes, the media only works with a valid Windows license on the machine
already, but reselling the PC like this with the counterfeit restore media
likely voids that Windows license agreement. Lundgren is far less innocent
than the Washington Post article implies.

~~~
HIPisTheAnswer
How are the disks counterfeit? As far as I understand they are functioning
exactly like the 'official' disks. Etching the brand on them makes them more
easily recognizable, as to what purpose they serve. There is no technical
difference between the 'original' disk and the ones this person manufactured,
so there is no possible intent to fool anyone. Nobody 'owns' a name or a logo.
Intellectual property is impossible. Sending someone who hasn't stolen
anything nor damaged anyone else's person or property, _that_ is a crime.

~~~
twblalock
> Intellectual property is impossible.

It's obvious that intellectual property is a social and legal construct,
because the things considered property are intangible, but all other forms of
property are also social and legal constructs.

Property is not merely possession -- it is the recognition by society and by
the law that you have a _right_ to possess things, and that those rights
include preventing people from taking the things you possess.

If you look at the history of property rights in land, which are among the
oldest and most fundamental property rights, you'll see how incredibly
complicated they became, and how much they have changed over time, and how
much of what we think is "just the way things are" is relatively new and does
not exist for the reasons we think it does. The legacy of feudal land tenure
in modern legal systems is a good example.

~~~
solotronics
In the sense of digital property where a copy does not deprive the "owner" of
anything its absurd someone can get in trouble for copying down bits of
information. Its like if someone owned the number 43290 and every time you
wrote down or typed that number you had to pay somebody because they
"invented" it.

------
lucio
Reading the court documents, the conclusion is that the guy is shady and the
journalist and the newspaper are borderline lying.

The correct headline is: "E-waste recycler loses appeal on 28,000 counterfeit
windows installation disks, must serve prison term"

>The sentencing judge determined that the appropriate infringement value was
the value of the infringed discs to small registered refurbishers: $25. _The
court found credible the government expert’s testimony that he was able to use
the infringing discs to install functioning Microsoft software_

So there were 28,000 discs with Microsoft and Dell logos which can be used to
to install functioning Microsoft software

That's a different picture than the one painted by the article.

>In particular, the court noted that it did not find it reasonable to believe
that Lundgren and his codefendant had spent at least around $80,000 to create
discs that had no value. Using the $25 infringement amount, Lundgren’s
guideline range was 37 to 46 months imprisonment. The court sentenced Lundgren
to 15-months imprisonment

[https://www.courtlistener.com/pdf/2018/04/11/united_states_v...](https://www.courtlistener.com/pdf/2018/04/11/united_states_v._clifford_eric_lundgren.pdf)

Did the journalist read the court papers?

~~~
JumpCrisscross
> _there were 28,000 discs with Microsoft and Dell logos which can be used to
> to install functioning Microsoft software_

I thought those discs could only “install functioning Microsoft software” if
provided with a valid license key, a key Lundgren didn’t provide nor purport
to provide. The “$25 infringement amount” seems like a bad comparison since
those disks include a license key. Lundgren’s did not.

~~~
criddell
Even without the key, the software is still copyrighted material.

------
sevensor
Sounds like this guy made a really bad decision in putting the Windows and
Dell logos on the disks, and then selling them (albeit for $0.25, which would
seem to just barely cover the cost of production.) But that bad decision pales
in comparison to the court's decision to value at $25 what Microsoft was
giving away for free. If anything, he was saving them a significant amount of
bandwidth.

~~~
treis
Microsoft wasn't giving them away for free though. According to the article,
they get $25 for each disk from computer manufacturers.

~~~
codetrotter
The $25 includes the cost of a Windows license. The restore disks Lundgren was
intending to distribute required the user to be in possession of a license
already.

Lundgren should not have been sentenced to prison for this. At most he should
have been punished for trademark infringement.

It’s a god damn travesty that we have judges who don’t seem to understand the
very important technical details of the court cases they are judging in.

~~~
treis
I did a little bit more research and my original post was factually
inaccurate, but the point was correct. An article from 2011 says this:

>The original Microsoft (COA) attached to the PC does not allow you to reload
Microsoft Windows software when no original recovery media is present.

