[Commons-Law] Microsoft appeals French piracy fine

[Sunil Abraham]

Microsoft appeals French piracy fine 
http://www.theregister.co.uk/content/7/31372.html
Microsoft went to court in France last week to appeal its conviction in
2001 for software piracy, for which it was ordered to pay $425,000 in
damages, costs and interest. Today we publish an eyewitness account of
the appeal by Lionel Berthomier, who has been covering the case almost
single-handedly since 1996.

But first some background. In 1994, Microsoft bought the company
Softimage Creative Environment. It sold the company on to Avid in 1998.
Softimage’s code illegally included proprietary software from another
company. Raymond Perrin and Isabelle Cuadros, 3D animation software
developers and authors of the misappropriated software have been
fighting the case for six years.

June 17th, 2003 the "Microsoft piracy" case is brought before the 12th
Chamber of the Versailles Appeal Court. Here are Judge Denis Coupin, his
clerk, the plaintiffs, their lawyer, a computer specialist, Microsoft's
lawyers, a Softimage engineer, two journalists and a curious passer-by:
the place is empty! No one could have expected a US$19 million piracy
suit would attract so few people. However, the audience will proceed in
a small committee room.

2:30 PM: after Judge Coupin's opening statement, the floor is open to
Ms. Renard, a brilliant Parisian lawyer acting on behalf of Microsoft.
The main argument: "only the code is copyrightable... and a software's
functionalities cannot be protected by author rights.". To prove her
point, the young lawyer, silently supported by her colleagues of law
firm August & Debouzy uses the "elevator trick". All elevator makers
around the world have developed the functionality that enables to reach
the desired floor by pushing the corresponding button, without having to
sue each other. She explains that her client, "totally rewrote and
copied the functionalities" in question, when the contract tying the
company to the plaintiffs was breached.

On the unfair competition indictment, she uses a judicial subtlety: one
cannot use this as "protection vs. counterfeiting". In regards to
parasitism, Ms. Renard guarantees her client "did not try and obtain a
determining advantage with the eight asserted functionalities".

She adds: "In 1995, these functionalities were already considered as
standard". Then, a Softimage engineer, who came in straight from Quebec,
proceeds to present the functionalities and, in an effort to communicate
with the audience, recalls the great commercial success of his employer,
citing Jurassic Park, for instance.

Ms. Renard claims that Microsoft, "the undisputed anti-piracy champion",
had seen its image tarnished in this affair "by a press campaign". And
she concludes that in the name of "the free course concept" regarding
the redeveloped functionality, her client's conviction for
counterfeiting in 2001 should be dismissed.

Judge Coupin then turns to Mr. Alterman, lawyer for Perrin and Cuatros.
Alterman builds his advocacy on concrete facts such as the settlement
proposal for the asserted functionalities, made to his clients on the
eve of Softimage's acquisition by Microsoft, or the contract requesting
that Softimage "drop them in case of contract breach".

Alterman goes down Memory Lane. He explains how Raymond Perrin and
Isabelle Cuadros were "seduced" by Softimage after the projection of
"The Puppet" movie in Montreal in the early 1990s. He wonders why the
asserted functionalities are qualified today by Microsoft's defense as
"not of great interest", but are nevertheless the object of so many
attempts at transaction. And regarding author rights, he reminds the
hearing that the organic descriptions and the detailed analysis of the
functionalities developed by his clients were registered at the APP (the
French association for software protection).

How Much?

Furthermore, Alterman questions the level of expertise which resulted in
Microsoft's conviction in 2001, pointing out that the difference found
while comparing the two source codes was not 16,000 bytes as mentioned
in the official report, but exceeded 110,000 bytes.

Finally, whereas Ms Renard had called into question the method Alterman
had used to estimate his clients' prejudice, qualifying it as
"unjustified", he reminded the court that three concurring experts
showed that the asserted functionalities corresponded to 6 per cent to 8
per cent of Softimage's software value. This was scaled back to 5 per
cent of the software's value during the period until Softimage's sale to
Avid (1998), while applying the usage fee specified in the initial
contract (50%), it all adds up to about 2.5% of the turnover generated
by the software (a little over US$790 million), that is to say US$19
million.

This is precisely what he requests before the Appeal Court as damage and
interest for Raymond Perrin and Isabelle Cuadros, along with the
unconditional removal of the pirated functionalities, knowing that
should the case go criminal, damage and interests would correspond to
the full amount of the software's turnover!

The session ends. It is 4:30 PM in Versailles on June 17th, 2003. The
Appeal Court will announce its verdict on October 9. ® 

-- 
Sunil Abraham, sunil at mahiti.org http://www.mahiti.org
MAHITI Infotech Pvt. Ltd.'Reducing the cost and complexity of ICTs'
314/1, 7th Cross, Domlur Bangalore - 560 071 Karnataka, INDIA
Ph/Fax: +91 80 4150580. Mobile: 98455 12611
"If you have an apple and I have an apple and we exchange apples 
then you and I will still each have one apple. 
But if you have an idea and I have one idea and we exchange these ideas,
then each of us will have two ideas" George B. Shaw
Shaw