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Microsoft Corp. v. Black Cat Computer Wholesale, Inc.

Citations: 269 F. Supp. 2d 118; 2002 U.S. Dist. LEXIS 26398; 2002 WL 32104589Docket: 1:00-cr-00231

Court: District Court, W.D. New York; September 24, 2002; Federal District Court

Narrative Opinion Summary

In the case between a leading software corporation and a wholesale computer distributor, the U.S. District Court for the Western District of New York awarded summary judgment to the plaintiff, following the magistrate judge’s recommendation. The plaintiff alleged the defendants infringed on multiple copyrights and trademarks by distributing counterfeit Microsoft software. The defendants did not contest the motion, which solidified the plaintiff's claims. The court determined that defendants' actions constituted willful infringement under both the Copyright Act and the Lanham Act, leading to a total judgment of $1,435,737.52, comprised of $510,000 for copyright infringements and $900,000 for trademark violations, along with costs and attorney fees. The defendants’ failure to oppose the motion resulted in the acceptance of all the plaintiff’s allegations, including willful blindness and continuous distribution of counterfeit products despite cease and desist notices. Both corporate officers were held personally liable due to their direct involvement in the infringing activities. The court also issued a permanent injunction against the defendants to prevent future violations under the relevant statutes, emphasizing the deterrent role of statutory damages and attorney fees. This case underscores the severe repercussions of willful intellectual property infringement, particularly regarding counterfeit distribution.

Legal Issues Addressed

Copyright Infringement under 17 U.S.C. 501

Application: Defendants were found to have infringed on seventeen registered copyrights by distributing counterfeit Microsoft software.

Reasoning: Plaintiff filed an amended complaint on March 22, 2000, seeking injunctive relief and damages for infringement of seventeen registered copyrights, including various versions of Microsoft software...

Permanent Injunctions under Copyright and Lanham Acts

Application: The court issued a permanent injunction to prevent future infringements under both the Copyright and Lanham Acts.

Reasoning: Furthermore, the plaintiff is entitled to a permanent injunction under both acts to prevent future violations.

Personal Liability for Corporate Officers

Application: Both Michael and Deborah Williams were held personally liable for their roles in the infringing activities of Black Cat Computer Wholesale, Inc.

Reasoning: Both Michael and Deborah Williams are personally liable for actual and contributory infringement.

Summary Judgment Standards

Application: The court granted summary judgment in favor of the plaintiff after defendants failed to oppose the motion or file a statement of undisputed facts.

Reasoning: The defendants did not file any objections or responses to the motion, leading to the court's decision to accept the recommendations in full.

Trademark Infringement under the Lanham Act 15 U.S.C. 1114

Application: Defendants were found liable for trademark infringement of ten registered trademarks, leading to significant damages and a permanent injunction.

Reasoning: Additionally, Plaintiff sought relief for violations of ten registered trademarks under the Lanham Act (15 U.S.C. 1114), claiming actual damages, Defendants' profits, and treble damages due to willful infringements.

Willful Infringement and Statutory Damages

Application: The court found willful infringement due to defendants' willful blindness and continued distribution of counterfeit software, justifying maximum statutory damages.

Reasoning: The facts indicate that Defendants willfully infringed by exhibiting 'willful blindness' towards the counterfeit nature of their products...