[https://blogs.msdn.microsoft.com/mssmallbiz/2011/10/05/looki...](https://blogs.msdn.microsoft.com/mssmallbiz/2011/10/05/looking-
to-provide-refurbished-pcs-what-you-need-to-know-about-the-microsoft-
refurbisher-program/)

So that's the crucial point. Yes, the software was free to download, but you
needed the original recovery disk to legitimately sell a refurbished computer.
By creating counterfeit disks he would enable refurbishers to avoid the fee to
Microsoft.

~~~
sevensor
> >The original Microsoft (COA) attached to the PC does not allow you to
> reload Microsoft Windows software when no original recovery media is
> present.

Thank you for digging this up. This is an important point, and I think a lot
of us, including myself and the hapless recycler, have naively assumed that
sticker plus iso equals a legit install in Microsoft's eyes. Nevertheless,
it's still a travesty that he was convicted for this.

~~~
treis
Oh come on. He wasn't a hapless recycler. He was the CEO of a 100 person for
profit company processing 41 million pounds of stuff from IBM, Motorola, and
Sprint. He knew exactly what he was doing. Who do you think he was intending
to sell these CDs to? His own company, of course. And why? To increase his
profit by $25 a computer.

There's no other logical explanation. No one would go through the trouble of
exactly replicating a physical CD with logos and all unless they had nefarious
intentions.

~~~
sevensor
The article I read had him selling them for $0.25 per computer. $25 was the
figure the court arrived at for the value of each disk. Other than that, your
point is well taken. The portrayal of this guy as totally naive and well-
intentioned is suspect.

~~~
learc83
$25 per computer is how much MS charges refurbishers, the GP's theory is that
he intended to sell them to his own refurbishment company in order to save the
$25 fee they'd otherwise have had to pay MS.

------
JumpCrisscross
“One of his projects was to manufacture thousands of ‘restore disks,’ usually
supplied by computer-makers as a way for users to restore Windows to a hard
drive if it crashes or must be wiped. The disks can be used only on a computer
that already has a license for the Windows operating system, and the license
transfers with the computer for its full life span. But computer owners often
lose or throw out the disks, and though the operating system can be downloaded
free on a licensed computer, Lundgren realized that many people didn’t feel
competent to do that, and were simply throwing out their computers and buying
new ones.

Lundgren had 28,000 of the disks made and shipped to a broker in Florida.
Their plan was to sell the disks to computer refurbishing shops for about 25
cents apiece, so the refurbishers could provide the disks to used-computer
buyers and wouldn’t have to take the time to create the disks themselves.

...

Eventually, the Florida broker, Robert Wolff, called Lundgren and offered to
buy the disks himself as part of a government sting, Lundgren said. Wolff sent
Lundgren $3,400, and the conspiracy was cemented. Both were indicted on a
charge of conspiracy to traffic in counterfeit goods and criminal copyright
infringement.”

This should not result in jail time. Is Florida really so free of violent
crime and other more serious offenses that this case is a priority for federal
prosecutors?

~~~
pc86
Not speaking about this case specifically, but the existence of other more
serious and/or violent crimes does not negate the impact of small crimes. You
can't just say "yeah well there's a lot of unsolved murders so what about
those?" as some sort of indictment against police officers enforcing laws.

~~~
ballenf
It's one thing if they could have proven the case without this fabricated
sting. Setting that up just to put the nails in the coffin of someone trying
to do good seems pretty evil to me.

Why the hell didn't the prosecutors just ring up the guy and say, "Hey,
Microsoft is pretty pissed about these disks. If you don't [destroy them /
remove their logo] we'll have to prosecute you."

They have exactly that kind of discretion.

~~~
cptskippy
Lundgren intended to sell the disks to computer refurbisher shops, this is a
fact of the case. In theory, they could have found a shop he intended to sell
the discs to and caught him in the act. The OP was lamenting the waste of
resources that went into setting up a sting, I would imagine the time involved
in the above mentioned scenario would be much greater.

Lundgren wasn't setup, he wasn't coerced into doing something illegal. He was
or was planning to do it and they just called him up and asked to be a
customer.

This is similar to busting people for prostitution. You can either spend
extraordinary time and effort in surveillance to catch them in the act. Or you
can just dress in civilian clothing and approach them.

