In what’s seen as a major breakthrough in the battle against software piracy, the Indian criminal court has jailed a man for using cracked commercial software without bail (pending an investigation). This marks the first time that an individual has been detained on such a charge.

If convicted, the defendant, Managing Director of VM Informatics (VMI) in New Delhi, faces up to three years in prison.

Following a raid by anti-piracy investigators and police on the offices of VMI in July 2011, Tekla Corporation made a criminal complaint against the company,

Tekla specializes in highly sophisticated modelling software for the construction, infrastructure, and energy industries. After submitting an allegation of large-scale software licensing fraud, VMI was found to be unlawfully using Tekla software with a licensed value of over $176,000.

Tackling unlicensed software use in emerging markets

The High Court of Delhi issued an injunction against VMI preventing further unauthorized use of Tekla software. However, VMI chose to ignore the injunction and a second police raid on their offices revealed new computers, each containing multiple illegal copies of Tekla software. The total licensed value of the infringed software discovered in both raids now stands at over $500,000.

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VMI’s Managing Director was arrested on 12th December 2011, and will remain in jail until the 19th of December as his application for bail was postponed for hearing by the Indian court – which has also brought contempt proceedings against him for breaching its earlier injunction. Under Indian law the maximum penalty for contempt of court is a one-year custodial sentence, while serious breaches of Indian copyright law are punishable by a up to three years imprisonment.

In a separate action, VMI and its Managing Director face a civil claim of $500,000 for using unlicensed software.

Our take

In emerging markets like India, software piracy is a serious and growing problem. Infringers will typically purchase a single license and then use it on multiple computers. The decision to bring both criminal and civil charges against VMI and its Managing Director was taken following repeated attempts to resolve VMI’s illegal use of Tekla’s software outside of the courts.

Commenting on the case, IT Compliance Association CEO Chris Luijten said:

The problem of software piracy remains widespread and serious, particularly in emerging markets like India. Those who chose to knowingly use or sell illegal software should heed our warning – we shall continue to relentlessly bring the full force of the civil and criminal law to bear upon any transgressors.

Andre Corniere, director of steel segment at Tekla, added:

Piracy weakens the competitiveness of our licensed customers as pirates seek unfair advantage of competition. Tekla is committed to ensuring the protection of its software users’ rights, Tekla’s rights, and the rights of other software suppliers. That’s why we are active in tracking down pirates and other parties involved in making or distributing illegal copies of Tekla software.

If you’ve been the victim to software privacy and aren’t sure how to proceed, you can report the issue on the ITCA website.

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