On this page you will learn:

- Whether your organisation is in danger

- What has happened in the past

- What could happen

- That action can be taken to avoid interest from the authorities

Will your organisation ever be prosecuted?
It depends on what you have done and who you are dealing with.

It also depends on how you handle the situation in the event of your organisation having caused the interest from one of the authorities.

What we know
If you manufacture counterfeit software then expect to be caught and prosecuted by the authorities at some point under copyright and licensing laws.

Unfortunately, the software authorities also use the same powers to criminalise organisations that use unlicensed software, i.e. software that is installed without the correct licence being in place, however unwittingly this might have happened.

Publishers have information about your purchasing patterns available to them and they know what you should be purchasing so simple analysis will indicate where it is worth asking questions.  Such enquiries will often uncover deeper issues that are then worth pursuing with a full blown audit.

Publishers are becoming more active in this space.  The more it happens, the more 'accepted' it becomes by the market, the more it happens...

Our interpretation of events
There are two types of audit:
  • Compliance authority audit
  • Software Publisher audit

There has been a significant increase in the publicity of customer organisations that have been audited and fined due to a lack of software licences by the software authorities since the beginning of 2007.

It is now also more common for the name of the organisation in question to be released as part of that publicity, whereas anonymity used to be maintained.

Top Tip - If you are in this situation, then make sure that anonymity is maintained wherever possible.

Prosecutions are taking place and publicity of such events is always the authorities' main weapon.

The BSA exist to police software licensing, that is what they do, so they will always look to prosecute and publicise that fact wherever possible.

The software publishers ultimately do not want to 'go legal' with customers, for the obvious reason that it does not generate a warm feeling with their customers.

But never forget that they can go legal and if you push them to a point where they feel that they have no other choice it can happen.

Where is it all going?
There is no doubt that the protection of copyright and intellectual property is not going to go away, in fact quite the opposite.  As many have said, 21st century law-making is going to be all about the protection of private data and intellectual property.

It is in fact very easy for any organisation to be shown to be non-compliant.  With the increasing variety of licence rules that we all have to deal with, unless there are dedicated resources in your organisation to do SAM, there will always be areas of weakness.

Even if there is good SAM in place, there will always be areas that can be shown to be non-compliant.

What it comes down to is tolerance.  Those organisations that go beyond what the authorities feel is acceptable will be lent on very heavily and they will have to pay in one way or another.

Those that have an acceptable level of licensing and can prove it will have little trouble in this way.

How you handle these situations is often the key.

The point
Legal prosecution of an end user organisation for the use of unlicensed software usually means that a total failure in management of the situation has occurred.

Such a violent end result is more often than not completely avoidable.

Our message to you is that prosecution can and does take place, you should take this very seriously indeed.  But, steps to avoid ever getting to that point can be taken quite easily.

Much of what the publishers, the BSA and national bodies (such as FAST) do in these situations is often just positioning to make the point so that it doesn't lead into drawn out legal proceedings.  If an out of court conclusion can be reached to the satisfaction of all parties then that is usually much more preferable.

The authorities are looking for some form of financial compensation, they do not necessarily want to take legal action, but they will if they have to.

Is legal action really what you want to happen?  There are plenty of ways of avoiding it.

In June 2007 it was announced by the BSA that they had just fined a company for £250,000, the biggest out-of-court settlement from a British company.  Notice that part of the agreement was non disclosure of the organisation's name.

Conclusions
In general
Clearly if there is flagrant abuse of the law, then action will be taken, but usually the threat of action is just positioning to ensure that people know that the long hand of the law is on the side of the authorities and the publisher.

The exception

One area where publishers will always prosecute is where people are producing or reselling counterfeit product.

The bottom line
Ultimately software publishers are looking to ensure that if people have access to their products, someone pays for the licence. 

They will use any means they can along the way to make that happen and the threat of legal action, they believe, is a necessary evil.

If the publisher knows that your organisation is short of licences they will do everything within their power to ensure that you pay for new licences to correct the difference.  If they can they will back-date any support to cover the obvious loss of income over time.  If you dispute this position for whatever reason, then expect a very forceful response from the publisher.

We have worked with organisations that have made out of court settlements with publishers, i.e. strong discussions took place, the threat of legal action was there but no legal action was ever taken.  This worked for the publisher because they received money for non-payment of licences and it worked for the end user organisation because their name was not publicly tarnished.

Clearly it is always better to talk to the publisher and work it out.  In our experience you will always be given ample opportunity to come to a settlement, but make sure you talk to them.

There are ways of maximising your position in such negotiations as we discuss in our How to do SAM section - How to handle...

We now look at Who might audit you...

Post script
It would appear that in the UK, FAST are upping the ante (October 2008) with a new push in terms of threatening prosecutions and using the law to conduct police raids as a first step rather than pursuing the longer legal process through the civil courts - click here to see article

Is this going to be one of the side affects of the credit crunch?