~~~
thedragonline
Just curious - do you think this is a reasonable, proportional punishment?

~~~
cptskippy
Not at all. In this case he hadn't sold anything. They should have approached
him and explained why he couldn't do what he was doing. Then gave him a
remediation option, like destroying the discs, and dropping the matter.

I'm also not convinced something like this didn't happened. All of his
exposing about Microsoft double dipping and the whole system being designed to
scam people out of money makes me suspicious of his true motivations.

Microsoft stepped forward and corrected Federal Prosecutors who initially
sought $299 per violation. They stated that they sold refurbishers licenses
for $25 and the discs had at most a $20 value.

Lundgren was convicted of counterfeiting and copyright violation, not piracy
and is even quoted as saying if he'd labeled the discs differently this would
have never happened. I'm curious if that statement was based on what he
ultimately got convicted of or something else?

~~~
dragonline
>Then gave him a remediation option, like destroying the discs, and dropping
the matter.

This strikes me as the far more reasonable outcome that didn't happen.

>I'm curious if that statement was based on what he ultimately got convicted
of or something else?

Who knows. As a practical matter, I do see a chilling effect coming out of
this judgement for those reselling Windows boxes - either don't do it or make
damn sure you have your legal ducks in a row.

(edit:formatting)

------
sailfast
It's really frustrating when reporters don't link to decisions so we can see
the logic behind the rulings. Found what I believe is the opinion in case
you're interested:
[https://www.courtlistener.com/pdf/2018/04/11/united_states_v...](https://www.courtlistener.com/pdf/2018/04/11/united_states_v._clifford_eric_lundgren.pdf)

Here's the original request for appeal:
[https://regmedia.co.uk/2018/02/20/lundgrenappeal.pdf](https://regmedia.co.uk/2018/02/20/lundgrenappeal.pdf)

~~~
jaclaz
Thanks for the link to the decision.

It seems to me like the key point is:

>In particular, the court noted that it did not find it reasonable to believe
that Lundgren and his codefendant had spent at least around $80,000 to create
discs that had no value.

Since the idea that they had "no value" was not accepted and since the CD's
had actually the MS and Dell logo's the Law shifts the value (and thus the
sentencing) from the value of the "infringing" good to the value of the
"infringed" one.

All in all, it seems to me more like a case of "counterfeit Gucci bags" than a
purely unauthorized software redistribution related one ...

EDIT: the last sentence above was meant as:

All in all, it seems to me _that the Courts treated it_ more like a case of
"counterfeit Gucci bags" than a purely unauthorized software redistribution
related one ...

~~~
lukeschlather
It's more like they were real Gucci bags, but the Gucci label had worn off and
he's getting prison time for restoring the label.

------
dingaling
I'm in two minds over this. First, it's ridiculous that someone is being
jailed for 15 months for trying to make it easier to keep using older PCs and
reducing waste.

On the other hand that's the risk one takes when dabbling in the world of
proprietary software. Where discouraging people from upgrading is seen as a
threat to revenue and is attacked accordingly.

Had he printed 34,000 Linux disks we'd never have had this case and sentence,
but then perhaps no one would have used those old PCs. It seems that someone
has to lose.

~~~
fuball63
My first response was "he should have used linux", but I came to a similar
conclusion as you. People are scared of linux, despite it now being almost as
easy as Windows to install/use for typical usage.

E-waste is the result of computer transitioning from the role of "tool" to
role of "disposable consumer good". The effort to provide people with the
ability to easily repair their machines to a familiar state (being Windows),
to me, seems the most effective way to combat e-waste.

EDIT: added 'being Windows' to second paragraph

~~~
AnIdiotOnTheNet
> My first response was "he should have used linux", but I came to a similar
> conclusion as you. People are scared of linux, despite it now being almost
> as easy as Windows to install/use for typical usage.

