BSA | The Software Alliance
Yes, You can fight the BSA
Did you or your company recently receive a demand letter from the BSA? We’ve seen them before and are here to help.
The BSA investigates reports of alleged use of unlicensed software. If you receive a demand letter, you cannot just ignore BSA’s demands and hope for the best. If you do, lawyers and police may seize your computers (as they execute the equivalent of a search warrant) and you may discover you are on the hook for a substantial fine.
The BSA exists for a good purpose and software piracy is a serious issue. However, in our view, you may find their approach aggressive, leaving you uncertain if you have any option but to agree to their demands.
The BSA’s typical approach is to, at the first instance, demand business owners complete a voluntary self-audit and produce a full index of all BSA-member software running on that business’ network. They must also provide receipts or other proof of licensed ownership of such software.
The BSA treats any software for which a licence cannot be produced as unlicensed. The most common types of unlicensed software we see are either businesses that
- install software more times than the license permits,
- use versions commercially that are not for commercial use, and/or
- utilize alternative methods to install unlicensed copies of software (which has become increasingly difficult now that most software is subscription-based).
To the extent that any software is deemed offside, those unlicensed titles will form the basis of voluntary settlement discussions with the BSA.
The financial consequences arising from the BSA and other software piracy claims can have dire consequences for small businesses that could have been avoided with the benefit of legal advice given at an earlier stage. In the past, the BSA has targeted and made hefty claims against successful small businesses for pirated software across Ontario, British Columbia, Alberta, and Quebec. Imagine the impact on these businesses as they were well on their way to transitioning to mid-size organizations, only to be told that they would be fined $30,000 to $40,000 during their rise. Legal issues caused by allegations of software piracy can be extremely serious for small businesses. In particular, two e-commerce businesses, one based in New Brunswick and one in Calgary, had to shutter their doors in 2001 after losing to Microsoft Canada in court.
The picture painted by the BSA does not have to be the final outcome in most situations. The BSA will calculate total fines on a case-by-case basis. The total fine is based on the BSA’s assigned base value of the product, plus a multiplier and additional fees. This all comes together in the negotiation.
Experienced counsel can help demonstrate that penalties should be substantially less than $30,000 to $40,000 and can help make your case one where these lesser penalties, if any, are the ones that are paid. No court will ever penalize you for retaining counsel to assert your rights.
If the BSA has contacted you or if you have infringed copyright and it has been brought to the attention of the BSA, there will be some consequences, but there is no reason you have to accept the BSA’s demands.
There are options. There are better outcomes available. We can help you find them.
If you have received a demand letter from the BSA, read our article here: https://www.mindengross.com/resources/news-events/2022/12/19/5-things-to-do-when-you-get-a-letter-from-the-bsa
The Truth about Adobe Systems Incorporated v. Dale Thompson DBA Appletree Solutions and The Business Software Alliance
For those who have received a demand letter from the business software alliance, here is something you should know.
In our experience, the BSA has used the Appletree case (Adobe Systems Incorporated v. Dale Thompson DBA Appletree Solutions) to convince people that resisting the BSA’s demands can be a costly mistake. In Appletree, the BSA was awarded almost $340,000 in damages because of software piracy.
In our opinion, the Appletree case is not to be feared. The reality is that there were a very specific set of facts at play in Appletree [Read More].
Software piracy is the illegal copying, distribution, and possession of copyrighted software without a license or permission of the owner of the authorized source. The Canadian Copyright Act was amended in 1988 to expressly include computer software programs in the definition of literary work, which clearly confirmed that software is entitled to copyright protection. The Canadian Copyright Act prohibits making unauthorized copies of software programs without the consent of the copyright owner. The Act also makes it an offence to knowingly produce, distribute, rent, or import for sale infringing copies of computer software. The Act was amended and modernized in 2012 to further strengthen these rights and remedies.
The Canadian Copyright Act can be found here: http://laws-lois.justice.gc.ca/eng/acts/C-42/