Novell awarded $600,000 in Internet piracy suit

A U.S. District Court in California awarded Novell Inc. $600,000 in damages in its suit against a man who is alleged to have been selling scores of unlicensed copies of the company's software on eBay Inc.'s online auction Web site.

The civil suit, filed by the software vendor in September 1999, contends that Chris Bonner of Davis, Calif., used several alias eBay accounts to conduct more than 40 illegal auctions of Novell's Net services software during a six-month period.

Nathan Gage, manager of Novell's antipiracy program for the U.S. and Canada, said the case was one of the largest among thousands that the company has uncovered in a growing trend on the Internet. According to Novell, Bonner eventually turned over more than 80 versions of its software valued at more than $880,000.

"We monitor those sites fairly closely and come across a large number of these [situations] on eBay and other auction sites," Gage said. "We do have some other suits in progress."

Gage said Novell is able to settle most cases out of court by simply asking the offender to stop. The company tried that approach in this case as well, added Gage, saying he met with both Bonner and his mother, who is a lawyer. Bonner agreed to stop selling the software, according to Gage.

Bonner "gave to Novell what he represented at the time to be the remainder of the infringing product," the company said in a statement issued today. "[But] investigators soon learned thereafter that Bonner was continuing to distribute infringing product and had opened nearly 20 more auctions."

Josie Parry, senior vice president and general counsel for Novell, said the illegal auctions of its software are not only "damaging to our sales channel, which is trying to compete fairly, but it also confuses and harms the honest customers who are seeking to acquire legitimate, licensed software."

Bonner, 41, said in an interview that he couldn't afford a lawyer in the civil case and therefore never showed up in court. He added that he had no idea he was breaking copyright laws by selling the software on eBay's site, something he said he does for a living.

But Bonner admitted that he only gave some of the software to Gage and another Novell official after they showed up at his door at 7 a.m. one morning, demanding that he turn over the products he still had along with a list of people to whom he had already sold packages.

The Novell representatives "didn't give me a chance to consult with anybody or anything like that," Bonner said. "They didn't have any legitimate documents proving they were from Novell."

Bonner said he later sold more of the software to "cover expenses for what I put out" in buying the Novell packages three years ago during an auction held by Egghead.com Inc. when it was transitioning from a brick-and-mortar retailer to an Internet-based company.

Bonner said he doesn't plan to appeal the judge's decision in the case. "All I can do is file for bankruptcy," he added.

Novell has been struggling to maintain sales of its networking software in recent months. In November, it reported fourth-quarter results that included a $47.9 million restructuring charge and a 16% reduction in its workforce (see story).

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Copyright © 2001 IDG Communications, Inc.

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