People aren't any more scared of Linux than they are of Windows. Not to go on
yet another rant about all the problems with Linux as a desktop, but refusing
to acknowledge that they exist and instead blaming users is part of the reason
people don't use Linux.

~~~
fuball63
My experience trying to set people up with Linux desktops is that even though
the metaphors are the same, (like the desktop, start button, update manager,
word processor), the unfamiliarity of the branding turns people off. Also, any
errors that appeared (one time the package list got corrupted), they
immediately go to "ah I'm not an expert this linux thing isn't for me",
whereas if Windows showed a cryptic dialog error window, they just ignore it
and move on, because that's the norm.

I'd be interested in your thoughts about Linux as a desktop; I just got done
with a multi month battle to get my graphics card working (contradicting
everything I say about Linux being easy), but I still love Kubuntu 18.

~~~
AnIdiotOnTheNet
Generally people are hesitant with things they are unfamiliar with, it's true,
but that's different than being afraid of it. They've learned to ignore
Windows error messages, but they were probably once terrified of what they
meant (usually nothing, which is why they're ignored). They aren't afraid of
Linux, they just don't see any advantage to learning how to deal with it like
they did for Windows, and that's because it doesn't really have any.

My thoughts on Linux litter my comment history. Some of it is inflammatory
because it really bothers me that no one has built a half-decent alternative
to Windows for my own needs, let alone those of all the various use cases out
there, but people will insist that they have and then ignore the reasons you
give them that they haven't.

------
joeevans1000
This is ridiculous. This should be a civil case at most. We are entering into
a dangerous era for our own selves when we allow this sort of punishment for
software issues.

Additionally, this guy recycles 41 million pounds of e-waste a year. He should
be celebrated. As a result of that, I can only imagine his larger clients may
have to drop the use of the services of his company. Apparently, we don't
care, and many comments online are philosophic in tone.

Even if the strategy were misguided, this outcome is absurd.

That Microsoft would so vigorously pursue this guy has rekindled my dislike
for the company. They almost seemed to be on a turnaround path with developers
with a cool editor and a new approach. This shows that they and their products
are to be avoided at all cost as before.

All I can say is that, as developers, we need to work to not embrace Microsoft
as they try to restore their relationship with us. And if you work there,
well, what can I say... you should speak up about this or leave for more fair
waters.

~~~
ksk
You are free to hate Microsoft of course, but your point didn't make much
sense to me. Nobody except Microsoft is allowed to distribute Windows because
thats their right under copyright law. Its the same law that prohibits people
from distributing GPL'd binaries without providing the source. The
owner/creator has certain rights.

------
HenryBemis
One of the phrases I keep from this article is: “I don’t think anybody in that
courtroom understood what a restore disk was”.

I remember listening to Steve Gibson (GRC), on SecurityNow podcast, saying
that this is the exact reason why he is not willing to testify to a Court of
Law any more. Having testified in court for some cases as "specialist" it is
(almost always) needed to find metaphors and analogies on anything-technology.
Some judges and lawyers are educated but twisting the meaning of something
(misinterpreting the truth) is often the case.

------
aresant
it is sad and amusing that at least three comments on this thread point out
that the wapo article is substantially incomplete.

From the original LaTimes article:

"In 2013, federal authorities intercepted shipments of 28,000 restore discs
that Lundgren had manufactured in China and sent to his sales partner in
Florida. The discs had labels nearly identical to the discs provided by Dell
for its computers and had the Windows and Dell logos."

Oh. Well that changes things substantially - copyright infringement on discs
created in China in bulk looks a bit fishy and more malicious than the wapo
points out.

What if the discs were rooted?

What if their intent was to charge the other recyclers $10 a pop vs the $25
msft charged for the same thing?

I bet all those things were discussed in the courtroom and I'd love to see a
really good source to understand this case vs watching the media try to wind
up the pitchfork brigade as usual.

~~~
gowld
> What if the discs were rooted?

They weren't. What if he murdered someone? He didn't.

> What if their intent was to charge the other recyclers $10 a pop vs the $25
> msft charged for the same thing?

So? It's not a crime for Amazon to charge lower shipping than Newegg.

~~~
pc86
It is a crime to resell a company's IP without their permission, though.

------
nerdponx
I want to know what harm he has done or what danger he poses to society that
warrants a 15 month prison sentence.

I feel like this is what pardons are for.

~~~
vorg
> what danger he poses to society that warrants a 15 month prison sentence

We're seeing the reason for the U.S.'s >1% of adult population incarceration
rate. The solution isn't occasional pardons but massive reform of the 51
criminal judicial systems in the U.S.

------
radiorental
This is just shameful prosecution of law for the sake of law and not whether
it's appropriate. Even the judge recognizes the greater good that was at play
and the non-malicious intent.

It boggles my mind that some DA put the effort in to this case.

------
emh68
Can’t blame this on Microsoft. Legal department probably said “these disks
look visually similar to Dell disks, therefore we must press charges or
everyone will start stamping out lookalike CDs and they’ll be able to get away
with it by pointing to us not pressing charges here”. Blame the legal system,
not Microsoft. All companies are under such obligations to not dilute their
IP.

~~~
larkeith
Could Microsoft not have pursued a cease-and-desist, rather than penalties of
$299 (original prosecution) and jail time, if this had truly been their
intent?

~~~
danso
Microsoft sought restitution of ~$400K but was denied it by the judge:
[https://www.washingtonpost.com/news/true-
crime/wp/2018/02/15...](https://www.washingtonpost.com/news/true-
crime/wp/2018/02/15/eric-lundgren-e-waste-recycling-innovator-faces-prison-
for-trying-to-extend-lifespan-of-pcs/)

------
JoeAltmaier
Doesn't a restore disk contain binaries from the operating system? So he's
distributing somebody else's work, with their logo on it. However well-
intentioned, its pretty dodgy. No matter what Microsoft does with those
binaries, they weren't his to resell?

~~~
gowld
What's the _harm_? 0. I get no commercial value from having the same OS twice
on my machine.

~~~
JoeAltmaier
E.g. harm to the brand when goofy guys start selling stuff with Microsoft
brand and old restore data screws up machine

As he said (naively) maybe he shouldn't have put somebody else's logo on the
disk. Duh.

------
everyone
So, the price MS paid to have him jailed was _less_ than the cost they would
incur if people used those discs to restore their machines instead of buying
new ones.

~~~
adventured
Microsoft didn't pursue having him jailed. They sought financial compensation.
The government prosecutors pursued the jail term to bolster their own resumes
as they always do.

------
abtinf
This is a travesty. It reminds me of Aaron Swartz.

~~~
JumpCrisscross
> _It reminds me of Aaron Swartz_

Aaron Swartz wilfully broke the law. This man didn’t. Not a good comparison.

~~~
vorg
Everyone fights the GAMAF sponsored subversion of the ICT industry in their
own way, depending on their personality. Although some people go around the
law without breaking it, others wilfully break it (Snowden), others go around
it but inadvertently break it (Lundgren), others wilfully break it but can't
handle the subsequent miscarriage of justice (Swartz), yet others make money
from doing things that shouldn't be illegal (Dotcom). Fight the corrupt IP
machine in your way.

~~~
MoBattah
GAMAF? What's that?

~~~
vorg
Because I spelt it GAMAF instead of GAFAM, people like you wouldn't be
enlightened by googling it. I would tend to add evil Oracle to that list of
the filthy five, and call them GAMAFO.

~~~
MoBattah
Google, Apple, Facebook, Amazon, Microsoft. Got it.

I'm sorry, were you implying that I'm stupid? Not picking up on the
implication.

~~~
vorg
That should read "people who don't know what GAFAM means" instead of "people
like you".

------
_Codemonkeyism
Main point:

"The judge said he disregarded Weadock’s testimony. 'I don’t think anybody in
that courtroom understood what a restore disk was,' Lundgren said."

~~~
kosievdmerwe
The judge's counter point[1]:

> In particular, the court noted that it did not find it reasonable to believe
> that Lundgren and his codefendant had spent at least around $80,000 to
> create discs that had no value.

They intended to get profit by creating counterfeit media. Trademarks are one
of the most important intellectual property laws, without them you cannot rely
on a company's reputation to inform you what to buy or even whether they
followed safety regulations for more physical kinds of property. Since why
would a counterfeiter waste money on safety: their reputation isn't getting
damaged.

If you allow counterfeit media like this guy tried to do, you can't rely on
the fact that the media doesn't have malware on it. Cause while I don't think
Lundgren added malware, if you allow counterfeit discs, someone else
eventually would.

[1]
[https://www.courtlistener.com/pdf/2018/04/11/united_states_v...](https://www.courtlistener.com/pdf/2018/04/11/united_states_v._clifford_eric_lundgren.pdf)

------
analognoise
I was really angry about this, until I read that the disks had Microsoft and
Dell logos.

~~~
whatshisface
MS and Dell logos are also used to indicate compatibility. That's probably
what was meant by their use here. (If you have any disks at your house, see
how many have a Windows/Apple logo on them.)

~~~
analognoise
I think he lifted the design of a genuine Dell restore disc . It was seized by
customs.

------
DoctorOetker
what makes it legal for an ISP (on behalf of an end-user) to request a
microsoft server for the recovery disc download and then send this stream of
bits to the end-user,

but then illegal for Lundgren (also on behalf of an end-user) to request a
microsoft server for the recovery disc download and then send a disc of those
bts to the end-user?

Is it because Lundgren is no ISP, or is it because the disc is considered a
medium of exchange?

~~~
cptskippy
Microsoft doesn't provide recovery/restore discs for download. Microsoft
provides installation images that require and prompt for a valid product key
and license to use the software (except Windows 10).

Most OEM Restore/Recovery media do not prompt the user for a product key. They
either have key/license hidden on a recovery partition on the machine, stored
in the firmware, or hardcoded on the disc.

It's unclear how his disc worked but what is clear is that he was not a
licensed software distributor and did not have the rights to distribute
Microsoft's media.

If someone gives away 100 free books, that doesn't give you permission to make
copies of their book and sell them with the caveat that only people who
received one of the free 100 books could buy them. How is this different?

~~~
RIMR
Microsoft does provide recovery disks for download:
[https://www.microsoft.com/en-us/software-
download/windows7](https://www.microsoft.com/en-us/software-download/windows7)

Only recently did you need to enter your license key to download them.
Regardless, you need the license key to activate the OS, so these disks did
not enable anyone to use the OS who did not already own a legitimate license.

Microsoft's lost revenue came in the form of reduced sales of redundant
licenses..

~~~
cptskippy
Your link is to installation media, not recovery/restore media. Microsoft does
not make Recovery/Restore media.

Recovery/Restore discs are custom made by OEMs under license from Microsoft.

> Microsoft's lost revenue came in the form of reduced sales of redundant
> licenses..

If this were true then Microsoft would not have persuaded Federal prosecutors
to lower their estimates. Originally prosecutors claimed the discs were valued
at $299 a pop but Microsoft informed them that they sold refurbishers a
license for $25 and that the discs were worth $20 at most.

------
adventured
> Randall Newman, Lundgren’s lawyer on the appeal, said there was no basis to
> seek a rehearing from the full 11th Circuit. Lundgren said an appeal to the
> Supreme Court would be a costly long shot.

The tech community should band together and fund Lundgren taking this to the
Supreme Court. It's worth trying to stop this precedent.

------
meesterdude
> despite the software being freely available online and only compatible with
> valid Windows licenses

I don't see why someone needs to go to jail for 15-months over this -
especially given his reasonings.

If you thought microsoft had turned a new page - think again. Different
tactics, same morals.

------
b1daly
Aside from the legal technicalities and motivations of the parties in this
case, the goal of prolonging the usable life of computers is incredibly
laudable.

The continuing process by which otherwise functional hardware is made into
trash simply because the market incentives don’t motivate the manufacturers to
prioritize this is (borderline) tragic.

The way updates of operating systems require ever more powerful hardware
drives me crazy. If prolonging the use of hardware was an explicit goal of the
companies that make the operating systems, not only could a huge amount of
waste be kept out of landfills, we could have devices whose performance
increases over time.

------
JumpCrisscross
Why isn’t he appealing? Where is the ACLU?

~~~
datalus
He just lost the appeal...

~~~
joeevans1000
I'm appealing to all talented college engineers and others to avoid applying
to work Microsoft at all costs. They pursued this guy and are the reason this
actually got so far. Your work would be literally furthering this sort of
absurd outcome.

~~~
jeffdubin
And I'm appealing to all talented college engineers and others to _work_
Microsoft at all costs - and change their culture to prevent this kind of
situation from happening again.

~~~
monocasa
Since when do engineers have a say in what legal does?

------
entwife
The used laptop shop near my house will install Windows 10, but not any flavor
of Linux. I wonder whether this will change their business.

------
blhack
This is horrifying, and sounds like something out of a story warning about
government overreach.

1 YEAR and three months in federal prison? That's not a short amount of time
for something that this guy had a reasonable expectation wasn't illegal.

------
naoru
Controversial opinion: mr. Lundgren could tamper with disc content and ship
any kind of malware with the OS to intercept sensible data. I'd never trust
that kind of 'OEM' CD.

~~~
riffic
This isn't controversial at all - a basic tenet of computer security is to to
install your bits from trusted media. If the install media is a burned cd of a
supposed windows ISO, it's not as trustworthy as the $25 replacement media
shipped out by the original vendor.

------
reimertz
As a CEO, you can have a business model that is ethically and morally wrong
without getting into jail.

As a CEO, you can ignore obvious security flaws leading to 100 million social
security numbers getting leaked without getting into jail.

As a CEO, you can sexually harass your employees without getting into jail.

Try and save the world by repurpose old computers, causing one of the biggest
companies in the world to maybe lose 0.0000001% of their revenue and you're
fucked.

Shame on you, Microsoft.

~~~
JumpCrisscross
> _you can have a business model that is ethically and morally wrong without
> getting into jail_

Rule of law. You go to jail for breaking the law, not for being unethical or
immoral. Societies which forget this distinction fall fast. (Legislation,
turning morals and ethics into laws, is the intermediating process your
complaint more properly addresses.)

~~~
natch
You're missing the whole crux of the story. The supposed law broken here
(none, actually) is based on multiple judges being absolutely clueless about
technology and refusing the regard the testimony of an expert witness who was
trying to set the first judge straight.

~~~
JumpCrisscross
> _The supposed law broken here (none, actually) is based on multiple judges
> being absolutely clueless about technology_

The problem is we criminally charge commercial infringement. The defendant put
others' logos on disks he sold. This shouldn't result in jail time, but that's
what the law says. The problem isn't the court, it's the law.

~~~
Cookiesaurusbex
> The problem isn't the court, it's the law.

>The judge said he disregarded Weadock’s testimony. “I don’t think anybody in
that courtroom understood what a restore disk was,” Lundgren said.

Oh, I think there was a problem with the court.

~~~
JumpCrisscross
> _The judge said he disregarded Weadock’s testimony_

That testimony seems irrelevant to the charge which resulted in the jail time.
Theoretically valueless or not, the discs were sold with an infringing logo.
That combination--infringement and commercial intent--is a crime under our
laws.

------
mute_x
this is so sad to see, +1 on the fu Microsoft

------
jrochkind1
oh my god.

------
justherefortart
Fuck you US Government is more like it.

Oh, and the assholes that vote these idiots into office over and over again. I
don't care if it's Pelosi/Boxer or Inhofe/Cruz, they all are pieces of shit.

~~~
garmaine
You think the other name on the ballot would have been any different?

~~~
eof
You think there were only two names on the ballot?

------
ada1981
No paywall: [https://outline.com/zcZGaN](https://outline.com/zcZGaN)

It’s unfortunate when people get punished because other people don’t
understand how technology works.

“Senator, we don’t sell data!” - Plato

~~~
ada1981
I guess Zuck downvoted me for misquoting him.

He still owes me $100 from 2004, can I get that back in 2004 FB Stock $100
equivlant?

------
desireco42
Is there anything we can do? Can he appeal? EFF? This can't be the end.

I guess pressuring MS to drop the charges is too late. We can't have good man
in jail over this.

~~~
24gttghh
I really hope he appeals this.

~~~
jrochkind1
Friend, the very headline, and HN post title, is "E-waste recycler Eric
Lundgren loses appeal…". He did appeal it. He lost.

~~~
24gttghh
Technically it could be appealed to the SCOTUS but that is unlikely :(

------
wpdev_63
This has to be fake news...

